An ability to effectively bring innovative, high quality products to market rapidly has become a hallmark of the successful consumer driven enterprise.
The core of lean is to maximise customer value while minimising waste. Lean means creating more value for customers with fewer resources.
A lean company understands customer value and focuses its processes to continuously increase it. The overarching goal is to provide ultimate value to the customer through a perfect value creation process – with zero waste.
The opportunity of a lifetime
Lean product development is proven to increase speed to market – speed to market is the biggest opportunity to increase profit.
As Stephen R. Covey said in The Speed of Trust, “My interactions with business leaders around the world have made it increasingly evident that ‘speed to market’ is now the ultimate competitive weapon.”
Don Reinertsen points out that we are in business to make a profit, so decisions made during the development process should be made by considering how they will impact profit. To achieve this we create an economic model that all teams understand and buy into. For most organisations, the biggest impact to profit is ‘cost of delay’.
Why use Lean?
When we are building digital products, it’s tempting to think in terms of features. The problem; Users dont care about features; they care about their own selfish wants and needs. Lean product design keeps us focused on outcomes. We are forced to check how our product works and what it accomplishes.
Lean is more than just a strategy for developing products. It enables us to create a sustainable system for consistently delivering great products and profitable value streams.
Always Be Validating
Inspired by the sales term ABC (Always Be Closing), ABV means Always Be Validating. In Lean Product Management we always need to be validating. Its critical to create awareness within the team of the time between validations with customers.
Learning creates new value
Creating new knowledge is fundamental to lean product development. The ability to learn effectively and then applying what you know to the creation of new value is where the magic happens. A lean product development system is about recognising and capturing the knowledge that is created for each product. Deeply understand what your product must be.
How to kick start a lean transformation
Heres the crucial part – with lean you need to change the focus of your management team. Move away from optimising separate technologies, assets, and vertical departments to optimising the flow of products and services through entire value streams. Streams that flow horizontally across technologies, assets, and departments to customers.
Lean Product Development (LPD), uses Lean principles to meet the tough challenges of Product Development. Beginning with the study of the Toyota Production System, lean product development seeks to achieve the following goals:
Reduction of long development cycle times
Reducing high costs of development
The need for more innovative solutions
Reduction of production costs
Eliminating waste along entire value streams creates processes that need less human effort, less space, less capital, and less time to make products and services at far less costs. As a bonus we will have fewer defects, compared with traditional business systems. Critically our company is can now be agile enough to respond to changing customer desires.
Whats your lean system called?
Many companies choose not to use the word lean, but to label a lean process with their own branding eg the Toyota Production System. This drives home the purpose that lean is not a flash in the pan management idea – but the way our organisation operates.
A “lean transformation” is used to describe a company moving from a previous way of thinking to lean thinking. Sometimes a complete transformation on how a company conducts business is required. To achieve success – a long term perspective and perseverance is required.
Changing behaviour
A popular myth is lean is suited only for manufacturing. Lean can apply to any business. Its not a tactic or a cost saving exercise, but a way of thinking and acting for an entire organisation.
Their are four phases of learning:
1) Introduction – when you first hear about the topic
2) Assimilation – attend the class and learn more about the topic
3) Translation – learn how to apply it to your specific job
4) Accumulation of Experience – do the new thing until it becomes habit
Most organisations stop at step two—somebody goes to a beginners class in say lean or agile and thats it. Some training programs go to step three and teach the students how to apply the knowledge at work.
But very few companies go to step four and actually coach, or otherwise enable, the students in the new behavior until they have reached proficiency.
Thats critical, as Charles Fred makes clear;
“There is a minimum threshold of experience necessary for new behaviours to become habit!”
Purpose, Process and People
Organisations have a tendency to focus just on process but lack over arching principles.
Principles are frameworks for thinking about product design and process from a strategic viewpoint
Processes are the steps we will follow with our teams to execute against our principles.
Embarked on a Lean Transformation? Your management team needs to focus on three fundamentals;
Purpose: What customer problems will we solve to achieve success?
Process: How will we optimise every major value stream to make sure each step is valuable, capable, available, adequate and flexible.
People: Every important process needs someone responsible for continually evaluating that value stream in terms of business purpose and lean process. Everybody touching the value stream needs to be actively engaged in operating it correctly and continually improving it.
