Strategic Direction

Leaner and fitter: Growth through waste elimination

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, (2008),"Leaner and fitter", Strategic Direction, Vol. 24 Iss 5 pp. 18 - 21
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(2004),"Learning to evolve: A review of contemporary lean thinking", International Journal of Operations & Production Management,
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(2014),"A FMEA-based approach to prioritize waste reduction in lean implementation", International Journal of Quality & Reliability
Management, Vol. 31 Iss 4 pp. 346-366 http://dx.doi.org/10.1108/IJQRM-05-2012-0058
(1998),"Lean behaviors", Management Decision, Vol. 36 Iss 9 pp. 615-631 http://dx.doi.org/10.1108/00251749810239504

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 Leaner and fitter
Growth through waste elimination
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here track records go, lean production principles can rub shoulders with the best.

W From 1920s origins at Henry Ford through various guises such as the renowned
Toyota production system (TPS), the principles have served as the bible for
countless organizations attempting to enhance the design process, fine-tune production or
eliminate waste.

The cost-cutting trap

Waste in this sense refers to identifying and removing unnecessary steps in organizational
systems and processes that naturally evolve to become needlessly intricate. Without
effective management of this waste, there is limited scope to improve the service provided to
customers. Nevertheless, many leaders continue to hold narrow perceptions and simply
equate waste elimination with cost-cutting. Their organizations inevitably fail to exploit lean’s
full potential to make a significant difference.
Trimming costs has its place, of course. But it also has its limitations. Realistically, the
strategy is inherently short term with an overwhelming focus on labor. And any company
whose policy involves constantly shedding jobs as the chief measure of reducing its outlay
can look forward to a demoralized workforce low in security, morale and commitment. And
whose interest does that serve?
The more astute organizations will adopt a longer-term outlook and realize that cost cutting and
growth need not be mutually exclusive. Removing waste through lean frees up additional
capacity for growth without the need for extra capital investment or an increase in labor costs.
Furthermore, the potential to grow exists for private and public sector alike. Both have
targets and budgets to meet and while private sector companies will typically measure
growth through increased sales, their public counterparts will be aiming at continual
improvements through better deployment of resources and greater efficiency.
Take, for instance, a military setting in the USA where the defense budget includes the costs
of repairing and maintaining aircraft and equipment. Eliminating waste from the system can
enable a faster turnaround so that planes get back in the air much sooner. The spare labor
capacity that results can be used to:
B cope with a larger workload demanded by such as an ageing or expanding fleet;
B undertake other repairs; or
B insource work presently carried out externally at much greater cost.
Simple mathematics shows that all these options would normally provide the scope for
savings that would far outweigh those gained from a simple reduction in staff numbers.

PAGE 18 j STRATEGIC DIRECTION j VOL. 24 NO. 5 2008, pp. 18-21, Q Emerald Group Publishing Limited, ISSN 0258-0543 DOI 10.1108/02580540810867899
 ‘‘ Nevertheless, many leaders continue to hold narrow
perceptions and simply equate waste elimination with
cost-cutting. ’’

Laying the foundations

But lean is no quick-fix and any deployment needs to be underpinned by a sound strategy
and realistic objectives. Practitioners should:
B Concentrate on the big picture. Lean’s real worth lies in its influence on the whole value chain.
B Adopt a long term perspective. Aim to secure year-on-year productivity improvements.
B Target efforts where they are most needed. Focus on activities that will reduce system
constraints and don not squander resources on activities not responsible for causing
productivity delays.
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B Aim to improve value to the customer. This may be best achieved by enhancing
competences that rivals are unable to match such as delivering the product to them
quicker and cheaper.
Any implementation of lean principles will also often require a reassessment of existing
mindsets, measurements or methods. Established mindsets can be deeply embedded
within an organization and serve to prevent serious consideration of any alternative ways of
working. In the military setting, the norm was to begin repairs as soon as the aircraft arrived
in the hangar. Problem was, the planes then spent a substantial amount of time waiting for
different operations to begin. Instead of speeding up the procedure, flow times were
significantly longer because the strategy generated waste in respect of necessary extra
storage and the moving, inspecting and sorting. How did management address the issue?
By developing a system whereby the flow of any bottlenecks controlled work throughput.
Measurement constraints can be similarly counterproductive. One example is the tendency
for the efficiency of machine operators to be gauged by the number of parts produced. This
will often involve bulk manufacture of a specific part. But what emerges if only a few
components are required? Waste. This time in the shape of delay in the production of other
parts that might be more urgent.
Workers may also be inhibited by existing methods forcing them to comply with prescribed
work schedules. Management should therefore empower their employees so that they are
able to, say, amend itineraries in order to minimize delay and sustain throughput. This makes
sense. After all, those closest to the action will often know best.
Lean is able to build in change from the outset and this is invaluable within environments
where business requirements determine the change agenda. Like software development.
Application of lean principles in this fast paced sector can bring massive productivity gains
within months as well as improving quality and speed. With the cost of developing and
maintaining applications now swallowing over 50 percent of a typical IT budget, the value of
lean cannot be overstated.
Utilizing the full potential of lean demands a concentration on turnaround time rather than
seeking ways to deliver to a set timescale. Subtle difference, perhaps, but an important one
given lean’s core aim of generating continuous improvement. In the IT sector, this
improvement can only occur through identifying and eliminating any delays in the
development process. Effective feedback mechanisms are therefore crucial.

Which cap fits best?

