What is lean methodology? The origins and growth of an idea

We mention lean and lean methodology on a semi-regular basis. We operate in a lean way and we create software that enables others to do the same. In fact, we even created Atlas based on Lean Start-up principles.

If you’ve kept your ears open in almost any industry in the world over the last decade or two, you’ve probably heard the term ‘lean’ repeated more and more.

As with most business concepts, it’s deceptively simple but has a depth to it that can be intimidating, but also rewarding. We want to take some time to break down what lean is, why it’s important and how you can use it to improve your work.

This article is going to be an overview of lean methodology but we’ve got articles coming up in the coming weeks which will take deeper dives into some more specific concepts within lean. But for now, we want to get you up to speed on what lean is.

What is lean methodology?

Lean methodology promotes a means of production that focuses on providing the maximum value to the customer whilst eliminating the maximum amount of waste. This is the core principle of lean methodology.

Unsurprisingly, the concept can grow in complexity the more you investigate it, but so long as you understand that the main goal is to provide value possible, while minimising waste, you’ve got the general idea.

What’s the history of lean methodology?

Lean methodology, as we understand it today, came about in the Toyota Production System in the mid-twentieth century. Toyota developed their production system based on the idea that they should define value from the customer’s perspective, and then continually develop their systems to provide that value as efficiently as possible.

That meant developing a means of production that could put their product into the hands of their customers with minimal wasted time and resources. With this perspective, every advancement they made in production was weighed against the value it provided the customer and the waste it produced.

This perspective birthed two principles; Jidoka (loosely translated to “automation with a human touch”) and Just-in-Time.

Jidoka

Automation with a human touch focused on automated production that required human attention when problems arose. Under this system, any time a fault or issue was noticed, production stopped and the ‘human touch’ was needed to get it started again.

As such, problems needed to be recognised, logged, understood, and then fixed efficiently. Because each issue halted the production as a whole, each issue was given equal importance. This resulted in minimal downtimes and maximum output.

Just-in-Time

This is simply the practice of only producing what is needed, when it is needed, and in the amount that is needed. This principle makes production focus on what is happening rather than what might happen. You shouldn’t make backup amounts of ingredient ‘x’ because product ‘y’ might become popular.

By only producing what you need, as you need it, you minimise waste and maximise output. Everything you produce, not just in terms of the end product but the ingredients that make up that product, is used effectively.

What is kaizen?

Kaizen translates to “change for the better” or “continuous improvement”. Alongside jidoka and just-in-time, it provided an important pillar of Toyota’s production philosophy.

With the end-user’s receipt of value in mind, they believed that all people involved in creating that value had equal opportunity to contribute to that goal. Most importantly, they believed that the workers directly involved in creating the final product probably had some of the most valuable insight.

Whereas some enterprises operate from the top down, with the workers on the production line having less input than the executives at the top, kaizen democratises continuous improvement.

By implementing kaizen, Toyota made sure that no source of inspiration was lost to hierarchical thinking. They ensured that innovation was free to occur no matter where the ideas behind it were born.

How is lean methodology used today?

Starting in the factories of Toyota, lean methodology found its way into manufacturing as a whole. From there, its next big expansion was into the world of software development where it has found a natural home.

While it deals more closely with the digital than the physical, software development shares key characteristics with manufacturing that make it perfectly suited for lean methodology, where it is more commonly known as agile methodology.

Software development has:

• A defined creation process
• An agreed level of acceptance
• An identifiable end-user

If you know what you’re making, who you’re making it for, and what the process is of making it, you can apply a lean, or agile, approach to your production process.

With software, the waste you’re eliminating in the pursuit of providing value to your end user isn’t typically material. You don’t need to worry about the nuts and bolts that go into creating a new app as there are none.

Instead, the resource you’re aiming to minimise waste of is more metaphysical but just as important. With agile development, you want to minimise the amount of hours spent creating a product. Time spent designing, coding, internally testing, re-designing and so-on could potentially be wasted if the end user doesn’t see value in your product.

What is an MVP?

An MVP is a ‘minimum viable product’. Broadly speaking, it’s the most basic form of a product that you can deliver to your potential customer. This term isn’t exclusive to software development but it is central to the idea of agile methodology.

The concept of an MVP is key because it encourages software developers to release often and iterate fast. Rapid releases mean constant feedback and smaller, more impactful improvements to your product.

This is what makes agile development a lean way of doing things. No time is wasted conceptualising, designing, creating, testing and eventually releasing monolithic applications only to find out they don’t provide the value people desire.

Instead you deliver a product that’s continuously improving based on feedback from the people who use it. That original idea that Toyota championed, visualising value from the customer’s standpoint and working towards providing it, finds a whole new reality in agile development.

You’re no longer visualising what your end user might perceive as value, but instead developing improvements based on what you know the end user perceives as value.

What’s next?

We hope this has given you a good understanding of the origins and basics of lean methodology. In our next article we look at Six Sigma and how it’s been combined with lean to create Lean Six Sigma. From there we’ll be looking into the eight kinds of waste that Lean Six Sigma aims to eliminate. See you next week!