Wednesday, October 6, 2010

What is Lean and why is it not more prevalent outside manufacturing?

Thirty years ago US automobile manufactures were challenged with building quality products which customers actually wanted.  They often neglected to understand what the customer was really looking for in transportation and the customer considered value.  Fortunately the manufacturers were able to imitate the Japanese Lean models in producing vehicles which customers would buy.  Unfortunately the concept of designing products based on value didn’t mature much past manufacturing division or department.  Flash forward thirty years today and much hasn’t changed.  Lean IT (or any department for that matter) is that change, with Value Stream maturity mapping an organization can adapt Lean Manufacturing concepts within IT.  There are several cultural changes which must occur for any Lean initiative to be adopted.
1.Treat your employees as intellectual capital  – True change can only occur where the rubber meets the road. Employees who live inside a process all day inherently know what’s broken and what’s not. Giving them the ability to make changes in the organization is the most effective way to increase value and continuous improvement.
2. Understand your core competencies – When businesses start they do so in order to make money. Money is made because an organization believes they have a core competency which is superior to their competition. It’s easy for an organization to lose focus on this point. I would argue if there’s anything you shouldn’t forget it’s what your core is and how does any decision you make impact that competency?
3. Anything not providing value is waste – Value is defined as anything the customer is willing to pay for. Simply enough anything which doesn’t provide value is considered waste. Waste can further be defined as anything which doesn’t support the core competencies. There are certainly times when waste is not an option (Government Regulations, Safety, supporting process) but as a rule of thumb focusing on waste will allow the organization to provide optimal value. Inside IT waste some waste examples are system functionality which isn’t being used, duplicate data store, server sprawl, change control wait times.
In summary, using Lean tools within a firm can keep the focus on value added activities. Remember the customer is only willing to pay for value added activities and after all aren’t we in business to provide the customer with value?

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