The Principles of Lean Improvement

At Castlefirth we are often asked “How Lean Can Help My Business?” The answer obviously depends on many things but one of the ways is to understand how work is undertaken and applying the five principles of lean.

Principle 1: Specify what creates value from the customers perspective

Always understand what the customer needs. Just think about how much waste there is when a product or service is provided to a customer and compare that to what they really wanted.  Remember that most processes contain over 90% waste. Do your customers really want to pay you for that waste?

Principle 2: Identify all steps across the whole value stream

An organisations value streams will usually cross departmental and sometimes company boundaries. Do you really understand the sequence of processes from the start to the finish? For example every step involved with taking raw material to finished product, the step for patient going from referral to treatment and then discharge, for taking a new product or service from concept to launch? WE often optimise vertical silos but we need to focus horizontally on the item which is being produced or service provided. This then helps us understand value adding and non value adding steps, performance measures and areas for improvement. When we do this we will see that there is usually only 5% value adding activity in a process with 95% waste and therefore opportunity for impro0vement.

Principle 3: Make those actions that create value flow

Now we understand where the value is added then we need to make that value flow. Redesign processes to eliminate waste, unevenness and overburden. Look at how you can design a system that never delays a value adding step because of a non value adding step. Create standard work to flow items one at a time in line with the heartbeat of the system. The heartbeat (or Takt time) is defined by the needs of the customer and as a provider of products or services if you do not know your Takt time then how do you know how to organize your process, equipment, people and supplies to deliver what they want when they want it? Without this there is a high probability that your systems and processes are inherently wasteful.

Principle 4: Organise so that the customer can pull just-in-time

Having setup flow, link the system to the needs of the customer. On a macro level link this to real customer demand. On a micro level link each activity within the value stream to only operate when the value stream needs to operate. Pull systems trigger the flow of activity between value added teams and help to eliminate vast amounts of waste.

Principle 5: Strive for perfection by continually removing successive layers of waste

We often have an improvement paradigm that we want to do it perfectly the first time and get the full result. The Lean approach understands that you cannot see all of the waste when you first look at the value stream. After the first improvement cycle then look again. The first cycle will have produced results but will also have made the next level of waste visible. A good rule of thumb is at least 5x repeated cycles