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Lean For Dummies, 2nd Edition

ISBN: 978-1-118-11756-9
408 pages
April 2012
Lean For Dummies, 2nd Edition (1118117565) cover image
Take charge and engage your enterprise in a Lean transformation

Have you thought about using Lean in your business or organization, but are not really sure how to implement it? Or perhaps you're already using Lean, but you need to get up to speed. Lean For Dummies shows you how to do more with less and create an enterprise that embraces change. In plain-English, this friendly guide explores the general overview of Lean, how flow and the value stream works, and the best ways to apply Lean to your enterprise.

This revised edition includes the latest tools, advice, and information that can be used by everyone — from major corporations to small business, from non-profits and hospitals to manufacturers and service corporations. In addition, it takes a look at the successes and failures of earlier Lean pioneers — including Toyota, the inventors of Lean — and offer case studies and hands-on advice.

  • The latest on the Six Sigma and Lean movements
  • The role of technology and the expanding Lean toolbox
  • Case studies enhance the material

Lean For Dummies gives today's business owners and upper level management in companies of all sizes and in all industries, the tools and information they need to streamline process and operate more efficiently.

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Foreword xvii

Introduction 1

Part I: Lean Basics 7

Chapter 1: Defining Lean 9

Chapter 2: The Foundation and Language of Lean 27

Part II: The Lean Culture 47

Chapter 3: Lean in the Organization: Principles, Behaviors, and Change 49

Chapter 4: Power to the People 65

Chapter 5: Go Lean: Implementation Strategy, Startup, and Evolution 87

Part III: Understanding Flow and the Value Stream 113

Chapter 6: Seeing Value through the Eyes of the Customer 115

Chapter 7: You Are Here: Mapping the Current State 133

Chapter 8: Charting the Course: Using Value-Stream Maps 157

Chapter 9: Flowing in the Right Direction: Lean Projects and Kaizen 181

Part IV: The Lean Toolbox 199

Chapter 10: Customer and Value-Stream Tools 201

Chapter 11: Flow and Pull Tools 215

Chapter 12: Perfection Tools 237

Chapter 13: Management Tools 261

Part V: The Lean Enterprise 279

Chapter 14: Lean within the Enterprise 281

Chapter 15: Lean across Industries 305

Chapter 16: Real-Life Lean 321

Part VI: The Part of Tens 345

Chapter 17: Ten Best Practices of Lean 347

Chapter 18: Ten Pitfalls to Avoid 353

Chapter 19: Ten Places to Go for Help 361

Glossary 369

Index 373

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Natalie J. Sayer has more than 25 years of international experience as an implementer, facilitator, and consultant in continuous improvement methods. Bruce Williams is Vice President of Pegasystems, the world leader in business process management. He is a leading speaker and presenter on business and technology trends and is coauthor of Six Sigma Workbook For Dummies, Process Intelligence For Dummies, BPM Basics For Dummies, and the Intelligent Guide to Enterprise BPM.

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April 23, 2012
Go Lean or Go Home

In this high-stakes, post-recession business world, doing things “better, cheaper, smarter, and faster” has never been more necessary for success. If your business can’t keep up with changing customer needs and is too slow to adjust to an ever-changing market, or is burdened with wasteful spending and outdated practices, then you just might get left in the dust.

Now, everyone must satisfy more demanding customers while using less of everything: time, energy, space, materials, and money. Natalie J. Sayer and Bruce Williams, authors of Lean For Dummies®, 2nd Edition (Wiley, 2012, ISBN: 978-1-1181-1756-9, $26.99), say there’s never been a more important time to take another look at the business-boosting benefits of Lean.

“Long gone are the days of doing things the same old way and being successful regardless—and of just being smart, working hard, and hoping for the best,” says Sayer. “Aggressive, unrelenting economic and demographic pressures are forcing everyone to embrace some type of dependable approach and strategy for performance management and improvement. It’s now a given that you’re going to do something to improve—so what’s it going to be?”

