Lean Thinking: Overview, Principles, Benefits & Applications Explained

What Is Lean Thinking?

In short, lean thinking is a business methodology. It comes from the history of Japanese manufacturing techniques applied to industries and organizations around the world. Lean thinking is a mindset as well, as the name would suggest. It’s a worldview that approaches and handles work in a lean way, meaning value to the customer is given the utmost focus. 

Lean thinking is more than just employing specific tools or tweaking a few steps in a business process – it’s all about changing how you see your business and how you recognize business operations. It's a worldview that’s adopted to change the way you think about your business. 

The Start of Lean 

Lean comes from the car manufacturing industry, specifically Toyota. 

The Japanese-owned and founded Toyota Production System created a sustainable, working environment for productive work where they were able to keep costs low, guarantee efficient processes, and ultimately sell excellent products at a competitive price.

Usually, when businesses have higher output, the quality of their products seems to drop. With lean thinking, however, this isn’t the case. Organizations can identify wasteful activities in their process, address them, and ultimately fix them for higher quality and less wasted time. By employing the lean mindset, Toyota came together with a whole new philosophy about hard work, prioritizing value to the customer, and striving to achieve that value in every product and service.

The Two Pillars of Lean 

To really understand lean thinking, you must understand the two pillars of lean, which provide you with a starting point to learn, understand, and grow: 

• Continuous Improvement: This simply means that every member of your organization is actively trying to find opportunities and execute initiatives that change work for the better. What you define as “better” will depend on your unique industry, but you can rely on this pillar for better team productivity and job satisfaction.
• Respect for People: Respect for others is the backbone of any thriving organization or team. When people are able to look at one another as individuals with goals, dreams, needs, wants, and fears, they’re able to practice true empathy. In a lean organization, having respect for people (workers, customers, and everyone in between) means you give everyone their autonomy to get the job done. In other words, it means you have confidence in the people around you, which lifts morale, shows trust, and goes a long way.

When business owners place their mindset on this foundation, they’re better equipped to formulate and ultimately execute smarter business decisions and strategies. In the end, adhering to the pillars of lean will result in more productive systems for your organization.

What Is the Goal of Lean Thinking?

The goal of lean thinking is to make business better, value one another, and focus on value to customers. When you can achieve these goals, lean thinking is fully in swing. 

Within a lean organization, employees actively respect their colleagues and superiors through collaboration, quality assurance, and clear communication. This means that every member’s skills, weaknesses, capacity, and output are managed equally so everyone bears the same burden (which really won’t feel like a burden at all). 

Lean Thinking and its 5 Principles

The Lean Enterprise Institute and the Lean Enterprise Academy were founded by James Womack and Dan Jones, respectively. They were business colleagues who penned the book, Lean Thinking: Banish Waste and Create Wealth in Your Corporation. 

Considered by many to be the “bible” of lean manufacturing, the 1996 publication was born from Womack and Jones’ intense study of the Toyota production system’s remarkable success. Within the book, the goal of Lean thinking and the five lean thinking principles are as follows:  

1. Value 

The first of the lean thinking principles is value, which begs organizations to really understand what value means for their customers. Once you identify value, you can provide it! Value is really the foundation of the five lean thinking principles, and without it, you can’t move on to the next four. 

2. Value Stream 

Once you can successfully identify value, organizations must next learn and define how to achieve that value. In other words, organizations must identify all the steps in the different processes that take raw ideas and materials and transform them into working products and services that customers can use.  

3. Flow

Once you identify the value stream, you can move on to the next lean thinking principle: flow. When flow has been established, it means that your work is not slowed or blocked in any way. Establishing flow is not an easy task, though. To do it effectively, you may have to introduce and implement changes within your organization that may be difficult and unpopular at first. This is the essence of lean thinking: continuous improvement pushed by a shared goal. Even if getting into your flow is stressful, it will always work out well for a unified organization. 

4. Pull

By the time you’ve eliminated waste and other problems and gotten your flow running smoothly, time to market will be low. This may sound bad, but it's actually a good thing. Instead of creating products that will sit in inventory, they’ll be “pulled” by customers right when they need them. Customers are now in a great position to pull what they need from your organization, satisfying their needs and saving you from unused products piling up in inventory.

5. Perfection 

The last principle of lean thinking is perfection. To reach perfection, your organization will have gone through a total lean transformation. This means you’ve correctly identified value, refined and streamlined your value stream, nailed down smooth flow, and met customer needs and demands with the right number of products at the right time. It’s important to understand perfection is a journey and not a destination – it’s something your organization is always working toward.

Get Trained to Improve Businesses with Lean

Learn to develop your organizational projects with Simplilearn’s Lean Six Sigma Green Belt Certification Training or the Post Graduate Program in Lean Six Sigma. Aligned to the IASSC exam, this online Six Sigma certification integrates lean and the related DMAIC methodologies with case studies to provide you with the skills and know-how to help grow your organization.

With Simplilearn's complete Post Graduate Program in Lean Six Sigma or the Lean Six Sigma Black Belt Certification Training, go beyond project development and take the helm of organizational change. This online Six Sigma certification deepens your understanding of the nuances of lean techniques, DMAIC concepts, and strategic implementation. It builds on your Green Belt foundation.

The Six Sigma Green Belt Certification is a globally recognized quality management certification offered to professionals who qualify the CSSGB exam.

FAQs 

Q1: What is meant by Lean thinking?

Lean thinking describes the process of making business decisions per the lean methodology. This business mindset is about approaching and handling work in a lean way, i.e., value to the customer is given the utmost focus. 

Q2: What are the five principles of Lean thinking?

The five lean principles include value, value stream, flow, pull, and perfection. These five principles rely on the two pillars of lean: continuous improvement and respect for people. 

Q3: What is a good example of lean thinking?

An excellent example of lean thinking is on-demand production. It helps monitor overproduction as well as under-production of goods/services. Consequently, you are always in a position to meet customer requirements. 

Q4: Why do we need Lean thinking?

Lean thinking is required in companies to create and design efficient business flows that produce products/services needed by the customers. It transforms the mindset via which businesses operate, focusing on respect for people and continuous improvement to churn out value.

Q5: What are the 4 Ps of lean?

Implementing lean conforms to the four basic tenets called the four Ps of lean thinking. They are Purpose, Process, People, and Performance.

Q6: What is the first step in Lean Thinking?

You must begin by developing a lean mindset by cultivating a positive attitude, thirst for knowledge, goal of team success, willingness to accept failure, pragmatism, and respect for people.

Q7: What are the three pillars of lean?

The three pillars of lean management include focusing on the client, eliminating waste, and developing flexible processes.