Know your domain: Successful lean practitioners need vertical industry knowledge
Cindy Jutras, Aberdeen Group -- Manufacturing Business Technology, 3/16/2008 6:07:00 PM
Lean manufacturing and the
(TPS) were born of the discrete industries, with mature levels of adoption being seen in the automotive, aerospace & defense, and industrial equipment sectors. As these initiatives matured, so did the lean tool box and the supporting network of lean professionals.
The Aberdeen Group’s most recent benchmark, Extending the Lean Enterprise, proves that cost reduction remains the leading business driver behind lean initiatives even as lean fever spreads to other sectors, including the process industries.
But are these industries achieving the desired results?
As interest in lean extended beyond the core verticals of its birth, the market was flooded with lean consultants, all having 10- to 20-plus years of practical experience with TPS in the discrete industries. Yet these consultants had very little experience extending lean tools to process industries, which typically face a different set of challenges—e.g., rigid regulations, attribute-based rules and routings, product shelf life, the need for yield and inventory optimization, and more.
Since these manufacturers face the same pressure to reduce waste and drive down manufacturing costs, they turned to these same consultants to jump-start their lean initiatives—with mixed results.
However, as this new bastion of lean enterprises emerged, we saw a number of marquee hybrid and process manufacturers enjoy their own success stories. And as the lean implementations matured, so did the consultants. Today, instead of having a community of lean consultants with 10 to 20 years of discrete experience, we now have lean practitioners with 15 to 25 years experience in discrete, hybrid, and process industries.
Aberdeen research confirms our intuition: Knowledge of lean methodologies is not enough. In these industries, top performers also draw on the expertise of lean consultants with deep domain expertise. Best-in-Class process manufacturers are 36 percent more likely to use consultants with specific vertical industry experience when implementing lean. And the best of the best also tap into best practices from other industries, intelligently applying them to the current situation based upon prior experience.
Similarly, collaboratively sharing best practices across the enterprise means taking lessons learned from one functional area of the enterprise and intelligently applying them to another. As manufacturing processes become leaner, we see a shift of attention from the standardization and acceleration of manufacturing processes to a focus on non-manufacturing processes, including order management, service, finance, and administration.
Value stream maps can be equally effective in removing waste from front- and back-office processes as they were in manufacturing processes. Lean Six Sigma can drive variability out of any process. As one Six Sigma Black Belt once told me, “A process is a process is a process.”
So as we seek new frontiers, stretching the boundaries of lean beyond discrete industries and beyond the confines of manufacturing, the secret sauce is to apply deep domain knowledge while shamelessly stealing ideas from those who have gone before.
To read the reports, Extending the Lean Enterprise and ERP Plus in Process Industries, visit www.aberdeen.com.
Cindy Jutras is a VP and group director with Boston-based Aberdeen Group, where she oversees research programs, products, and services related to ERP, performance management, and financial applications.
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