Doing more with less by employing ‘lean thinking.’ Lean manufacturing involves never ending efforts to eliminate or reduce waste or any activity that consumes resources without adding value in design, manufacturing, distribution, and customer service processes.
The core idea is to maximize customer value while minimizing waste. Simply, lean means creating more value for customers with fewer resources.
A lean organization understands customer value and focuses its key processes to continuously increase it. The ultimate goal is to provide perfect value to the customer through a perfect value creation process that has zero waste.
Eliminating waste along entire value streams, instead of at isolated points, creates processes that need less human effort, less space, less capital, and less time to make products and services at far less costs and with much fewer defects, compared with traditional business systems. Companies are able to respond to changing customer desires with high variety, high quality, low cost, and with very fast throughput times. Also, information management becomes much simpler and more accurate.
A popular misconception is that lean is suited only for manufacturing. Not true. Lean applies in every business and every process. It is not a tactic or a cost reduction program, but a way of thinking and acting for an entire organization.
Purpose, Process, People
Womack and Jones recommend that managers and executives embarked on lean transformations think about three fundamental business issues that should guide the transformation of the entire organization:
• Purpose: What customer problems will the enterprise solve to achieve its own purpose of prospering?
• Process: How will the organization assess each major value stream to make sure each step is valuable, capable, available, adequate, flexible, and that all the steps are linked by flow, pull, and leveling?
• People: How can the organization ensure that every important process has someone responsible for continually evaluating that value stream in terms of business purpose and lean process? How can everyone touching the value stream be actively engaged in operating it correctly and continually improving it?