The Small Business Guide to Lean Methodology

The pillars of modern industry -- and for businesses that want the plan to stick around so the business can, too -- are reducing waste and increasing efficiency. These ideas are also the core of lean methodology.

The concept got its roots in the manufacturing sector, but it was quickly adopted by any industry that wanted to accomplish those lean practices, and, most notably, in software development.

Overview: What is lean methodology?

Lean methodology is simply a way of optimizing every aspect of your business, including the people, materials, and input and output of energy, in an effort to stay competitive. The main goal is to reduce waste in monetary, energy, and raw material terms and give the customer the best value possible.

At its start, lean methodology was used as a way to imitate Japanese ways of manufacturing. Nowadays, the manufacturing space is much smaller, but the ideals of lean manufacturing principles have now made their way into many other industries that want to implement the concept.

Respect for the customer and constant improvement are two huge aspects of the lean methodology process. Do everything you can to make sure the customer is happy and fix issues as soon as they come up, and you’ll be well on your way to realizing the benefits of lean methodology.

4 advantages of using lean methodology

It’s a big undertaking, but moving to lean methodology practices comes with advantages to make the effort worth the time. Your business will reap the benefits of process improvement in all facets, from management to customer service to supplier relations.

Improved customer service and customer interactions

Since one of the main pillars of lean methodology is respect for the customer, within that is making sure your customer service is up to par. You can do this by retraining your customer service department or training all employees to be able to handle incoming customer communications.

Decreased overhead costs

Once you’ve evaluated your excess spending and determined where you can cut down, your overhead costs will naturally decrease. This isn’t to say you should get rid of things you use because doing so won’t help make your process more efficient, and it could actually set you back.

Increased quality

If you have time, money, and employee cooperation when implementing lean operations, there’s no reason why the quality of what you’re putting out shouldn’t improve as well.

Additionally, being more in tune with your customers and knowing what they like and don’t like and what they expect from your business will help you to understand which areas need improvement.

More positive workplace culture and higher employee morale

Lean project management is designed so that managers are in more constant communication with employees about projects. The back and forth leads to employees feeling more empowered and trusted by leadership to do their job and to do it effectively.

This mentality adds to a more positive office culture because of higher employee morale. Employees are bound to be happier at work, more inclined to help others, and won’t feel left out of conversations that pertain to them and their jobs.

3 disadvantages of using lean methodology

Making the switch to lean methodology won’t happen overnight and might be met with some hesitation. It’s important to be prepared to handle any negatives that follow to continue to make the process run smoothly.

Less product availability

When your business is going lean, one of the things you’ll probably do is decrease the amount of backstock you have on hand at any given time. Working with your suppliers during this time will be crucial.

Give them the same constant communication you give your employees, and make sure they know what the deal is since your business works so closely with them. At first, you might get some resistance if what you’re doing leads to more work for your suppliers, but, hopefully, over time they will see that lean methodology actually improves the efficacy of the inventory process.

Implementation challenges

As mentioned above, you might receive some pushback from employees, suppliers, and even customers while your business is going through the transition to the lean method. It will take patience on everyone’s part, and a laser focus on the end goal, to make it through to the final steps.

Your business could also incur additional costs associated with implementing lean methodology. Whether it’s introducing project management software, overhauling production equipment, or introducing intangible items, these are all costs your business will have to be prepared for.

Overabundance of structure

A business might be tempted to put a structured process in place in every aspect of the business and from the top down. But that won’t work. In order for a transition to lean methodology to be successful, all employees need to feel like they have some say in what happens.

This doesn’t mean they get to choose what the company does, but maybe they get to have input in projects or changes that are presented to them. All input should be considered, so if there’s strict structure to everything, it takes away the element of choice.

How to implement lean methodology within your organization

Now that we’ve gone through the advantages and disadvantages of lean methodology, you should be ready to make the decision for your business whether to implement or not. Here’s how it should work.

1. Determine your reasons for implementation

The powers that be need to ask themselves why lean methodology will be a positive change for the business. Figuring out the goal will help narrow down other important steps in the process.

To get started, ask any of the following questions:

• Is the goal to save money?
• Are we lacking in employee satisfaction?
• Do our customers get what they need from us?

Whatever your reasons for wanting to implement lean methodology into your business, take the time to determine where you want to be at the end and thoroughly lay out how you’ll get there.

2. Identify crucial areas of need

Take a realistic look at which areas of your business need improving. This is the only way to prevent overspending on implementation or overhauling areas that were running just fine. Focus on what needs to change and leave the rest.

Here are some ideas about what you may be able to improve upon:

• Deliverables
• Product or money waste
• Production cycles
• Management

Each area will have to be dealt with accordingly since there isn’t necessarily a one-size-fits-all solution with lean methodology. Once you’ve gone through the process, though, you’ll be able to apply certain principles to more than one area to maintain the new leanness.

3. Pick a project person

This will be the person who puts their foot down and makes the difficult decisions that will ultimately have to be made along the way. Make sure everyone at the company knows who this person is and has a way of contacting them.

When the process gets underway, there will be a lot of questions about what’s changing, what can be purchased, what can be gotten rid of, etc. The project person will also need to make sure the life cycles of projects already in the works don’t get derailed.

5. Ask for feedback

When you’ve gotten your business to a lean place that you’re happy with, it’s time to reach out to people to see if what you’re doing is working. Contact customers with a survey asking them if they’ve noticed anything different in their experience with your business and, if so, how they feel about it.

Also ask employees how they think the implementation went and how putting it in practice has been for them. This will be great feedback to gauge the feel at the office and other workspaces and continue to improve upon things.

Final thoughts: What lean methodology could mean for your business

Making the decision to implement lean methodology in your business is the first step in a long process, but it’s one that will be well worth the effort when all is said and done. Aside from improving employee morale and enhancing respect for your customers and your products, your business can also help cut down on the waste plaguing the planet.

Whether you tighten the belt in terms of spending, excess inventory, or materials, going lean can be the start of a bright future for all involved.