Definition of Lean Production

May 12, 2015ToyotaBuzzwords, Critical Thinking, History, Theory, Toyota

What exactly is it?

As the name says, this site is all about lean manufacturing. But, what is lean? How do
we define lean manufacturing? After all, since most of industry talks about lean, we
should have a definition to make sure that were all talking about the same thing.
Unfortunately, a) we do not have a good definition of lean, and b) not everybody
means the same thing when they talk about lean. So, what could lean
manufacturing mean? Lets have a look at the different definitions out there:

The Origin of the Term Lean

Thats how the term started English language publications started to note the Toyota
Production System around 1975. Soon thereafter, the term Lean Production was
coined by John Krafcik in his 1988 article, Triumph of the Lean Production System,
and it has been used in industry ever since. After a slight delay, the term Lean
Manufacturing also appeared.
From 1998 onward, Six Sigma also took on the term Lean Six Sigma, although in my
opinion they did not really add anything valuable to it. Nowadays, Operational
Excellence is pushed as a replacement for the aging term Lean Production,
although I still prefer lean. The chart below gives you an overview on how often the
words are used in literature (Data from Google Ngram viewer)
Usage of different lean terms throughout time. (Note: Start 1986 due to incorrect
dated books.)

Selection of Lean Definition

Below are some definitions of lean found in literature and the web. In pretty much all
instances there would be many more similar definitions out there. However, for the
sake of brevity, I usually cite only one or two of them.

Lean is Whatever Toyota Does!

Lean manufacturing is the term most commonly used to describe the Toyota
Production System (TPS). (emsstrategies.com)

"Lean" is the set of management practices based on the Toyota Production System
(TPS). (Mark Graban Lean Blog)

Well, these definitions are mostly correct. Pretty much everything we do in lean is a
(rarely better, often worse) copy of the Toyota Production System. The Western
world added a few new aspects to lean, but very few of them are actually useful (see,
for example, how the original seven types of waste from Toyota bloomed into up
to 31 types of waste).

However, while the definition is correct, it is of little use. For one thing, what is good
for Toyota is not necessarily good for everybody. Toyota is a mass-producing auto
company. If a small custom-made machine tool maker would use methods identical
to Toyota, it would be anything but lean, and the methods would probably kill the
company.
Secondly, while it is okay to say that lean is whatever Toyota does, it does not help at
all in figuring out what exactly Toyota does! But luckily, here are a few more lean
definitions for you:

Lean is 5S, SMED, Kanban, JIT, !

Hey, I have an idea!

This is (luckily) not a definition I have found written down. Unfortunately, when
talking with people in industry and academia, all too often it feels like that is some
peoples definition. Ill just do kanban and JIT, and then I will be lean. Or better, Ill
have somebody else do it for me.

Lean is not just a set of different tools. Just as a car is not just a pile of parts.
Michelangelo was not just someone with a chisel. It is the art of using these tools
that makes production lean.

While the reduction of lean production on its tools is luckily not an official definition,
the reduction on one tool is unfortunately all too common: waste elimination!
Lean is Elimination of Waste!

Lean manufacturing or lean production, often simply "lean," is a systemic method for
the elimination of waste ("Muda") within a manufacturing process. (English
Wikipedia, but also similar on French, Portuguese, and Dutch Wikipedia)

Lean manufacturing involves never-ending efforts to eliminate or reduce [waste] in

design, manufacturing, distribution, and customer service processes.
(BusinessDictionary.com)

Defining lean as reducing waste is actually surprisingly common. Of the definitions I

have come across, most are using waste elimination to define lean. Maybe its
because of the word lean itself, which, among other things, means containing
little or no fat.

However, reducing lean production solely to elimination of waste is in my view also

far too short-sighted. Lean production is so much more than simple elimination of
waste.
Lean is Fast, Efficient, and High Quality!

I didnt know my Tin Lizzy was lean

Lean Production refers to the both economical and time-efficient use of factors of
production resources, personnel, materials, planning, and organization in the context
of all company activities. (Gabler Wirtschaftslexikon, translated by me)

Defining lean as being fast, efficient, and high quality is just the other side of
elimination of waste. Besides, how do you, using this definition, distinguish lean from
other types of production systems? Pretty much every manufacturing entity since
the dawn of time aimed to be efficient.

For example, Henry Fords assembly line also was geared toward efficient use of
resources and time through relentless elimination of waste. Therefore, defining lean
through efficiency and waste elimination would mean that Henry Ford invented lean
production. While Ford certainly contributed to the ideas at Toyota, he did not have
a lean production system!
Lean is Flow!

Let it flow!

Lean manufacturing is a management model focused on creating flow to deliver

maximum value for customers, using the minimum resources necessary. (Spanish
Wikipedia, translated by me)

Another concept often associated with lean is the idea of optimizing the flow of
material. This is also found at least partially in many definitions of lean. While it is an
important aspect of lean, it is in my view also far short of the true ambitions and
values of lean production. Similar to waste elimination or efficiency, one aspect of
lean is not enough to define lean.

Lean Is a Culture!

What is a culture?
In discussion with other practitioners, yet another set of definitions tries to define
lean as a culture. It certainly is a culture, but it becomes rapidly fuzzy when one tries
to define what kind of culture it is. Defining the culture of lean inevitably falls back to
any of the above definitions of eliminating waste, increasing value, or adding flow.

Lean is Adding Customer Value

The core idea is to maximize customer value while minimizing waste. (LEI Institute)

Lean is the permanent struggle to flow value to one customer. (Mike Rother)

Yet another set of definitions goes toward adding customer value. While I like the
customer as part of the definition, he is certainly not the only stakeholder. The latter
definition by Mike Rother also includes flow, and importantly, the element of
continuous improvement. However, again we find the focus on eliminating waste in
order to create value.

Even including continuous improvement, flow, and elimination of waste (or in

Japanese kaizen, mura, and muda), we still fall far short of what lean really is. For
example, in none of the definitions above have I found the elimination of
unreasonableness, which is the third of the three evils of manufacturing. Also the
entire concept of respect for people is missing completely.

How Toyota Defines TPS

Well, after all these sometimes-better, sometimes-worse attempts by Westerners to

define lean, we can only agree that it came originally from Toyota, although this does
not help us. Well, lets have a look at how Toyota defines its own Toyota Production
System. I found the following three definitions by Toyota themselves.

A production system which is steeped in the philosophy of "the complete elimination

of all waste" imbuing all aspects of production in pursuit of the most efficient
methods. (Toyota Global)

The first definition is the basic eliminate waste definition that we have seen many
times above, nothing new here.

The practical expression of Toyota's people and customer-oriented philosophy is

known as the Toyota Production System (TPS). (Toyota Australia)

The second definition not only has customers included, but also its own Toyota
people. I like that. However, as for the definition of the Toyota Production System,
even Toyota says that it is whatever Toyota does.
The Toyota Production System is built on two main principles: "Just-In-Time"
production and "Jidoka." Underlying this management philosophy and the entire
Toyota production process is the concept that "Good Thinking Means Good Product."
(Toyota Georgetown)

The third definition uses the two main pillars of the Toyota Production System: JIT
and Jidoka (Autonomation). However, in my view, these are only two aspects of the
whole Toyota Production System. It seems even Toyota does not agree on its
definition of the Toyota Production System.

Besides, from my point of view, they are not even the most important ones. I believe
they are the pillars of Toyota because these two originate from the Toyoda clan, and
not one of its employees like Taiichi Ohno. My gut feeling is that Toyota likes to
praise its own bloodline and is working on legend building.

So Which D efinition is Right?

Good question. Just as an iterative brain teaser, here is the definition of definition:

Definition (nounde-f-ni-shn\): a statement that describes what something is.

To define something, you would need to make the definition clear enough to
distinguish it from other similar things. However, most of the definitions above
clearly fail at distinguishing it from almost all other production systems. Most of
them would be, for example, perfectly valid for Henry Ford and his assembly line, or
pretty much any production system developed after the Industrial Revolution.

Additionally, none of the above definitions really include the respect for people,
which I consider one of the important elements of lean. Other important concepts
like reducing unevenness (mura) and overburden (muri) are also missing. Therefore,
in my view, none of the above definitions really capture the essence of the Toyota
production system and lean production.

The Blind Men and the Elephant

Overall, it reminds me of the fable of the blind men and the elephant. A group of
blind men touch an elephant to learn what it is like. Each one feels a different part,
and in the end they disagree completely on what an elephant really is.

Blind monks examining an elephant. Wood print by Itcho Hanabusa 1888

Conclusion: The Definition of Lean Production

Okay, now that I have criticized all the other definitions above, it is time for my own
definition except

I dont have one!

