Lean Management Methodology

Cite this article as:"Lean Management Methodology," in The Business Professor, updated April 11, 2020, last accessed October 20, 2020, https://thebusinessprofessor.com/lesson/lean-management-methodology/.


What is Lean Control?

Lean control (or simply “Lean”) is a process used to control non-financial aspects (work processes, purposes, and people) of organizational performance – all with the purpose of improving quality and decreasing waste. The three core principles of the lean methodology include:

  • Focus on delivering value from a customer perspective.
  • Respect for People.
  • Eliminate Waste (or “muda”).
  • Continuous Improvement (or “kaizen”)

It is a knowledge-based system with the underline objective of streamlining the production process by measuring and reducing inventory or capital-intensive procedures. Lean organizations undertake the same output with less of specific resources, such as human effort, less equipment, less facilities space, less time, and less capital.

The process encourages shared responsibility and leadership. It empowers individuals at any level of the hierarchy where initiatives are carried out.

What is “muda”?

Luda is the Japanese term for wasteful activity. It generally includes seven forms of waste:

  • production of defective products that must be remade or fixed,
  • production of more products than the market will buy,
  • excessive work-in-process inventories,
  • overprocessing (processing steps that aren’t really needed or that add no value),
  • unnecessary movement of people or products, and
  • unnecessary waiting by employees.

What is the Womack-Jones Lean Framework?

This is a framework that applies lean methodology through five core principles:

  • Customer Perspective – Value should be identified from the customer’s perspective and specify how a particular value offering (product) meets customer needs or wants.
  • Map the Value Stream – The value stream is the set of activities that the business is performing to bring a finished product to a customer. This is necessary to understand the activities that add value and those that do not.
  • Create a Continuous Activity Flow in Each Value Stream – After removing non-value-adding activities the remaining activities should be arranged sequentially to run smoothly and continuously from one activity to the next. This approach directly challenges the traditional “batch-and-queue” model of manufacturing, where people and equipment are organized and located by function, and products (and component parts) are manufactured in large batches.
  • Produce what is needed to meet Actual Customer Demand (Pull) – Having a continuous flow in production means that lead time is dramatically reduced. This allows the organization to respond more closely to actual customer demand.
  • Strive to Continuously Improve All Business Operations (or “kaizen”) – This requires a mindset that it is always possible to improve any business activity. Organizations should regularly conduct kaizen events throughout their organizations to improve specific processes or operations.

What is the Effect of Lean Management?

The primary benefits associated with lean management include:

  • Focus – By eliminating wast the workforce can focus on value-add activities.
  • Improved Productivity & Efficiency
  • Paces Demand – Allows for activities only to the extent of actual demand.
  • Better Use of Resources – Uses fewer resources.

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