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Process Improvement with Lean

A Case Study in Improving the Support Process in an IT Startup

Written by Magnus Persson

Paper category

Bachelor Thesis


Business Administration>Management




Bachelor Thesis: What does Lean mean? The concept of lean is known today, and countless professional versions have been produced according to the industry or application (Lean Service (Wei, 2009), Lean Management (Atkinson & Linehan, 2009), Lean Hospital (Kim, et al., 2006), etc.) , Its foundation is derived from the management philosophy of the car manufacturer Toyota (Liker, 2009). Many different versions of Lean are based on a core concept that provides inclusiveness and value creation for identified customers, while reducing waste, increasing processes, and shortening process lead times (ibid.). For this paper, Liker's interpretation of Lean (Liker, 2009) was chosen as the basis for its breadth and universality. In addition, in terms of lean indicators (Ries, 2017) and value stream maps (Humble, et al., 2015), more modern lean interpretations have been chosen as supplements. Western researchers traveled to Japan in the early 1980s to analyze and document the differences in the way the Japanese automaker Toyota and American automakers such as Ford and Chrysler operate their factories—it was clear at this time that Toyota had a lot of cars. Compared with its American counterparts, the quality is higher and requires fewer repairs and services. Also of interest to Western researchers are Toyota's high-quality parts, whether they come directly from the Toyota plant or from subcontractors (Liker, 2009, p. 13-14). Obviously, Toyota applies lean thinking not only to the production side of the company, but to the entire enterprise: the focus should be systematic, covering the entire value chain (ibid.)-including spreading the Toyota way of philosophy along the value chain, because this It will benefit Toyota and ultimately create value for its customers. Toyota has developed these ideas and tools over a long period of time in order to provide quality to different customer groups: internal customers, such as subcontractors and their own organizations, and external customers, such as product buyers, and ultimately, The whole society. This broad perspective is the key difference in how Toyota and its American counterparts view customers. American companies tend to focus more on creating shareholder value. (Liker, 2009, p. 99) The foundation of the lean philosophy is that management should have a long-term vision-not only in terms of financial goals such as revenue growth and profit increase-but also actively develop and focus on the entire organization with a common goal , Not just for the pursuit of profit. Companies should focus on creating value for customers, society and the economy as a whole, so as to exceed financial goals. Every function of the company should be related to how to create value to promote these goals. 2.2 Lean process perspective Identifying, improving and creating repeatable processes in an organization is the core of lean. Each process must produce the correct result and create the value requested by the customer. The focus of the process must be to provide customers with value when they need it—not sooner or later. Another key aspect is continuous improvement: never stop improving and continuously evaluate current performance (Liker, 2009, p. 33). The PDCA cycle is the cornerstone of the continuous improvement workflow. It can help create a systematic improvement method through the four stages of planning, execution, inspection and action (Liker, 2009, p. 45). Jeffrey K. Liker has 7 principles for dealing with lean processes (Liker, 2009, pp. 61-64): 1. Create a continuous process to surface problems. The prerequisite for achieving this goal is to create a continuous process-a process whose activities are fully synchronized to shorten the lead time: business processes are usually up to 90% wasteful activities, and only 10% create value for customers (Liker, 2009, p. 87). Through the continuous process in the process, you can minimize waiting and maximize the use of resources. The process will also visualize the problem in the process, namely Muda, a meaningless activity that does not create value for the customer. There are eight different kinds of Muda (Liker, 2009, pp. 50-51): overproduction. Producing things that are not needed is a waste of resources, and these resources can be better used elsewhere in the process. Overproduction leads to increased inventories, thereby increasing costs. b. Wait. When the activities in the process have to be stopped for some reason: the previous activities are overwhelmed by some failures, waiting for approval, unbalanced downtime, poor communication, etc. c. Transportation. A waste of resources that occurs when something must be transported between activities. d. Excessive processing. The inefficiency of work is caused by unnecessary processing due to incomplete design or wrong tools. Over-processing can also occur when the output of a process produces higher quality than the customer requires. e. Excess inventory. Waste occurs when the inventory is unnecessarily large. When the inventory is surplus, due to the huge scale of output, other types of waste may be hidden, and the actual number of defects, lead time, and insufficient planning may be hidden. f. Excessive exercise. Every moment in the process that is unnecessary for the expected result: searching for the information or tools needed, or unnecessary moments for employees working in the process. For example, defects. Producing defective products or services is a waste of processes and requires additional resources to repair, redesign or recycle. h. Do not use talents. Do not use imagination, creativity. Read Less