The 3 Steps Involved In Creating A LEAN Product And Service

This piece is a contribution by Daniel Damilola Nejo

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Have you ever been asked a petty question such as: what is the meaning of WASTE? I have.

In one of my Quality Management classes during my MSc, a lecturer, Dr. Lindsey, asked “What do you understand by WASTE?”

A class mate, I remember, answered that, “Waste is anything that does not add value to the consumer.” Interesting! Collins was right. Winner businesses are those that strive harder to provide “value” to the consumers and strive further to eliminate waste in their business processes and product development. Meaning, if a process does not add value to the customer, it’s a WASTE. And you should eliminate it.

The foregoing brings us to the topic at hand – LEAN. What is it?

Lean is a manufacturing philosophy that focuses on value delivery (from customer’s point of view) waste elimination and continuous improvement of business processes. Although the term says “manufacturing” but it’s noteworthy that all types of businesses –including service based businesses– are intended.

I am going to highlight the keywords that make “LEAN philosophy” great for your business and how to achieve them:

(1) Delivering Value from your customer’s point of view.

The emphasis here is “from your customer’s point of view.“ It’s not from the business’s perceived point of view. Needless to say is that customers are the foundation of every business success. As such, value creation is synonymous to customers’ satisfaction. To properly understand what value your product provides to the customer, it is advisable to understand the value Stream of your business/product.

Womack and Jones in 2003 defined Value Stream as “The specific activities required to design, order and provide a specific product from concept to launch, order to delivery, and raw materials into the hands of the customer.

After understanding the Value Stream of your product, it is important to Map the Value Stream to identify specific key activities in the Value Stream and sort them into activities that:

  • actually create value as perceived by the customer
  • create no value but are required by product development, by order filling or by the production systems (work towards removing)
  • create no value and can be eliminated immediately (eliminate immediately)

To eliminate waste, you have to identify what brings value. The above helps

(2) Eliminating Waste.

The concept of Waste Elimination in production originated form Toyota’s Chief Engineer, Taiichi Ohno, which then became the core Production System of Toyota. But like every other thing, to eliminate waste , it is important to identify what waste is. Whilst preparing for my Quality Management exams, I was able to find out an interesting way to remember sources of waste in businesses and it lies in this word “TIMWOOD”.

Transporting: This is basically the moving of product and information. When products / information are being transported, it does not make the product more valuable to the consumer, thus it is waste and unnecessary long transportation should be eliminated.

Inventory: Storing product and information, this does not add value to the end customer and storage spaces can cost your business money.

Motion: This waste is related to ergonomics and is seen in all instances of bending, stretching, walking, lifting, and reaching. These are also health and safety issues, which in today’s litigious society are becoming more of a problem for organizations. (from “EMC consulting group”). Motion waste within businesses should be eliminated, it adds no value to the customer.

Waiting: Unnecessary waiting for information or product by the customer or product / service waiting for the next step in the process.

Overproduction: Making more than the customer requires or needs and also purchasing more resources than is actually necessary to fulfill an order or customers’ need.

Over-Processing: Using the wrong tool to try achieve a specific task. Investing in smaller, more flexible equipment where possible; creating manufacturing cells; and combining steps will greatly reduce the waste of inappropriate processing.

Defect: Defects like rework, re-inspecting and quarantining inventory can add cost to your business and not add value to the end consumer.

(3) Continuous Improvement.

To remain on top of the game, you have to keep rolling out better products and improving the production processes within your business. To that end, the key requirement is an evolving plan and time-bound implementation. However, these efforts can seek “incremental” improvement over time or “breakthrough” improvement all at once.

Whichever, it’s time to focus more efforts on value delivery and waste elimination in your business process and product development. Go LEAN.

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