Article -> Everybody Wins with Lean
Date Added: December 2006
Lean production was developed more than 50 years ago by Toyota. Lean was designed to eliminate waste, minimize costs and maximize productivity and profitability. Lean production was designed to give organizations a means to improve their bottom line. No one said Lean production was easy, and the beauty is, it does not have to be difficult. Organizations can implement a lean production system that strengthens partnerships with employees and customers, while increasing productivity and profitability.
Lean production was designed to benefit your organization and your customers. When organizations are able to optimize production and reduce waste, employees become satisfied with their role in the lean system; and customers are happy when their needs and wants are catered to.
For example, a major European bank that used lean techniques to reduce processing time for mortgage applications. By implementing and embracing lean techniques, the bank was able to reduce the mortgage application processing time from 35 days to 5 days. Because the processing time was reduced, fewer applications dropped out. The bank’s revenues grew by 5 percent while processing costs fell by 35 percent.¹ In this instance, both the customer and the organization benefited from the lean system – as is the case when other organizations embrace lean production techniques. Everyone wins with lean.
As with any significant organization-wide changes, there may be resistance from employees. This is especially true in the case of lean. One of the main elements of lean is eliminating waste. Some employees fear one thing that may be eliminated is their job. This is a common fear. Organizations can partner with strategic business advisors when implementing lean to help alleviate some of the fears associated with lean production.
A strategic business advisor can work with your organization to educate how to engage employees and communicate the lean system. As with any business strategy, an advisor will encourage your organization to ask, listen and learn from employees and customers. Your organization will help eliminate employee fears, raise engagement of employees and customers, and create a stronger culture with employees and enhance partnerships with customers.
Adding value for customers and engaging employees in business functions are ways in which lean production can benefit all parties associated with your organization. Organizations willing to take the challenge and implement a successful lean system will be rewarded by customer and employee satisfaction. The lean approach breaks with the common assumption that there must be a trade off between quality products and services and the cost of providing them. Successful lean systems prove there can be both – quality products and minimized costs.¹ The result is an organization with increased productivity and profitability.
¹Bhatia, Nina and John Drew. “Applying Lean Production to the Public Sector.” The McKinsey Quarterly.