2016.10.17.

Project management

LEAN Office - LEAN in the office, efficient office organization

The LEAN methodology and its tools are primarily used by manufacturing companies to develop their production procedures and to increase their efficiency and competitiveness. “Thinking Lean” is not the exclusive privilege of manufacturing companies: its system of tools can be put to use in the service sector as well – of course, with a bit of customizing. And, we should not forget that manufacturing companies have back office procedures as well where the lean perspective is just as valid. In the case of manufacturing companies it is not sufficient to focus on production procedures exclusively, but the procedures supporting and serving production are also worth optimizing in order to increase efficiency.

Projektmenedzsment

What is LEAN?

Let’s Eliminate All Non-value add, that is “Let’s get rid of everything that does not add value”.  So, LEAN communicates a way of thinking: let’s examine our procedures, find the losses and let’s try to eliminate them. Besides, let’s endeavor to use our available resources to the maximum and let’s create value for our customers. LEAN focuses on simple methods, filtering out losses and involving colleagues; this is how our results will improve and procedures (workflow) will be optimized in the life of our company.

So, the essence of the LEAN management is that we accelerate the company’s value adding activities by the methods of constant development and we decrease the time of the value production procedure by finding and reducing losses that do not add value. Let’s focus on the things our customers are willing to pay us for, let’s place that activity in the center while all our other activities fall into the wasteful category that need to be eliminated.

LEAN in the office

Why would we have give up on this in the case of office procedures if LEAN principles used in the industrial sector can be applied to administrational and office procedures with only a bit of customization also in the service sector. Losses occur here just like in traditional LEAN areas. With the help of the LEAN’s system of tools the efficiency of any office procedure can bee improved significantly. We might even say that service procedures supporting production though they fall further away from production, they have more potential since the majority of actions for efficiency increase are focused on manufacturing in industrial circles. It is important that the workers of the company would not feel that the introduced system is an extra burden for them, but that it is a solution that makes their everyday work simpler and easier.

Manufacturers vs. providers

There are significant differences in the operation of manufacturing companies and providers. Exactly that is why focus needs to be different when the LEAN method is applied in a manufacturing company or in a provider company. While the two-thirds of the costs of a manufacturing company is material costs for a provider company the dominant factor is wage costs. Other significant costs for manufacturing companies would be energy and wage costs; provider companies spend a lot on utilities, office rent, and information technology.

Another important difference is, that while in case of manufacturing companies the customer meets the product only after it has been manufactured (maybe before that), with provider companies the client can already be a part of the service procedure. So, if there is a mistake the customer can detect it immediately. Manufacturing companies have the opportunity to intervene without the customer realizing that there has been a problem. Service has to be provided whenever there is a need; you have to be on your toes all the time and customer needs have to be harmonized with capacity.

The procedures of manufacturing companies in most of the cases can be well mechanized or automated employees with less expertise can do the tasks well. The procedures of provider companies have many exceptions, there is great emphasis on well trained colleagues; basically, the well-prepared, motivated colleagues carry the company. Therefore the main purpose is the more efficient use of workforce and time.

What can be a loss?

The purpose of LEAN management is to eliminate every possible form of waste. Loss free procedures represent a better quality, they are faster and cheaper; that is, they can be maintained at lower operational costs. LEAN considers every activity as waste that the customer/client is not willing to pay for.

Summarizing the losses that occur in office procedures: 

  • If our performance of a task is faulty or dedicate more than necessary resources to the completion of the task; 
  • If we spend more time on an activity than it requires;
  • If a colleague does a task that could be done by a lower cost resource;
  • If we cannot fulfill a customer’s need on time
  • If we make a bad decision because of wrong information,
  • then we have indeed found a wasteful activity that needs to be eliminated immediately according to the LEAN methodology.

Lean Office – how should we create it?

The essence of the LEAN Office is that information would be available to the right people in the right amount and quality at the right time and in the right place. This is the principle of the “Just in time” service.

Efficient office organization greatly contributes to the effective operation of the company; and the lack of it often supposes wrong management methods. There are numerous work organizing and IT systems and their functionality may contribute to successful operation. First, you have to think through the procedures that are real and the ones that need to be improved and you should select the suitable IT support only after this. If we do it the other way around and fit an IT system to a bad work organizing practice we should not be surprised when it does not work. Keeping the right order we may obtain a well functioning, error free, significantly cheaper operation with faster processing time. We can substitute e-mail, phone, papers, and meetings with the right application that accelerates operational procedures; thanks to workflow support the company becomes controllable and documented; collaboration ensures comprehensive navigation to everyone regardless of when they joined an activity.

In case of office procedures both the identification and elimination of the mistakes of an activity are the tasks of the LEAN methodology. The emphasis here is not only on recognizing and eliminating the mistakes or problems, but on finding the root of the problem and taking care of it as well; this is how we can make sure it is eliminated for the long run. The PDCA cycle can help us with this:

  • PLAN: Plan it!
  • DO: Do it!
  • CHECK: Check if it works!
  • ACT: If it works, expand it to all workflows!

From the point of view of the efficient operation of our company, we have to pay sufficient attention to training our colleagues. If it is our goal that our colleagues would not only recognize problems, but they would also be able to fix them, then it is worth supporting their training. It is not only the company that profits form this we are giving them an opportunity for creativity and self realization.

Is your company affected?

You should consider the reorganization of office procedures if…

  • The collagues complain because of the administrational burdens they have;
  • documents cannot be found when you need them;
  • the number of tasks that should be done on a daily basis becomes almost chaotic and it is difficult to check the status of tasks influencing the company’s operation;
  • creating efficient communication is a growing challenge and the different organizational units function separately;
  • the decision procedure slows down and the willingness for innovation decreases;
  • there are lots of misunderstandings and blaming;
  • the colleagues are tired of the daily grind and they are visibly overburdened;
  • operational costs are high…