For building long-term relationships based on mutual trust with customers, the lean project management methodology might be the best way to go about it.
The word “lean” refers to someone who is slim and fit, which provides a vivid analogy that is essential for this methodology. In any process, whether it be manufacturing or product development, a company should strive to eliminate as much, if not all, of the “excess weight” that slows down its progress.
This is much easier said than done, so read this article to gain a better and deeper understanding of how to efficiently shape your business organization and get great results more easily and cost-effectively.
Let’s dive in!
What is Lean Project Management?
Lean project management is based on the continuous improvement of production processes, product quality, and business value by striving to eliminate waste from all procedures.
Organizations can streamline operations, enhance efficiency, and deliver higher customer value by reducing waste.
For example, in lean project management, one of the fundamental principles is “Just-in-Time” production, where materials and resources are delivered precisely when needed, minimizing inventory costs and eliminating unnecessary storage.
This way, available resources are channeled more effectively towards customers, establishing a relationship of trust and satisfaction due to consistent product quality. On the other hand, this positively affects the ownership structure of the company, suppliers, and, ultimately, the entire community.
The history of lean project management methodology takes us back to 1988 when researchers from MIT studied the production process of the Japanese giant Toyota. The researchers closely examined how Toyota operated and managed its projects during their study.
They found that Toyota had adopted a unique approach to reduce waste, enhance efficiency, and optimize resource utilization.
By implementing this methodology, Toyota achieved impressive productivity and quality results while minimizing the need for excessive effort, significant investment, and reliance on a vast number of suppliers
3 Benefits of Lean Project Management
Examples of lean project management in the operations of large systems, such as Toyota, Nike, Intel, and others, clearly demonstrate the benefits that successful implementation of this methodology can bring.
Let’s take a closer look at what you can expect if you decide to apply the lean methodology:
- Reducing lead time. Eliminating waste from the production process implies faster production, resulting in quicker delivery of products or services to customers, ultimately leading to customer satisfaction and loyalty. Additionally, it allows companies to adapt to market changes more quickly, giving them a competitive advantage.
- Cost reduction. Once again, we come back to the essence of this methodology, which is the elimination of waste, and the effects of this can be seen in the reduction of company costs, ultimately leading to a more profitable bottom line. This not only helps companies save money but also improves their ability to compete in today’s business landscape.
- Productivity and quality improvement. Lean methodology allows companies to produce more with less, ultimately leading to greater profits. Additionally, a focus on quality improvement ensures that products or services meet or exceed customer expectations, leading to even greater customer satisfaction and loyalty.
5 Principles of Lean Project Management
When we talk about the lean methodology’s management principles, we refer to five essential principles on which the methodology is based. The essence behind these five principles, which we will outline in the following text, is the improvement of the work process.
Keep in mind that effectively implementing the five principles of lean project management will result in the following:
- Reduced storage space due to lower inventory levels
- Improved product quality
- Shortened production cycle time
- Increased employee efficiency
So, let’s take a closer look.
#1. Identify Value (From Customer’s Viewpoint)
The first principle involves understanding and identifying what customers perceive as valuable. By thoroughly exploring customer needs, expectations, and desires, you can define the true value of your products or services. This knowledge enables you to tailor your offerings to meet customer expectations effectively.
#2. Map the Value Stream
This principle indeed encompasses the entire production process, from the inputs such as raw materials and work tools to the selection of the employees involved in the production flow. As well as assigning roles to them, providing necessary training, monitoring the workflow, and ultimately delivering the final product.
The key aspect of this principle is to create a comprehensive map or visual representation of all the steps and activities involved in the work process.
This mapping exercise enables you to monitor the development of the work process, identify areas for improvement, correct errors, and introduce necessary changes to optimize the flow and achieve the desired results.
#3. Create Flow
The aim of this principle is to eliminate bottlenecks in the work process by ensuring a smooth and continuous workflow. The goal is to have a well-oiled process without any time waste, where all parts of the process function in a way that eliminates gaps and allows for a continuous flow.
For example, in a manufacturing process, a gap may occur when a particular machine or piece of equipment is temporarily unavailable, causing other processes to halt and causing delays in the overall production schedule.
Having backup equipment and implementing preventive maintenance practices can overcome the gap caused by equipment unavailability.
#4. Create a Pull System
This principle is based on producing the exact quantity of products ordered. By this, we mean that production is based on customer demand rather than pushing products blindly into the market. Note that if you create a pull system, you can minimize the risk of overproduction.
Overproduction is not good because it leads to excess inventory, which not only reduces the value of the goods but also requires more storage space and, depending on the type of product, runs the risk of spoilage, which further increases waste, cost, and inefficiency.
#5. Implement Continuous Improvement
The fifth principle symbolizes the never-ending search for perfection through constant progress. The responsibility for achieving perfection lies on the shoulders of all employees, so all of the organization’s employees should share this mindset.
By encouraging a culture of innovation, problem-solving, and learning, you can continually identify opportunities for enhancement, address weaknesses, and eliminate waste. This ongoing commitment to improvement is essential for long-term success.
Lean Project Management Tools
Once you have decided to implement the lean project management methodology, you will need to choose the appropriate framework to achieve your goals. Each of the tools we will present to you has its own advantages, and it is up to you to choose the one that suits your system and employees.
PDCA is a widely used lean project management tool that provides a systematic approach to continuous improvement.
PDCA is an acronym that stands for the following four terms:
- Plan. The first step is to develop a plan, meaning the goal that the company wants to achieve, the way it needs to be done, and the role of each individual in achieving it.
- Do. The next phase is practical and involves the work of everyone directed toward achieving the previously set goal.
- Check. Changes are made during performance monitoring to improve a certain part of the performance, like productivity, quality, or customer happiness. Once the change has been made, data is collected to see how it affects the desired result.
- Act. When the company is confident that the targeted results have been achieved, the implementation phase of the process, which will be applied on a daily basis, follows.
The precursor to the modern Kanban approach is again linked to Japan and Toyota. After years of perfecting this lean tool, we can say that it is one of the most widely used.
Kanban makes it easier for employees to track process flow by using easily accessible boards that display columns with tasks to be done, in which phase they are, and when they are completed.
This makes it easier for employees to stay focused and know exactly what their task is, which ultimately results in increased efficiency and productivity.
Kaizen, the method of continuous improvement, relies on prompt action by employees within a short time frame after implementing this approach.
Its goal is to eliminate everything considered waste in both the manufacturing process and the service delivery process.
The emphasis here is on the competence of employees to identify problems, propose ideas for solutions, and implement them, as well as to take into account the results they have achieved in order to implement the solution.
Lean project management is an essential tool for organizations that want to remain competitive and achieve sustainable growth.
The key to success with lean project management is to engage employees at all levels of the organization and empower them to identify and solve problems, reduce waste, and improve the quality of products and services.
On the other hand, it is clear that this directly affects customer satisfaction, making you a preferred long-term partner.
Do not hesitate if you are considering implementing the Lean methodology, as there are numerous global giants, like Nike or Intel, who now have thousands of satisfied clients, in part thanks to this method.