Gosh, thats embarrassing! Despite my 20+ years of experience in lean, I cannot

come up with a definition that I feel comfortable with. Whenever I try I just come up
with something similar to the many definitions above. And whenever I add respect
for others, it sounds clich.

After all this lengthy discussion, we only find out that we have no good definition!
Most definitions are too detailed about some methods that except for their
modern Japanese names have been known a long time. The rest is too fuzzy and
vague and reads like a typical company mission statement (which in general says do
good using fancy words while trying not to offend anyone). However, my overall
conclusion on this mess of definitions is pretty clear:

We havent understood yet what lean production really is!

Probably all the difficulties we have in implementing lean production and all the
failed projects with only a few successes in between probably stem from this lack of
understanding. Even people who instinctively do things right have a hard time
explaining it to other people. It is somewhat comforting that while Toyota does it
right, even they cannot define it well.

In any case, I hope I have not confused you too much with this mess of
definitions. Now go out and organize your industry, even though you may not be

able to define what you are doing .

P.S.: The idea for this post was initiated by an e-mailed question by Troels Andersen
(Differience Consulting, Copenhagen, Name mentioned with permission). By the way,
if you have a question related to lean, feel free to ask me!

What do you mean by waste in Lean Production?

The Seven Wastes | 7 Mudas 7 Wastes of Lean Manufacturing

The seven wastes of Lean Manufacturing are what we are aiming to remove from our
processes by removing the causes of Mura and Muri as well as tackling Muda
directly. But what exactly are the seven wastes of Lean Manufacturing (or 7 Mudas)?
The Seven Wastes of Lean Manufacturing are;

Transport
 Inventory
Motion
Waiting
Over-Processing
Overproduction
Defects

For a more in depth discussion of each waste including causes, examples, and
potential solutions click the links within each description.

Remove Wastes to Reduce Costs

How to Remember the 7 Wastes

There are a couple of Simple Mnemonics that you can use to help you remember the
7 Wastes. The first is to ask your self Who is TIM WOOD?
TIMWOOD

1. Transport
2. Inventory
3. Motion
4. Waiting
5. Over Processing
6. Over Production
7. Defects

TimWood comes from Standard-Cooper in the UK where I first started my career as a

young Quality Engineer in the Automotive Industry. It is now probably the most
recognized way of remembering the seven wastes.
An alternative is

WORMPIT;

1. Waiting
2. Over Production
3. Rejects
4. Motion
5. Processing
6. Inventory
7. Transport

Using either TIMWOOD or WORMPIT will help you to remember your seven wastes,
very useful if you are training others and have to list them out on a board.

What Exactly is Waste?

The simplest way to describe waste is as Something that adds no Value. Our
customers would not be happy to pay for any action that we take that does not add
value to what they actually want and nor should we be.
Would you be happy if you received a bill in a restaurant that included a meal that
was prepared in error? No; you would argue and demand that it was removed from
your bill; yet if you buy a product in a store the price that you pay will contain costs
that you would not want to pay. Would you want to pay for the machine operators
wages whilst they sat idle waiting for a delivery, or for the rework processes that had
to be undertaken because the machine was incorrectly set, or even for storing your
product for three months before it was delivered to the store? These wastes are
included within the cost of your products, either inflating the price you pay or
reducing the profit of the company.
Why Remove Waste?
Your companies Profit is your selling price less your costs, no matter how you think
about the selling price it is very much dictated by the market not by yourself. If you
charge too much then your customers will go elsewhere, even if you charge too little
you may lose customers as they will perceive there may be something wrong with
what you are offering. Therefore the only way you have to improve your profits are
to reduce your costs; this means removing all elements of waste from your
processes.
In addition to improving your profits you will find that waste has a major impact on
your customers satisfaction with your products and services. Your customers want
on time delivery, perfect quality and at the right price. Something that you cannot
achieve if you allow the 7 wastes to persist within your processes.

The Waste of Transport

 Transportation is a waste and costs you money.

Transport is the movement of materials from one location to another, this is a waste
as it adds zero value to the product. Why would your customer (or you for that
matter) want to pay for an operation that adds no value?
Transport adds no value to the product, you as a business are paying people to move
material from one location to another, a process that only costs you money and
makes nothing for you. The waste of Transport can be a very high cost to your
business, you need people to operate it and equipment such as trucks or fork trucks
to undertake this expensive movement of materials.

The Waste of Inventory

Inventory Hides Problems

Inventory costs you money, every piece of product tied up in raw material, work in
progress or finished goods has a cost and until it is actually sold that cost is yours. In
addition to the pure cost of your inventory it adds many other costs; inventory feeds
many other wastes.
Inventory has to be stored, it needs space, it needs packaging and it has to be
transported around. It has the chance of being damaged during transport and
becoming obsolete. The waste of Inventory hides many of the other wastes in your
systems.

The Waste of Motion

Excessive motion of either people or a machine is a waste.

Unnecessary motions are those movements of man or machine which are not as
small or as easy to achieve as possible, by this I mean bending down to retrieve
heavy objects at floor level when they could be fed at waist level to reduce stress and
time to retrieve. Excessive travel between work stations, excessive machine
movements from start point to work start point are all examples of the waste of
Motion.
All of these wasteful motions cost you time (money) and cause stress on your
employees and machines, after all even robots wear out.

The Waste of Waiting

 Eliminate the waste of waiting to make your processes smoother

How often do you spend time waiting for an answer from another department in
your organization, or waiting for a delivery from a supplier or an engineer to come
and fix a machine? We tend to spend an enormous amount of time waiting for things
in our working lives (and personal lives too), this is an obvious waste.
The Waste of Waiting disrupts flow, one of the main principles of Lean
Manufacturing, as such it is one of the more serious of the seven wastes or 7 mudas
of lean manufacturing.

The waste of Overproduction

Over producing what the customer does not want now is a waste
The most serious of all of the seven wastes; the waste of overproduction is making
too much or too early. This is usually because of working with oversize batches, long
lead times, poor supplier relations and a host of other reasons. Overproduction leads
to high levels of inventory which mask many of the problems within your
organization.
The aim should be to make only what is required when it is required by the
customer, the philosophy of Just in Time (JIT), however many companies work on the
principle of Just in Case!

The Waste of Over-processing

Doing More than the customer wants costs you money

The waste of Overprocessing is where we use inappropriate techniques, oversize
equipment, working to tolerances that are too tight, perform processes that are not
required by the customer and so forth. All of these things cost us time and money.
One of the biggest examples of over-processing in most companies is that of the
mega machine that can do an operation faster than any other, but every process
flow has to be routed through it causing scheduling complications, delays and so
forth. In lean; small is beautiful, use small appropriate machines where they are
needed in the flow, not break the flow to route through a highly expensive
monstrosity that the accountants insist is kept busy!

The Waste of Defects

Defects hide many other problems and wastes

The most obvious of the seven wastes, although not always the easiest to detect
before they reach your customers. Quality errors that cause defects invariably cost
you far more than you expect. Every defective item requires rework or replacement,
it wastes resources and materials, it creates paperwork, it can lead to lost customers.
The Waste of Defects should be prevented where possible, better to prevent than to
try to detect them, implementation of pokayoke systems and autonomation can help
to prevent defects from occurring.
Additional wastes
Waste of Talent;
failing to make use of the people within your organization. This is an issue that many
of our companies in the West fail to address. We still tend to operate within a
command and control environment and take little real notice of what our employees
really think and what they can contribute. Your employees are your greatest asset by
far and can help you to drive out many of the other wastes.

Waste of resources;
failure to make efficient use of electricity, gas, water. Not only does this waste cost
you money it is also a burden on our environment and society as a whole.
Wasted materials; too often off-cuts and other byproducts are just sent to landfill
rather than being utilized elsewhere.

Eliminating the Seven Wastes

Eliminating the seven wastes is something that can be done through the
implementation of Lean and the various lean tools, however the focus of your
implementation should not be to identify and remove waste. Instead you should use
the principles of lean manufacturing to identify value according to the customer and
make those value adding processes flow through your organization at the pull of the
customer. This approach helps you to make your value adding processes more
efficient and causes the waste to literally dissolve.
Approaching lean from a perspective of removing the 7 wastes rather than making
value flow however usually ends up with us making non-value adding processes
more efficient and we get better and better at doing things that the customer does
not want. To eliminate the 7 wastes of lean we have to focus on the lean principles
and value as perceived by our customers.
Supermarket Pull System

A couple of years ago, I was working with a group to create a complex supermarket
pull system. The supermarket was centered around a component that was
manufactured inside the assembly facility and feed several assembly lines. A timed
delivery system was going to be used to deliver components to the each assembly
line every two hours. The deliveries were based on the orders the lines placed
during the previous two hours. Only four hours worth of components would be
stored at the assembly line and the rest would be stored in the centralized
supermarket.

