A summary of the Lean Manufacturing process. The process can be used by Government departments to improve customer focus and avoid some common business pitfalls.

It seems management theories are subject to fashion. Every few years, a “bright young thing” comes up with a slightly new “cut” and “colour”. Suddenly cosy and regular management meetings seem alien and full of new buzzwords, although the underlying concepts can seem familiar.

One of the most popular currently doing the rounds of UK government bodies is the concept of “lean”, based on the successful ethos of the Japanese, particularly the Toyota Production System developed by Taiichi Ohno (1912–1990).

The Toyota Production System (TPS)

When Toyota took over an ailing UK car plant in the early 90’s, they offered continued business to local parts suppliers on condition they could improve quality and cut costs. Toyota offered to work with businesses to develop their output, and consequently, English managers became familiar with the concept of lean production and the impressive improvements it could achieve.

In short, the theory relies less on managing processes, but staying in control of and reducing the “movement” and “flow” of work. While the theory was first developed in manufacturing, some enterprising consultants have now extended the theory to work in service industries and the public sector.

The lean concept encourages services to consider three main elements:

- “failure demand” (what extra work do we create because our processes fail). An example is the extra work we create because customer letters aren’t clear, or when we don’t ask customers for the right information.

- remove processes that do not “add value”. What work can we strip out because they do not “add value” for the majority of our customers.

- reduce the movement of work between departments. This will reduce double (treble and quadruple!) handling. This could mean, for example, that more work is dealt with at the point of contact.

Outsourcing - is it a good idea?

In UK local government and business, lean consultants now consider the rush to outsource periphery business to be a bad move. Just consider the overseas-based contact centre as an example. Common sense might suggest this to be a good idea; a specialist service is handled by customer care experts, and from an individual cost centre perspective, moving the contact centre abroad to a lower cost base seems to make good business logic.

However, many organisations have seen customer satisfaction plummet, and despite comparatively attractive wages, many Far East contact centres have similar issues of staff burn out and retention as those in the west.

Factor in customer dissatisfaction, and an increase in failure demand, because the contact centre simply “gets it wrong”, then the “common sense” theory of outsourcing your contact centre suddenly doesn’t seem quite so cost effective.

Lean practitioners will argue that the push towards centralised contact centres to handle customer enquiries, with back office processing functions administering the requests is the wrong way to go in terms of flow. The set up encourages double handling, as each set of staff have to read and check the information twice.

The “well meaning” error

We receive a complaint from a customer with a particularly complex enquiry. How many of us try to positively learn from customer comments, and so change our procedures to take account of the complaint?

In reality, the situation was a “one off”, but we now have extra work to do on every subsequent enquiry, simply because we have tried to ensure we don’t repeat the complaint. Our processes should be flexible enough for us to do the “right job for the right person”, rather than simply work to rigid processes.

Summing Up

The lean theory questions the validity of many of our established practices, and from a human point of view, it will be more satisfying to bring all the different functions and special-isms back into one work environment.

Staff are the key to making these changes work. Staff know which areas managers need to look at, and managers need to work with staff to make sure they can make the changes work in practical terms.