5 principles of lean management

Lean management refers to a technique developed with the aim of minimizing waste and maximizing the value of products/services to customers, without compromising on quality. It focuses on providing value to customers. A number of tools are deployed by lean management systems to align customer value with processes and people. To implement lean management well, we need to understand the following 5 principles:

1. Determine the value of the product/service

Value is what the customer is willing to pay and must be determined according to the customer's needs for each type of product/service. There are many techniques to determine the value of a product/service from the customer's point of view such as interviews, surveys and market research.

2. Determine the value flow

In this principle, businesses need to define goals to achieve the value of the product/service. From there, businesses can list the necessary activities and eliminate unnecessary activities that cause waste.

3. Establish work flow

After removing waste from the value stream, this principle helps to streamline the steps without interruption or delay. In addition, the elimination of waste is still carried out in this principle.

4. Pull principle

Inventory is considered one of the biggest wastes. Many businesses stock materials according to anticipated demand while lean management uses the principle of pull, i.e. produce products/services only when needed in required quantities. The pull principle is made based on the needs of the customer. To do this requires businesses to conduct extremely accurate market research. In addition, all processes must be streamlined to avoid losing time to improve working efficiency.

5. Seeking Perfection

Preventing waste is done through the above 4 principles but the principle of “Finding Perfection” is important. Because the core meaning of lean management is continuous process improvement. Every employee of the business needs to aim for perfection while providing products/services based on customer needs.

The 5 principles of lean management allow managers to recognize inefficiencies in business operations and bring more value to customers. By implementing all 5 principles, businesses can stay competitive, add value to customers, reduce waste, and increase profits.

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