The document outlines the principles of lean management, focusing on waste reduction to improve product and service value for customers. It details various categories of waste, benefits of implementing lean practices, and several case studies showcasing successful lean transformations in organizations. Additionally, it describes tools and methodologies such as value stream mapping and 5S, emphasizing the importance of continuous improvement in achieving sustainable performance.

1. Lean Capability Event
March 2013

2. What is Lean?
Lean is a management approach.
Lean focuses on improving the value of a product or a
service from the customers perspective by reducing, or
eliminating, waste. As waste is eliminated, quality
improves while production time and cost are reduced.
In summary, Lean is about identifying and eliminating
Waste.

3. Categories of Waste
 Over production
“Typically less than 5% of
 Inventory activities are value adding.”
 Waiting
 Motion
 Transportation
 Over processing
 Defects
 Not utilising workers talent
and knowledge

4. Benefits of Implementing Lean
The benefits can be broken down into four main categories;
• Operational Improvement
• Administrative Improvements
• Strategic Improvements
• Improved culture in the organisation

5. Case study: Mining company Shift change
The company considered that efficiencies could be gained
during the shift changeover process
• Team formed – 2 supervisors; 1 manager; 1 CI rep; miner;
external facilitator;
• Time analysis conducted for finishing shift and starting shift;
• Repetition and “lost” time identified;
• Value stream maps and swimlane chart confirmed the wastes;
• Changeover process redesigned with union support;
• Annual saving of $3 million.

6. The Lean Tool Box
 Value Stream Maps  Batch Size Reduction
 5S  Takt Paced Production & Delivery
 Visualisation  Fool Proofing
 Kaizen and Kaikaku  Spaghetti charts
 Quick Changeover  Level Loading
 Point of Use Storage (POUS)  Kanban
 Monuments and Remedies  Work Cells
 Lean Performance Measurement

7. Value Stream Map
Type Testing: Current State Value Stream Map
Represents information flow.
Business
Development
Contractor Client
Scheduling and
Resource Planning
Report
Receive and Develop Provision of Issue
process project Type Test Report to
application plan for Assessmen client and
client t Service invoice
Lead time:
7 weeks
2 weeks 4 weeks 1 week
Value add
0.25 days 0.25 days 2 days 0.25 days time:
2.75 days
Total time: 7 weeks 2.75 days
Value add time: 2.75 days
% value add time: 7.30%

8. Value Stream Map
Type Testing: Future State Value Stream Map
Represents information flow.
Business
Development
Contractor Client
Scheduling and
Resource Planning
Report
Receive and Develop Provision of Issue
process project Type Test Report to
application plan for Assessmen client and
client t Service invoice
Lead time:
2 weeks 2
1 day 2 weeks 1 day days
Value add
0.25 days 0.25 days 2 days 0.25 days time:
2.75 days
Total time: 2 weeks 2 days
Value add time: 2.75 days
% value add time: 22.90%

9. Swimlane Chart
Start
DEVELOPMENT
End
Maintained and
Technical
Upgraded Product
Architecture
Set Product Set Product Code Maintain
Strategy Requirements Application Application
Fully Functioning Product
Packaged
Components Product
Develop Bill Components Build Ship Problem
of Materials List of Exist? Yes Product Product Report
OPERATIONS
Application Required
Vision and Components
Direction Components
Customer Receive Product
Requirements Components Shipped
Information
Product
TECHNICAL SUPPORT
Obtain Customer
Customer Search for Support Problem Report
Feedback Components Product Problems
Problem
Customer Customer Resolution
ACCOUNTING
Requisition Invoice Process
Components Customer Payment
Order Invoice Payment
Customer
Supplier Customer
Invoice

10. Value-add Analysis
Value Adding activities are those exert an effect on the
service or product and this adds value from the customer’s
perspective.
Value Enabling activities are those that do not add value
as such, but are necessary or required for the conduct of the
process. Examples: steps needed to comply with regulatory
requirements; or to provide information to the organisation.
Non-Value Adding activities are those that do not add
any value from the customer or organisational perspective.

11. Swimlane Chart
Showing: Handover analysis and Value-add analysis
Start
DEVELOPMENT
End
Maintained and
Technical
Upgraded Product
Architecture
Set Product Set Product Code Maintain
Strategy Requirements Application Application
Fully Functioning Product
Packaged
Components Product
Develop Bill Components Build Ship Problem
of Materials List of Exist? Yes Product Product Report
OPERATIONS
Application Required
Vision and Components
Direction Components
Customer Receive Product
Requirements Components Shipped
Information
Product
TECHNICAL SUPPORT
Obtain Customer
Customer Search for Support Problem Report
Feedback Components Product Problems
Problem
Customer Customer Resolution
ACCOUNTING
Requisition Invoice Process
Components Customer Payment
Order Invoice Payment
Customer
Supplier Customer
Invoice

12. CASE STUDY: Gov’t dep’t support application process
The application process took 12 weeks
• Team formed – manager; team leader, operators;
service support dep’t rep;
• Value stream map; Swimlane chart and value-add analysis;
• Identified multiple checks that did not add value and work flowing
backwards and forwards between departments;
• Gained management and operations agreement to remove checks
and waste activities along with redesigning some process steps;
• Pilot showed the time reduced to 3 weeks.

13. 5S Workplace Organisation
Tool Meaning
Sort Housekeeping. The only things that should be in the
workplace are files, materials and tools being used.
Set in order Workplace organisation. A place for everything and
everything in its place.
Shine Clean up. Make the place shine.
Standardise Best Practice. Make the above 3S’s become a way of
life.
Sustain Discipline. 5S becomes part of the way we do things
around here.

