Isolated and inappropriate use of the Lean tools is often inaccurately promoted the Lean way forward by too many Lean proponents and organisations. Kaizen, for instance, is a central concept which promotes empowering work teams to rapidly improve specific problems. A possible quandary that organisations encounter is that of “drive-by kaizens” (p. 2, Biddle 2006). This depicts a situation whereby improvements are implemented in a haphazard manner and without any priority and without any recognition on their impact on resources, suppliers, or customers. Value stream map-ping essentially attempts to highlight areas where one-piece flow breaks down.
Consequently, the “future state maps” are developed to express where the various kaizen events may assist to eradicate the root causes of stoppages. Inherent in this process has to be the recognition that individuals affected will experience this much later in the improvement cycle than those would implicated by, i.e., kaizen techniques.
Moreover, VSM does not always fully recognise the dynamic processes such as var-iability in demand andfluctuations in supply. A predominant drawback is that VSM does not fully recognise “competing value streams” (p. 3, Biddle 2006). In most organisations, there exist several value streams, numerous product lines, or in some situations one product line producing one or more products. These value streams compete for resources and have departments such as accounts and purchasing sup-porting their operations. Consequently, an alteration in a value stream without con-sideration on how it impacts on a competing stream or support function would induce adverse consequences for the organisation.
Similarly, many Lean journeys start with a major training commitment. This is often observed as a preferred strategy for consultants since there is less pressure to deliver any result other than a trained audience. However, unless this is carefully coordinated, there is a risk of not being able to apply the benefits to a project quickly. Accordingly, the training needs to be focused towards the provision of a solution within a specific area. Value stream mapping is one of the most critical components to successful Lean yet it is often overlooked because it can sound dull and academic. The author has discovered the situation in many organisations that utilised it effectively; they proceeded to half lead times and doubled stock turns whilst making huge improvements in labour productivity. Likewise, Lean main-tenance using various tools and techniques such as total predictive mainmain-tenance (TPM), radar controlled messages (RCM), continuous improvement, and comput-erised maintenance management systems (CMMS) need to be utilised in a way appropriate to the situation and to meet the organisation’s needs. Progressive or-ganisations, in the past, such as BMW Engines and Vauxhall, have utilised CMMS
Sustainability of a Leagile System 85
either as a stand-alone system or as a maintenance module which is part of a business-wide ERP system. The CMMS should provide the glue which holds the strategy together and makes fact-based decisions much easier.
Often the barriers cited are not specific to Lean, but would have been stumbling blocks to any strategic implementation. Once the respective organisation overcomes these issues, Lean has a greater probability of success. Lean is an end-to-end value stream that delivers competitiveness. A great cell feeding into a morass of poorly controlled inventory is waste. A changeover reduction programme in a high capacity area is waste. A 5S programme without any follow through into standard attainment is largely waste. A kanban operating in a situation of unlevelled demand can also be waste. Whilst Lean is about waste, its focus should be on waste prevention. Experienced Lean practitioners, after eradicating the obvious waste, return to thefirst two Lean principles of customer and value stream. Rethinking the value side is as important since this leads to the seeking of new opportunities. The literature has sometimes made reference to“mechanical” Lean which in essence is a reference to the implementation of tools in a piecemeal fashion; “Managerial”
Lean, on the other hand, is its implementation in an integrated manner.“Innovative”
Lean takes it beyond the shop floor and the organisation to create a new oppor-tunity, new value, and new customers.
At no stage should an organisation even assume that the Lean tools are a strategy. An essential prerequisite are the appropriate tools in the right circum-stances within the context of the organisation’s value chain and stage of Lean implementation. Equally, by making reference to a value stream, an organisation is only examining one product, one family at a time. Whilst this is an apt methodology to understand the system by analysing one product at a time from the raw material to the finished goods stage, it is only a slice of the total requirement. Any orga-nisation undergoing a transformation needs to know where to be (future state) and where it is presently. Value stream mapping is one of the tools used to define an organisation’s work processes and to identify where an organisation has non-value-added steps. Undoubtedly, the transformation is difficult, multi faceted, risky, and can be frustrating. In trying to both capturing and contextualising this into Lean, it should be remembered that strategy precedes process and process precedes struc-ture; this could be translated in terms of define value first; then, we should proceed to define a process that provides the desired value. This will then assist to create an organisation able to operate the process effectively.
The majority of organisations fail to achieve Lean since there exists confusion between the Lean goals and the intended results which it is expected to accomplish.
Many organisations struggle on the commencement of their journey which is critical to the success of Lean. If the initial project is not successful, there is a good chance that there will not be another opportunity since the initial project has failed to make any impact on the strategic objectives. The essential problem is that most Lean efforts begin with a tactical approach rather than a strategic one. Ironically, many consultants proceed to recommend a tactical approach which is misleading.
This is because Lean has progressed from operational improvements and many cannot visualise Lean as a strategy.
