Ways to Grow During Economic Uncertainty via Lean Management

In times of economic uncertainty, research shows that leading organisations balance reduction in current costs with future investment. Post-COVID, the challenges associated with attracting and retaining talent are prominent together with uncertainties due to inflation, economic downturn, rising interest rates, accelerating digital transformation and supply chain security, etc.

Companies are supposed to create value for shareholders by making investments that can be inherently risky. But has the economic environment made businesses risk-averse? Waiting it out is not a winning strategy so how can a business grow in these times? Is the goal marginal improvements?

Growing Through Lean Management

The lean philosophy can help transform every business – small, medium, and large. Lean management is an approach to management that supports the concept of continuous improvement, a long-term approach to work that systematically seeks to achieve small, incremental changes in processes to improve efficiency and quality. A benefit of the methodology is that it is simple to understand and quick to make an impact when implemented properly. 

Lean is an ideology that is meant to minimise communication gaps and long, drawn-out manufacturing processes and instead maximise customer satisfaction. Creating a culture of continuous improvement takes more than an open mind–it depends on a methodology that turns activities into measurable and reviewable routines. A business can follow these five lean management steps to build a more initiative-taking, resilient company:

1. Value stream mapping

Mapping all the steps to the delivery of products and services helps everyone in the organisation to see how information and materials flow throughout the value stream, this is usually achieved with the help of Kanban boards. A good map should tell you the state of:

1. Resources in the value stream.
2. Capacity.
3. Value-added and non-value-added activities.
4. Constraints.

This can then be used to identify strengths, spot gaps, articulate goals, and assist in the creation of the three or five-year business plan.

When mapping a value stream for the first time, you should focus on value-adding steps to create a Lean process, which is updated as the process evolves.

2. Standard practices

Many companies have documented processes and procedures that list the actions, inventory, resources, and equipment needed to make a product. Documenting how work should implemented not only improves quality and consistency, but also provides a baseline that can be used to measure improvement. Standard practices should be reviewed regularly to keep them up to date and improve them.

3. Training strategy and methodology

An onboarding process is crucial for employee retention, a major concern for every organisation in the current talent drought–especially as employee turnover costs time and money. New employees learn new tasks faster and more accurately when these three questions are answered:

1. What to do?
2. Why is it done that way?
3. How does it fit into the operation as a whole?

Great onboarding should start with a mentored, certified trainer and should be audited. But it doesn’t all have to be left to the trainer– expert employees can help train others. It is also a wonderful way of providing development opportunities while fostering connections between experienced and newer employees.

4. Problem-solving process

Having a systematic problem-solving process is a terrific way to reduce risk and solve problems more proactively. It helps the business look beyond the effects of the cause and to the solution. A good problem-solving process will:

• Define the problem. What do you need to resolve?
• Set a goal. What would be an appropriate resolution? It doesn’t have to be instant perfection.
• Understand the current state. What are all the steps in the process? What are the people doing those steps experiencing?
• Identify the root cause. Find what needs fixing. Do not guess and remember you may need to look several steps upstream.
• Determine potential countermeasures or improvements. Rank potential solutions by ROI to find the winner.
• Implement a temporary solution. This could be a trial solution, a staged rollout, or a short-term fix. Check if you missed anything.
• Follow up to make sure everything is in the appropriate place. Double-check that you haven’t missed anything while solving the problem.
• Once the problem is solved, the problem-solving process can also be reviewed for improvement opportunities.

5. ‘Just do it’ attitude

Having a methodology means doing what has been promised/committed, even if the outcome is uncertain, and even if there is a need to slow down or adjust. Being reactive rather than proactive limits opportunity.

To be more initiative-taking, consider the three zones of human change described by Mike Rother in his book Toyota Kata:

1. Apparent certainty/comfort zone. This is the green zone. It’s familiar and easy to go to but staying their limits progress/potential.
2. Uncertainty/uncomfortable zone. This is the yellow zone of risk and opportunity. It makes us nervous.
3. Mystery/panic zone. This is the red zone. We don’t want to go there and may find ourselves fleeing back to the green zone.

Taking a proactive approach will help a business spend more time in the yellow zone and grow a bigger green zone. For instance, implementing innovative technology may push a company to the yellow zone the first time, but once they’re used to it, it becomes part of their green zone. 

Remember quality control goes together with productivity. This approach has benefits including;

• Improved quality
• Increase in team morale
• Better stakeholder visibility
• Predictable customer value
• Decreased costs

If you would like advice, tips, inspiration, or a knowledge-led approach to recruitment from the UK’s most trusted Electronics and High Technology recruitment specialist, contact us on 01582 450054 or send us an email at info@RedlineGroup.com for more information.