Lean transformation is the process of introducing changes in an organization to maximize the flow of value produced for the customer. As a result of this process, wasteful activities are identified, removed, or optimized. This comes contrary to the popular belief that Lean is all about eliminating waste.
Lean is all about producing more customer value, and the removal of waste is just a consequence. This might sound like a nuance to some, but making a distinction is actually pretty important.
If we think about Lean only from the perspective of reducing waste, then it’s easy to confuse a Lean initiative with cost-cutting or budget reduction. It’s a shame, but many companies actually mean exactly this when they claim to be going Lean. This is plain wrong and far from what the real intentions should be.
In the paragraphs below, you will learn about the most important elements of the Lean transformation model. Stick to the end to see how to build a transformation roadmap and learn the stages that come with it.
The Lean Transformation Model
Before committing to transform your organization into a Lean machine, you need to understand what you are getting yourself, your team, and your whole company into. There are 5 elements that will be in focus during the transformation:
- Situational Approach
- Process Improvement
- Capability Development
- Responsible Leadership
- Basic Thinking, Mindset, Assumptions
It must be obvious to the management and clear to the staff why you are starting the Lean transformation. As the initiator, you need to have solid support at all levels of your organization, or you risk reverting to the “old ways” really quickly. Make it transparent what problems you are trying to solve with Lean and validate your pain with the C suite to ensure they’ve got your back.
As some of Lean's methods and techniques go against conventional western work practices, they may seem illogical to most people in your company. Communicating clearly what is expected to happen during and after the Lean transformation is crucial to avoid mass resistance.
You need to put special attention on training managers and regular team members alike in the practices of Lean. You can’t expect anything to change unless your people adopt a new mentality and transform how they work.
Nonetheless, you are to embrace leadership changes on a company level. By that, we don’t mean to fire half of your management team but to embrace a culture of shared leadership. In Lean, everyone is a leader. Allowing even regular team members to embrace their leadership potential and giving them the liberty to make decisions to some extent without explicitly asking a supervisor for permission is crucial to make the transformation successful.
Last but not least, a Lean transformation will require you to evolve your company’s culture to become aligned with what Lean stands for.
Understanding the Lean transformation model is just the first step on the way toward transforming your organization. As the process takes time, you should prepare a roadmap for the journey ahead.
There are 8 typical stages of a lean transformation:
- Training & Tooling
- Flow across a single service
- Analysis & Optimization
- Flow across multiple connected services
- Establishing governing methods
- Continuously improving processes & services
The Lean transformation roadmap's first step is to evaluate the real underlying problems and identify potential solutions. At this stage, you need to choose wisely whether to start small and spread Lean in time or go with a bang and begin your transformation with large-scale major changes.
In the initiation phase, you need to get the C-suite on board with the transformation and secure funding for the necessary training and tools. You need to win over a person with unquestionable authority ready to stand by the transformation even if things don’t go according to the initial plan.
Training & Tooling
After you’ve got the budget, invest a substantial amount of these funds in training for the management staff. Find a consultant to work with you and advise you on the way to transforming your company. That person will be able to provide practical know-how about the tools you need and coach you in implementing Lean.
Flow across a single service
A service in the context of a business organization is a function that receives a certain input, manipulates it, and produces a particular output. Visualizing the steps required to produce the output is vital for getting the most of Lean. During this stage of your roadmap, you should introduce the concept of flow and map your teams' process to get started with continuous improvement.
Analysis & Optimization
After a few months, you should have enough data to analyze your workflow and see more room for improvement. At this stage of the Lean transformation, you should establish unified key performance indicators for your process and get the whole company on board with them.
Flow across multiple connected services
By the time you reach the 6th stage of your Lean transformation, your company will be ready to expand value stream mapping across the whole company from product management to direct value delivery to your customer.
Establishing governing models
When you’ve got a complete value stream in place, you will need a unified way to manage it. Methods such as Portfolio Kanban can be invaluable at this stage as they will make every process in the company transparent across the hierarchy. To manage your company’s value stream effectively, you need to select a range of unified metrics to track, like the number of tasks in progress, number of completed work items for a predefined time frame, etc.
Continuously improving processes & services
Finally, to complete your Lean transformation, you need to adopt continuous improvement as part of your company culture. Every person needs to take it to heart and constantly look for ways to improve both the process and their competencies.