LEAN IN

Prof.Dr.Aung Tun Thet

LEAN IN

Prof.Dr.Aung Tun Thet

◦“Nobody knows the future. ◦You can only create the future.”◦Jack Ma

Organization

Organization

LEAN IN

Continuous

Improvement

WastageReduction

Respect for

People

Lean In◦Philosophy◦System ◦Integrated tools ◦Improve results by eliminating waste of non-value activities

◦Continuous improvement ◦Culture with respect for people

Lean In◦Employee ownership ◦Holistic approach ◦Transform organizations into efficient, customer driven and successful enterprises

Lean In

Lean Concepts

Lean PlanningLean Culture

Lean Tools

LEAN Organization

◦Creating more value for customers with fewer resources

◦Understand customer value ◦Key processes to continuously improve◦Ultimate goal - perfect value to customer through perfect value creation process with zero waste

LEAN Organization

Capability to identify and solve

problems

PDCA Thinking

PURPOSEVision/ValuesTrue North

Employee Line of Sight

Strategy Formulation &

Deployment

PEOPLEInvolved & Engaged

in CIContinuously solve

problemsTeamwork

Learn

PROCESSHorizontal flow of

valueManagement

through Standardization &

VisualizationElimination of

waste

SYST

EMS

MANAGEMENT PRACTICE

Lean Principles

◦Toyota - Taichii Ohno◦Lean Thinking ◦Operational excellence ◦Creating value for customers◦Meeting objectives

Lean Principles

◦Origins in manufacturing sector◦Application in all sectors – service, healthcare, finance, IT, etc.

◦Heart - elimination of waste - Mudas

1. Overproduction

◦Creating more than required or before required ◦Advertising in saturated market◦Building houses and selling them cheaply◦Hotels run empty etc.

2. Waiting

◦Individuals and items wait because of mismanagement or misappropriate allocation of resources

◦Waiting in queues in restaurant or shop◦Newly recruited employees not contributing because of lack of infrastructure - computers

◦Forms waiting for days requiring approvals from authorities

◦Waiting for net or mobile connection to get started etc.

3. Unnecessary Transport

◦Movement of materials serve no purpose or add any value to customer

◦Long email chains with excessive attachments◦Systems requiring multiple approvals in Government offices etc.

4. Over-processing

◦Efforts do not add value◦Redundant steps in process◦Call centre employees not trained properly

5. Excessive inventory

◦Supply of services or information exceeding demand or before required

◦Food thrown away ◦More IT infrastructure ◦Schools and colleges not filled to capacity etc.

6. Unnecessary Movement

◦People ◦Customer representatives walking long to get brochures

◦Multiple visits by salespersons to get correct documents

◦Multiple visits to government offices to get job done

7. Defects

◦ “Getting Right First Time” ◦Correcting overhead◦Rework of application forms ◦Incorrect delivery of couriers and goods◦Systems failure

8. Unused employee calibre

◦Uneven work distribution◦Not leveraging strengths of employees◦Decisions being made only by upper management without involvement of employees, etc.

Lean Thinking

◦Antidote to Mudas

LEAN IN PROCESS

Step 1: Identify Value

◦Value defined by customer◦“What does customer want?”◦“Am I adding value to customer?”

Step 2: Map Value Stream◦Separate value-added steps from non-value-added steps

Step 3: Create Flow◦Eliminate or minimize non-value added steps◦Value adding steps flow in continuous manner

Step 4: Establish Pull◦Arranging processes into Cell structure ◦Transparency and information Pulled rather than Pushed from one component to another

◦Pull based continuous system uncover hidden problems

Step 5: Seek Perfection◦Kaizen: Continuous incremental improvement◦Progressing towards ultimate goal of zero wastage◦Healthcare sector◦Ultimate goal - serve customer/patient quickly with optimum results

◦Once case arrives in hospital minimal lead time◦Divide process of serving customer/patient into modules and improve every module at every single stage

Step 5: Seek Perfection◦Jidoko: Built-in quality◦Cultivating culture of stopping to fix problems at root

◦Error proofing ◦Delivering right quality first time ◦Enhance customers’ experience

