LEAN THINKING

Concept and Meaning

Lean Thinking has its origins in the Toyota Production System since 1950s. Womack, et al (1990) were probably the first to use this term in their seminal piece of work "The machine that changed the world". Lean Thinking is a set of principles that redefines the way the organization thinks about waste, value, quality and efficiency. It leads the organization on a path of continuous improvement by relentlessly driving waste out of the operation.

Michael Porter in his work on The Competitive Advantage of the Nations (1980) had identified three generic strategies to be followed by a company. They are cost leadership, differentiation and focus. There was an implicit assumption in the porter's model that a company can adopt only one of these strategies in the long term. Lean Thinking runs contrary to this and shows the way to achieve cost leadership, enhanced customer value and increased quality of product and services.

Català: Michael Porter. Česky: Michael Porter. D...

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With the application of Lean Thinking, organization creates a niche for itself through flexible operations, differentiates itself by offering only those product and services that customer needs and achieves cost leadership by reducing all forms of muda - the Japanese term for waste.

Thus, while removing muda or waste from the process, system, organization is one side of the coin, adding value is another side of the same coin. In other words, Lean Thinking and its principles help organization to uncover the muda in its operations and convert the muda into value from the customer point of view. With lean thinking it is possible to do / achieve more and more with less and less of resources, effort and time; within the context of the customer requirements.

Womack and Jones (2003) believe and claim that Lean Thinking is counter-intuitive and thus difficult to...