As in most other contexts, good preparation will help ensure the successful launch of lean
projects. Companies that do their homework beforehand will reap the reward. The impact of

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VOL. 24 NO. 5 2008 STRATEGIC DIRECTION PAGE 19
 lean on an organization can often be determined by questions posed and decisions taken
during the initial stages. Leaders should ask: what are the reasons for deploying lean? What
are the goals? What is the scope and scale of the project?
Being able to articulate persuasive reasons for introducing lean in the shape of Six Sigma or
other variants can help drive the project and convince those doubting its value. Lean is often
justified by the presence of perceived threats or opportunities such as:
B falling customer satisfaction;
B emergence of new competition; or
B improving financial performance.
While lean is ideal for addressing these and other problems, it is worth noting that thriving
companies can also reap the benefits from its deployment.
It is also a sound idea to relay the level of anticipated improvement and this is best achieved
by closely associating lean with key business goals. Early identification of goals will also help
influence deployment decisions and a focus on customer requirements should have the
same effect. Organizations need to develop structured procedures such as interviews or
focus groups for identifying and properly understanding customer needs. Where possible,
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proposed changes should be measured and quantified so that customers can be made
aware of the benefits lean is able to offer them.
Lean models come in various shapes and sizes but the type chosen should be most
appropriate to company needs. Considerations that will determine choice are:
B how much of the organization will participate;
B whether problems are company wide or restricted to specific functions or units;
B the amount of leadership input;
B size of the support infrastructure;
B if there is an aim to improve cross functional processes; and
B what resources are necessary.
While a model with an organization-wide focus is the most sustainable and has the greatest
potential for business transformation, it is inherently resource-hungry to the point of stifling
other initiatives. On the other hand, smaller-scale deployment demands fewer resources and
support but the trade off for this lower complexity is a more localized effect. When such an
outcome is desired, then the more targeted approach is clearly most suitable not least
because of the option to disband the initiative upon project completion. There is also sound
logic in using pilot projects to showcase the benefits of lean with a view to subsequent
deployment across other parts of the organization. However, it can be difficult and
time-consuming for small-scale initiatives to evolve company wide. Making the right choice
at the outset is clearly the best way forward.

Making lean work

Accountability is another issue that needs resolving early. Managers and executives must be
accountable for project implementation and results. And if not? The said personnel may well
relegate lean to the periphery. Getting top-level executive support is one means of
monitoring commitment, especially when individuals are commissioned to report to

‘‘ The more astute organizations will adopt a longer term

outlook and realize that cost cutting and growth need not be
mutually exclusive. ’’

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PAGE 20 STRATEGIC DIRECTION VOL. 24 NO. 5 2008
 organizational leaders. An added bonus of this is the increased likelihood that lean remains
closely attuned with strategy. And since money talks, linking financial incentives to
attainment of lean objectives is as good a motivator as any.
Small projects apart, lean practitioners should make plans to be in for the long haul. Lean is
not a one-off but a mindset that influences the introduction of business systems within an
environment of ongoing change. Because of this, organizations should:
B carry out regular assessments of its future plans as these plans are likely to evolve over
time; and
B review lean with customers on an annual basis so that the company can adapt to
changing demands and keep application relevant.
Like anything else, success depends on getting the best people on board. But this is not
always straightforward as consensus about who the best performers are might not exist.
Then there is the problem of managers failing to put forward talented employees for fear of
losing them. Again, the early bird catches the word and early collaboration with HR to
develop processes for identifying talent is a good strategy.

Early attention to change management is likewise a must. Change equals threat to those who
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seek sanctuary in the status quo. Lean often requires radical organization change with
established methods, processes and even roles subject to redefinition. People will often be
expected to become multi-skilled in order to carry out other tasks as each situation
demands. Opposition is in some ways inevitable but with good communication and a
sensitive approach, concerns can be properly addressed and any resistance minimized.

Comment
The review is based upon: ‘‘Lean’s new look’’ by Melissa Bowers, Kenneth Gilbert, Alex Miller
and Mandyam Srinivasan, ‘‘Get lean to see productivity soar’’ by Cath Jennings and
‘‘Deployment: start off on the right foot’’ by Robin Gates. Bowers et al. provide an interesting
account of how lean principles can be used as an integral part of growth strategies. The
authors suggest guidelines for the implementation of lean and illustrate many of the points
made with reference to lean’s use within a US public sector environment. In the second
piece, Jennings examines how lean principles are implemented in software development.
The need to eliminate unnecessary phases from organizational processes is highlighted and
the author points out how to achieve this by focusing on the cycle time. Suggestions about
how to deal with resistance to change resulting as a consequence of lean deployment are
some other useful implications contained within the article. The piece by Gates offers a
comprehensive how-to guide to the steps involved in implementing lean principles.
Keywords: Strengths and weaknesses of different lean models are pointed out and the author stresses
Lean production, the need to make crucial early decisions to lay key foundations and ensure the right choices
Change management, are made. The importance of securing top-level support is likewise emphasized and the
Business development author insists that key business goals should drive lean activities.

References
Bowers, M.R., Gilbert, K.C., Miller, A.G. and Srinivasan, M.M. (2007), ‘‘Lean’s new look: deploying lean
as a growth strategy for improvement efforts’’, APICS, Vol. 17 No. 8, pp. 30-3, ISSN 1056-0017.

Gates, R. (2007), ‘‘Deployment: start off on the right foot’’, Quality Progress, Vol. 40 No. 8, pp. 51-7,
ISSN 0033-524X.

Jennings, C. (2007), ‘‘Get lean to see productivity soar’’, Computer Weekly, 28th August, pp. 20-2,
ISSN 0010-4787.

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VOL. 24 NO. 5 2008 STRATEGIC DIRECTION PAGE 21
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