Below is a quick presentation I gave to the leadership to help them understand how
the system would work. Slides 5 -15 show the specifics for this supermarket delivery
system.

This is a specific example of how to use this supermarket system. However, the
concept is the same no matter what supermarket you use. There should be:

Centralized storage location for the components

A small amount of inventory at the point of use
A signal to replenish the point of use inventory
A signal to replenish the supermarket inventory
Replenishment triggers should be based on lead time to receive inventory from
supplier

A well designed supermarket system can be a very powerful tool to help reduce
inventory and simplify operation

What Are Supermarkets?

Lets look at what defines a supermarket in manufacturing. But before that, we

would briefly need to look at pull systems.

What kind of finished goods inventory can I have in a pull system?

In a pull system, you can only produce if a part leaves the system!
The difference between push and pull is that a pull system limits the amount of
inventory in the system (see my post on the (True) Difference between Push and
Pull). In a pull system, completed parts are also counted toward the inventory limit.
Hence, regardless of how we store the inventory, there cannot be more parts than
what the cap on WIP allows.

Only if a part leaves the system is a signal given to start production of another part.
In a kanban system, this signal is the kanban and tells the first process to re-produce
exactl

y this part and quantity. In a CONWIP system, the signal is a CONWIP card and tells
the first process to produce whatever order is most urgent.

Regardless of the type of inventory, if the limit on WIP is maintained, it is a pull

system. It is not necessary to have a supermarket in order to have a pull
system. Even if it is an absolutely unorganized and chaotic inventory, it is a pull
system if the cap on WIP is maintained. Only when a part leaves the system
(hopefully sold to a customer, but could also be scrapped or broken) is permission to
produce another part given.

What is the purpose of Andon in Lean Production Management?

What is Andon in the Toyota Production System
What is Andon in the Toyota Production System is a common question to those not
familiar with Lean Manufacturing.

In English, Andon means Sign or Signal. It is a a visual aid which alerts and
highlights where action is required. Think, for example, a flashing light in a
manufacturing plant that indicates the line has been stopped by one of the operators
due to some irregularity.

Andon is a principle and is also a typical tool to apply the Jidoka principle in Lean
Manufacturing Jidoka is also referred to as autonomation, which means the
highlighting of a problem, as it occurs, in order to immediately introduce
countermeasures to prevent re-occurrence.

At the Toyota plant where I was, the Andon principle was applied differently than
how you might see it in manufacturing. In supply parts distribution, there is no
assembly line, as it were. But the principle was applied nonetheless, just within the
context of supply chain and warehousing.

What is 'Standardization'

Standardization is a framework of agreements to which all relevant parties in an

industry or organization must adhere to ensure that all processes associated with the
creation of a good or performance of a service are performed within set guidelines.
This ensures that the end product has consistent quality and that any conclusions
made are comparable with all other equivalent items in the same class.

BREAKING DOWN 'Standardization'

Standardization is achieved by setting generally accepted guidelines in regards to
how a product or service is created or supported, as well as to how a business is
operated or how certain required processes are governed. The goal of
standardization is to enforce a level of consistency or uniformity to certain practices
or operations within the selected environment.
Generally Accepted Accounting Principles

An example of standardization would be the generally accepted accounting

principles (GAAP) to which all companies listed on U.S. stock exchanges much
adhere. GAAP is a standardized set of guidelines created by the Financial Accounting
Standards Board (FASB) to ensure that all financial statements undergo the same
processes so that the disclosed information is relevant, reliable, comparable and
consistent.

WHAT IS QUALITY FUNCTION DEPLOYMENT (QFD)?

In the world of business and industry, every organization has customers. Some have
only internal customers, some just external customers, and some have both. When
you are working to determine what you need to accomplish to satisfy or even
delight your customers, then the tool of choice is quality function deployment or
QFD.
Background

Quality professionals refer to QFD by many names, including matrix product

planning, decision matrices, and customer-driven engineering. Whatever you call it,
QFD is a focused methodology for carefully listening to the voice of the customer and
then effectively responding to those needs and expectations.

First developed in Japan in the late 1960s as a form of cause-and-effect analysis, QFD
was brought to the United States in the early 1980s. It gained its early popularity as a
result of numerous successes in the automotive industry.

Methodology

In QFD, quality is a measure of customer satisfaction with a product or a

service. QFD is a structured method that uses the seven management and planning
tools to identify and prioritize customers expectations quickly and effectively.
Beginning with the initial matrix, commonly termed the house of quality, depicted in
Figure 1, the QFD methodology focuses on the most important product or service
attributes or qualities. These are composed of customer wows,
wants, and musts. (See the Kano model of customer perception versus customer
reality.)

Once you have prioritized the attributes and qualities, QFD deploys them to the
appropriate organizational function for action, as shown in Figure 2. Thus, QFD is the
deployment of customer-driven qualities to the responsible functions of an
organization.

Many QFD practitioners claim that using QFD has enabled them to reduce their
product and service development cycle times by as much as 75 percent with equally
impressive improvements in measured customer satisfaction.

Figure 1 House of quality template and benefits

Click to enlarge

Figure 2 Waterfall relationship of QFD matrices

 Click to enlarge

What is Poka Yoke

What is Poka Yoke is a common question. As is true with many Japanese terms, they
carry a level of mystery and intrigue that is not really merited. You see, in North
America, Poka-Yoke is more commonly known as mistake-proof or error-proof.

But even that doesnt really carry the full meaning of the Japanese term. Theres a
little bit more.

Idiot-proof would be a more accurate term that is in the spirit of what the Japanese
Poka-Yoke means, but not in a mean way. What I mean is that no matter who the
person is, what their physical or cognitive ability, can they perform the activity and
process and there are enough robust prevention measures such that the person
doesnt make a mistake?

Thats what Poka-Yoke really means.

What is Lean?
If youre here from a Google search, interested in what this whole Lean
Manufacturing Training thing is about, Ill try to do my best to explain what Lean
means. Keep in mind, Im just like you Im learning about Lean everyday so Im no
expert by any means. But Ill do my best to help you as you begin your Lean journey.
Following the Toyota House model, here are the key principles and terms in Lean:

So, What is Lean? Answering that question might be best done from reading
from Lean Leaders themselves, but let me give it a shot.

The term Lean was coined by John Krafcik of MIT, while he was part of the
International Motor Vehicle Program. During a study of Japanese companies, he
observed that Toyota did everything with half of everything: half the people, half
the space, half the inventory, half the resources, etc., yet with very high quality. Not
knowing what to call the method or approach that Toyota followed in their
Operations, Krafcik used the word Lean.

Well, the term Lean stuck.

It wasnt until later that Krafcik, Womack, and others who were part of the
International Motor Vehicle Program learned that what they observed was actually
the Toyota Production System. They aimed to learn more about it.

Womack and team then culminated their findings in the watershed book The
Machine that Changed the World. It was after the publishing of that book that Lean
really gained some traction outside of Japan.

The Toyota House

Lean is based on principles that will help an organization with the complete
elimination of all waste. That phrase is important, but there are several concepts at
play that we wont go into detail here. But, there are other articles on this website
where you can deeper understanding.

Lean is based on several principles. Ill now attempt to paint a picture of each of its
parts and then bring it together into a more strategic whole.

Value
Value is always from the perspective of the customer. The opposite of value is
formally called Waste. In Lean, there are 7 common waste that Lean aims to prevent
and actively eliminate. The idea is that if we eliminate waste, then what is left over
for the customer is value.

Principles, Methods, and Tools

In order to eliminate waste and only deliver value to the customer, Lean and the
Toyota Production System has various approaches, methods, tools to achieve that
aim. These tools are all based on principles.

Each of the items in the Toyota House above deserve a topic of their own, but heres
the important thing to remember: one could get easily lost in all the tools, methods,
and elements in the Toyota House. But the important thing to remember is that they
are all aimed at eliminating waste and in helping the firm deliver value to the
customer at the lowest possible cost. Many people get lost in their goal to learn a
specific tool or approach. That is like focusing tree and not seeing the forest.

Some common terms youll hear as you learn more about Lean are the following.
Over time, well dedicate an article to each of the terms above, to the right and left
of the Toyota House:

Respect for the Human

A critical element that is not discussed much is the notion of Respect for the Human
or, is more commonly phrased outside of Japan, is Respect for People. At bottom,
Lean recognizes the intrinsic value inherent in each person; their unique talents,
gifts, and abilities. From the firms perspective, this means that recognizing the value
in each individual, the firms goal then is to develop that through challenging
assignments that align with the persons interest, goals and needs of the firm, and
the demands of the customer. The core of Respect for People is really human
development.