Lean For Dummies provides a comprehensive, easy-to-understand guide to everything Lean. It explains Lean’s origins—the Toyota Production System—and the logic of Lean from its principles to its language and lexicon. Updated with the latest tools, advice, and information, Lean For Dummies gives today’s business owners and upper-level management in companies of all sizes and in all industries the tools and information they need to streamline the process and operate more efficiently.

“Simply stated, Lean is a proven long-term approach to aligning everything in a business or institution to deliver increasing customer value,” says Sayer. “Lean is an everyday practice, performed by everyone, at all levels, to consistently improve performance. Unlike so many of the alternatives, Lean is something that everyone can understand, everyone can do, and everyone can benefit from."

Sayer and Williams note that it’s important to remember that Lean is different from traditional Western-style thinking, organizational structures, and management styles. Keeping your bearings can be difficult. They explain a few pitfalls you should be aware of along your path to transformation:

Getting distracted by shiny objects. There are multiple approaches to improvement. And new improvement ideas and tools constantly emerge on the landscape. What’s so special about Lean? What’s wrong with these other paths? It’s simple: Like fad diets and exercise programs, these other paths can distract you from your improvement journey. Although innovation is good—and many initiatives have something to offer—understand how best to include these approaches in a way that is consistent with your Lean principles and methods.

“Take Six Sigma, for example,” says Sayer. “The statistical tools most commonly associated with Six Sigma can be very useful in the reduction of variation and the elimination of defects, but the approach and infrastructure of a Six Sigma initiative differs greatly from Lean. You can easily include Six Sigma tools within Lean, but because Lean is a fundamental methodology, it cannot be wholly subjugated into other methodologies or frameworks. Lean is a holistic and complete system. If you’re practicing Lean, be careful and thoughtful in how you adopt other methods and tools.”

The “Why do this? It’s just not for us” attitude. You may find people in your organization have a preconceived notion or belief that Lean isn’t for them—or even for you. These people may have other ideas, or are used to thinking another way and don’t want to change.

“It’s now proven that Lean applies everywhere—for enterprises in any industry and for all functions and processes,” notes Sayer. “Remember that how you apply it is unique to circumstances: Lean isn’t formulaic, so everyone tailors it to how it best works for them. But don’t let anyone tell you, ‘Lean? That’s not for us.’ Because it is! You’ll need to help people understand why it’s the right thing to do and how each individual will benefit.”

Complacency. Complacency is the number-one killer of initiatives like Lean. It’s tough for people to really change their behaviors and stay the course. Even if things aren’t going well, it’s often difficult for people to change, take on a new initiative, and carry it forward; if there’s not a crisis, people often can’t see the compelling reason to change.

“Resistance to change is natural to any change initiative, and it’s no different in Lean,” says Sayer. “But Lean almost intensifies this resistance through its incremental, baby-steps approach.”

How do you get people to adopt Lean practices if they can’t readily see the results? You fight complacency with several weapons:

  • Customer awareness: People need to know what customers want, how they are changing, and what they say about your organization.
  • Communications: Have strong communicators who are unrelenting and convincing in the purpose and goals of the Lean initiative, as well as its proven, time-tested methods and tools.
  • Information updates: Be sure to communicate the results and benefits from Lean improvement activities as they occur—both in your company and elsewhere.
  • Competition: People need to know what your competitors are doing, what industry practices are, and what it takes to keep pace.
  • Lean measurements: Create performance measures that reinforce Lean behaviors.
  • Punitive measures: Sometimes, you have to use the stick. In every group, there are some who will not board the train.

Same-old, same-old senior managers. Like with any program or initiative, if the senior managers aren’t fully embracing Lean, you have a very, very difficult road ahead. Many in the industry would tell you that your chances of a successful Lean implementation are nil without senior management’s full commitment and action. Why? Because the initiative is so all-encompassing and life-changing, that without management’s active participation, it simply won’t happen.

“Senior managers can’t go on living the old way and expect a change in the way the organization functions,” says Sayer. “Senior managers must change how they lead the organization every day if Lean is to become the way the organization does business. The management functions can’t be delegated or handed off; they must be practiced and performed by the managers themselves. You cannot have a successful Lean journey unless the leaders understand and are committed to its success.”

