Lean methodology is crucial for growing companies to refine their business processes, resources, products, and services so that they can truly understand the value they bring to customers, remove waste from business processes, and practice continuous improvement.
Lean methodology is a business philosophy that helps project managers improve their business practices while eliminating waste. This philosophy leans on two pillars: respect for people and continuous improvement. To aid these efforts, lean methodology focuses on the following five key principles:
- Identify value.
- Create a value stream map.
- Develop a continuous workflow.
- Create a pull system.
- Enable continuous improvement.
It’s important to keep in mind that lean methodology is more of a business philosophy than a business approach. Lean thinking considers what customers value and lean management is the actions taken by managers and team members to create that value for stakeholders. This guiding philosophy enables businesses to adapt to ever-changing industry environments, since it focuses on specifying value and finding more efficient pathways to provide it.
By following these key principles, businesses will be able to minimize company waste and prioritize the value they provide to their customers. This article will cover the various types of lean methodologies in addition to the benefits, use cases, and visual tools required for lean methodologies.
Types of lean methodologies
Lean methodologies are the frameworks that businesses use to eliminate identified processes that do not create value in an organization. Here are a few methodologies that help businesses carry out lean thinking and practices:
Agile. Lean-agile is a hybrid approach to business that combines lean principles with agile practices. Lean and agile mesh well together, as they both emphasize the importance of a continuous learning environment and a people-first approach to management.
Lean-agile strives to reduce or eliminate all business activities that do not provide value to the organization, ensuring that all project team members stay efficient.
Scrum. Scrum is an agile development process based on constant iteration and incremental improvements. By adopting lean thinking, scrum masters will gain the ability to pinpoint wastefulness in the various parts of the scrum process, enabling them to encourage their team to raise issues with anything that does not add value to the customer and/or impedes the development process.
By integrating lean principles with the scrum methodology, companies can ensure that customers are not only satisfied with the product/service produced, but that the product/service allocates true value, referred to as usefulness, to customers.
Kaizen. Kaizen means “change for the better” in Japanese. In lean methodology, a primary goal is to support the continuous improvement of an organization by creating a work environment where employees feel empowered to address and solve operational issues. When lean meets Kaizen, incremental improvements can be achieved over time, enabling teams to improve the efficiency and quality of their company workflows.
Kanban. Lean-Kanban focuses on the improvement of project efficiency, team communications, and continuous flow of product delivery. Kanban is a visual workflow management method that helps companies better visualize their business activities and metrics to ensure all employees are operating in alignment. Due to this, Kanban offers lean-minded organizations the visibility, metrics, and focus needed to foster continuous improvement.
Lean Sigma. Lean Sigma is a data-driven philosophy for improvement that values the prevention of defects over the detection of defects. Six Sigma focuses on reducing variation in business processes to optimize quality control efforts, whereas lean focuses on the reduction of waste. Together, lean and Six Sigma can be used to manage and reduce the eight types of waste outlined in lean methodology.
The pillars of lean methodology
As previously mentioned, there are two main pillars of lean: continuous improvement and respect for people. These pillars enable businesses to make smarter decisions, ultimately leading them to form healthier, more efficient operational systems.
In the context of lean methodology, continuous improvement is the ongoing effort to improve company processes by focusing on activities that generate the highest value for customers. Continuous improvement also requires an organization to actively eliminate activities that do not generate value, otherwise known as waste activities.
Although there are various techniques that may be used to facilitate continuous improvement, most organizations use the Plan-Do-Check-Act (PCDA) model to achieve continuous improvement. PCDA is a never-ending cycle that pushes further improvement based on previously achieved results.
Respect for people
The second pillar of lean methodology, respect for people, refers to management’s efforts to show respect for the team members closest to the work so that they can assess current operations and create solutions to problems.
Involving team members in the problem solving process helps communicate that management respects their knowledge and trusts that the team will dedicate themselves to find a solution to the problem at hand. Lean leaders should also provide their employees with lightweight mentoring that encourages employees to stay focused on delivering value to customers.
