Lean Office: Completing Efficiency Implementation Company-Wide
By Tim Sinclair and Martha Baker-Starr

Thousands of manufacturers have embraced the principles of Lean Manufacturing to drastically improve their shop floor operations. Reduction in lead time, improved quality and increased capacity are just a few of the benefits companies have realized. Although achieving 35 to 40 percent productivity gains over three to five years, the majority of manufacturers are missing their potential by not considering the entire enterprise and by limiting Lean efforts to the shop floor. Much untapped opportunity for productivity improvement lies off the shop floor in nonproduction areas where the enterprise has yet to understand or embrace Lean thinking and principles. Companies need to realize the same Lean principles used on the shop floor are applicable, and just as effective, in the office.

When Lean initiatives are considered, companies are quick to agree that nonproduction areas tend to be ignored. Since one of the goals of Lean is to reduce total lead time, does it make sense to only focus on reducing production lead time and not address the office and administration processes, especially given that nonproduction time is often a greater percentage of total lead time? Of course not. The nonproduction order-to-cash process can have an even greater impact on a business than its raw material to customer value stream. The challenges of implementing Lean in the office lie in changing the culture of the typical office and in applying systems thinking in identifying value, waste and flow in a nonproduction environment.

The success and sustainability of Lean improvements heavily relies on a successful culture shift to one of continuous improvement. Unlike some improvement approaches which can be pushed down from upper management and forced into place, Lean must be embraced by employees at all levels. Lean is about employee involvement and everyone in the organization being proactive to improve. In most cases, Lean implementation in the office will require jobs to be performed differently and people to behave differently than before. For this culture shift to be successful there needs to be strong commitment from management, an understanding of Lean and its benefits, and clearly communicated expectations for the program. The table below illustrates these three necessities.

Once the foundation is in place, there is a preferred implementation methodology. Understand this is not a "cookie cutter" approach, but rather a set of concepts which are critical to adhere to for successful implementation.

Appoint the Continuous Improvement Manager (CIM)
Lean manufacturing is not only about implementation, but also sustaining. There should be a champion appointed who is responsible for becoming the resident expert of Lean within the organization. The CIM will be responsible for understanding Lean, knowing what it takes to implement, ensuring the training tools are appropriate and consistent, and directing the transfer of knowledge throughout the organization. The CIM should report to the most senior position in the organization as appropriate.

Training in the Principles of Lean Office and Administration
Appointment of the CIM and Lean training do not have to be done sequentially. In fact, in many areas of Lean Implementation sequential training and implementation is not necessary. There needs to be a firm understanding by management, supervisors, and lead associates as to what Lean is and what it can do for the company and employees. SCMEP offers an excellent Principles of Lean Office and Administration course which provides a broad base understanding to what the key concepts and tools are of Lean and how they apply to the office.

Value Stream Mapping
Value Stream Mapping (VSM) is a visual illustration of the entire value stream (from customer order through shipping and invoicing). VSM will identify and even define the areas/departments that will give the quickest and most beneficial impact as they relate to Lean implementation. While many companies have successfully used value stream mapping on the shop floor, its application to office and administration processes, while very relevant, has been more difficult. It is important for companies to realize they can use the value stream mapping tool in the office the same way they use it on the shop floor. There are some differences, but it is still an important component to successful implementation and a good way to tackle strategic business issues and organizational challenges.

Policy Deployment
Policy Deployment is the tool used in taking the findings from VSM, combining the company's strategic plan, and laying out a definitive plan with yearly objectives. Policy deployment is a powerful tool of organizing and managing the plan and execution of that plan, with the intent being that it will focus on the process, which will bring results. Compared to Management By Objective (MBO), which is more results-oriented, Policy Deployment, by focusing on the process, allows results to be more sustainable for the long term.

Initial Lean Implementation
Initial Lean Implementation can certainly begin during and even before Policy Deployment, but for clear direction Policy Deployment should be done soon after initial implementation.

Continue Using Lean Tools in Implementation
Using Policy Deployment as the guide and management tool in implementing Lean along with the specific tools of Lean is an organized way of ensuring the resources in the organization are utilized with the proper priorities and direction. Which Lean tools are used and when will be driven from VSM and strategic plan through Policy Deployment. Not all of the tools will be used in every Lean implementation. Depending on the size of the office, resources available, and commitment by management, how long it takes to fully implement Lean will vary. Below is a chart outlining some of the Lean tools for the office and examples of their applications.

The office is often the most disorganized and anti-Lean in any organization. This causes delays, red tape, miscommunication, redundant paperwork and dissatisfied customers. The same principles of Lean that are applied on the shop floor are applicable to nonproduction processes. Like anything else, it requires commitment, but the financial results are tremendous. By properly implementing and sustaining Lean Office techniques, companies can see measurable results.

The results are measurable and well worth the investment in learning and applying Lean Office fundamentals.

Tim Sinclair is a manufacturing specialist with SCMEP. Reach him at 803-252-6976 ext. 236 or tsinclair
@scmep.org.

Martha Baker-Starr is SCMEP's finance manager. Reach her at 803-252-6976 or mbaker-starr
@scmep.org.