Friday, August 21, 2009

Lean waste elimination fails to hit the bottom line numbers

Many companies, embracing the concepts of lean thinking, hear the urging to 'Just do it', in the spirit of the leaders and pioneers of the Toyota Production System. They then excitedly delve into the transformation process. They stage a kickoff meeting to share their passion, pick something important and start removing waste quickly to capitalize on that “low hanging fruit”.

The target area becomes a beehive of activity, kaizen events, continuous improvement blitzes, 5S initiatives and production tracking boards. People get engaged in the process improvements and the staff gains some hope that finally the company is listening to what they are saying.

Yet flow through the facility does not consistently improve, the mounds of in process inventory do not reduce, and expediting hot orders remains the norm. No cost savings reach the bottom line, there is no demonstrable service and quality improvement for the customer. The improvements are not sustainable. Processes drift back to the old ways of doing things.

So management reaches the conclusion that lean does not work in this environment. We are “different” and the principals must not apply in this industry. We cannot demonstrate a return on our investment.

This lean offensive with its disappointing result drifts off as another abandoned program.

So why does this happen? Why do the concepts of lean, that seem to be such common sense, not work when we apply them? How can so much information be readily available about this approach to process improvement, yet it is so incredibly difficult to implement with concrete demonstrable results?

Click here to read the rest of this article and explore the answer to this all too common dilemma


No comments:

NBI - Making sense of business improvement - Blogged