‘Lean’ is almost a movement, it’s become a philosophy that has applications in many spheres of business. The concept of Lean is essentially about eliminating waste from your business processes. Its origins are in manufacturing with the Toyota Motor Company, but the principles of Lean have spread and found application across myriad areas of business.
One of those, is the area of business innovation. Lean has been most notably promoted and publicized as an innovation methodology by Eric Ries and his mentor Steve Blank. They came up with the application of Lean to innovation and have written a number of books on the subject.
Ries started and ran a successful company himself. He realized that what he was doing with that startup was applying the principles of Lean to his business process. Together with Blank they went on to discuss and document how the lean principles can be successfully applied to innovation.
The History of ‘Lean’
Just after the Second World War, Toyota had a problem. Restrictions in the marketplace meant that Toyota had to produce small quantities of many varieties of cars and trucks under conditions of low demand, while facing competition from the mass production manufacturers in Europe and the United States.
Toyota had started life as a textile company. The success of the Toyoda Automatic Loom Works was based on the development by Sakichi Toyoda of sophisticated automated power looms for weaving textiles. The patent for the looms was sold to Platt Brothers, the leading manufacturer of spinning and weaving equipment, for £100,000. In 1930 this money was used to start the Toyota Motor Company, which struggled in its early years.
In 1950, Taiichi Ohno had become plant manager. He was given the mission of improving Toyota’s manufacturing process so that it equalled the productivity of the Ford Motor Company. Mr Ohno had been a manager at the weaving plant of Toyoda Spinning and Weaving before he was made production manager at the car factory. In his previous job, he saw that, as a result of smart automation, one woman could run a large number of weaving machines. He applied similar principles to automotive manufacturing. He documented these principles, and Toyota’s underpinning philosophy, in a short book, Toyota Production System.
The essence of the Toyota Production System, which later gave birth to the term Lean Manufacturing, is a systemic method for the elimination of waste ("Muda") within a manufacturing process. Lean also takes into account waste created through overburden ("Muri") and waste created through unevenness in workloads ("Mura").
- Muda is anything that takes time but does not add value to your customer
- Muri – overburdening people results in safety and quality problems; overburdening equipment causes breakdowns and defects
- Mura – unevenness; heijunka is levelling out the work schedule; behaving more like the tortoise rather than the hare
Working from the perspective of the client who consumes a product or service, "value" is any action or process that a customer would be willing to pay for. Essentially, Lean is centered on making obvious what adds value by reducing everything else. As Mr Ohno says in the foreword to his book: “All we are doing is looking at the time line, from the moment the customer gives us an order to the point when we collect the cash. And we are reducing that time line by removing the non-value-added wastes”.
“The key to the Toyota Way and what makes Toyota stand out is not any of the individual elements…..But what is important is having all the elements together as a system. It must be practiced every day in a very consistent manner – not in spurts”
— Fujio Cho, President of Toyota Motor Company, 2002
Lean has now caught on in many areas of business, including construction, services, integration, higher education, accounting and Lean Six Sigma, the combination of lean and six sigma approaches.
Applying Lean to Business Innovation
It was Eric Ries and his mentor, Steve Blank who led the charge when it comes to applying lean principles to innovation. Ries documented 