Lean needs to be constantly treated as a system comprising of more than the sum of its components. The Toyota Production System grew through both revolution and evolution. The revolution rejected the concepts of mass production and the evolution developed the details and the tools in a constantly methodical manner. It is erroneous to suggest that Lean is little more than scientific management, since it predominantly focuses on people and leadership. Similarly, Lean becomes in flex-ible when it transforms into a programme that is managed. At its core, Lean is little more than a problem-solving methodology that everyone can use on a daily basis. If Lean is successful, then you will have fewer managers because people will solve problems as they arise on the shop floor. Similarly, when Lean becomes a pro-gramme, egos get involved with implementation projects and strategy.
Equally, many Lean consultants strive for immediate credibility by focusing on the main problems. Undoubtedly, there is a growing appreciation that Lean needs to exist at an enterprise level. The inclination for many Lean organisations at the start of their journey can be grouped into several categories; they are often very con-cerned about:
• how to apply some Lean principles,
• which tool to utilise first,
• who is to push the overall impetus, and
• at which stage of the value chain should the journey originate from.
All of the above approaches in isolation have inherent weaknesses. Many or-ganisations have started their journey with workplace reorganisation. Undoubtedly, marginal increases in productivity are achieved, though despite being difficult to measure, the improvements may be isolated. Kanbans are often used as a com-promise since ideally products should be“pulled” through the factory in quantities of one—hence the term one-piece flow. Nonetheless, it is often impractical to strictly adhere to this principle for many modern enterprises. Consequently, kan-bans are used to move small, controlled batches of material in a“pull” environment.
Nevertheless, as has been witnessed by the author in many recent organisations, kanbans without other harmonised improvements such as reducing equipment changeover times can cause poor equipment utilisation and worsen late shipments.
Equally, since kanbans can be used as a compromise some organisations fail to tackle the primary issue of inventory levels as a result of changeover times.
Lean is an entire business philosophy; it essentially needs to ensure that the whole business is analysed its entirety, including how orders are processed, the way materials are purchased, and the way manufacturing is done. In essence, it is necessary to subscribe to the total approach and stress the need to combine the
“socio-technical systems”, whereby the work organisations combine a technical, i.e.
technology, and a social system, i.e. people and organisational structures.
Historically if we were to examine the TPS, it could safely be concluded that it is an interlocking set of three underlying elements: the philosophical underpinnings, the managerial culture, and the technical tools. This was neatly summarised by George Koenigsaecker early, in Sheridan (2000), who has directed Lean conversion ini-tiatives in 18 manufacturing plants comments:
Lean and Strategy Formulation 87
“often people who attempt a Lean conversion start with one of the tools, or a couple, and they push them through the organisation. They then wonder why things are notflowing in the total value stream. The problem is that there are about a dozen key tools in Lean manufacturing and you have to move them all ahead somewhat simultaneously;” he con-tinues,“it is a long learning curve” (page 33).
It is often necessary to adapt the principles of Lean in order that it can both cope and tackle local circumstances. There are numerous issues being encountered in efforts to apply the TPS principles to other companies without appropriate adjust-ments. Whilst the principles of Lea have been around for over three decades, the literature is still scant on the details of the methods for achieving it. The common theme regards improving continuously whilst focusing on the customer and erad-icating waste is reiterated consistently. Companies need to safeguard a philosophy whereby people are permitted to look creatively at what they do on a daily basis and do it better; this principle was initially proposed by Ohno (1988) and has been subsequently developed. Insufficient published work explicitly addresses the issue of whether Lean methods are suitable and applicable in industrial sectors which are characterised by highly differentiated, low volume production of low repeatability.
Undeniably, there has to be a recognition that the pioneering work within the automobile industry is misleading as conditions differ in other industries and any correlations may be spurious.
An area which Lean proponents need to actively promote and are often mis-leading is the need to clarify that there is no“cookbook” to explain each step of the Lean process and exactly how to apply the tools. Often it is discovered that quality improvements are only possible if companies implement comprehensive change management programmes addressing both the organisational and technological aspects of quality management. An aspect often not advocated sufficiently centres upon a need to suggest that Lean should be applied to the entire value chain. Lean ranges from an organisation’s product development to its distributional logistics as depicted in Fig.4.3.
It is often evident when new in a client organisation that the senior policy leads do not grasp the real concept of Lean and its associated impact; it is imperative that Lean is not viewed as a direction and instead it should be viewed as a state to be reached after a certain time. Without doubt, all the determinants of Lean might not point in the right direction all the time; many organisations encounter instances where they can receive and send mixed signals. However, Lean requires a need to explain that the TPS necessitates to be adapted to prevailing circumstances for successful Lean implementations. Those organisations that manage to both view and apply Lean as a comprehensive management system, rather than a group of tools, tend to perform better and achieve their Lean implementation more smoothly.
Lean + Lean + Lean + Lean + Other Lean Functions Development Procurement Manufacturing Distribution i.e., Finance / HR / R&D
Fig. 4.3 Scope for Lean
Lean is successful where organisations see it as a never-ending process. An organisation always strives to be Lean, but will often never quite achieve it.
