Stepping from lean to servitization

Transcription

1 Stepping from lean to servitization Ian Machan Machan Consulting Ltd The aim of the paper and this short presentation is to: Explain an evolution of a popular and widely used definition of lean to include the delivery of advanced services along with the product Expand the traditional lean value stream mapping back into a tool that can be applied in designing and managing servitized commercial relationships

2 Why consider lean at all? Lean thinking has dominated, along with six-sigma, and their amalgamation lean six-sigma the improvement culture of the manufacturing sector for over twenty years With some modifications lean thinking is intellectually consistent with servitization. Thus for practitioners and business transformations, servitization does not replace lean but can make use of the training and skills already in place. The successful use of lean tools can be re-used, extended into an arena outside of traditional supply chain and factory boundaries. A coherent build on lean is more likely to gain traction and be successful

3 Stepping. Precisely specify value by specific product, identify the value stream for each product, make value flow without interruptions, let the customer pull value from the producer, and pursue perfection. Womack and Jones (1996) To: Precisely specify value by the customers requirements, identify the investment streams for each of the requirements, make value flow without interruptions, let the customers pull value from the supplier, and pursue perfection.

4 A more Commercial relationship A change from a product transaction to a longer-term commercial relationship. Benefits: Customer Lock in Increased Value to Supplier Opportunity for innovation Risks: A different contracting process and new skills required Potentially significant cashflow changes Reducing the likelihood of isolated lean implementations

5 Value to investment stream mapping Process mapping: Gilbreth and Gilbreth (1921) were probably the first to publish and described their process charts as.. a chart for visualizing a process as a means of improving it. They went on to emphasis the inter-related nature of the subdivisions that make up the whole, previewing the systems approach. Value stream mapping considers material and information flow but is based on delivery of value to the customer through a product transaction Investment stream mapping recognises that the supplier and customer are both involved in a more significant and probably longer-term investment style relationship, not merely a product transaction

6 What gets put into an investment stream map? In existence long before a product sale takes place. For example: bespoke product design, customer specific telemetry, contracting methods, financing models, pre-tender documentation Multiple customers. In most organizations, the functional split will result in a customer fielding accountants, procurement, lawyers, and quality assessors each looking to satisfy their part of the requirements. Multiple streams & multiple customers operating in parallel, but to different timescales The whole can be captured into an investment stream map and allow the visibility to manage that we have come to expect of value stream maps and value stream leaders.

7 Case Study 2009: China plant After VSM training, the workshop participants captured the complexities of their site in traditional fashion on large pieces of paper. A large number of activities were done to deliver value and meet customer requirements that were unrelated to the product delivery. In addition to shipping product they identified three further streams. Provision of forecasting and supply/demand analysis that had been relocated to the factory Preparation of financial controls, including budgeting and reporting Activities to maintain compliance with regional, national & corporate standards/ regulations These streams delivered value to their customers and were a significant overhead to the site. By mapping the extra streams the management team were able to identify improvements to these as well as the traditional VSM

8 To summarise: In moving from lean to servitization we can change from a product transaction to longer-term commercial relationship. However this is a coherent, logical adaptation of lean into servitization Investment stream mapping is a return to a holistic process mapping approach that can tackle the whole of the advanced services design challenge THANK YOU Ian Machan