Lean manufacturing, often simply referred to as “lean”, is a systematic method for the elimination of waste during the creative and production process. Lean encompasses every element of waste such as overburden and unevenness in workload. It seeks to work from the perspective of the end user who consumes a product or service ensuring the best value. “Value” is any action or process that a customer would be willing to pay for and anything which does not bring value is eliminated immediately.
Essentially, lean methodologies integral focus is on making obvious what adds value by reducing/removing everything else. Lean manufacturing is a management philosophy derived mostly from the Toyota Production System and identified as “lean” only in the 1990s. The steady growth of Toyota, from a small company to the world’s largest automaker, has focused attention on how it has achieved this success and what is means to be lean. As a reaction replication of this methodology has been adopted by some companies across every industry.
Simply put, being lean is about doing the things which that matter most for success.
Lean processes have achieved significant proliferation into the arena of entrepreneurship in recent years. Startups and elimination of waste have always been, and will always be, inexplicably linked. The adoption of Lean thinking has led to the development of ideas such as minimum viable product and innovation accounting. It has witnessed the obliteration of what has become ubiquitously known as ‘Vanity Metrics’ instead focusing on ‘engines for growth’. It flaunts the accepted/expected historical norms of product innovation by significantly reducing iteration cycles of product releases in favour of more frequent launches of less refined products to ascertain product feedback as early in the process as possible.
Lean focusses on utilising data to inform decision making. It humorously mocks the throwing of darts in the dark at moving targets by meticulously shining a spotlight searching for the solution. The data informs the direction in which the search progresses instead of trusting the gut feeling of a product manager. It seeks to establish measurable data points which can be continuously and regularly tracked providing a baseline which can be measured against.
By testing, testing again, measuring the results, tweaking the idea and testing again optimisation of any product can be achieved. This experimental approach is generally sampled using a small batch size of users prior to rolling out what works across the entire user base. This method of A/B testing hypothesis, ideas and methodologies removes waste by critically ensuring only those ideas which are successful are implemented.
By being Lean, companies can save time and money by only accelerating growth once they have arrived at a viable solution. The viewpoint is taken that growing prior to achieving ‘product market fit’ is an abject waste of resources. Instead, the methodology advocates starting small and scaling up through the use of growth engines. This means once your product has achieved acceptance and delight from your users/customers there will be intrinsic growth birthed from their joy. The product itself will be its own best marketing tool.
Being Lean in 2016
Being lean during the entrepreneurial revolution is both easier and more difficult.
It’s not more difficult in applying the processes or methodology intrinsic to the mindset but in finding inherent value in something new in the first place. Finding value is all about value proposition. Have you developed an idea which is innovative and could potentially achieve success? Then employment of lean processes ensures your hypotheses are meticulously tested at minimal cost and time, minimising waste. Remember it is often better to evolve and extract every element of value which has been missed by a pre-existing business model than to blaze an unknown trail.
It’s easier because of the new avenues which enable rapid development and bring the product to market quicker. Products like invision enable you to rapidly develop wireframe models to express your ideas to investors. Mixpanel and kissmetrics can provide the data required to ensure your progression and focus on the things that matter. Technology has closed the gap by clearing the fog and sharpening the vision of founders.
Ultimately being Lean is a tool which ensures you are economical with every decision you make. It is more than a methodology it’s a mindset. It is about applying the principals to every element of a business to ensure maximum return on every investment. It alleviates waste by ensuring development of a product as quickly as possible, achieving product feedback earlier in the cycle and production of a service or product that people actually want. It avoids the disastrous consequences of white elephants by finding out something won’t work while it is still the scale of a rodent.
Being Lean saves time, money and sanity. It negates the need to create for creations sake by giving purpose and direction to every product or development. If what you are suggesting doesn’t make sense after testing it doesn’t proceed. Every hypothesis is subject to the same measurables meaning continuity and consistency. It provides definitive proof of what works, what doesn’t and leaves no middle ground for wonderment.
Lean is about succeeding or pivoting to succeed elsewhere. Do you truly want to succeed or do you want to create something you want and hope that others do to. Crucially, Lean gives the customer what they want, evidenced by rigorous data, not what they ask for.
So what does it mean to be Lean? It means only developing things of value. Lean is about trusting what you have learned in the face of adversity and using your acquired knowledge to achieve. Can you strictly adhere to that or will ego and vanity overpower your thinking? If so you will know what it means to be lean.