Lean Manufacturing: The Five Lean Principles And How To Apply Them

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Minimise your waste and maximise your profits with Lean. Let’s discover the five Lean Principles, the eight Lean Wastes, the 5s technique, and the Obeya project management structure…

Key points:

  • Lean is about making your product quickly and efficiently, and critically, it’s used to eliminate waste. 
  • The five Lean Principles help you to identify and eliminate waste, and change processes to continuously improve. They five Lean principles are: Value, Map The Value Stream, Flow, Pull, and Perfection
  • The eight Lean Wastes are typical inefficiencies within a business and include defects, over-production, transport, and movement.

What is lean manufacturing?

Lean is a technique that eliminates waste in your workplace, particularly in production or manufacturing environments. The Lean Principles create a continuous improvement culture, considering every material, machine, product, process, meeting and the mindset and duties of your entire workforce. 

The technique has a rich history but its principles have been refined through trial and error since the invention of the automatic loom within the Toyota Production System (TPS) in 1924. 

TPS, otherwise known as ‘Just-In-Time’ or ‘JIT’, gives your product to customers exactly when they need it, eliminating ‘all waste in pursuit of the most efficient methods.’ 

The founder of Toyota, Kiichiro Toyoda, developed TPS because the ‘intertwining’ of production waste negatively affected company performance. He pursued an environment and processes where machines, people and the workplace are cohesive and work as one, to ‘add value without generating any waste.’

Toyoda’s “Daily Improvements” and “Good Thinking, Good Products” ethos (sometimes we refer to it as ‘Kaizen’, a Japanese business philosophy of continuous improvement) became TPS. 

But it’s over the Pacific Ocean, in America, where we first see the word ‘Lean’. Touted in the 1988 article “Triumph of the Lean Production System“, author John F Krafcik debunked the idea that automotive factories were only successful because they were based in Japan. 

Its five principles were developed a few years later in 1996, by researchers James Womack and Daniel Jones. 

What are the benefits of Lean Manufacturing?

Lean is about making your product efficiently, and critically, eliminating waste. 

In 2022, lean is a proven and standard approach to production, adopted by manufacturers around the world, exploding in popularity beyond automotive production lines.

  • It maximises productivity, regardless of what is being made, built and created which;
  • Enables a greater volume of product production, and that;
  • Directly and positively impacts revenue

A factory practising lean manufacturing will:

  • Have a floor plan enabling a product to flow swiftly along a production line, between skilled workers and machines 
  • Feature machines and materials that enable swiftness, for example, quick drying adhesive
  • Incorporate technology and processes that minimise waste, for example, packaging a greater volume of product per box to reduce shipping costs  
  • Enable swifter communication between staff, for example, swapping percentages for traffic light systems so all staff can see problems at a glance

The five key lean principles

1) Value

What is your product worth to your customer? Your product’s value will give you several definitions of its worth:

  • Its cost: What are your customers paying to own your products?
  • Its influence and impact on their lives: Determined only through observation, this is a non-numerical value metric. Market research, interviews and case studies, for example, will give you data about your product’s quality, stability and whether you are a preferential manufacturer as a result. 

2) Map your value stream

How do you make your product? The second principle encourages you to follow the product from inception to delivery to the customer, creating a map of the product journey. 

You’ll see first-hand which stages of production are wasteful, detract from the quality of the product, and add no value. There are eight lean wastes: 

  • Defects: When a product doesn’t meet your standards or customer expectations
  • Overproduction: When you stockpile or make too much product in advance
  • Transportation: Moving products unnecessarily, impacting time and resources 
  • Non-value added processing: More work and person power applied than necessary to produce the product to the expected standard
  • Motion: Relating to time and effort by people moving unnecessarily
  • Waiting: A sluggish process, referring to the time between steps and operations
  • Inventory: Excess materials and product waste
  • Unused talent: Squandered skills and talent within your team

Once evaluated, you can re-engineer your processes, streamlining product migration at every step, avoiding the eight wastes. 

3) Flow

Waste is removed from your workplace. Now you need to stress test the remaining processes for loss of value. Run the new streamlined process from start to finish, to diagnose problems and apply fixes. The goal is to minimise flow time, without compromising the quality value your customer needs.

