Home | Practice Areas | Creating a Lean Enterprise
One of the most important and misunderstood elements with regard to creating a lean organization is that it is not just another way to achieve significant cost reductions—although that will be one of the benefits. As we've seen, ordering across the board cost reductions without thinking through their ramifications often creates employees afraid for their jobs, reduces productivity, key people flee to avoid the possibility of being "downsized out," etc. Any financial improvements tend to be lower than anticipated and the costs that were cut tend to find their way back into the organization down the road. But perhaps the worst result may be that senior management is perceived as being mean and self-serving. And one more key point to remember is this: cost cutting alone rarely creates value for your customer. Constructing a lean enterprise is all about creating value for your customers, which in turn drives value throughout your organization. Nothing mean about that.
Traditional cost cutting efforts are akin to surgical techniques in the early 20th century. Your company will never be competitive for the long term if all you do is cut costs, programs, and head counts when economic times get tough. You will lose key people, lower morale, reduce productivity and squelch creativity. You will likely reduce your overall competitiveness in the market place.
At Maverick, we have always understood and practiced our own version of Lean Thinking, the concepts articulated in the excellent books authored by James P. Womack and Daniel T. Jones. We start by determining what your customers perceive as value: then, by working our way backwards up the value stream we work with your managers and associates to assist them in eliminating all waste. In this manner, everything that takes place in your organization, from inception to delivery of your products or services creates value for your customers. This is easier said than done, because there are always significant political and structural impediments to reducing or eliminating waste.
To create a truly lean enterprise, you must go beyond your own walls. Many of your company's products and services are themselves dependent upon the goods and services provided to you by other vendors. And if all parties involved in the value stream do not integrate their efforts and share each others' concerns, you will never achieve a truly lean enterprise.
Maverick has integrated the management and behavioral sciences; that means we assess and address the people issues concurrent with our collaborative efforts to create a lean enterprise. Of course, you don't start with the whole organization at one time! We will work with you to determine the most inefficient and wasteful areas of your organization—you probably know where those areas are right now—and we'll create a lean division, or lean group, or even just take one product or service, and help you transform it into a lean value stream for your customer—and that customer can be internal or external. The near-term success of this one action to demonstrate the benefits of creating a lean enterprise will be extremely helpful in motivating others to come on-board as the expansion of lean thinking within your organization takes hold. To discuss how your organization can benefit by becoming lean, please contact Bill Stark here.