6 Mistakes Manufacturers Make When Misunderstanding Lean

Many manufacturing leaders make the decision to bring a Lean implementation to their organizations. Unfortunately, many of them either fail to take the time to become educated on the subject; or are misinformed because of the information being shared in many circles.

When I say educated, I do not mean that business leaders need to become technical experts of the Lean manufacturing concepts. However, they do need to understand what to expect, the role it plays, and how to incorporate it into the business, not as a project but as a business management philosophy.

When leaders fail to do this, they set themselves and the organization up for failure. The effect of that failed deployment could take extensive recovery time. This becomes a missed opportunity of the positive ways Lean can impact a manufacturer’s bottom line.

This poor implementation contributes to the low success rates in attaining the desired results as revealed by a manufacturing industry survey. Read this blog – 10 Reasons Why Lean Manufacturing Transformations fail to learn some of the mistakes manufacturers make.

Please read below 5 common Lean manufacturing implementation pitfalls to watch for before launching your implementation:

1. Seeing Lean as a program – When working with manufacturers I often ask: What is Lean to you? I typically get answers such as efficiency, waste elimination, and so on. My response to those answers is that yes, those are all elements of Lean manufacturing; however, Lean is much more than that. Lean is a business management philosophy. As you dig and learn, you will find Lean manufacturing has business principles for the following areas:
   1. Strategy Deployment
   2. Finance & Accounting
   3. Leadership
   4. Supply Chain
   5. Operations
   6. Sales & Marketing
   7. Human Resources
   8. New Product Development

As you can see the scope of Lean extends well beyond the shop floor and should be implemented that way. Since Lean finds its origins in the automotive industry, specifically in manufacturing, many consider it a program to improve the shop floor and believe it is limited to that area. Most recently, other industries (healthcare, construction, distribution, banking, insurance, and the list goes on) have begun to embrace the principles and have seen tremendous results.

2. Delegating the implementation down – if you were the leader of a manufacturing business, would you delegate the development of your business strategy? How about any other core function of your role? Probably not. Well, when it comes to Lean many leaders because of point no. 1 decide to delegate the implementation to other leaders. If Lean is to be seen as a business management philosophy, its focus should be to drive business level improvement; and this should be led by the senior leaders and cascaded down to the rest of the organization. When senior leaders fail to drive the adoption of Lean, the initiative is assumed to be of a lower priority and thus the team puts in less effort and de-prioritizes implementation.
3. Over emphasis on results – Those of you that have led significant change in a manufacturing business understand that an initiative of this magnitude can reap significant benefits for the business. However, leaders often lose sight of the bigger picture or they succumb to pitfall no. 1,and expect the improvements to yield drastic results indefinitely, which is just not practical. Worse yet, some leaders have an over-emphasis on tangible benefits such as cost savings. As soon as these results are not up to their expectations, these leaders are ready to kill the initiative. This exemplifies a short-term mentality vs a long-term mentality when it comes to the success of the business. I do believe in having a ROI on initiatives, however if the success criteria for Lean focuses on savings it shows a lack of understanding of the philosophy. I would suggest you base your criteria more on operational metrics (Safety, quality, delivery/service, and cost) that show a progressive level of improved performance. These should be leading indicators to customer satisfaction and predictors of growth, profitability, and market share.

If you are thinking of or already implementing Lean reflect on these pitfalls and avoid many of the consequences that these can bring to your manufacturing organization. Next week I’ll share the rest of the pitfalls we have identified.