Struggling middle managers. The roles of middle managers and supervisors are very different in Lean from traditional hierarchical, order-giving organizations and systems. In Lean enterprises, the supervisors become coaches and mentors. They relinquish considerable authority and decision-making to the employee teams, who find their own solutions to problems and challenges. The middle managers guide, question, listen, and enable their people. Their job is to break down walls that inhibit team success.

“These roles of middle management and supervisors are different from traditional Western-style systems,” explains Sayer. “Managers and supervisors must be properly trained and equipped and supported in order to perform within a Lean system. It’s not an easy transition for people. Some of them just don’t make it.”

Thinking it’s a quick fix. Do not sell yourself or your organization on Lean as a quick fix. You can realize short-term benefits; however, the true success of Lean does not come through short-term special events. The true power of Lean is through continuous, incremental improvements over the long term.

“Use Lean as a long-term solution,” says Sayer. “Use Lean to more patiently, orderly, and consistently change people’s thinking and behaviors, change the culture, and improve continuously and incrementally forever. You don’t create that kind of change overnight. You can make progress in the short term, but to truly change you need time.”

Cherry-picking. One of the most common faux pas of Lean implementations is the piecemeal application of individual tools. Because Lean is a complete system, picking up a few tools and hacking away is a recipe for disaster. “Without the holistic understanding, adoption, and support of the principles and methods of Lean, the tools are out of context,” notes Sayer. “Of course, you never implement all the elements of Lean at the same time, but keep in sight that the interrelationships of all the elements in the overall system are critical. With Lean, do it or don’t do it. But don’t think you can do it halfway and sustain your gains.”

Playing the waste shell game. Let’s say that a nugget of waste is sitting there on the table, under the shell of your organization. Your operations manager—fully trained in Lean practices—deftly pulls out two additional shells: one for a supplier, and one for a distributor. He starts moving shells around, and suddenly—presto!—the nugget of waste is no longer under your shell. It’s now under one of the others. He’s eliminated waste from your organization, and aren’t you the better for it?

“You’ve just committed a Lean infraction,” explains Sayer. “You’ve moved the waste. Moving the waste doesn’t count in Lean, because improving yourself at the expense of someone else isn’t really improvement. You’re all interconnected through the value stream. Ultimately, the aim of Lean is to improve the entire stream. You have to eliminate the waste—period.”

Misusing the Lean tools. People love tools. They seem like toys. When you get a new toy, you get to play with something different that you haven’t had before. You look for opportunities to show off your new toy, er, tool. But you need to remember to pick the right tool for the job.

“One tool does not a transformation make,” says Sayer. “You need to figure out how to use the full complement of tools in your toolbox and pick the right tool for the job.”

Bean counting with an outdated mindset. Of all the nemeses to befall Lean initiatives, this is perhaps the most insidious: Believing that the old ways of accounting for the business are the only ways to account for it.

“The accounting managers may tell you how difficult it is for them to change, or even wave the risk flags (think Sarbanes-Oxley),” suggests Sayer. “Help them understand how they can be part of the solution instead of the problem. Show them the results, and challenge them on how best to account for the improvements you make. Bring them on board, and they can make a key difference!”

Mistaking activity for progress. Everyone knows that people can be busy—very busy—without being at all productive. Bureaucracies are replete with useless activity, wasting people, time, and effort without producing anything of value. Make sure that the Lean improvement activities you undertake really add value.

“When you have kaizen events (kind of like test runs for improvement activities), make sure that they’re well organized, with defined objectives and teams creating lasting results aligned with your long-term vision,” says Sayer. “Be certain that managers are participating in them, to ensure people with authority and accountability understand and support the results. For example, if the objective is to free up floor space, then make sure it is freed up in usable, collective areas, rather than isolated pockets that don’t create value for anything.”

“Lean means less of many things—less waste, shorter cycle times, fewer suppliers, less bureaucracy,” concludes Sayer. “But Lean also means more—more employee knowledge and empowerment, more organizational agility and capability, more productivity, more satisfied customers, and more long-term success.”

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