Can a lean initiative work in a non-manufacturing environment or department?
The answer is YES.
Indeed Lean Transformation is for any organization that seeks to grow and has a set of objectives to meet. This means Lean or Continuous Improvement initiatives are for all businesses, organizations and departments.
Of course many know lean as a set of tools only meant for a manufacturing plant, department or factory. Nothing could be further from the truth. Lean is for Finance, HR, Sales and Marketing. It’s for the Service sector as much as it is for manufacturing.
Any organization that wants to be part of the future has to find a way to engage in a lean transformation process because times are ever dynamic and business is ever changing. The principles underpinned in lean are such that you keep thinking of the best way to do what it is you do on a daily basis for better “Value” delivery to your customer.
When I joined the Coca-Cola Bottling Co of Nairobi in 1996 as an accounts assistant, the business hadn’t yet embraced Lean. Soon after it was bought by a South African Bottler who brought a Lean transformation system with them. Before the program was introduced we operated in silos. Finance, at least at my junior level for instance, didn’t feel the need to know what was going on in the Sales department or any other department for that matter. The concern at our level, was mainly to meet our deadlines and that was it. My concern at the time was: have I updated and sent the cash flow every Monday? Is the cash book well maintained? Or, have I paid my suppliers on time, have I done my accruals? And as long as I met these deadlines, I didn’t really see the need to know much about the sales people or other departments. I wasn’t the only one with this wrong mindset. But then this would soon change. Suddenly there was pressure for everyone to know how the business was performing. They told us, you are either selling or helping sell. Our senior managers started walking the floor and asking questions like:” Do you know how much we sold last month? What was our target? Etc. The lean transformation culture was slowly taking shape company-wide even though at the time it was only being implemented in the manufacturing department. Our plant had heard of the great results coming from the sister Bottler in Uganda, which had embraced lean with an open heart. Tanzania was also coming on board and no bottler wanted to be left behind. Everyone wanted to be the best Bottler in the group!
A few years later, I was transferred to the Sales Department where I was to manage coolers. Soon the company decentralized budgets in order to hold every department accountable for their own spend. I was selected to help the Country Market Execution Manager, run the Sales budget and to assist in supervising Warehouse and Distribution’s as well.
Soon we begun to become truly accountable for every cent spent in our departments. No one wanted to have an “over-spend”. The company also decided to roll out the Lean program company-wide and I was selected to be the Champion in Sales. The transformation was great. Communication barriers begun to fall. Alignment between management and the sales force begun to flow. Feedback from the market also begun to flow upwards and horizontally. Each Area Sales Manager had a team. They would meet weekly to assess their performance in line with the Company’s objectives and to conduct problem solving. As a champion I would participate in their meetings, collect feedback and share with management or at least help management come to the floor to see the Innovations and problem-solving that was taking place. I would also help in horizontal alignment between Sales and other departments. Some of the meetings would be very heated but in the end we did problem solve. The Silos were slowly falling away and people were taking ownership.
As a result of this, certain key issues affecting performance were addressed; Sales numbers were often met and surpassed. Morale went up! Distributors were happier as we also had a forum for active engagement with them. The missing tools were provided and even though most of the management team left soon after this phase, Mission Directed Work Teams™, a lean transformation product of Competitive Dynamics International (AMA), which I now implement as a consultant, did transform the business, Everyone including finance and HR was concerned about how to get better in every KPI that was being measured in order to satisfy their customers!
But what is lean or lean management?
It is best described by James P Womack & Daniel T Jones in their book LEAN THINKING as:
Being concerned with Defining Value from the customer’s point of view, identifying the value adding processes from Design, Launch, to Order, to raw materials, to manufacture, to delivery to the customer and organizing these processes in sequence, whilst removing the non- value adding activities or processes and then making this value flow without interruption as the customer pulls as you pursue perfection.
“All we are doing is looking at the timeline from the moment a customer gives us an order to the point when we collect the cash. And we are reducing that time by removing non-value adding wastes”
Taichi Ohno, Founder TPS, 1988
Since the primary role of a lean transformation exercise is to identify Value from the customer’s perspective, map out the value adding processes in the value stream, eliminate the non-value adding activities and wastes, engage the people and make value flow, any organization or department can and should be able to engage in lean transformation.
If you consider the 7 wastes identified by Taichi Ohno; Namely waste of; Transportation, Inventory, Motion, Waiting, Over-processing, Over-production, Defects and most recently the 8th waste of under-utilized human potential, you will realize that every organization has room for improvement. This applies to Factories, Banks, Call Centers, Hospitals, Hotels, Tour operators, Supermarket chains, Governments, NGOs etc. The same goes for every department in any organization: Procurement, HR, Finance, Sales, and Marketing, Warehousing, Distribution and Manufacturing. Every organization and department has an opportunity to improve on their processes and eliminate wastes to become a lean enterprise.
What’s important is having the right mindset and a culture of continuous improvement from the person with the broom to the CEO, and for management to provide an enabling environment. You’ll be surprised that everyone, including the person with the broom or the one driving the forklift, wants to make the business better and successful. But more than this they know how.
We all can go lean and continuously improve!
Lean Thinking, Toyota Way