Lean SG&A: Designing a service system that optimally responds to customer demand

Doesn’t matter how you will call it, Lean Admin, Lean Service or Lean SG&A can be a pitfall for experienced lean manufacturing practitioner. Especially engineer minded companies and countries like Germany and Switzerland like to start with „the tools“. But adapting or migrating tools and even key learnings from the shop floor to the administrative is the wrong approach. The lean journey in administration should not start with the lean thinking pillar of continuous improvement but with respect for people.

Respect for people includes three important aspects: PURPOSE, PROCESS and PEOPLE.

The purpose can be defined by the customer and only by the customer.

Even in manufacturing, „so called lean experts“ did not achieve to grasp the full potential of the origine of the lean philosophy but became tool experts instead. In Lean administration you need to start with a system approach first. Then you can pick tools depending on the need of the system driven by the customers.

Manufacturing and Service – two different worlds

„Service and administration are generally characterised by greater variety than repetitive manufacturing… . Mapping short-cycle repetitive manufacturing is well catered for by classic texts such as Learning to See. If you are ‚fortunate‘ enough to have an administrative process with high repetition, dedicated resources, low variation between similar products, highly standardised tasks, and minimal customer contact, then certainly you should use the Learn to See mapping. Takt time will be relevant. However, most of the time repetitive manufacturing concepts like takt time will have little or no relevance in service.“ [BICH08, S.5]

In lean manufacturing the toolbox helps you to standardize work as much as possible. Get 5S in place, define the takt time, reduce variations, implement Kanban, etc. At the end you set-up a working environment that allows even average people to achieve great results with great processes. In lean administration this is different. You need great people with a natural understanding of customer value and willing to see the big picture = the system. Understanding the properties of gasses like oxygen and hydrogen will never lead to a general understanding of liquid water. Likewise with Lean and Lean tools [BICH05, S.9]. Taiichi Ohno compared parts of the Toyota Production System ‚autonomation‘ with the human reflex nerve system. Katsuaki Watanabe, the Toyota President, extended the analogy of the human body: „Layout, supermarket and buffers provide the skeleton; pull system and information flows are the circulation system; vision and strategy are the eyes and brain; control, deployment come from the muscular system; and energy and getting rid of waste come from the digestive system. The body needs them all for ’simple, slim and speedy‘ Lean.“ [BICH08, S.9]

The human body is complex, so is a Lean system. But where should you start? Here you can go back to the principles and philosophies perfectly decribed in Womack and Jones „Lean Thinking“. Start with defining value for the customer. Even this is not easy. Most customer do not communicate what they need, just what they want. What is the difference between needs and wants? Here some examples: The customer needs to go (somehow) to work daily, but what he wants is a car. The customer need to spread information on paper, but what he wants is a printer. The customer needs a lower inventory, but he wants to scrap stuff. Did you get it. What customers want and  is quite different from their needs. What they communicate could be just one potential solution to fulfill their need. As soon as you put yourself in your customer’s shoes, you’ll have done a big step in understanding the core of a lean service system.

It’s a long journey. Enjoy every step you take.

If you liked that, you'll probably like these too:

Kommentar verfassen

Deine E-Mail-Adresse wird nicht veröffentlicht. Erforderliche Felder sind mit * markiert.