What Lean is Not

One approach to defining Lean may be to show you what Lean is not. Heres my
attempt:

Lean is not a set of tools only

Lean is not a silver bullet or an easy transformation
Lean is not part of Six Sigma
Lean is not just a process improvement methodology
Lean is not meant to use to drive layoffs
Lean is not a bunch of projects
Lean is not just about speed or efficiency Lean is also about quality
Lean is not just for front line staff
Remember, this is just the beginning. On this site, youll find hundreds of resources
to help you gain a deeper and more fuller understanding of Lean. On this site, you
can also gain a deeper understanding of specific topics in Lean.

Thanks for visiting and were honored you came here to begin your Lean journey.

What is Kanban?
This video and transcript is an introduction to Kanban and how to apply it regardless
of environment. So, to answer the question, What is Kanban? Well, let me show you.

Also, while Kanban was first established and used in Lean Manufacturing, it now has
many applications outside of manufacturing. This includes Kanban for creative and
knowledge work or Kanban for Software engineering.

Welcome to this video introduction to kanban in a manufacturing environment.

Specifically, by the end of this module, youll know what a kanban and kanban
system are as well as the different functions kanban can serve. Finally, by the end of
this module, youll understand the many different types of kanban used today. Lets
get things started by answering a question. What is a kanban? Kanban is a Japanese
word that literally means signboard or sign. In the context of production control,
kanban refers to the visual signals that authorize the production or movement of
items. Kanban are sometimes referred to as the nervous system of a lean production
system. Just like our human brain sends instructions to our various body parts, a
kanban system gives production control instructions to each and every work area. It
does this by connecting information flow with material flow by attaching kanban
cards to the actual goods.

The kanban system was developed by Taiichi Ohno of the Toyota Motor Corporation
as a way to make Toyotas vision of just in time manufacturing a reality on the
production floor. Ohnos original aim was to stop overproduction in his machine
shop, which was creating large inventories and costing a lot of money. Mr. Ohno was
inspired to create the kanban system by the product replenishment methods he
observed in American supermarkets. What caught his attention was the way shelves
were restocked with goods only after products were consumed, in other words,
pulled by the customers. In the broadest context, kanban is a tool of a just in time
system. At the most basic level, a kanban is a signal that authorizes the production or
movement of items. We often use a chain laying on the ground to visually
demonstrate the difference between a kanban pull based system and a traditional
push system that doesnt use kanban. When we attempt to move the chain by
pushing it, we end up with this type of situation. Just as the chain is uneven and
loose, push production systems often create uneven inventory levels resulting in
having too much of the wrong inventory and not enough of the correct inventory.

But, when we pull production through the system, meaning we only produce product
when its required, the chain is tight resulting in all processes having the right
inventory when they need it. With this said, kanban systems are far from perfect.
You see, the kanban system can be full of ways such as excessive handling, inventory,
and processing. In fact, the ideal just in time production system would use no kanban
at all so long as it produces what the customer wants, when they want it and the
quantity they want. In other words, our goal shouldnt be to implement a kanban
system. Instead, our goal should be true one-piece flow. Lets now move our
attention to the different functions of a kanban. First of all, a kanban sets limits
within a production system. You might think of kanban as a type of currency thats
exchanged for an item, much like money is used to buy parts or materials. If there is
no kanban, no items get moved or produced. When a kanban system functions
correctly, nothing is ever made or moved without a kanban signal of some kind. This
enables companies to limit the extremely deadly waste of overproduction since
things are not produced until theyre needed.

In addition to setting limits, kanban also physically links material and information
flow through a card, or as we often see today, through a bar code scan. Finally,
kanban makes abnormalities visible since no material should be without a kanban
and no kanban on the shop floor should be found anywhere but attached to the
material, in the heijunka board, or in the kanban post box, which well learn about
later in the course. To wrap up this first overview module, lets learn about some of
the most common types of kanban. The first type of kanban is the classic two-card
system where production and withdrawal kanban cards are used. In this example, we
see a shaded withdrawal kanban going from shipping to the supermarket. This is a
signal from shipping to the supermarket that it needs product to meet a customer
request. Once the shipping clerk removes product from the supermarket, a
production kanban will be sent to the assembly department signaling theres an item
missing in the supermarket that needs to be replenished. Well get into this in more
detail later in the course, but a kanban card normally contains information such as
the party name and number, the supplier process name, the quantity per container,
the delivery address, the storage address, and the number of cards in the system.

A kanban system using cards differs most significantly from the two-bin system,
which well discuss shortly, and that the card is pulled as soon as the first part is
taken. The next type of kanban system is referred to as a one-card system. While
were referring to it as one card, there may not be a card used at all. Instead, we
might use empty containers, or carts, or colored golf balls, or ping-pong balls, a light,
or any kind of signal that conveys information. One of the most practical examples of
a one-card kanban system is the mailbox flag. When the flag is up, a signal is sent to
the postal worker that there is something inside the mailbox we wish to mail.
Another system that doesnt rely on traditional kanban cards is the two-bin system.
In the two bin system, standardized bins or containers perform the role of the
kanban card. An empty bin signals that more parts are required. The collection of
empty bins should follow time based standard work whenever possible so that one
person can supply the materials reliably for a department or section.

Heres an example of how a two bin system works. It uses two bins with an equal
amount of goods inside and the same information on the outside about the
contained goods such as the name, location, and quantity within each bin. Parts are
then consumed from the first bin as shown here. When the first bin is empty, theres
a signal to bring or replenish two more bins. The second bin then slides forward into
position while two more bins are being prepared. Finally, a material handler
replenishes two bins within the agreed lead time, which will obviously be before all
of the parts are consumed from the second bin. While there are other kanban
systems, these are some of the most common. Throughout the rest of this course,
well go on a much deeper journey, including how to calculate kanban quantities.
Well also discuss how to implement and manage a kanban system. In our next
module, were going to take a closer look at the two-card kanban system. Well speak
to you soon.
What is Push vs Pull Strategy?
Answering the question What is Push vs Pull Strategy? isnt just for manufacturing
anymore; but, for service too. In fact, the question also is germane even in areas
such as Marketing, where theres an ongoing debate between inbound vs outbound
or push vs pull. In this article, I explain the general strategy and the influence of the
Toyota Production System on Push vs Pull. Ill also introduce the notion of a pull
signal, or Kanban. And, you can also visit my page demonstrating the Paper Airplane
Game, which shows the difference between Push versus Pull.

Maximizing profits in todays business world can prove to be a tedious voyage,

especially when the logistics arent fully up to par. When considering the demand for
certain products in the market, it is important to understand that projected demand
often does not correspond with the actual or consumed demand. Push vs pull, two
models of manufacturing which should be separately considered with care in order
to ensure the usage of the right manufacturing model for ones business plan.

In a push system, companies manufacture their products based on projected or

predicted demand which can often fail to correspond with the actual or consumed
demand, this inaccuracy can cause a huge dent in the companys budget. An excess
in inventory, and the associated required storage space would be the main causes for
this. However there are some advantages to a push method. A business which
implements a push method will only in rare cases have to worry about a lack of
inventory and the customer dissatisfaction that comes with it. Additionally under a
push system, businesses and their retailers have the advantage of predictability in
their supply chain. This sense of predictability allows the retailers to plan ahead of
time as of how to store the product and organize the merchandise accordingly.

A pull method like implemented by Toyota eliminates the disadvantages of the push
model. An excess in inventory is not possible since the manufacturing process is only
put into work when pull signals are given. These signals are given when actual
demand occurs, a customer purchasing a car for example sets the manufacturing
chain back into motion so that stock can be replenished accordingly. A pull strategy,
like implemented by Toyota, also allows for a single piece flow or a one piece flow
system. A one piece flow system eliminates the bulk production, the need for batch
sizes, and lot production since only one product at a time is being worked on. This of
course is an unrealistic model for manufacturers that produce low cost products such
as foods or toys and so forth, however for car manufacturers such as Toyota this can
prove to be a quite lucrative and time saving procedure. The single piece flow system
additionally cuts unnecessary expenditures such as the need for space caused by
excess inventory due to overproduction. This lean manufacturing model also allows a
company to reduce the costs of labor associated with space acquirement, and stock
handling significantly. Disadvantages to the pull strategy do however exist. When a
business operates solely under a pull model it can in some instances fall subject to
over demand. An excess in actual customer demand will cause a shortage of supply,
which in turn will render the company unable to meet customer demand.
Dissatisfaction of the customer is the ultimate result. This can hurt the companys
reputation regarding its reliability.