Symptom: Sluggish, or stagnant, performance. One typical blip is a congestion point on the production line, either at an individual or department level.

Remedy:Ask the Five Whys until you understand the bottleneck and apply solutions. For example, delegating or redistributing the work, hiring new team members or promoting existing staff, until the strain is released.

Symptom: Silos. You’ll see an information, process and communication mismatch between people and departments. A simple disconnection leads to inefficiencies, errors and re-doing work, creating a longer cycle time as well as waste. 

Remedy: Uniting your departments with a common goal, such as launching a new product, will create a cross-functional way of working, breaking barriers between silos. To achieve this, create an Obeya project management environment.

With the process streamlined, and wrinkle-free, top-quality products leave the production line in an efficient time, and at an optimised price point. 

4) Pull

It’s time to tackle surplus stock and stockpiling. Inventory storage and management is wasteful if the product is made in anticipation of sales, rather than orders.

Leaner operations have minimal inventory overheads because the customer pulls the product from the manufacturer when they need it.

This principle is customer focused, asking the manufacturer to calculate the need for demand. Put simply, there must be a customer need for every product that leaves the production line. 

It’s a balancing act – having the correct volume of materials, minimising work in process and the volume of inventory stock. Pull echoes the principles of Toyota’s ‘Just In Time’ manufacturing, where the stock meets demand precisely. 

5) Perfection

Toyota has incrementally improved its systems by trial and error, striving for continuous improvement. In other words, always working to achieve perfection. 

Encourage your people to analyse and evaluate their contributions. Prompt them to ask: ‘what is going well?’, and ‘what could I do better?’ to identify meaningful improvements to their ways of working that will benefit your organisation. They have a front-row seat to waste and inefficiencies, the power to improve is in their hands.

Lean Manufacturing Champions

Once your senior leaders have bought into lean, they’ll need the support of internal champions to maintain momentum. Your Lean Manufacturing Champions can be employees within the business who are seen as influencers in the organisation.

Lean manufacturing and the 5s

The 5s is a visual management tool that creates an efficient and tidy working environment. Once the 5s are deployed and actively observed, it’s easier to apply the more sophisticated Lean Principles on top.

Developed in the pursuit of efficiency, the 5s were honed in Japan’s automotive industry: Seiri, Seiton, Seisou, Seiketsu, and Shitsuke describe a mindset, and personal set of rules to assure clarity, cleanliness, efficiency and profit. 

In UK manufacturers, we refer to them as:

  • Sort: Remove the things which aren’t needed 
  • Straighten: Organise the remaining items
  • Shine: Keeping your workspace clean, orderly, and well maintained
  • Standardise: Create standards to evaluate the 5s
  • Sustain: Always apply the 5s, and strive for perfection

It creates a culture that respects quality and efficiency, illustrating the benefits of having an organised workplace, versus the costs of being disorganised. It paves the way for Lean Principles. 

How to project manage using Lean Principles

Obeya is a lean project management technique that helps you to reduce waste, access efficiencies within your team, and maximise productivity and revenue. A Japanese term, Obeya means ‘large room’, first used by engineer Takeshi Uchiyamada as a means to have an ‘arena for all his discussions with the discipline leaders,’ during a project where he felt overrun, without authority and autonomy. 

Obeya is a physical space for workers to convene in and is known for its visual approach to project management. On the walls of your Obeya room are representations of processes, for example, simple schedules and diagrams that represent progress to everyone, regardless of your expertise and discipline.

It creates a collaborative and trusting environment. Supporting clear, factual decision-making, Obeya speeds up communication between key people in different departments, but it is powered by a single vision. That’s usually the leader’s goal, for example, to deliver a new product.

Obeya enables the five Lean Principles. Manufacturers can use the Lean Obeya room technique to create a central command centre, sometimes referred to as a brain, that manages the continuous improvement of processes and workflows. 

Would you like to learn more about applying Lean Principles in your workplace? Please contact one of the team to discuss our lean awareness training course.

Picture of Amanda Bathory-Griffiths
Amanda Bathory-Griffiths
Amanda is TSW's Head of Marketing. Her articles are largely about the benefits of professional development investment.
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