Lean implementation requires following clear steps: 1. Start at the strategic level by creating a business case and lean vision with senior management buy-in. 2. Focus on value streams by mapping them, eliminating waste, and setting goals and metrics. 3. Develop lean behaviors over several years by appointing change agents and champions and training all employees. 4. Restructure systems and continuously improve after implementing lean solutions.

1. Lecture 7. Lean Implementation
In todays lecture, I want you to understand that there are clear steps for implementing
lean. You know what lean is, but that is no good because you now know how to im-
plement it.
Implementation of lean is actually a focused application of common sense. Maybe
you have noticed whatever we have talked about Just in Time, Jidoka and house
keeping all that staff are not some kind of an innovation, it is a common sense.
And, there is one critical things for the implementation of that common sense. It is a
commitment.
When you look at it, commitment is also not a complicated principle, right, it is a
quite simple principle. However, the actual obtainment of commitment from the large
number of people is what is difficult and complicated. And there is no one right way
to implement lean and obtain commitment. Because, each organization creates their
own path and each organization feel confused in their own way in terms of where to
start and which direction to head.
It is obvious that you must start from where you are and you must improve your ex-
isting processes incrementally but what do you implement first, what are the biggest
challenges and how will you measure progress.
Now, lets just think for a minute and discuss where do you think is the most appro-
priate to start your lean journey. We have talked about building stability, creating pull
system, value stream mapping, jidoka and all that stuff. From all what we have talked
where do you think is the most appropriate to start.
Well, there is actually a roadmap for implementing lean and we today are going to
use this roadmap throughout the lecture. When you look at the map, you can see entry
cycle, then you have a long term cycle, and finally you have a short term cycle.
Down there, in the short term cycle, you see the step called lean implementation. And
the problem is many organizations start implementation right there (including you).
But you cannot change your enterprise and overall culture of your organization start-
ing down there. Well, it is a good place to start, you might get some quick results but
those results would not have much impact.
Therefore, when you implement lean, you have to start at the strategic level. You
have to create a business case. You know what is the business case? Business case is
a formal document where normally business analysts must carefully analyse the cur-
rent situation and develop a solution requests. It includes needs assessment, current
situation assessment and success factors that must be met. You also have to really
think about the customer value, and add all that in your strategic plan.

2. And then you must adopt a lean paradigm. Here you must build a clear lean vision,
and you must commit to the vision you created. And then you must obtain senior
management buy-in. What happens if leadership does not buy-in? You can’t change
anything, right. Because, leadership has to ensure people that nobody is going to
loose their jobs and give a sense of security. Leader must also create a sense of ur-
gency to change and act as a role model. And role modelling is very important when
you are trying to change your enterprise.
Then, you have to focus on the value stream. Since you have your vision, you must
now internalise that vision by value stream mapping. You must follow the product,
eliminate waste, identify takt time requirements, create pull system and JIT, introduce
5s. You must then set goals for your team and create metrics (hoshin planning). You
must also identify your stakeholders and create engagement plan for your stakehold-
ers.
So setting metrics for your team and engaging with key stakeholders are what is go-
ing to move you to the future state.
Next we got to get to the behaviour. Despite metrics are good thing to foster lean be-
haviour, it is not sustainable, right. Because, employees might actually be okay with
the idea of change until they realize that their own experiences, skills and interests
might be replaced. Some of the everyday tasks might be changed.
Employees start to unintentionally work against the change initiative. Not because
they want to jeopardise the transformation but because they revert to the survival
mode. People might actually start politicking and power playing within your organi-
zation that will slow your lean implementation progress.
Thus, you must really develop the behaviour in the organization. You can’t do that
between Monday morning and Friday night. We are talking about few years here.
But what is helpful here is the appointment of change agents and change champions.
To foster lean behaviour, you can identify identify change agents and change cham-
pions from each department or team and appoint them to that team or department to
advocate lean. You must provide these change agents an extra training and in return
these change agents must foster lean behaviour within those departments and teams.
Leadership must also be closely involved at this stage and socialise with employees
very closely to create safety, and just to make sure that people’s concerns are being
heard.
After you have done this, you can start organizating your structure and systems. Here
you can see lean implementation requires fundamental changes.
Then, you must commit resources and provide specific training and education to all
employees.
After you can implement all of your lean solutions and move to future state VSM.
For that, you must have an implementation plan and you must act on that plan. The
plan must include specific timelines and deliverables.

3. Then, you must focus on the continuous improvement.
Overall, lean implementation is a strategic decision and it requires fundamental and
systemic changes. Only by adhering to the steps I have talked here, you will be able
to achieve long lasting and sustainable change.
An organization with a functional structure, for instance, would group all of the mar-
keters together in one department, group all of the salespeople together in a separate
department, and group all of the customer service people together in a third depart-
ment.
A divisional organizational structure is comprised of multiple divisions (i.e. each di-
vision within the organization can have its own marketing team, its own sales team,
and so on). For example, in a product-based divisional structure -- each division with-
in the organization is dedicated to a particular product line and each division have its
own marketing team, its own sales team, and so on.
Another type of the divisional structure is the market-based structure, where the divi-
sions of an organization are based around markets, industries, or customer types.
The location-based divisional structure establishes its divisions based on geography.
More specifically, the divisions of an organization can include territories, regions, or
districts.
Process-based organizational structures are designed around the end-to-end flow of
different processes, such as "Research & Development," "Customer Acquisition," and
"Order Fulfillment." So the process-based structure considers not only the activities
employees perform in that division like marketing or sales like in the functional
structure, but process-based structure considers how those different activities form
the end-to-end flow of different processes.
A matrix organizational structure doesn't follow the traditional, hierarchical model.
Instead, in matrix organizational structure all projects performed by employees (rep-
resented by the green boxes) have dual reporting system. Typically, there is a func-
tional reporting line (shown in blue) as well as a product- based reporting line (shown
in yellow). Having a single project overseen by more than one business line also cre-
ates opportunities for these businesses to share resources and communicate more
openly with each other -- things they might not otherwise be able to possible.
The circular structure still relies on hierarchy, but with executives occupying the in-
ner rings of the circle and lower-level employees occupying the outer rings. Execu-
tives at the center of the organization are considered to be spreading their vision out-
ward instead of giving directions from the top. Fundamentally, the circular structure
says that all divisions as the part of the same whole but not divided by the chart.

4. The concept underlying the network structure is the social network—a social struc-
ture of interactions, open communications, mutual adjustments and reliable partners
(both internally and externally). Some experts argue that the network structure is
more agile than other structures. Because it is decentralized, it has few levels, a wider
span of control, and a bottom-up flow of decision making and ideas.