Even though the implementation of only either one of the systems can prove to be
advantageous for some business models, most businesses will have to operate under
a hybrid of the two. A company that aims to implement only the push method for
example which has stockpiled a certain amount of the product at a distribution
center, still has to wait for a pull signal in the retailing location in order to move
product to the customer and ultimately manufacture more product as a result. A
company which prefers the pull method will still have to plan ahead and predict
customer demand in order to acquire the right raw materials to ensure an efficient
manufacturing process. Companies and their manufacturers which have decided on
implementing the pull method are of course not immune to the changing fluxes of
the market and therefore have to purchase certain materials ahead of time which
may at a later time go up in price. This too requires a certain amount of prediction
regarding customer demand. So even though one can model their business more
after either a pull or a push method, it is important to understand that a pure system
of either is difficult and oftentimes inefficient to operate under.

What is SMED and Quick Changeover

If youre here interested in learning what SMED, Single Minute Exchange of Dies, and
Quick Changeover is guess what, theyre all roughly the same. So, please watch the
video below and feel free to read the video and audio transcript of the What is SMED
video.

What is SMED and Quick Changeover Video Transcript

Id like to welcome you to the Quick Changeover Course. Now, in this first module,
were going to introduce Quick Changeover as well as a powerful Lean concept,
known as SMED, or Single Minute Exchange of Dies. And specifically, by the end of
this module, youll know what both Quick Changeover and SMED are as well as why
Quick Changeover is so important. And well wrap this module up by introducing the
eight steps to Quick Changeover.

And lastly, similar to our dealing with the Seven Deadly Waste Course, well be
visiting with the Lean thinkers of Ram Technologies throughout this course as we
witness an actual Quick Changeover event take place. But first things first.

Lets start off by defining exactly what we mean when we refer to a Changeover.
Well, formally defined, in manufacturing terms, a Changeover is simply the amount
of time taken to change a piece of equipment from producing the last good piece of
a production lot to the first good piece of the next production lot. And if you work in
a hospital or office area, or any other non-manufacturing environment, simply
replace the words, last good piece with last good unit of one type of work.

Now, one of the best ways to learn about Quick Changeover is to watch a pit crew
operate at a Formula One or NASCAR race. It goes without say that the ability to get
the car back onto the track as quickly as possible can mean the difference between
winning and losing. And so it is with the producers of any product or service. We too
need to be able to get our equipment or value-added processes up and running as
quickly as possible.

Now, to make sure we have a good grasp of this definition, lets look at a simple
example. First, lets assume were running product A. Lets also assume we come to
the end and weve successfully produced a product A and the machine stops running.
Well, since the operator knows that he must now get prepared to run product B,
they begin the Changeover Process which might include gathering the needed parts,
tools, drawings, paperwork, and work instructions. While all of this results in
machine downtime, which is pure muda or waste, since no value is being created for
the end customer.

Finally, after some time, the operator is able to get the machine ramped up and is
busy fine-tuning and tweaking things as they produce the first good part, which we
are calling product B here. Now, once the operator has successfully produced a
product B, the Changeover is complete.

Okay, well, lets envision the worst case scenario. Lets imagine the operator has
made it all the way to the end and has produced a product B, only to learn its
defective in some way. Well, the question is, is the Changeover complete or not?
Well, the answer is no, its not. Since, again, the definition of a Changeover is the
amount of time taken to change a piece of equipment from producing the last good
piece of a production lot to the first good piece of the next production lot. All right.
So thats what Changeover is. Now lets learn what this thing called SMED is all
about.

Well, SMED, which stands for Single Minute Exchange of Dies, is a system focused on
dramatically reducing the time it takes to perform Changeovers or set-ups as they
are often called. SMED was actually developed 50 years ago by a man named Shigeo
Shingo, who was working for the Toyota Motor Company as a consultant. Well, in
those days, Toyota needed to reduce inventory of automotive stampings and began
looking for ways to perform Changeovers in a more efficient manner.
Well, as it turns out, Shingo was able to collaborate with Toyota engineers on a
method that reduced a four-hour Changeover on a thousand ton press to less than
three minutes. Yes, you heard me right. Four hours to three minutes. Now, this
example, as well as an excellent description of the overall SMED process was
documented in a book, A Revolution of Manufacturing: The SMED System. So it
goes without say, if you dont already own this book, I highly encourage you to pick a
copy up.

Now, in later modules, we will go into great detail as how the SMED system can lead
to lightning quick Changeovers, but one thing Id like to point out in this overview
module is how much focus is placed on basic workplace, organization, and planning.
In fact, its estimated that as much as 80% of the improvements identified by the
SMED system are related to the techniques weve already learned about in the
Gemba Academy 5S Workplace Productivity Course. So to be sure, the primary focus
of Quick Changeover and SMED is most definitely not on spending money for special
tooling or expensive equipment.

All right. So thats what Quick Changeover and SMED is. Now, lets talk a bit about
the benefits of Quick Changeover and why any of us should bother with it. Well, the
first reason for Quick Changeover, is that it leads to the reduction of lead time. You
see Quick Changeover leads to increased velocity. In other words, youre able to
create value faster when your machines are running and not sitting idle. You should
definitely use this increase in velocity to your advantage. In fact, you can and should
use it to increase customer satisfaction and grow your business.

Another reason Quick Changeover reduces lead time is related to lot sizes. You see,
when lot sizes are reduced, the lead time of the time when a customer orders a
product until its received, is also reduced. This is because much of the lead time
through a series of processes is nothing but waiting or queue time. In other words,
the parts just sit and wait to be processed and moved on until the other parts in the
lot are complete.

Well, lets look at an example. Here we see a manufacturing system with

Ques 1(a) What is lean manufacturing?

Lean manufacturing, lean enterprise, or lean production, often simply, "lean", is a

production practice that considers the expenditure of resources for any goal other
than the creation of value for the end customer to be wasteful, and thus a target for
elimination. Working from the perspective of the customer who consumes a product
or service, "value" is defined as any action or process that a customer would be
willing to pay for.

Ques:1 (b) What is role of dielectric in EDM?

The functions of a dielectric fluid in Electric Discharge Machining process are as

follows:
To serve as a spark conductor in the spark gap between the tool and work material.
To act as a coolant to quench the spark and to cool the tool and work piece.
To carry away the condensed metal particles and to maintain the gap for
continuous and smooth operation

Ques: 1(c) What are the similarities between Agile & lean Manufacturing?

Lean and agile manufacturing are both ultimately focused on increasing business
sustainability in the high-cost manufacturing sector. Both are answers to challenges
faced by historical manufacturers, and both provide opportunities for smaller players
to compete with larger, entrenched competitors. Both concepts rely heavily on
statistical analysis, computerized information systems and open communication
between internal and external stakeholders. Because of this, both of these concepts
are tied to modern advances in production technology and are perfectly suited to the
tools and resources available to modern managers. Lean and agile design
considerations are both early stage planning decisions, influencing the way in which
organizations are structured from the accounting system all the down to the factory
floor.

Ques 1(d)How ultrasonic vibration are produced?

Lean philosophy and its applications in the service industry: a review of the current
knowledge

ABSTRACT

This article presents an in-depth bibliographic study about the creation, principles,
evolution, and practices of the lean philosophy oriented to the services sector. More
than 70 papers about lean thinking specially with focus on services have been
carefully reviewed. It presents the principles of lean service in an organized way,
companies applying lean service, and best practices and tools in the implementation
of lean service. It shows that lean service does not have a single or specific model of
tools, practices or standards. In fact, it is a mix of tools and practices that must be
applied according the situation found to be improved. Despite the lack of a standards
and methodology for use in services, its best practices, inherited from
manufacturing, when applied to services can generate large economic and financial
results, as well as improvement of workers behavior. But, like any change process,
this study shows that the application of lean in services also suffers resistance. There
might be limitations when evaluating lean practices and principles to services,
specially those that have not yet been well defined and reported. Other limitations
are due to the scarce articles in the literature. However, this research showed that
the use of the lean philosophy in services proved to be effective and quite
worthwhile. Several cases analyzed presented significant gains and confirmed an
increasing and promising future for service companies thinking lean.

Key words: Lean service; Service performance improvement; Waste elimination;

Lean philosophy

INTRODUCTION

The lean philosophy (lean thinking, lean manufacturing or Toyota Production System)
were developed by the Japanese in the mid 50s, and is nowadays worldwide used by
companies. The term lean thinking encompasses a set of lean practices and was
first proposed by Womack et al.(1992). From the advent of the lean concept to the present
days, the popularity of lean thinking has spread exorbitantly. Earlier applications only
focused on manufacturing companies (therefore the resulting designations: lean
manufacturing or lean production). The lean thinking philosophy, however, quickly
moved to new areas such as services, trade and the public sector (Womack & Jones, 2005).
Even with this expansion to new areas, the major use of lean thinking is still little
spread among other areas. And hence the availability of literature specific with lean
applied to the service sector is still scarce (Piercy & Rich, 2008b). The lean transformation to
the manufacturing sector is well established, however, the use of lean tools to
improve service quality is relatively new, with limited reported benefits and
approaches.

