The purpose of a business is to acquire and keep customers in order to grow profitably. If the customers’ needs are not fully met, especially in a highly competitive market, that company will not perform and fail to be profitable. Fulfilling the customer’s needs is about defining and delivering what is valuable to them i.e. what they are willing to pay for. This may be a product and / or service. Everything else, by default is waste. Providing value for the customer, being effective and efficient, is the core of Lean Thinking. A business run in this way, keeps both customers, shareholders, and employees happy.
Lean principles are a framework to guide an organization while implementing Lean Thinking. Although these principles are commonly associated with manufacturing, they are just as valid for processes in other disciplines. At Four Principles, we thought they were so important, we named the company after them.
Allow demand to pull goods or services - only do what is required when requested by the end customer or the next step in a process. Value is pulled through a process rather than being created in batches or as capacity constraints allow. This minimizes overproduction, stocks and ultimately working capital.
Enable value to flow - the addition of value needs to be uninterrupted through the processes across the value stream. Focusing on the ideal, the addition of value of one single piece at a time enables us to optimally align process steps across the business while eliminating wasteful activities.
Work in a rhythm according to the pace of customer demand - takt is the German term for timing. This pace is how fast you need to manufacture a product or offer a service in order to fill your customer orders. It provides the heartbeat of a Lean system that allows us to balance work content and achieve a continuous flow through the business. It also allows us to adjust the rhythm and respond flexibly to changes in the marketplace.
Stop and fix when something goes wrong - defects are easily identifiable at or very close to the point at which they arise. By addressing the root cause of the defect immediately and neither accepting nor passing on defects, subsequent defects and problems are avoided and overall product or service quality is improved.
To learn more, contact Four Principles to begin implementing Lean Principles today.