just not there, or buried under this pile of soon-to-be-trashed food. Why did this happen, if it's such an effective Lean tool? Does this mean that everything said so far is just mumbo-jumbo and doesn't work in the real world? Well, let's take a look at what probably happened here.
When you take a closer look at what that expired stuff is before you chuck it all in the bin and reflect on all the wasted cash, we see a couple of recurring themes.
Firstly, a lot of it is the dreaded “impulse buy”, in other words, a lot of stuff you never really needed in the first place. Secondly, you'll find several packs of the same thing and if you cast your mind back you'll probably remember the “three for the price of two” deal on at the time, persuading you to part with your money to get something free. In reality it's not as free as you first thought, as you end up paying for two when you really needed one and end up throwing at least one away. All of these problems are as a result of caving in to the devious antics of the supermarket marketing ploys, which waste your money and fridge space but keep them in business.
Yes, but this is just silly shoppers being duped, right? Real business people don't fall for this do they? Really? Never heard of instances where Purchasing get a good deal by buying larger quantities of something that sits on the shelf for the next three years?
The bottom line here is discipline. This is at the heart of Lean thinking and good shopping or business management. If you don't stick to the rules, all the best ideas and processes in the world won't save you.
So there you have it. We all do some Lean in our everyday lives and we don't even think about it. Basic common sense, I hear you say, and indeed it is. This is just one example of Lean concepts showing up in everyday life – there are many more if you stop and think about it. So why do businesses have so much trouble and employ armies of people to do something that simple? In my experience, small entrepreneurial companies don't have this problem; they run their businesses like families and employ Lean concepts naturally, just like you and me. It's the bigger guys who seem to have the problem. Their sheer size, organisational structure and hierarchy seem to prevent them from behaving in a natural way. So we need to find a way to break through this constraint and get the organisation thinking like they do when they go home.
The first step in this is to define a small set of common sense-based principles that everyone can get their heads round and embrace.
2
The Core Lean Principles
As I've hinted at before, Lean is simple and there should only be a few principles that need to be kept in mind to be successful. In this chapter I will introduce a few that I believe are core to the thinking. None of this will be earth-shattering insights from the heavens for you, but it should at least make you think a bit about how the parts fit together. So, here they are:
• Be customer demand-driven – Don't do anything until there is demand from the customer to do it.
• Maximise flow – Once something has been started, finish it. After all, if you apply the rule above, someone wants it now, so why hold it up?
• Identify and eliminate waste – Learn to identify waste in all its forms: material, time and resources. Then take whatever steps necessary to eliminate it.
• Declare war on variation – Variability kills. It creates an atmosphere of uncertainty, which causes much of the waste mentioned above. Systematically identify and eliminate the root cause, not just the symptoms.
• Organise your people around outcomes you want – Create an organisational structure around delivery of your products or services to customers. Make sure there is clear individual or team accountability for end-to-end delivery.
• Equip your people, at all levels, with the skills to be successful in their roles.
• Clear and simple measures and controls – Lean environments are fast and things happen very quickly, so you need to keep aware of the situation and have early warning indicators at critical points in the business.
• Finally, paint a clear and compelling picture of what the future looks and feels like in your “Ideal State” – then tell everyone!
This last point is absolutely critical. Without a clear understanding of where you are going, your organisation will flounder around and find its own destinations, which probably will not be consistent with the objectives of the business and certainly not consistent with each other. A favourite quote of mine by a certain grinning cat from a well-known children's book sums this up perfectly: “If you don't know where you're going, any road will get you there”1
If you start a change programme without a clear destination, when you get “there” it probably will not be where you really wanted to be and will have taken three times longer than you expected. Not good, so more on this later.
There are many other principles and rules that delve into detail on specific topics, but to me these are the cardinal ones, and are so fundamental that it is worth spending a little time to understand them in more detail. In keeping with the theme of this book, I'll try to provide examples in both the business context and in everyday life.
Sounds very obvious, but it's not always that easy. The first step is to understand who the customer is and what value means for that customer. Here are my definitions:
The customer is an external person or organisation which ultimately consumes/uses your product or service. Not somebody who does something to it, then just passes it on.
This is the first hurdle you need to overcome and one at which many organisations fall. The history of Lean doesn't help here, in that many see it, and still refer to it, as Lean Manufacturing, implying that it's all about processes, and stops at the factory gates. Nothing could be further from the real truth and power of Lean. When starting out, don't constrain yourself to the internal view, always look at your business from the point of view of the external customer. In most businesses, the customer is the consumer of the products or services and, as most large businesses are publicly owned, the shareholders. In some industries, customers may include regulators and governments as well. Now we have “who the customer is” sorted, we need to take a look at value:
Value is something that the customer is prepared to pay or sacrifice for.
This might seem an odd phrase: “sacrifice for”, but think about it. If you value something as an individual, you are prepared to make sacrifices to get it, keep it or care for it. The ultimate example is, of course, your family. What good parent wouldn't sacrifice everything for their child? The same is true in business: if you offer something of value to your customers, they'll very often do more than just part with money for it. They will use it, do without something else to get it, tell their friends about it and ultimately come back for more. All of which is good for your business.
Again, this all sounds very simple and obvious, but don't be complacent about it. In the complex world of big corporations, identifying the true customer and what they value can be a difficult task. It is vital, however, that you don't move on until you have this nailed, and please, please, please make sure that you validate your ideas with the customer to make sure.
So, we have customer value defined, which will help focus Lean on what is important. As a by-product, it will also help define new products and services to offer, but let's not go there right now as this is the Lean Book of Lean, not the Lean Encyclopedia!
With a clear handle on value, we should fire up the furnaces, get the engine in gear and start creating
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