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Lean Study 2008

Nordic service industry

By Cordial Business Advisers


Stockholm, September 2008
About Cordial Lean Study 2008 A selection of participating companies

• This Lean Study was carried out during April – July 2008
targeting different industries within the service sector and
service related processes at manufacturing companies, e.g.
procurement, sales and business development units.
ƒ The study aims to get a “pulse check” regarding state-of-
the-art development of Lean at selected service companies
in the Nordic and Japan.
ƒ The study is based on 44 interviews with key persons at the
companies, e.g. business developers, process owners, Vice
Presidents, Lean Managers etc.

Key findings

• 79% of the companies working with Lean said to have achieved bottom line results, compared to 47% of the companies working
with other continuous process improvements.
• 53% of the companies currently not working with Lean are planning to implement Lean in the future.
• Lean is regarded as a mean to achieve cost efficiency and customer satisfaction.
• Lean is a well recognized concept in the Nordic Service industry: 95% are familiar with Lean as a concept.
• Various Lean tools are used when working with Lean, 5 S and Value Stream Mapping being the most common tools.
• Main challenges when working with Lean incorporate having the right leadership, creating a sustainable employee commitment,
having the right communication, establishing clear work process, roles & a toolbox as well as linking the bottom line effect to the
Lean work.

1 © 2008 Cordial Business Advisers AB


2008-05-08 Projektnamn och konsult Fil: filnamn.ppt
Table of contents

Î About Cordial
Î About the study
Î A few words about Lean
Î Results of the Lean Study 2008
Î Conclusions and reflections
Î Contact information

2 © 2008 Cordial Business Advisers AB


About us – Cordial enhances clients’ own ability to
develop
Î Cordial Business Advisers AB is a modern management
consultancy with the ambition of setting a new standard for
developing businesses
Î Cordial started in 2000 and currently consists of 35
consultants and a turnover of 50 MSEK
Î Our ambition is to become the leading management
advisor with a Swedish origin
Î Cordial concretizes strategies and guarantees execution
Î Cordials starting point in all we do is:
– All business is human
Î Focus on customers that have a service based business
logic and actively look for change
Î We have been entrusted more than 300 projects for some
of the largest companies in the Nordic region, private
equity companies and growth companies

Our customers do not become dependent, they become enriched

3 © 2008 Cordial Business Advisers AB


Our four service areas
Strategy & Market
Î Business strategy
Î Market- and customer-strategy
Î Transactions

Structure & Process


Î Organizational design
Î Process development
Î Lean management
Î Business control

Business Architecture
Î Design of flexible business models
Î Service oriented business and IT-architecture
Î Structure and control for efficient IT

Culture & Leadership


Î Successful Change
Î Performance culture
Î Efficient leadership

4 © 2008 Cordial Business Advisers AB


Cordial’s Lean Offering
If you are considering to start working with Lean If you already work with Lean

Î Lean Proof-of-Concept for a selected Companies already working with Lean face various
process/area challenges. Cordial can offer the following support:

• Support prioritization of process scope Î Conduct/support Customer value analysis,


by “heat-mapping” using interviews, filming techniques
• Conduct waste analysis, and summarize into Î Help develop useful KPI’s for process
a business case that shows potential values measurement, and link to overall business
• 1-3 day workshop defining “As-Is” state, “To- targets
Be” state as well as a GAP-analysis, Î Analysis and modeling support for complex
including an Action plan value streams/processes, for example statistical
• Establish measurement to follow-up of the analysis (six sigma)
results after 30, 60 and 90 days Î Develop customized training programs for Lean,
Î Develop and support initiation of Lean programs train-the-trainer concept and Lean ambassadors
Î Training of Lean-coaches/facilitators Î Lean seminars – Lean Thinking and TPS by
Toyota
Î Leadership coaching and educational journeys
to Japan
Î Process improvements with the DMAIC-method
Î Visualization tools, Lean-games among other
communication tools

5 © 2008 Cordial Business Advisers AB


Cordial’s Lean Service Management model
for continuous improvements

3. Establish
4. Remove waste
benchmarks and
and transform
ideals

Re-calibrate Re-visualize

2. Describe the 5. Visualize and


value stream and
measure
analyze

New needs
Lean Educate
Thinking
1. Understand - coaching leadership 6. