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Lean Principles and Philosophy Extend Beyond Manufacturing

Thought Leader

By Jeff Peretin, Partner and President of Connors Group

When hearing the term “Lean,” most professionals think of the Toyota Production System for Manufacturing, where eliminating waste without comprising quality or sacrificing production is the focus.

But, in addition to the daily pursuit of operational improvements and efficiencies, the “Toyota Way” also focuses on the dignity of work and the people who perform it. Happy and respected employees are better at their jobs and transfer that respect and pride in the business to the customers they serve…that’s why Lean practices and the philosophy that accompanies it have extended beyond manufacturing to heavy service-focused sectors like health care, hospitality and retail.

In health care, the goals of improving the patient experience and eliminating waste are top priorities for hospital administrators. Solutions such as examining predetermined staffing levels and applying engineered labor standards, capacity planning, reducing administrative work and claims processing free up resources and alleviate unnecessary or repetitive tasks, while also improving profitability. With streamlined administrative tasks, employee satisfaction improvements have almost immediate positive impacts on both the patient experience and the bottom line.

It is important to remember, that Lean is more than a business practice, it is a philosophy where the aim is to empower employees while improving the financial growth of the business.

Another example where Lean practices are being used is in the hospitality and restaurant industry. The emergence of the digital age along with the ever-increasing expectation of customers is driving the need for agility and growth. Again, optimizing processes and labor plays an important role, but speed of service, table turn-over, delivery speed, space planning and kitchen design are also equally important, especially with the emergence of the “Grocerant,” which is blurring the line between restaurants and grocery stores. Chains like Wegman’s have been applying Lean methods for years which enables and empowers employees to focus on superb customer service, while keeping positive and sustained growth at the forefront.

There’s no denying that the retail industry has been struggling for years. The Amazon Effect is just one cause of its struggles…The lack of focus on the customer experience has had a lasting impact on the bottom line and has made it imperative that retail stores shift focus to Lean Principles to attract, engage and retain customers.

Operational improvements that focus on labor models and profitability are key, but with customers accustomed to the comfort and ease of shopping at home (or anywhere), focus on store design and functionality are no longer a nice-to-have, but rather a must. And, with competition for employees in a tight labor market, now more than ever, the need to also respect and retain talent is of equal importance.

It is important to remember, that Lean is more than a business practice, it is a philosophy where the aim is to empower employees while improving the financial growth of the business. Most of us conjure up visions of the merciless consultants looking to cut costs at any measure, when the reality is that a true, transformational journey with equal focus on employees and customers is the only way to achieve real, lasting change. If you look at the world’s most successful brands, you will see the trifecta of happy employees, customers and excellent financials!

About the Author:

Jeff Peretin is Partner and President of Connors Group, a Canonsburg, PA-based Management Consultancy specializing in Workforce Performance