At its core, Lean is a business methodology that promotes the flow of value to the customer through two guiding tenets: Continuous improvement and respect for people. Jim Benson of Modus Cooperandi defines Lean methodology in this way: “Lean is both a philosophy and a discipline which, at its core, increases access to information to ensure responsible decision making in the service of creating customer value.”
Lean methodology is not a new concept, but its modern application to business is constantly evolving. Before Lean was known as a business methodology, it was an approach to the manufacturing process. Keep reading to learn more about the history, application, and key tenets of Lean methodology.
Roots in Manufacturing
Lean originated with the Toyota Production System, or TPS, which revolutionized the manufacture of physical goods in the 1950s, ‘60s, and beyond. Lean maintains its hold in manufacturing, but has also found new applications in knowledge work, helping businesses in all industries eliminate waste, improve processes, and boost innovation. To learn more about the history of Lean, visit this page.
Expansion into Software Development
Lean’s first applications outside of manufacturing appeared in software development, in a discipline known as Agile methodology. Conceptually, Agile software development is a Lean method for optimizing the software development cycle. Learn more about Lean and Agile software development here.
Software development is a natural application of Lean methodology because, much like manufacturing, it generally follows a defined process, has some defined conditions of acceptance, and results in the delivery of tangible value.
Over time, the success of applying Agile and Lean principles to software development piqued the interest of other departments and other industries. Today, Lean is being applied to knowledge work that follows a process -- which is essentially all knowledge work. Learn more about how Lean is applied in businesses today by reading our Lean Business Report.
Pillars of Lean: Continuous Improvement and Respect for People
There are two primary concepts that guide all practice of Lean methodology, which we call the Pillars of Lean. They are: continuous improvement and respect for people.
When some people think of Lean, they equate it with the elimination of waste. While it’s true that Lean organizations aim to eliminate waste (defined as anything that does not deliver value to the customer), the goal is not elimination -- it’s value creation.
So how do we create value? We become learning organizations. We set out to learn what our customers want and need -- and how to eliminate what they don’t. We work to continuously improve so that our value stream, from end to end, is continuously optimizing to create more value for the customer.
How do we learn what is valuable? We deliver quickly. When we deliver quickly, based on what we know about the customer, we are able to get feedback quickly. And whether what we deliver is a failure or a success (or somewhere in between), we gain valuable insight into how to improve. This is how we achieve business agility -- this is how we, through the process of creating value, eliminate waste.
The continuous improvement cycle helps Lean organizations differentiate themselves from our competitors. Lean organizations are nimble, humble, and methodical. We encourage employees to foster a learning mindset, and more specifically, a testing mindset. We test ideas with our target market before we throw dollars at them. In this way, Lean methodology is as much of a path toward innovation as it is a form of risk management.
Respect for Frontline Workers
Often, the best ideas come from the people with their hands on the product. In most organizations, decisions are made at the top of the organization and trickled down to the frontline. Lean thinking encourages allowing everyone -- especially those closest to the product and the customer -- to have an equal voice, to ensure that the voice of the customer, and those doing the work, is heard.
This is the Lean concept of going to the gemba -- going to the place where the work is done -- to get ideas for improving work and creating value. Lean thinking says that good people want to do their best work, and are motivated to make decisions that optimize their time and talent to create the most value for the customer. Going to the gemba allows the organization to capture the best ideas and bring them to fruition.
In most organizations, decisions are made at the top of the organization and trickled down to the frontline. Lean thinking encourages allowing everyone -- especially those closest to the product and the customer -- to have an equal voice, to ensure that the voice of the customer, and those doing the work, is heard.
Elevating the voice of the frontline worker evolves the role of leadership. In an organization structured around a command-and-control form of leadership, the role of the leader is to set the course of what to do, but also how and when.
Lean leadership empowers employees with the autonomy to make decisions, the opportunity to master their craft, and the purpose (the “why” behind the work) to understand the value of their efforts. The role of the leader is to define the goal at hand, and then allow their talented employees to discover the most appropriate course of action toward that goal.
Leaders are charged with the task of bringing the best out of their employees, and removing any obstacles that could prevent their team from delivering value to the customer. Lean leadership is better defined by what it is not than what it is. It’s not command-and-control, it’s not micro-managing, it’s not driven by ego or the power of position. It’s leading in the truest sense. Learn more about Lean leadership in this post.
Want to learn more about operationalizing respect for people? Read about our own journey towards practicing respect for people here.
Lean Methodology: Learn More
In short, Lean methodology is a way of optimizing the people, resources, effort, and energy of your organization toward creating value for the customer. It is based on two guiding tenets, continuous improvement and respect for people. Teams all over the world, from sales to software development, are using Lean methodology to sustainably deliver more value to their customers, while building healthier, more resilient organizations.
Download this year’s Lean Business Report to learn more about how teams and organizations use Lean to work smarter and deliver greater value to their customers.