Therefore, there is still a great need for new strategies and technologies to the
service sector, despite the fact that it accounts for over half of the gross domestic
product (GDP) and employment of most modern economies. Specifically, according
to Fortes (2010), the service industry accounts for 58% of the worlds GDP and in the
beginning of this millennium, in the United States, professions related to services
amounted to 79% of total employment. Since 2008, more that 55% of Brazils GDP is
generated by services (IBGE - Brazilian Institute of Geography and Statistics).

This article has two focuses. First, it intends to conduct a literature review on the
history of lean service. Secondly, it analyzes important topics related to the
development of lean service, such as, where publications are being made,
researchers involved with this subject, main contributions and principles of lean to
the service areas, focus on the customer, companies applying lean service, most
important the results being reported, the areas applying lean service and best
practices specific to lean service.

For a better understanding of the research conducted, the article was divided into
four sections, namely: introduction, history and evolution of lean production and
services, development of the lean service (including volume of annual publications,
researches, principles, aplications, uses, best practices) and closing remarks.

2. History and evolution of lean production and services

According to a study conducted by Cerioli (2009), the services sector has already
demonstrated its relevance as an economic activity since classical Greece, when
young people received education. Subsequently, other service activities were
developed, such as spices and textiles transportation through the silk route during
the low Middle Age (Correa, 2006). Since then, the service sector developed strongly until
the first industrial revolution, when it lost its economic importance, regaining it only
in the twentieth century. Thereafter, it has maintained a steady growth, gaining
increasing importance, both in developed and emerging countries.

Today, the service sector stands out for being responsible for the largest share of the
worlds GDP and for creating jobs and wealth that grow at higher rates than in other
sectors of the economy (Table 1). Some factors such as urbanization, demographic
changes, socioeconomic changes, increased sophistication and technological changes
have contributed to ensure that services reached this level of importance in society.

Currently, services are considered the center of economic activity, being one of the
pillars of economy, as well as mining, agriculture and manufacturing. According
toCobra (2004), there are five particularly important service sub-groups: a) Business:
consulting, finance, banks, etc. b) Commercial: retail, maintenance, repairs, etc. c)
Infrastructure: communications, transportation, etc. d) Social and personal:
restaurants, supermarkets, health, etc. e) Public administration: education,
government, etc. Besides being essential in generating jobs, service companies are
also responsible for supporting the major types of industrial, commercial and
agricultural activities.

In the mid-eighteenth century, with the advent of industrial revolution in England,

the world market was flooded with machinery and equipment, which increased the
production of products on a large scale. Mass production is a term that means large-
scale production of standardized products by means of serial assembly lines. This
mode of production was expanded and improved by Henry Ford in the early
twentieth century, particularly in the production of the vehicle Ford Model T. Mass
production has become a widespread mode of production, considered best-in-class
at the time, because it allowed high rates of output per worker and at the same time
generated products at low prices.

According to Dennis (2008), the traditional mass production had its problems. Workers
hated it: no one wanted to be in a factory. Unions fought constantly to reduce work
hours. Many works of art satirized mass production, including Charlie Chaplin in his
classic movie Modern Times. But mass production could not be applied to all plants
and thus, the Japanese, in particular the Toyota car factory, had to develop their own
model, which would be called the Toyota Production System (lean production or lean
manufacturing). Shingo (1996) cites the Toyota Production System as a process of
continuous waste elimination. After World War II, the Japanese industry had a very
low productivity and huge lack of resources, which, of course, prevented it from
adopting the mass production model.
Dennis (2008)
defines waste with the Japanese word muda, the opposite of value,
which is simply what a customer is willing to pay. It is also common to see the
definition of seven wastes that the lean philosophy seeks to eliminate are: a)
overproduction, the largest source of waste; b) waiting time, refers to materials that
are waiting in queues to be processed; c) unnecessary transportation that does not
generate added value to the product; d) unnecessary processing, some operations of
a process could not exist; e) inventories, their reduction will occur through their root
cause; f) motion; g) defects, producing defective products means waste materials; h)
manpower, handling of defective materials and others. Recently a new (eighth)
waste has been introduced: the misuse of intellectual capital Womack & Jones (2003). This
waste means not stimulate or use the complete employee capacity in identify
opportunities for improvement.

Lately, Bowen & Youngdahl (1998) proposed a framework that depicts the convergence of
manufacturing production to services (Figure 1). Levitt (1972) was one of the first authors
to study the transfer of organization principles applied to production lines for
manufacturing systems towards services. His studies were based on the fact that the
services sector could benefit from the techniques developed by manufacture.
Figure 1 The Convergence of services and guidelines of manufacturing production
(Bowen & Youngdahl, 1998).

Based on the studies of Levitt (1972, 1976) and additionally taking advantage of the
emergence of the fundamentals of lean production (Ohno, 1997), researchers Bowen &
Youngdahl (1998)
were the first to carry out studies about the transfer of the lean
production techniques used in industries to the services sector. They conducted case
studies of applications of lean tools and published the results of what became known
as lean service. This study presented the characteristics of the lean service applied in
a network of fast food restaurants, in a hospital and an airline company. The results
of these studies led to new applications in lean service and further studies by other
authors, which will be demonstrated later in this paper.

3. Analyzis of important topics related to lean service

Since its first real appearance as lean service (Bowen & Younghal, 1998), when it began to be
considered as a new model of services production, and until present days, the
concept of lean service received several reviews and suggestions for improvements
and applications. This part of the study analyzes the main contributions, results,
principles and companies that are applying lean service, areas more interested in
lean service, best practices and tools adapted to lean service.

3.1. Researches and main contributions

To allow a better understanding of the evolution of lean service, it is important to

understand its origins, evolution and the main contributions during its
evolution. Table 2 summarizes the main authors and their contributions to the area
of lean service. Presented in chronological order, it is possible to evaluate the early
transfer of manufacturing techniques to services (Levitt, 1972), as well as, applications in
other services areas.

Principles of lean service

The lean manufacturing philosophy, strongly disseminated by Taiichi Ohno, is based

on principles that guide the lean thinking. According to Womack & Jones (2003), the
principles of lean manufacturing are five, namely: value specification, value stream
mapping, flow optimization, pull production system and perfection or continuous
improvement.

For Nascimento & Francischini (2004), the definition of lean service is a standardizable system of
service operations made up only by activities that generate value for customers,
focusing on explicit tangibles and aiming to meet the customers expectations for
quality and price.
For Bowen & Youngdhal (1998), the great similarity with the Womacks model is to generate
production flow process in services and also use pull systems by the customer.
However, another important contribution by these authors is the human factor
involved in the process, when they suggest the use of empowerment for
employees and teams. The service sector, differently from industries, has a great
involvement of people, whether in customer service (front office) or in preparing
something that should be delivered to a distributor or even directly to the customer
at the point of sale (back office). This is evidenced by Chase & Apte (2006) who reported
that in 2006, the service sector in the United States had 83% of the workforce while
manufacturing had only 10% (U.S. Department of Labor, 2006). Lean service
principles must be improved: focused on low cost customer, easy process
standardization, co-production and information technology accepted by the
customer.

Lean principles applied to the service sector and focused on employees, whether in
training or in increase of their autonomy (empowerment), were studied byBowen &
Youngdahl (1998) Swank (2003) Sarkar (2007)
, , and Bicheno (2008), reinforcing the importance of the
human factor in the process of delivering services.

Besides focusing on people that make part of the transformation process, lean
service also focuses on the customer. Unlike manufacturing, the first contact for
selling service is the customer. The service company deals with the customer directly
on the front line, differently from most industries. According to Silvestro et al. (1992)there
are three different categories in service sector. First, professional service with high
focus on people, contact time and process, as an example of this category is a
corporate bank. Second, service shops as hotel or rental service with medium focus
on customization and front office and back office; this category which falls between
professional and mass services with the levels of the classification dimensions falling
between the other two extremes. The last one is mass service with low attention to
equipment and customization, a great example is the transportation service.

For Womack & Jones (2005) for a correct use of lean in services it is necessary to apply
important principles, such as: completely solve the customers problems by ensuring
that all services operate and, especially, work together, and do not waste the
customers time, provide exactly what they want, exactly where and when
wanted. Maister (1985) also suggested two service laws: the first compares customers
expectations with their perceptions of service delivery - if the perceived service is
better than the expectations, they turnout to become happy customers. The second
law states that the first impression can influence the rest of the service consumption
experience. Based on this statement, there are two fundamental variables in the
relationship of service delivery:

customers being the first, and

the employees who deliver the service.
In manufacturing operations, high costs and focuses are related to raw materials and
equipment, but in service operations, manpower is one of the most relevant factors
in the cost of doing the job. Abid et al. (2006) argues that the human element is a highly
relevant variable in the services sector.