17. Is this sorted?

18. Fool Proofing
Fool proofing or error proofing.
It is a technique for avoiding and eliminating mistakes.

19. Example: 5S and Error Proofing
Messy, time lost finding parts
and wrong parts often picked.
Cardboard template is
“bill of material”. Wrong
parts cannot be picked.

23. ISO 9001 Lean
ISO 9001 Lean is a program that combines the
benefits of a structured management system
with the powerful but simple tools of Lean to
implement effective performance improvement
using an ISO 9001 based management system.

24. ISO 9001 Lean
5.4 Planning (to meet objectives) –The objectives are established and processes are designed
to support the achievement of objectives at section, division and the strategic level.

25. ISO 9001 Lean
5.4 Planning (to meet objectives) –The objectives are
established at section, division and the strategic level.
8.4 Analysis of data
Collect and analyse data relating to:
Process performance
Customer satisfaction
Product / service performance
Cost
Time / efficiency
Internal audits
Performance against objectives

26. ISO 9001 Lean
5.4 Planning (to meet objectives) –The objectives are
established at section, division and the strategic level).
8.4 Analysis of data
Collect and analyse data relating to:
Process performance
Customer satisfaction
Product / service performance
Results of internal audits
Cost
Time / efficiency
Performance against objectives
Gaps in performance are now known.

27. ISO 9001 Lean
5.4 Planning (to meet objectives) –The objectives are
established at section, division and the strategic level).
8.4 Analysis of data
Collect and analyse data relating to:
Process performance
Customer satisfaction
Product / service performance
Results of internal audits
Cost
Time / efficiency
Performance against objectives
Gaps in performance are now known.
Use the improvement clauses
of the standard to address
gaps in performance using
simple Lean tools.

28. ISO 9001 Lean
5.4 Planning (to meet objectives) –The objectives are
established at section, division and the strategic level.
8.4 Analysis of data
Collect and analyse data relating to:
Process performance
Customer satisfaction
Product / service performance
Results of internal audits
Cost
Time / efficiency
Performance against objectives
8.5.1 Continual improvement
8.5.2 Corrective action
8.5.3 Preventive action
Use the tools out of the Lean Toolbox

29. ISO 9001 Lean
5.4 Planning (to meet objectives) –The objectives are
established at section, division and the strategic level.
8.4 Analysis of data
Collect and analyse data relating to:
Process performance
Customer satisfaction
Product / service performance
Results of internal audits
Cost
Time / efficiency
Performance against objectives
8.5.1 Continual improvement
8.5.2 Corrective action
8.5.3 Preventive action
Use the tools out of the Lean Toolbox
Causes of gaps identified, solutions
identified, future state developed and
implemented.
Improved and sustainable performance

30. Lean Improving Business Performance
Lean provides an extremely effective tool for:
 Focusing key members on the elimination of
waste,
 Identifying specific alternatives that will improve
processing times or quality,
 Provides a new lens for reviewing customer
requirements,
 Creating solutions that ‘bridge the gap’ between
process and management.

31. An organisational journey
Sustainable
Performance
Focus on
value
Align the
System
Fix the
basics

32. SAI Global Client Solutions
• Establishing sustainable performance
Client • Organisational wide engagement in
Solutions Excellence and Continuous Improvement
• Tailored Systems for Business
Services What
Performance Improvement
• Facilitating sustainable capability
development
• Structured program for organisational
learning
• Delivered by credible advisors with
How
extensive experience in Business
Excellence
• Sole Australian Provider of the
internationally recognised Australian
Business Excellence Framework
Our point • Demonstrated success in Organisational
of
difference
Change Management

33. Our Approach for LEAN
• Lean Implementation 5 day event – consecutive days or split over several weeks
 Training of CI Facilitators
 Action Learning approach
 Address an improvement opportunity and deliver outcomes through the training Event
• Lean Blitz
 2 day Blitz
 Basic Lean skills applied to an operational problem
• Applying Lean Concepts
• 2 day Introduction to Lean Concepts
• Working towards a Lean Organisation
• ISO 9001 Lean
• Application of lean to improve your management system
• Lean Coaching

34. The ABEF Categories

35. Achieving Sustainable Excellence
Understand
the
System Common Understanding
Review
Improvements of the System and
Priorities Agreed
Systems i.e. System Outcomes OFI’s from
Thinking Other
Sources
Understand the
Implement and Clarify Strengths
Australian Business
Manage the and Opportunities
Excellence Framework
Solution for Improvement
and Principles
Approval to Implement Allocation of
and Accountability Resources for Working
Assignment Apply ON the System
Improvement
Techniques

36. Benefits to Commercial organisations
 20% productivity increase in one year
 247% sales increase over two years
 150% increase in tenders won
 500% increase in share price over six years
 25% sick leave reduction in one year
 66% lost time injury reduction
 80% product defect reduction
Benefits to the way you personally work
Provided me with solutions I needed to overcome issues being imposed upon me by the
Standards Agency and Accreditation.
Has allowed me to devolve responsibility down the line better.
I look at requests for change through eyes of data and not just whims. Personally more
open to ideas and suggestions.
I have stepped back from ‘leading’ to allow others to try to make decisions.

37. Benefits to Organisations
Reduced Outside Maintenance cost by approximately $6000 per year.
This has brought the four facilities together in sharing data and common systems.
Greater focus on the system and not on the people when things go wrong.
Feel we now have control of the business again.
Benefits to Staff
Staff morale has increased and they are in more control.
Improved staff satisfaction.
Staff are beginning to understand their role in the context of the wider organization
Personal improvement plans now work.
Staff members who previously were reluctant to be involved now line up to be part of it.
The staff have more confidence in using feedback systems.
Better use of RN time.
Communication and awareness has increased by more than 90%

38. BE & Management Systems
ABEF & integrated
leadership and management systems

39. Questions?
Thank You
Lean Capability Event
March 2013