Lean has become the leading method to pursue productivity improvement in Western companies. However, the rate of success of implementation in industry is overwhelmingly disappointing and not in line with the level of available documentation and support. This chapter describes a back to basics approach to Lean implementation, developed specifically for small- and medium-sized businesses (SMEs). This approach was developed out of many years of research, which is described succinctly. The chapter then delineates the framework of a management system, which uses standard Lean tools embedded in an IT data gathering system. This framework consists of 3 loops that provide the kind of information needed for a sustainable Lean implementation trajectory. Finally, the authors show how the system provides an answer to current gaps in Lean Management.
TopBackground
Since its inception in 1990 through the work of Womack and Jones (Womack et al., 1995), Lean has come to age. The concepts of Lean, fighting waste to reduce process lead time towards creating value for the customer (Womack & Jones, 1995) and the vast toolbox that exists (Bicheno & Holweg, 2004) have been broadly disseminated and massively adopted (Marchwinski, 2008).
Yet the success rate of Lean implementation remains dismal. A census by Industry Week (Pay, 2008) found that 75% of companies do not reach any improvements, and less than 2% achieve the full amount of anticipated results. More recently, only 30 out of 100 executives stated that there companies achieved the intended 5% productivity improvement, and 60% of them did not expect these savings to be sustainable (Stoll, 2011).
In order to try to verify these results, we set out ourselves to monitor 23 industrial companies (SMEs) in Belgium that all started on a Lean journey. These companies all followed a carefully laid out implementation sequence, which will be explained further on. Over a time period of 2 years (Dec. 2009 – Nov. 2011) some 1000 improvement actions that were defined as part of the Lean implementation were registered and their status according to the Plan-Do-Check-Act cycle (PDCA) monitored. From the detailed results, reported in (Van Landeghem et al., 2013), we cite the main elements.
First we noticed (Figure 1) that only 61% of the actions were ever completed, and only 38% verified as to their effectiveness (checked). This already suggest a decay in the effort devoted by these companies.
Figure 1. Progression of improvement actions over the reference period