The answer is yes! The concept and language of lean, rooted as they are in manufacturing, spark cynicism among many people. Some feel that their priority should be matters of policy, not operations; others resent the notion that they are somehow part of a production line. Moreover, without the incentive of the profit motive, these “old guard’ managers believe they have neither a reason nor the levers to pursue a lean approach.
Yet practical experience suggests that they can. If we look at how Lean has been successfully implemented in organizations we shall be pleasantly surprised.
For Example: In a government office processing large volumes of standard documents, lean techniques achieved double-digit productivity gains in the number of documents processed per hour and improved customer service by slashing lead times to fewer than 12 days, from about 40, thus eliminating backlogs. The proportion of documents processed correctly the first time increased by roughly 30 percent; lead times to process incoming mail decreased to 2 days, from 15; and the staff occasionally attains the nirvana of an unprecedented zero backlog.
In a military armored-vehicle repair shop, a lean transformation generated a 44 percent increase in the availability of equipment, a 16 percent reduction in turnaround times, and a more than 40 percent increase in “right the first time” production. This achievement put about 40 more vehicles into operation at any one time. Moreover, the repair shop progressed from constantly missing its vehicle delivery deadlines to never missing them.
Governments around the world want to deliver better education, better health care, better pensions, and better transportation services. They know that impatient electorates expect to see change, and fast. But the funds required to meet such expectations are enormous—particularly in the many developed economies where populations are aging and the public sector’s productivity hasn’t kept pace with that of the private sector. The need to get value for money from governments at all levels is therefore under the spotlight as never before. But cost-cutting programs that seek savings of 1 to 3 percent a year will not be enough and in some cases may even weaken the quality of service.
To address the problem, public-sector leaders are looking with growing interest at “lean” techniques long used in private industry. From the repair of military vehicles to the processing of income tax returns, from surgery to urban planning, lean is showing that it can not only improve public services but also transform them for the better. Crucially for the public sector, a lean approach breaks with the prevailing view that there has to be a trade-off between the quality of public services and the cost of providing them.
A lean system is designed to eliminate waste, variability, and inflexibility (see sidebar, “Three sources of loss”), though given the variety and complexity of many processes there can be no one-size-fits-all lean template. The needs of customers and the organization’s goals and values drive the design. But some important themes and principles of the lean approach do pose specific challenges for public-sector organizations.
For instance it is often questioned “Is lean resulting in job losses?”
To be sure, some countries bar layoffs of public-sector workers. In other cases, union contracts make layoffs difficult. Even so, increasing operational effectiveness can free employees from one part of an organization to deliver new or better services in other areas, within existing budgets and without layoffs. For instance, in Germany, Berlin’s state government, which is barred by law from firing its workers, took an innovative approach: people no longer needed in one area were placed in labor pools where they could be selected for new assignments in others. Even in the United Kingdom, where workforce rules are more flexible, the government reinvests much of the money saved through efficiencies in new services, and workers often take on new roles.
Organizations can apply lean principles in almost any environment where a process can be defined at the working level. Many public services—military logistics, employment agencies, hospital tests, social-security benefits, airport security checks—use processes that lend themselves to efficiency and quality improvements. Lean principles even apply in specialized fields such as legal casework and the development of policy. Work in these areas tends to be solitary, and the availability of e-mail and voice mail discourages face-to-face collaboration.
Looking at such activities through a lean lens suggests that productivity can rise through more highly structured problem solving in teams, a more flexible allocation of resources, and a more sophisticated approach to managing knowledge. From an operational viewpoint, the aim is to smooth out the work flow.
So what ever be the nature or structure of your organization. You need to be Lean, and you need to start right away!
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