I first heard about the five lean principles from Mr. Ashley Johnson, a co-founder of Gemba Systems LLC, which is a boutique professional services firm. Whatever I say about Ashley would be just too weak to express my admiration for this guy, because he is a rare combination of passion, skill, and devotion. I strongly recommend him as a coach, mentor, and adviser.
What I’ve learned about the Lean principles literally changed my whole perception of building products. I was able to see how inefficient traditional software development processes were and I could suggest improvements into basically any part of the production chain. In my case, it was the software industry, but the principles easily apply to any product or services company out there. Actually, this is how I got into Kanban in the first place. The reason why I fell in love with this method is its simplicity (somewhat delusive at times), and its ability to implement the Lean principles in such a lightweight and elegant way. Below is a short summary of the core principles that a lean company must follow accompanied with my thoughts about how Kanban can help you to keep them.
Principle Number 1: Value
Although it is oversimplified and somewhat blunt, my favorite definition of Value is the following: “Value is anything that the customer pays you for”. Yep, as simple as that. Anything else is considered “Waste”. Being a QA guy at the time, I was struck by the fact that my work was a big piece of waste according to the lean principles. After all, nobody was paying my company to test, right? A small consolation was the fact that it was not considered “Pure Waste” (things that you MUST remove from your system), but “Necessary Waste” (things you should do to be able to produce value of high enough quality).
We don’t live in a perfect world and we will always need people that handle the necessary waste. However, we need to track down how much of the work we do is really valuable, how much is a necessary waste and how much we can classify as pure waste. A Kanban board can help you with that.
Each card on the Kanban board can be assigned a Type or also a class of service. In this particular example, the red card is a Bug (which is quite often classified as pure waste), the purple is a support request (which is usually mapped to necessary waste) and the green is a customer feature (value). When you track each bug, support request and feature on your board, you can later on visualize on a chart and investigate how much of your times goes into which category. If you find out that a lot of time is consumed by necessary or pure waste, don’t be discouraged. You are a lucky guy that has a lot of potential to improve.
This is how your card distribution chart might look in Kanbanize. When you click on some of the areas you get a list of the actual cards and you can easily inspect each one of them. Quite handy when you want to analyze a big number of items.
Principle Number 2: Value Stream
Moving forward to the second principle, things start to look even more Kanban-ish. Most waste-reducing activities are possible after the creation of a value stream map of your process. In other words, you visualize the states through which materials and information flow on their way to becoming value for the customer. A traditional value stream map looks like that and it is the standard in manufacturing, but as usual, with Kanbanize we make things simple. The analog of a full-fledged value stream map is the Kanban board where you can define an unlimited number of columns or horizontal swimlanes to reflect the different states.
Principle Number 3: Flow
As shown in the picture above (the red arrow), the Kanban cards representing the customer value that you produce are “flowing” from left to right and each consecutive step on the right brings more value to the end result. The idea of flow is very simple – deliver regularly in small batches. It is better to produce 10 pieces of product A and ship them to your customers early instead of producing 1000 and only then send them to market (just to figure out you’ve produced much more than required). Flow depends on how frequently your customers are ready to accept new goods, which is called Takt time. To learn more about Takt time, see our dedicated blog post here: Kanban Dancing
The ideal theoretical flow consists of a single item (Single Piece Flow), but there are different interpretations and studies that tend to prove other values would be more productive. My suggestion would be to first establish flow with the help of your Kanban board and only then worry about your batch size. Establishing stable flow is hard enough in the first place 🙂
Principle Number 4: Pull
Things get more complex here and we need to revert to the well-known supply chains to clarify why pull is so important. There are different types of supply chain systems some of which implement the push strategy and others implement the pull strategy. The push strategy is the standard with pretty much every store (books, groceries, clothing, etc.). This is where vendors “push” their goods to the stores and only then customers can buy them. The pull strategy is the opposite – first, we get an order (for an expensive suite for example) and only then the vendor produces and delivers it.
What’s the difference? In a push system vendors produce without actually knowing how much they will sell. They have predictions of course, but they never know the precise amounts. This gives them the benefit of having things in stock but, also puts them at risk of overproduction. On the contrary, pull systems are slower to react but, prevent losses from overproduction.
What’s with the Kanban board and pull? The lean principles suggest that you produce as much as possible coming from the PULL strategy. To achieve this, you set WIP limits on given columns on the board and by that prevent many items to be accumulated in it. When a column is full, it will not be allowed to accept more items unless an item is taken out of it. This is a crucial concept that guarantees a couple of benefits:
- The total amount of items being worked on at every moment in time is small and therefore each separate item is produced faster.
- The overall productivity of the system becomes more predictable
- All the work which is started eventually gets completed (which is rarely the case with non-Kanban systems).
Principle Number 5: Perfection
This post has already become quite long so I will be short on the last principle. The Lean culture demands that we relentlessly seek improvements into every corner of our organization. The Kaizen culture should be the first thing to adopt as widely as possible. If you get this right, even if you fail to adopt some of the other principles fast enough, you will get there eventually. Though, if you fail to adopt the Kaizen way of thinking, you will get out of business even if you do everything else right.
Kanbanize provides a rich toolbox of customizable Kanban analytics and reports to help you on your way to identifying waste and this makes it an invaluable partner on your journey to perfection.
Thanks for reading and as usual, feel free to drop us a line in the comments section below.
Happy Kanbanizing with Kanbanize – The Kanban Software that Scales your Business