by Denise Grey, CMO at LeanKit
Lean is a methodology that can be applied to all disciplines of knowledge work to increase business efficiency, agility, and visibility. Due to its roots in manufacturing, Lean is often equated with the elimination of waste, but this view of Lean misses the mark on realizing its true value.
Lean is more about aligning your organization’s skills, talents, resources, processes, and strategy with the needs of your customers. Finding this alignment allows organizations to be lightweight and nimble – which allows them to quickly respond to changes in the market and ensure sustainability.
Lean Transformations.
Research shows that 95% of organizations do not start as Lean organizations – they implement Lean after identifying a need for better agility, visibility, and efficiency. The process of implementing Lean across the organization is usually referred to as a Lean transformation, because it transforms every facet of how a company operates – including its culture, decision making, and plans for the future.
Here’s why Lean transformations are important: To optimize value delivery, organizations must look “under the hood” to determine how value flows through their organizations. In doing so, they learn how to better align employees and their talents and skills to optimize the flow of value to their customers. This results in employees who are more fulfilled and efficient, and in customers who are happier and more engaged.
Top 10 Benefits of Lean.
The impact of this holistic type of Lean transformation is widespread, affecting everything from productivity and morale all the way to the bottom line. The Lean Business Report surveyed more than 3,000 knowledge workers practicing Lean and found these to be the top 10 benefits of Lean.
#1 Manage Team/Process Complexity.
Lean helps organizations understand their value streams, so they can begin to strip away what is not adding value to the customer, and optimize what is. Often, organizations don’t understand how much effort, energy, and creativity is lost due to process complexity until they define their value streams.
Organizational complexity leads to significant inefficiencies, in the form of duplicate effort, lack of alignment, and communication breakdowns. Without an understanding of how value flows through the organization, it’s nearly impossible to optimize the flow of value to the customer.
#2 More Efficient Business Processes.
Efficient processes are a key part of business agility — the ability to pivot in real time based on the needs of your customers. Efficiency enables organizations to release new features, products, or information into the market quickly, enabling organizations to start receiving feedback from the customer faster.
Without an optimized process, an idea has to travel through a maze of inefficiency before it reaches the customer. Lean helps organizations and the teams within them visualize, manage, and optimize processes to maximize value, improve speed, and eliminate anything blocking the flow of value to the customer.
#3 Better Management of Changing Priorities.
Also related to business agility is the ability to synchronize efforts in the midst of changing priorities. Lean organizations are lightweight and nimble enough to pivot based on shifting demands. This creates a tremendous competitive advantage, especially for organizations working in particularly fast-paced industries, such as technology.
#4 Better Project Visibility at the Team Level.
A key Lean principle is “optimize the whole.” This starts at the organizational level — first, organizations need to identify how value flows through their various departments and teams. This exercise is known as value stream mapping.
Lean teams undergo a value stream mapping exercise when they begin to identify and define their collaborative work processes, as it relates to the organizational value stream. To hold themselves accountable to a process, teams often find it helpful to visualize their process and actively manage their workflow. Around 83% of Lean teams use Kanban to visualize, manage, and optimize their processes.
Using Kanban to implement Lean, teams enjoy better project visibility. They can see how work flows through their process: Where it is in the process, who’s working on it, when it’s due, etc.
#5 Increased Team Productivity.
It’s unsurprising that most teams struggle to meet productivity goals in environments where
team members are encouraged to take on more than their capacity allows. With each task, project, email, drive-by conversation, meeting, etc., individuals dilute their focus and slow their productivity. In this case, the issue isn’t about working faster: it’s about working with more focus.
Lean encourages teams to intentionally limit their work in process (called WIP). Limiting WIP can help teams collaborate more efficiently, by encouraging them to focus on delivering each piece of value across the finish line as a team. This enhanced collaboration and intense focus allows teams practicing Kanban to sustainably improve productivity while eliminating stress.
#6 Reduced Lead Time.
When teams optimize their process for value delivery and limit their WIP, they can focus their efforts on completing tasks with as little distraction as possible. This allows them to reduce the time between when a piece of work is requested and when it is delivered to the customer. Shorter lead times allow Lean organizations to receive feedback quickly, which they can use to optimize their efforts even further.
#7 Increased Team Morale.
A key tenet of Lean is respect for people: Lean organizations recognize that their employees want to do good work. They also recognize that people want to learn, grow, and evolve in the workplace, not just serve as a cog in the system. This respect encourages Lean leaders to create environments that foster the autonomy, mastery, and purpose that teams need to do great work.
With this respect, along with more efficient processes, better collaboration, less complexity, and shorter lead times, Lean teams report increased team morale as one of the top 10 benefits of Lean.
#8 Improved Visibility to Stakeholders.
Above, you learned how Lean teams use Kanban to improve project visibility at the team level. The beauty of Kanban is: As teams manage their work on Kanban boards, they create a view of their workflow that gives stakeholders more visibility. Instead of holding status meetings with their direct reports to discuss status meetings of their direct reports, stakeholders at every level in the company can simply glance at a team or department’s Kanban board to get a clear understanding of the status of various initiatives.
This gives leadership more time to spend going to the gemba, the place where the work is done, to gain a deeper understanding of the organization and the people with their hands directly on the product.
#9 Reduced Costs.
With such increases in efficiency, productivity, lead time, agility, and visibility, organizations often are able to reduce their operating costs after implementing Lean.
It’s no secret that every business wants to save money and increase its bottom line, and many organizations approach their Lean implementation with this as their primary goal. However, this can be dangerous: Aiming to reduce costs without a deeper understanding of why (to maximize customer value) may result in a Lean implementation that is superficial, which will not have the transformative effect of a more principle-driven implementation.
#10 Predictable Delivery of Customer Value.
Finally, Lean teams reported that Lean helps them have more predictable delivery of customer value. As Lean influencer Mary Poppendieck says: “Lean development is the art and discipline of basing commitments on facts rather than forecasts. It starts earlier, encourages change, freezes decisions later, and delivers faster than traditional practices, but nevertheless Lean development produces outcomes that are more predictable.”
Lean creates organizations that are collaborative, communicative, and innovative. It helps them deliver products and services that consistently, predictably provide customer value. Lean organizations eliminate anything which does not serve the customer, and in doing so, become more adaptable, agile, and innovative.
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