In this approach, team members do not place blame when problems arise; they simply focus on the improvement process. Only with mutual respect in place can management and employees synthesize their efforts to solve problems, eliminate wastes, and ultimately push the entire organization to perform on a higher level.
Benefits of lean methodologies for businesses
Now that we have discussed the fundamentals of lean methodology, let’s look at just a few of the benefits of lean methodologies for businesses:
Enables employee engagement. Respect for people is an all-important pillar of employing lean management in the workplace. You empower team members by involving them in the operational improvement process. This helps individuals feel more personally invested in the outcome of process improvement initiatives, increasing employee engagement overall.
Encourages continuous learning. Lean methodology encourages organizations to improve upon as many workflows as possible, indefinitely. By doing so, companies will gain a robust knowledge repository that can be used to inspire new innovative process improvement initiatives and avoid old workflows that proved wasteful.
Enhances business insights. In the lean methodology, a baseline is documented before improvements are implemented into an operational workflow. This enables a project team to understand the amount of waste eliminated by implementing the changes, which then enables management to better understand the actual value of the improvement.
Use cases for lean methodologies
Lean methodology can be implemented in a variety of industries to help businesses eliminate waste, improve team communications, and bring greater value to customers. Some use cases for lean methodologies include:
Starbucks utilizes lean management to close a $2 million revenue gap. Karen Gaudet, an HR and organizational development director for Starbucks, utilized the principles of lean management to resolve the issue of a slow-selling Starbuck breakfast item. As Karen left the office and began observing in-store operations, she had to become a more humble, lightweight leader. Instead of simply observing in-store operations for error in process, she hopped on the front-line and worked through each step of the breakfast sandwich production process to see why the sausage breakfast sandwich wasn’t selling well. She brainstormed with in-store workers and got their input as to why the breakfast item wasn’t selling well. Only then did she learn that there was a problem in the way that these sandwiches were stored before production, causing them to be stale when thawed and heated for customer. Karen quickly implemented a company-wide change to the breakfast sandwich storage method, resulting in the closure of a $2 million revenue gap.
Barcelona-based 365.cafe uses lean thinking to drive company growth. As a result of lean thinking, 365.cafe, which was once a small bakery in central Barcelona, was able to dramatically increase their production ability, supplying 55 shops out of their small 650-square-meter factory.
When looking to scale up their business, 365.cafe decided against purchasing additional space. Instead, in proper lean fashion, the company started to produce smaller batches of baked goods and tried to use every inch of their facility to eliminate waste activities. As a result, the company was able to increase their production without having to expand their facility.
Haven Hot Chicken used lean methodology to launch a successful restaurant during the pandemic. In 2019, Haven Hot Chicken embraced a key concept in lean methodology, kaizen. Instead of solely focusing their attention on menu, recipes, and branding, Haven Hot Chicken focused on optimizing production. They developed a just-in-time approach to shorten customer wait times, reduce waste, and improve the overall quality of the restaurant.
By adhering to the principles of lean methodology and implementing necessary changes over time, Haven Hot Chicken was able to successfully optimize production, reducing the average order times from 40 minutes to 10 minutes.
Visual tools to enhance lean methodologies
The core principle of lean management requires businesses to properly visualize their current organizational workflows if they intend to make continuous improvements to operational performance.
Visual management tools such as process control charts, value stream maps, huddle boards, and other tools enable lean organizations to share information with their teams, bring attention to irregularities in operational workflows, and streamline project management efforts.
MindManager® is a visual management tool that helps organizations facilitate decision-making and problem-solving activities by providing mind maps, flow charts, and other visualization tools that can be used to organize information.
With MindManager, lean teams can play out different problem-solving scenarios using drag-and-drop functions to create new relationships or perform new calculations. MindManager provides the tools necessary to efficiently test team contributions and problem-solve ideas so that they can be quickly considered, evolved, and implemented.