Despite the similarity of some lean service principles and lean manufacturing, lean
service does not have a single or specific model that can be taken as reference in any
situation or area of service like standard steps, on the contrary, there are several
models which can be applied according to the nature of the service. Such statement
can be justified by the broad variation of the nature of services. For instance, there
are services related to hospitals, logistics, food production, food consumption, air
transport of passengers or cargo, information technology and so on. Table 3 shows a
list of characteristics found in lean service for each author who has done in his/her
research.

Lean Service: focus on the customers and on time

The service area, differently from the manufacturing area, strongly depends on
human factors, which is responsible for the prospection, execution and delivery of
service to the customer, who expects service with high quality.

In a recent study (Lean Solutions), Womack & Jones (2005) introduced the concept of the
Lean Consumption. The idea is not that the customer shops less but shops with less
difficulty and disruption. In this context, companies should adopt practices to
eliminate inefficiency in production processes, and it is now the moment to take
initiatives to deliver consumption experience more efficiently and with less sacrifice.
The principles of Lean Consumption described byWomack & Jones (2005), are summarized in
the Table 4.

Table 4 The principles of Lean Consumption (Womack & Jones, 2005).

Principles of Lean Consumption

1. Solve the customers problem completely by insuring that all the goods and
services work, and work together.
2. Dont waste the customers time.
3. Provide exactly what the customer wants.
4. Provide whats wanted exactly where its wanted.
5. Provide whats wanted where its wanted exactlywhen its wanted.
6. Continually aggregate solutions to reduce the customers time and hassle.

Although these principles were created having the final consumer in mind, they are
perfectly adaptable for all kinds of customers since companies belong to a supply
chain. Any supplier or customer can be targeted to receive lean initiatives. In a
company-to-company relationship, some examples reinforce the use of lean
initiatives. If a company examines its inbound process, for instance, it can find ways
to not waste drivers time and suppliers vehicles with inbound and outbound
activities. A furniture manufacturer, for example, knows that it should not delivery
tables alone, even if the factory was not able to manufacture chars on time.

The lean service operations must offer what customer wants, where he wants it.
Supermarkets build branches (stores) where customers are and connect them
through distribution centers strategically located. This increases speed and agility
on the product distribution. It is easy to see that these retailers are using large
supermarkets (megastores) located out of downtowns, regular supermarkets in
neighborhoods, small markets are spread for all city, and on-line markets for internet
sales.

Lean logistics must be up-to-date with new techniques to increase performance

(especially delivery time) and customer satisfaction. Suppliers should understand the
customers needs, apply lean methodologies to their processes and adapt
themselves to customers. But often this is a two-way highway. Customers and
suppliers should be strategically and operationally aligned (Chopra & Meindl, 2004).

Currently, there is a saying well know in airlines companies: low cost/low fare. The
focus is to reduce aircraft time on ground. For this, customers are partially involved
in some activities to reduce this time, for example, just before landing, the crew
requests all passengers to collect their trash and magazines. Besides reducing ground
time it help reduce expenses with cleaning. Another lean logistics strategy at airports
is the boarding time. Passengers located at different portions of the aircraft are
called at different time intervals.

In hospitals, lean is applied to reduce the waiting time. They have rules and
procedures specific to different types patients and procedures, such as for first aid,
surgery, tomography, X-ray, lesions, and etc. Lean logistics in this business form team
responsible to precisely identify each case, quality performance indicators are used
to help find possible problems, and surgery tools, tomography equipments, rooms
needed.

3.4. Companies applying lean service and main results

Once analyzed the principles of lean service, a second step is a study to verify the
companies that have been using the lean philosophy in services and the
improvements being obtained. Around twenty-five companies were studied, from
large fast food chains, financial groups, hospitals to a safari park (Table 5).

Table 5 Lean service companies and their results with lean principles.

Company Improvements Obtained Using lean service

 Company Improvements Obtained Using lean service
One of the first companies on record to apply lean service and
Taco Bell solve its tradeoffs between efficiency with low cost operations
and flexibility.
Southwest Elimination of services costs, flow and speed of service delivery,
Airlines and creation of a service experience for customers.
Shouldice Cost reduction, remarkable recovery rates of patients, greater
Hospital availability of operating rooms and hospitalization.
Jefferson Pilot Improved operation and increased revenue. Reduced by 70% the
Financial time of processing a request, 26% the cost of labor and 40% for
Company errors.
Extended the time of customers value aggregation from 53% to
Grupo Fernando
94% and its operations extended the time of adding value from
Simo
27% to 50%, while reducing costs by 30%.
Reduced calls relating to customer complaints by 40% and
specifically for complaints of printer malfunctioning by 80% in 18
Fugitsu services
months, improving customer satisfaction and reducing operating
costs with the delivery of new printers.
Reached a level of service above 96% becoming the market leader
Tesco Retailer
in its segment in the United Kingdom.
Eliminated the need to hold the stocks in the back of the store or
Wal-Mart
in a warehouse.
It offers a wide variety of clothing, but avoid large inventories and
Zara
counting on a quick response to the market.
LifeCare Hospital 87% reduction in infections caused by transfusion.
Monongahela
Dramatic reduction in infections.
Valley Hospital
UPMC Health
Dramatic reduction in infections.
System
Allegheny
Dramatic reduction in infections.
General Hospital
Significant reduction of costs, savings on storage space, reduction
HISCO Inc.
of labor costs.
Lotte- Mart. Significant cost savings by outsourcing logistics.
MC Donalds Developed processes to ensure quality.
Disney Theme
Developed processes to ensure quality.
Parks
Reduction of trade-offs of performance combining flexibility and
efficiency, reduced processing time with improved quality and
Plo do P
productivity. Elimination of non-value added activities, eliminating
Diabtico
unnecessary displacement of patients and reducing the number of
hospitalizations.
 Company Improvements Obtained Using lean service
Hospital Pr- Reduction of trade-offs of performance combining efficiency and
Cardico flexibility. Elimination of non-value added activities.
Reduction of trade-offs of performance combining efficiency and
Hospital Dr.
flexibility. Elimination of activities that do not add value by
Badim
improving efficiency and agility.
Reduction of trade-offs of performance combining efficiency and
Hospital Copa
flexibility. Elimination of non-value added activities, reducing
DOr
pharmacy costs.
Diagnstico da Reduction of trade-offs of performance combining efficiency and
Amrica flexibility. Elimination of non-value added activities.
Wipro
Not informed
Technologies
Inventory reduction, improved animal welfare and improved
WSP Park Safari
customer satisfaction.
Hospital de Presented a series of possible improvements to be implemented in
Clnicas de Porto the process, with strong potential for applicability of the principle
Alegre of waste elimination.

Bowen & Youngdahl (1998)

presented Taco Bell fast-food chain as an example of lean
implementation in services. Results can be described as based on tradeoffs between
efficiency and operations with low cost and flexibility, thus increasing human
resources management and focus on customer and on quality.

Another company that had significant improvements and should be highlighted in

this analysis is Jefferson Pilot Financial Insurance Company (Swank, 2003). Applying the
principles of lean production, the insurance company improved its operation and
increased revenues, reduced order processing time by 70%, labor costs by 26%, and
error reduction around 40%.

The improvements, reductions and gains are not only financial results when applying
the principles of lean service, but also positive reflections on quality perveived by
clients (Table 5). This is the case of the LifeCare Hospital, which reduced infections
caused by transfusion by 70%. There were also gains for the Hospital Plo do P
Diabtico that eliminated unnecessary movements of patients, combined flexibility
and efficiency, reduced processing time with improved quality and productivity.

It is possible to verify that the use of lean service principles are rapidly appearing in
several companies in different areas of activities. Results are increasingly tangible to
the organization and often intangible to customers.

3.5. Areas that most have applied lean service

Due to diversity of service sector, the principles of operation management and
market practices are difficult to be defined in service companies (Chase & Apte, 2006).
Nevertheless, some authors have presented models to define actions within the
service area, for example, Lovelock (2001), who argued about focusing on specific service
categories and proposed five schemes for classifying services, from services classes
to delivery methods. In order to define the areas of possible services action, Schmenner
(1986)
suggested the use of a matrix with four classes of service: manufacturing
services, shopping services, mass services and professional services. This matrix has
great relevance, helping define and implement the best lean service tool (or
principle) to specific service class.

Some areas within the service sector that have mostly applied lean principles are
health, finance sector, banks and insurance. The health sector, mainly with hospitals,
is the area that have mostly applied lean principles. According toAraujo et al. (2009), health
services have many sources of inefficiency and quality problems that are a real
challenge for managers in the area. Generaly a hospital can be seen as a large
company with multiple services in it, for example, drug pharmacies, warehouses,
restaurants, safety, lobby and patients release area, surgical centers, hotels and
others. The potential for improvement in service quality and cost reduction is
enormous in the healthcare area.

