Lean does not mean Little
by Tom Pryor

The proper way to get lean is not instinctive.

Most people try starving themselves while running on a treadmill. But if you go to any health club and walk into the cardiovascular room, what do you see? At my gym, you'll see lots of people on treadmills, StairMasters and elliptical trainers. Notice that the vast majority of these individuals are overweight!

Now, go to the strength and resistance room. What do you see? The majority of people lifting weights and using strength machines are in vastly better shape. Why? While aerobic exercise is certainly worthwhile, strength training increases lean muscle tissue. Muscles consume more calories, leading to faster loss of fat.

Becoming a lean manufacturer, lean distributor or lean service provider is not instinctive. You cannot become a lean and healthy organization by starving yourself of inventory, headcount, training and capital investments while simultaneously running yourself crazy. Diets rarely work. Instead, lean organizations must change their "eating" habits by feeding and strengthening themselves with flowcharts of business processes, financial facts from an Activity Based Cost system and finite goals. Goals should be providing customers the right products/services, in the right quantity, at the right time, and at the lowest cost, by doing the right activities.

Ten Tips to become a Lean Manufacturer, Lean Distributor or Lean Service Provider

1. Lean Thinking… In their 1996 book, Lean Thinking, authors Jim Womack and Daniel Jones focused on the Japanese word "muda". Muda is waste. Muda is "any human activity which absorbs resources but creates no value. Fortunately, there is a powerful antidote to muda: lean thinking." In short, lean thinking is believing that it is possible to do more and more with less and less, while providing the customer exactly what they want. To be lean, think lean.
2. Lean Accounting… Lean managers need lean measures. Activity Based Costing (ABC) converts muda into money. Many lean organizations are using ABC systems to dollarize waste by measuring non-value added activities, excess capacity, excess inventory, wait time and duplicated activities. The most successful lean organizations reduce the size of monthly accounting reports. Accounting managers should cut out the financial fat.
3. Lean Variation… Process variation is lean's number one enemy. Error prone processes, downtime and binge inventory purchases bleed organizations of their resolve to become lean. For example, the single most important principle in the design of a lean distribution system is understanding that a warehouse is not a place to store products. It is not a big box where raw materials and finished goods go to sit or die. Instead, a distribution center is a "factory" that never varies from its primary purpose… quickly convert products into customer orders.
4. Lean Pockets… Closing the gap between process steps is a key step in achieving leanness. Move machines closer together. Move workers closer together. Move organizations closer to the customer. Movement and build-up between activities is a non-value added cost. Efforts to synchronize the activities between manufacturers, distributors and customers in the automotive, food and healthcare industries during the 1990's were marginally successful in reducing pockets of cycle time, inventory and cost. A 2002 food industry goal is a 50% reduction in cycle time by 2005.
5. Lean & Mean… Lean manufacturing, lean distribution or lean services will not work unless you mean it. Lean behavior is controlled by the consequence or response it receives. Define positive and negative consequences to insure that employees, suppliers and customers focus on fat reduction. Reward lean customers with lower prices. Split cycle time savings with lean suppliers. Recognize employees for lean ideas. If no consequences exist, it signals that management didn't really mean it when they said "We're gonna get lean and mean."
6. Lean Leaders… Leaders are the lid of lean. Employees will never surpass senior management's understanding of lean manufacturing, distribution or servicing. If senior management can't explain lean, don't expect the employees to perform lean. An onsite "Lean Workout" is a great way to educate, train and implement at a distribution site. NOTE: For more information on Lean Workouts, send a request to tompryor@icms.net.
7. Lean Rules… The February 2002 issue of FAST COMPANY magazine published four rules that set the stage for lean innovation: (a) list the tasks and activities of your key processes; (b) simplify process flowcharts; (c) experiment at the lowest possible level by asking employees for continuous improvement ideas; and, (d) connect suppliers of know-how with customers who need help. Lean rules should be liberating, not limiting.
8. Lean Fasting… Resource fasting is a good way to bring focus to your lean efforts. Throughout the Bible, fasting refers to abstaining from food for spiritual purposes. While the human body can survive for only a short time without water, it can go for many days without food. Fasting reveals the things that control us. Select inventory items, open job requisitions or budget requests as fasting targets. Fasting will expose non-essentials.
9. Lean Forward… Getting lean is not easy. Tests, trials and temporary setbacks are a normal and important part of getting lean. Resistance makes you stronger. Tests make you wiser. Quitting, on the other hand, is a permanent solution to a temporary problem. When you fail, fail forward by adding an "R" to lean. Learn from your tests, trials and setbacks.
10. Lean Focus… It is very difficult to be a lean organization with a fat mission statement, e.g. be everything to everyone. Lean organizations, such as Southwest Airlines, Dell Computer and Tech Data, use focus to remain lean, strong and profitable. For example, Dell's mission statement says they will strive to be the best for "those markets that we choose to serve."

What does a lean organization look like? It's like a sleek racing skull. Everyone in the organizations is in the same boat, sitting close together, working at a synchronized rhythm that is spoken by a single, strong voice. Each person with an oar has prepared their lean body to share the workload as the skull cuts through the water towards the goal line. Is that a picture of your organization? It can be if you'll apply the ten lean principles.

"The three variables to weight loss are eating, exercise and the right mind-set", says Jim Karas in "The Business Plan for the Body". Changing our diet to lose weight is instinctive. Selecting the proper combination of diet, activities and mindset to become lean is not instinctive. It has to be learned. Manufacturing and service organizations will learn that lean savings multiply into fat profits. And city, county, state and federal organizations that apply lean principles will add muscle to the annual budget. Remember, lean does not mean little. Lean means low fat!

LEAN ON ME... call Tom Pryor at 817-475-2945 or send an e-mail to tompryor@icms.net if you want to learn how to use an Activity Based Management system in your organization to support a lean program.

EASTER… The entire ICMS family want to wish you and your family a very happy and holy Easter holiday.

MARCH MADNESS … It's that time of year again. And if you've never read it, take time to read the following article: http://www.icms.net/news-28.htm

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