Lean has proved to be a successful philosophy of management operation planning due to its capability to reduce waste (Bamford & Forrester 2010). Additionally, lean is favored because of its assistance in sustainability (Piercy & Rich 2015). Implementing lean thinking in an organization makes it possible to create favorable conditions for monitoring of supply, better employee engagement, and transparency.
Lean and Business Performance in the UK
In their research of lean in the UK government, Radnor and Johnston (2013) analyze the impact of lean management on the connection between internal supply mechanisms and consumer service in public sector companies. The scholars argue that although public service institutions admit the significance of lean for their internal processes, the companies fail to connect it to consumer service or value. Analyzing customer focus, Radnor and Johnston (2013) note that the delivery of high-level services is the basic objective of most companies. Still, there is an opinion that client focus is not sufficiently interpreted. Such misunderstanding causes the situation when consumers or organizations do not receive anticipated advantages. Even though being client-focused does not presuppose becoming entirely consumer-oriented, such focus still requires a company to make its clients participants of the unit analysis (Radnor & Johnston 2013). The organization is supposed to consider consumers as members of value establishment and needs to find ways of creating value for themselves and the customers.
Achieving lean is connected with several critical factors:
- determining value from the client’s point of view;
- organizing an uninterrupted product flow;
- distinguishing the value flow for services and products;
- managing the company’s activity in the direction of eliminating value decrease;
- providing pull between the stages where the uninterrupted flow is inaccessible (Radnor & Johnston 2013).
Radnor and Johnston (2013) remark that without providing these options company’s competitive advantage will not be possible. They emphasize that the present public sector modifications are operated by the productivity program, and there is no perception of the consumers and their values or demands. Therefore, the authors conclude that unless the UK companies change their approach, lean will not be successfully implemented and its positive outcomes will not be achieved.
The Importance of Strategic Supplier Partnership and Postponement in Supply Chain
Among the effective operation strategies which could be employed by the UK government to achieve lean thinking are postponement and strategic supplier partnership. These activities can help companies to accomplish their plans and objectives (Qrunfleh & Tarafdar 2013). Strategic management increases the organizations’ competitiveness, and its implementation requires thoroughly prepared approaches to gain success.
The core purpose of the supply chain strategy is the improvement of the company’s supply chain reception with proper regard to its clients (Qrunfleh & Tarafdar 2013). Still, many organizations fail to obtain a relative reaction from their strategies. For instance, manufacturers may lose their customers’ respect and trust if they neglect the need to react quickly to the shipment delays. To eliminate the gap between the company’s strategy and the reaction of the supply chain to clients it is necessary to utilize relevant activities that would promote the underlying strategy (Qrunfleh & Tarafdar 2013). A strategic supplier partnership is a great way to achieve the organization’s objectives. Such a partnership should be delineated as resources to promote the accomplishment of the company’s supply chain strategy. The postponement is an essential element in negotiating between agile strategy and supply chain reaction. The research shows that it develops the supply chain’s capacity and increases the company’s performance.
Ways of Application of Core Lean Processes
Lean thinking enhances the decision-making process in companies. Thus, it can be used as a suitable industry philosophy by the managers (Lyons et al. 2013). Lean thinking used to be applied in manufacturing, but its obvious advantages led to the employment of this philosophy in many other industries. Many empirical study results show how the endorsement of a lean approach helps to enhance operational performance.
Lyons et al. (2013) delineate four lean principles that help to achieve lean goals: (1) adjustment of production to requirements, (2) disposal of waste, (3) unification of suppliers, and (4) creative engagement of the employees. The principles are interdependent. For instance, adjustment of production to demand is connected with waste disposal. The exclusion of waste helps to decrease costs and arrange the necessary production activities into an effective system model which promotes steady production flow with a minimum of breaks, suspensions, and divergences (Lyons et al. 2013). While lean thinking is not the best way of thinking, every industry has to meet the competition challenges by constant modernization and enhancement. Meeting these challenges is the most productive while applying the lean thinking approach. Lean philosophy goes far beyond waste elimination. Rather, it is the adjustment of production and demand, the unification of suppliers, and the creative involvement of the workers along with waste disposal (Lyons et al. 2013). Thus, it is vital to take into consideration all of the principles when outlining the company’s strategies. Any company’s success depends on its ability to reach out to the customers and maintain good relationships with them. The employment of lean philosophy creates favorable conditions for advantageous manufacturing and distribution.
The Importance of Adopting Lean as a Holistic Strategy
Manufacturing companies have succeeded in enhancing their quality, adaptability, and client response time owing to the principle of lean thinking. However, to attain its full potential, lean needs to be embraced as an integrated business strategy and not merely a separate activity (Fullerton et al. 2014).
Management accounting practices are considered a crucial element of financial control within an organization in the environment of lean philosophy. Lean management accounting practices can assist the operations crew in the decision-making processes. It also helps business leaders and operations executives to enhance the efficiency of lean operation as a component of a holistic strategy. Fullerton et al. (2013) note that the level of lean production implementation is connected with the employment of lean management accounting practices. Strategically adjusted management accounting practice has a positive impact on the use of value stream which further increases the visual performance efforts.
Current business strategies demand diversified approaches to manufacturing and interaction with customers. Lean philosophy is gaining more and more popular among organizations due to its capability to eliminate waste and enhance communication with customers. However, for the successful implementation of lean theory, it is necessary to take into consideration the current limitations. For instance, a better understanding of customer needs will enable the companies to meet these requirements and thus make the clients interested in cooperation. Once the obstacles to implementing the lean theory are overcome, it will provide the most positive outcomes for the manufacturers.
Bamford, D & Forrester, P 2010, Essential guide to operations management: concepts and case notes, Wiley, London.
Fullerton, R R, Kennedy, F A & Widener, S K 2014, ‘Lean manufacturing and firm performance: the incremental contribution of lean management accounting practices’, Journal of Operations Management, vol. 32, no. 7/8, pp. 414-428.
Lyons, A C, Vidamour, K, Jain, R & Sutherland, M 2013, ‘Developing an understanding of lean thinking in process industries’, Production Planning & Control, vol. 24, no. 6, pp. 475-494.
Piercy, N & Rich, N 2015, ‘The relationship between lean operations and sustainable operations’, International Journal of Operations & Production Management, vol. 35, no. 2, pp. 282-315.
Qrunfleh, S & Tarafdar, M 2013, ‘Lean and agile supply chain strategies and supply chain responsiveness: the role of strategic supplier partnership and postponement’, Supply Chain Management: An International Journal, vol. 18, no. 6, pp. 571-582.
Radnor, Z & Johnston, R 2013, ‘Lean in UK government: internal efficiency or customer service?’ Production Planning & Control, vol. 24, no. 10/11, pp. 903-915.