Other areas that deserve attention are the financial sector and banks, which are
institutions with large volumes of document processing and analysis, prone to
mistakes and/or rework. This is an area that acts with a market that can generate
immediate profits or losses and where competition is rapidly acting upon customers.
An example is a process to finance a vehicle: the customer shops and the financial
institution has only a few minutes to approve or not the credit, but during this time,
a series of information must be collected and analyzed.

Lean service enters with its principles acting in control, autonomation, agility and
continuous improvement, ensuring the process a considerable stability and
continuity. Similarly to the financial sector, the insurance area also has a high
turnover of processes and approvals within its activities, and perhaps that is why
lean service, seeking to improve the work process, has been highly studied within
these organizations. Table 6 sums up some of the service areas using lean philosophy
in their processes.

Best practices and tools applied to lean service

It is important to know the tools that are being adapted and applied to lean service.
For better detailing, besides checking all the tools, Table 7 shows implementations of
the four most commonly used tools: value stream mapping (VSM), production
balancing (heijunka), just in time (JIT) and 5S standardization. For a common
comprehension of the lean tools, the research addressed tool as a group of
techniques developed and applied from the lean philosophy, these tools applied to
lean service are quickly explained next.

To learn about the current state of operation and to propose further improvement, it
is first necessary to carry out the value stream mapping in the production process
applied to services, because this way it is possible to view all stages in the process.
For Rother & Shook (1999), a value stream is all action (adding value or not) required to bring
a product through all flows essential to each product: production flow from raw
material to the hands of the consumer, and the flow of product design, from
conception to launching. Even in the service sector, the application of value stream
maps is of great relevance, because most of the companies mentioned by the
authors used VSM to improve processes because, similarly to manufacturing, the
service sector also has direct relation with development, preparation and delivery of
service to customers, and these steps, activities or processes are easily mapped using
VSM concepts.

Production balancing (heijunka) is one of the pillars of the Toyota Production

System. It leads to efficient resources use, inventory reduction, downtime and high
and high costs elimination, hence directing the creation of processes flexibility. Using
a balanced operation helps a company to develop new ways of better buying from
suppliers, better use of equipment, and more efficient use, inclusion of new
processes and better team planning. Without balancing production is not possible to
achieve JIT.

Practical applications of production balancing in services are seen in hospitals

(setting the correct patients flow through service and surgeries), in restaurants
(avoiding disruptions and delays in serving meals), in the financial sector (balancing
the distribution of credit approval processes), and so on.

Next tool is JIT that is more considered an effect caused by the application of several
tools. According to Slack et al. (2002), just in time is a paced technique, aiming at improving
global productivity and eliminating waste. It comes as a consequence of the use of a
balanced production. The customer will have his needs met on time and only for
what is needed (it is a pull system, triggered by demand). JIT allows organizations to
deliver services more efficiently and with reduced costs, since it intends to provide
just the right amount, at the right time, at the place determined and using the
minimum capacity from facilities, equipment, materials and people. JIT has a number
of tools and techniques that provide operating conditions, such as Kanban ( Slack et al.,
2002
).

Another tool often mentioned in the literature is the use of standardization and 5S.
Although it may seem something that is already inherent in organizations, this is one
of the issues organizations end up not paying much attention to and, in fact, this is
one of the tools that will ensure that the obtained improvement can stay stable.
Especially in service areas with expressive movement of people and materials,
standardization and 5S can help ensure process stability.

Something relevant about these tools is the fact that they are all connected to the
pillars of the Toyota Production Systems house, which demonstrate that the use of
the same tools applied to manufacturing should also be used in the services sector. A
summary of tools that have been applied to lean service is given at Table 7.

4. CONCLUDING REMARKS

This article is one of the first known researches to present a bibliographic study
about the creation and evolution of lean service, with principles and practices
oriented to the services sector. A major benefit of this work was to present what are
the principles of lean service in an organized way, the companies that are applying
lean service and the best tools and practices applied in the implementation of lean
service.

By analyzing the results, it can be said that lean does not have a single model of tools
or practices and standards for services. It can be noticed that each author uses a
mix of tools and practices that in their opinion best serves in an operation, this is, a
collection of the best practices applied to specific needs of a company and its line of
services.

Despite the lack of a standard set for which, when and where to use a lean tool in
services, it can be seen that the best lean manufacturing practices, when applied to
services, can generate large economic and financial results, as well as in the behavior
of people. Obviously, like any change process, the applications of lean in services also
suffer high resistance to their application. However, as shown in some articles, and
specifically by Swank (2003), this is another barrier to be overcome that if not treated
with care will compromise the operation. But successfully attracting those who have
been resistant to the lean thinking will become a factor that in time will be favorable
to new lean implementations. The results cannot pass unnoticed.

Despite possible limitations, one can affirm that lean philosophy in services has
proved to be very positive. In fact, none of the works researched mentioned
significant drawbacks or brought suggestions to not implement lean in business
services. On the contrary, several cases in service companies showed large success
obtained with lean practices and principles and at increasing rate of
implementations.

Future researches shall study in more details each business service sector to where
lean has been (or can be) applied. Areas such as health, government (public
administration), logistics, offices, teaching, retail and others have been applying lean
 practices. One can now do a specific study in each of these areas and translate the
benefits from one service area to another. Perhaps even propose an implementation
methodology, for each specific area and/or to services in general.

What Is Kaizen?
The purpose of Kaizen goes beyond simple productivity improvement. When done
correctly, the process humanizes the workplace, eliminates overly hard work, and
teaches people how to spot and eliminate waste in business processes.

The continuous cycle of Kaizen activity has seven phases:

1. Identify an opportunity
2. Analyze the process
3. Develop an optimal solution
4. Implement the solution
5. Study the results
6. Standardize the solution
7. Plan for the future
Kaizen generates small improvements as a result of coordinated continuous efforts
by all employees. Kaizen events bring together a group of process owners and
managers to map out an existing process and identify improvements that are within
the scope of the participants.
The following are some basic tips for doing Kaizen:

Replace conventional fixed ideas with fresh ones.

Start by questioning current practices and standards.
Seek the advice of many associates before starting a Kaizen activity.
Think of how to do something, not why it cannot be done.
Dont make excuses. Make execution happen.
Do not seek perfection. Implement a solution right away, even if it covers only 50
percent of the target.
Correct something right away if a mistake is made.
Kaizen activities cover improvements in a number of areas, including:

Quality Bettering products, service, work environment, practice and processes.

Cost Reducing expenses and manpower, and use of material, energy and
resources.
Delivery Cutting delivery time, movement and non-value-added activities
Management Improving procedures, training, morale, administration, planning,
flow, information systems, documentation and reporting.
Safety Decreasing hazardous situations, unsafe working conditions, chances of
resource depletion and damage to the environment.
Implementing Kaizen
 To generate a Kaizen, everyone involved must begin thinking about their work in a
new way in terms of:

Now: Present condition

Next: Desired state
New: How to reach that state
Typically, implementation of Kaizen occurs in three stages in any organization:

1. Encourage participation: Awareness training sessions for all employees are a must.
To further encourage employee involvement, promote specific Kaizen activities, and
consider distributing monetary or tangible benefits after solutions from Kaizen
activities are implemented.
2. Training and education: Focused training of associates is required for understanding
what is and is not the essence of Kaizen. Team leaders should be trained to
understand Kaizen in an organizational vision context, which needs to be followed
thoroughly in order to achieve desired business objectives. They also must be taught
about the necessity of impartial evaluation and strategy for improving participation.
3. Quality level improvement: After the training stage is completed, practitioners
should continue to focus on long-term implication, widespread application,
alignment with organizational objectives and planning objectives. Management
should form a core department to carry out Kaizen evaluation and implementation.
Using Kaizen with Six Sigma
Through Six Sigma, companies can make breakthrough improvements in existing
processes. Cost savings from breakthrough Six Sigma projects are not always
reflected in the bottom line, however. The reason for this is the absence of small
improvements, as well as maintenance establishing standard operating procedures
and ensuring everyone follows them. Processes can degrade without systemic
monitoring and improvement (Figure 1).

Figure 1: Results of Six Sigma Use without Maintenance

But if a company has a combined system of Six Sigma, a strict adherence to

established processes, and local resources who are constantly looking for ways to
make their processes better (Kaizen), the situation becomes the best. This puts the
organization in a better financial position in the long-run because improvements
happen on an ongoing basis in addition to the occasional breakthrough (Figure 2).

Figure 2: Use of Continuous Improvement by Market Leader