Key Factors

7 Steps for Successful Lean Implementation Why is it that a large number of Lean implementations are not successful, when Lean is simple and common sense? The failures can be attributed to a) lack of commitment from the top management, b) lack of clear vision and strategy, c) Lean is seen as a cost-cutting tool rather than cost-saving tool and last but the most important one is, d) Lean tools are implemented to gain some quick wins but the culture of continuous improvement is not developed. Lean is 20% about the tools and 80% about the people. Lean is a way of running business and once you adopt it, then it has to continue for the years to come, no matter what. The average ROI is to the tune of 600% and it improves productivity, quality, delivery, service, morale, safety and reduces cost. Are these not enough incentives to carry on?

So, how can we implement Lean successfully? Step 1: Commitment from the TOP management The first step should be to ensure that all members of the senior management team are totally committed to the process. They should be prepared to make a commitment not to reduce the head count, rather utilise them elsewhere within the business and also support any projects that the implementation spurs. Step 2: Getting the strategy right Balance Scorecard Approach The balanced scorecard is a strategic planning and management system that is used worldwide to align business activities to the vision and strategy of the organisation, improve internal and external communications, and monitor organisation performance against strategic goals. The balanced scorecard transforms an organization’s strategic plan from an attractive but passive document into the "marching orders" for the organisation on a daily basis. It provides a framework that not only provides performance measurements, but helps planners identify what should be done and measured. It enables executives to truly execute their strategies. It looks at 4 perspectives, Financial, Customer, Business Processes and Learning & Growth.

Financial

Customer

Vision & Strategy

Business Processes

Learning & Growth

Hoshin Kanri (Policy Deployment) Hoshin Kanri is a systems approach to the management of change in critical business processes using a step-by-step planning, implementation, and review process, aimed at improving the performance of business systems. A business system is a set of coordinated processes that accomplish the core objectives of the business. For every business system there are measures of performance and desired levels of performance. Hoshin Kanri provides a planning structure that will bring selected critical business processes up to the desired level of performance. Hoshin Kanri means management and control of the organization's direction needle or focus. PO Box 24499 Royal Oak Auckland Ph: 64 21 173 1060 Email: [email protected] Visit our Website: www.solutions4productivity.com

Step 3: Assessing the current state A high level Value Stream Map of the current state needs to be drawn. Value stream map helps to see and understand the flow of material and information as a product or service makes its way through the value stream. It is important to gather as much information as possible for the various processes, such as KPI’s (metrics) and identify potential opportunities for improvement. Once you have identified the opportunities, draw a future state map based on where you would like your organisation to be in 12 to 24 months period. Step 4: Communication Once all managers are familiar with this vision a brainstorming session should be held to select the project leader who is the most natural choice to move the company towards this vision. Once the appropriate project leader is found he/she will need to assemble a team of key people from across the organisation. The best way to recruit people for this leadership team is to fully explain the process to each department and then ask for volunteers from each department. Step 5: Training The implementation team needs to be trained in the concepts and tools of 8 wastes (Defects, Over Production, Waiting, Non-Utilisation of Staff Talents, Transportation, Inventory, Motion and Excessive Processing) and 5S (Sort, Set-to-Order, Shine, Standardise and Sustain) as a minimum. The training needs to continue depending on the projects. Step 6: Pilot Project Select a pilot area and implement the concepts learnt. The pilot area selected should be the most visible part of the organisation, so everyone is aware of the changes taking place, so getting the buy-in would be easy. The pilot runs for 90 days. Get the feedback, analyse and continue to improvement. Step 7: Full Rollover Once the pilot project is a success, it is time to consider rolling out the programme to other parts of the organisation and also other tools can be used. Always pick the tool(s) that will have the greatest impact on business. Implement this next tool in the same way that the first project was implemented. The most important step will always be to ensure that company personnel are on board with the plan, as their support and cooperation is needed throughout the implementation.

PO Box 24499 Royal Oak Auckland Ph: 64 21 173 1060 Email: [email protected] Visit our Website: www.solutions4productivity.com