Essentially, there is always a gap between where the organisation is and where its ideal state is. Lean is a set of rules and principles, not just tools. Tools focus on physical system changes, but that is not where the heart of Lean beats. The entire way of thinking must become embedded in every person of the organisation. It is insisted that it is a total system; however, if it is referred to as a value stream, by definition, the organisation will proceed to analyse one product, one family at a time. Whilst this strategy may be sufficient to an extent, it will be necessary to analyse further aspects in order to understand the system. A policy to continue examining one product from raw material to finished goods is only a partial investigation. Every organisation is unique and is likely to have distinctive prob-lems and constraints. It is imperative that Lean is engrained in the organisation so that it canfind its own answers. If the intention is to secure the full benefits, this unsettling can seem painful but is a prerequisite since it is crucial that the business is reorganised along the “value streams” with the focus on the customer and product families. All the components including design, materials management, and production have to be included.
The work and research undertaken by the author over the previous twenty years indicated that organisations are required to ensure that instead of merely embracing one or two solitary tools that it is obligatory for companies to operate most, if not all, of the following components of Lean. Sheridan (2000) had proposed that it takes“three years to become competent in applying such tools as set-up reduction, standard work or cell building andfive years to instil a firm belief in all the tools”
(page 38). The University of Michigan and Prof. Liker have been at the forefront of Lean research for over a decade; he unequivocally promotes a total approach; that Lean cannot work with isolated tools. Securing the full benefits of Lean requires a need to concentrate on the whole value chain. It has become evident that for the Toyota Production System to work effectively, it needs to be adopted in its entirety, not piecemeal. Undeniably, Lean is an arrangement and should be utilised as such.
Each component builds on the previous one, anchoring the systems as a whole. In this case, a system of sprinkling Lean tools which are not properly used will undoubtedly confuse the workforce.
In order to reap the full benefits and classed as a truly Lean enterprise, Lean has to be expanded into the supply chain. In addition to the need for just-in-time delivery, minimising inventories, and the dependence upon the high-quality prod-ucts and services, there is a prerequisite to embrace suppliers into the improvement efforts. Progressive organisations are recognising that if they are to succeed at Lean, it is necessary to bring together different sections that historically erected barriers between them. Much of the contemporary empirical evidence corroborates that the Lean philosophy relies on three goals:
(i) flow,
(ii) harmony (pace set by customers), and (iii) synchronisation (pullflow).
Lean and Strategy Formulation 89
and that this needs to exist in all sectors. Even over ten years ago, Bicheno (2004) reflects on how supply chains have altered and mentions the “partnership philoso-phy” (page 189); how both parties could benefit from this arrangement.
Conventionally, the prevailing scenario was that businesses have sought to control the supply chain through vertical integration; recently, this trend has reversed as companies now engage in a high level of outsourcing. Consequently, it makes sense to extend the order fulfilment mapping to customers and suppliers. Consequently, supply chain coordination should be encouraged, i.e. working to common quality standards, sharing transport and the employment of intercompany communication methods such as EDI. Furthermore, supply chain development should be supported as inefficiencies within the supply chain are examined sooner and to a greater extent.
Often in practice, it is usually discovered that lead time is split between in-house processes and supplier processes, which crucially means that we should involve suppliers too. The closer the order signal is to the actual use, the less volatility is passed upstream and smaller the buffer stock required securing availability. For Lean success, any organisation cannot leave this decision to chance (Womack and Jones 2005). In its early stages, it needs to be treated as a strategy until it becomes an ideology embraced by the entire value chain (Bicheno and Holweg2009).
Lean should never be viewed as a business improvement tool; it is a philosophy which needs to be driven from the top team down if it is to generate required levels of understanding and belief. The prevailing evidence does proceed to suggest that appropriate strategic management proceeds to both facilitate and encourage better performance. Nonetheless, it should be recognised that the relationship is in fact quite complex, heavily influenced by factors such as the nature of change, envi-ronmental turbulence, and industry structures. The literature does offer a pragmatic deduction, insisting that businesses which perform formal strategic planning have a higher probability of success than those which do not. The truly great companies are those that have been able to sustain long-term ROI and growth rates for 10 years or more. Frustratingly, it is still often the case, what is termed as“strategic” is often no more than ordinary one-year tofive-year capital operational budgeting in many organisations. It is important to note that within the academic world, the weight of the argument appears to be shifting from seeing strategy as a rational, mathematical process, to seeing it as the outcome of the ability of an organisation to utilise its strengths and expertise in the competitive pursuit of success. In a similar per-spective, improving operational effectiveness, whilst needed for management, should not be deemed as strategy. Strategic positioning refers to performing dif-ferent activities to those of your rivals, alternatively performing similar activities to your rivals but to do so in a different manner.
Organisations that have managed to succeed have generally been able to depict a genuine strategy—a radically different way of thinking and a unique strategic focus.
These companies are able to conceptualise the impact on processes, stakeholders, and the business objectives. If these are not fully understood, the impacts will be
These companies are able to conceptualise the impact on processes, stakeholders, and the business objectives. If these are not fully understood, the impacts will be