Step 5: Seek Perfection◦Standardisation of work processes: ◦Maintain predictability◦Regular timing ◦Regular output from processes◦Mcdonalds, Dominos or Pizza Hut

Step 5: Seek Perfection◦Use of visual indicators◦Alert everyone as soon as system deviating from regular predicted behaviour

Step 5: Seek Perfection◦Use Pull Systems to avoid overproduction◦Generate service only when assured of demand from next customer-in-line

◦Grow leaders from within rather than from hiring from outside

Step 5: Seek Perfection◦Genchi Genbutsu: ◦Get on floor and see for yourself what the real problem is

◦Take decisions slowly after total consensus of all stakeholders

◦Implement them quickly

Lean Philosophy◦Not tool or technique ◦Culture ◦Cultivated within organization to succeed in long run

LEAN MANAGEMENTOrganization renews itself

Four Disciplines

◦Reinforce one another ◦Create adaptive organization ◦Generate value for all stakeholders

Four Disciplines

◦Tangible skills and ways of working ◦People and organizations learn - over time culture - how people behave and think

1. Delivering value efficiently to customer◦Understand what customers truly value◦Where, when, how, and why ◦Configure how it works ◦Deliver exact value - no more and no less

1. Delivering value efficiently to customer◦Fewest resources possible◦Improving coordination◦Eliminating redundancy◦Building quality into every process

1. Delivering value efficiently to customer◦Cycle of listening and responding never ends◦Customer’s evolving needs reveal:◦New opportunities to attack waste◦Create new worth◦Build competitive advantage

2. Enabling people to lead and contribute to fullest potential◦Provide support mechanisms ◦Truly master work◦Revamped physical space foster collaboration◦Visual-management techniques let everyone see what needs to be done

2. Enabling people to lead and contribute to fullest potential◦Targeted coaching builds capabilities◦“Job aids” reinforce standards◦Employees own development

3. Discovering better ways of working◦Continually think about today’s ways of working and managing improveent

◦Clear sense of what “better” means - ideal organization

◦Unvarnished view of current conditions ◦Ability to work with others to close gaps

3. Discovering better ways of working◦Problem identification and resolution part of everyone’s job description

◦Problems flow to people best able to solve them

4. Connecting strategy, goals, and meaningful purpose◦Operate from clear direction◦Vision of what organization is for◦Shapes strategy and objectives

4. Connecting strategy, goals, and meaningful purpose◦Leaders articulate strategy and objectives people understand and support

◦Align individual goals to strategy and vision◦People fully understand role in organization and why it matters

Four Disciplines

◦Build on one another◦New products deliver better value to customers◦Convince employees ideas matter◦Find new ways to respond to customers◦Clarify organization’s purpose

Four Disciplines

◦Government agency evaluate what matters ◦Reassess how work done◦Strategy consistent with mission◦Emphasize different disciplines at different times◦Need all to keep renewing itself◦Form lean-management system

Lean-Management System: Four integrated disciplines

NEXT FRONTIERS

Lean In

◦Put customers first by truly understanding what they need and delivering it efficiently

◦Enabling workers to contribute to fullest potential◦Constantly searching for better ways of working◦Giving meaning to work by connecting strategy and goals in clear, coherent way

Lean In

◦Biggest management idea of past 50 years◦Transformed how leading organizations think about operations

◦Senior executives gain more exposure and deepen understanding

Lean In

◦New technologies, new analytical tools, and new ways of looking at customers

◦Ultimate “North Star” ◦Translate what customers value into additional improvements

◦Bridge gaps among operations, marketing, and product development

New Horizons

◦Lean not stationary◦Delighting customers ◦Boosting productivity

Scientific Insights

◦Product and service contribute to customer value◦New ways to look at - lead time, cost, quality, responsiveness, flexibility, and reliability

◦New opportunities for cross-functional problem solving to eliminate anything that strays from customer-defined value

Future of Lean In◦Exciting◦Tools for eliminating waste ◦Increasing value as customers define it ◦Volume and quality of information about customer behaviour

Future of Lean In◦Marketing insights integrated with operations◦Psychological insights on customer’s needs and desires

◦“Learning to see”

THANK YOU!