When we discuss producing products and services for the customers, there’ll be resources and workflow to worry about. We must consider the materials, machines, inventory, labour, expense, and more. We must ensure the delivery happens in time without reducing the quality.
Utilising your resources and workflow effectively sounds like an influential step to maximising your business process. What if we tell you there’s a particular way to achieve that while reducing waste and cost?
Welcome to the lean thinking concept, which we’ll explain extensively here!
This article also details the two pillars and five principles of lean thinking. They present advantages when embedded in your workplace culture.
What Is Lean Thinking?
Lean thinking refers to the approaches and attitudes incorporated in workplaces to improve business values. With fewer resources and more optimisation, it shifts your perspective on the company’s overall business operations. The process is a steady growth toward accomplishing the ideal values with as little waste as possible.
This philosophy originated from the beginning phase of vehicle manufacture. It solidified its path in engineering industries and improved operational processes and profits. This idea soon showed potential to be implemented in other sectors. Businesses were eager to assert the importance of client value, and adopting this thinking was one way to achieve that.
What Are the 2 Pillars of Lean Thinking?
This way of thinking has two pillars that serve as the bedrock of lean management. These pillars are the underlying mindset that drives the philosophy’s working principles.
#1: Continuous Improvement
Continuous improvement embraces a desire to keep striving to attain something better. This sense of purpose drives you to build an efficient working culture.
It’s a no-brainer that business progresses, and work is continuous and cyclical. Constant improvement pinpoints that while the existing system has no issues, enhancing operational processes doesn’t seem bad and is encouraged.
Rather than pushing big transformations, facilitate tiny changes from time to time. Explore efficient methods to complete tasks and welcome innovative ideas for streamlining work. Stick to the lean philosophy of using fewer resources to optimise business processes.
These actions lead to a high-quality means of delivering to your consumers.
#2: Respect for All People
Lean thinking also prioritises the value of the people. There won’t be any sound output to consumers if respect isn’t there. This sense of purpose drives you to build a healthier and more conducive working culture.
Instil the mindset that respect is crucial by encouraging empathy and constructive feedback. Press the point that two-way caring goes a long way in developing mutual trust and synergy. Provide possibilities for advancement to enhance both individual and team performance.
These actions solidify trust across all levels of your business and boost the team’s morale.
What Are the 5 Principles of Lean Thinking?
You already know the two pillars supporting the lean management foundation. Both correlate with the five key principles of the lean philosophy listed below:
Firstly, lean thinking requires evaluating your brand’s product and service. The significant components include what clients value. Depending on what you offer, they can be the price, material, design, and more. The focus is on maximising those and minimising the rest.
Defining the value helps improve the solution to your customers’ problems. Start by identifying what influence their decision to purchase your product and service.
#2: Value Stream
Compared to the previous principle, the value stream is more about identifying the tasks or procedures involved in producing your product and service.
Organising the value stream allows you to identify opportunities to utilise fewer resources. You want your customers to feel secure investing their money for value-added workflow while lowering costs and waste.
Production comes in several stages. Concentrate on ones that bring value and reduce those that don’t.
After identifying values, the next principle in lean thinking is using the details above to map and maximise the workflow. An unorganised workflow leads to errors. Fixing them requires resources (time, effort, and cost). Therefore, coordinate the workflow accordingly to anticipate possible obstacles in production.
If the process gets halted, be proactive in addressing the root of the problem. Lean thinking aims for a more efficient business process, after all. Mapping the workflow delivers products and services in time for your customers.
The fourth principle is establishing the pull system rather than the push system for your inventory. The system is paired with regular observation of the current demands and the expense of inventory management.
Make the relationship between production, managing cost, and inventory space as balanced as possible. In particular, don’t produce many products in advance and cram your inventory “just in case.” Remember: lean management encourages less waste. Create goods in response to consumer requests.
Though the final principle in the lean framework is achieving perfection, it’s not the end of everything. The steps are cyclical and continuous. Today’s business processes won’t be the same as those in the coming years, and lean thinking principles help you adapt to those changes.
Re-evaluate and re-polish any areas of your business processes as necessary. Observe the customer values and the efficiency of your workflow. Examine how those adjustments affect the cost and quality of your products and services.
What to Expect From Applying Lean Thinking to Your Business
We’ve mentioned or implied several benefits of implementing the pillars and principles of lean management. In general, expect reduced waste and cost regarding fewer resource utilisation. The production process grows more efficient in terms of time, effort, and budget.
Here are other benefits of applying lean thinking to your business.
In line with the efficient business process, expect a productivity increase as well. There’s little need to hire more people or obtain more space when productivity’s already ideal. (We covered it in our article “Five Productivity Tips To Increase Efficiency”.)
To measure productivity, analyse the balance between inputs and outputs. Consider factors like human resources, machines, materials, inventory, and so on. It ideally should show good performance over time.
Today, there are many latest tools and systems designed for productivity. However, there’s no need to get too fixated on them if they don’t contribute to your productivity. Unless major upgrades are necessary, lean organisations effectively utilise existing resources for their business processes.
Developed Attention to Details
With various tasks and procedures in your business, it’s easy to miss minor details. As human beings, it’s natural to forget them as time passes.
As lean thinking encourages observation in perfecting operational production, this benefit is a sweet bonus. Attention to detail further promotes efficiency and enhances management.
Remember: lean management appreciates the implementation of tiny changes. Perhaps, any small details spotted by your employees are one step toward perfection.
Increased Employee Morale
A healthy work environment boosts employees’ motivation. They engage and innovate further, which lean companies strive for. After all, one pillar of lean thinking is mutual respect, and human resource is the backbone of a company. Nurturing them from within comes without question.
Managers communicate with employees regularly to listen and respond to their feedback. Employees who feel heard and respected for their hard work offer insights into improving the business processes.
Fun fact: companies that prioritise employees benefit from 21% higher profitability. Read this Gallup article that further explains why a high-engagement culture matters.
All those steps to perfect your production flow pay for themselves in the long run. You’ll see it through the improved quality of your products and services. After all, the first principle of lean thinking is defining the values. They demand solutions to their problems, expecting you to fulfil that goal. They’re willing to invest in those values you offer.
Fewer errors and defects also indicate increased quality. Lean management aims to reduce those by eliminating non-value-added aspects. Optimising resources and spending less on correcting mistakes reflect a high-quality production.
Improved Relationships with Customers
Lastly, expect improved relationships with your customers, especially if they keep returning. Customer retention rate is just as important as employee retention rate. You don’t only offer them the best products and services; you also have to maintain regular communication to obtain and answer their feedback.
Examining your brand’s relationship with customers provides important data for improving your production workflow again. Your customers are the users of your products and services, after all.
Lean thinking is one approach in workplaces for reaching success, especially if companies aim to use fewer resources. Its two underlying pillars support lean management: continuous improvement and respect for everyone. They drive companies to focus on achieving perfection and establishing mutual respect with one another.
Five working principles run in the veins of those two pillars: defining value, mapping value stream, maximising workflow, running a pull-based system, and attaining perfection. The whole process is cyclical because business processes are not static.
Companies can expect less waste and cost from applying lean thinking to their business. Their production process becomes efficient, affecting productivity and improving attention to detail. Employee morale is also boosted, along with the overall quality and customer relationships.