Lean beyond the Shop Floor Management

The new face of the global marketplace is very competitive and unpredictable. Organizations looking for survival in this environment must not ignore these characteristics finding ways to overcome them. Facing this scenario require enterprises to broad their vision, incorporating every part of the business into a long-range plan that in order to keep its accuracy needs to be effectively managed on a daily basis. This strategy requires a cultural change highly focused on standards, the elimination of waste and continuous improvement.

Lean is a holistic system which involves the whole product value chain, from its design to its final delivery to customer. Phil White, one of the Lean Coaching Project Managers, describes Lean as a “common sense approach of doing business”, its principles are simple and applicable in any area of an organization. Though Lean is described as a simple management system, the change in behaviors necessary to make it effective is not.

Despite the natural tendency of associating Lean with the Shop Floor, the system can also provide great results in areas such as New Product Introduction, Engineering, Human Resources, Marketing and other areas which indirectly add value to the customer. “These areas usually deal with a great amount of waste in their processes” says Neil Wilson, the U.S Director of Lean Coaching. “With the implementation of visual controls, management can concentrate better their efforts on adding value to their products and processes” he adds. Designing products faster with fewer errors and managing human resources efficiently affect the product cost just as much as the Shop floor does. So, how do we apply Lean to these areas?

It all starts with a clear understanding of the company’s vision followed by its translation into a long-term strategy plan, with set objectives and key performance indicators which will not only monitor progress, but also indicate where actions need to be made. This strategy is cascaded down in the organization setting one common direction for all departments. In each part of this approach the PDCA cycle is repeatedly and rigorously used to ensure effectiveness and the continuous improvement of business processes. This strategy planning method is called Hoshin Kanri and when aligned with Gemba Kanri becomes a very powerful business tool.

Although, the principle of Gemba Kanri was fundamentally created for Shop Floor management, its concept is completely applicable to any area within the business. Gemba Kanri refers to the presence of management where everything happens. In other words, it promotes a structured involvement of management in the work areas with the purpose of adding value and increasing productivity. “The Hawthorne effect helps explaining the power of Gemba Kanri; people will be more productive when they see that their managers are concerned with their workplace” says Neil Wilson from Lean Coaching.

The effectiveness of Hoshin Kanri and Gemba Kanri is very dependable of management behaviors. Essentially, it requires an organizational culture change focused on standards, where people are empowered and rewarded, where effective communication happens bottom-up and top-down, where problems are highlighted and seen as opportunities “It is all about behaviors” says Lars Nielsen, the Director of Business Support for Novo Nordisk in recognition of the improvements in his area, “We became a more cohesive team; today people don’t feel afraid of showing problems rather, they understand that this is the only way for improvement”.

At Lean Coaching, we utilize these two fundamental processes as basis for our coaching. “We teach leadership how to incorporate Hoshin Kanri to drive the business in a common direction and introduce Gemba Kanri into their culture as part of the normal day to day business” says Gert Haar-Jorgensen from Lean Coaching. The results from this combination are a more united and efficient organization that consistently raises the bar by reducing the waste in the process.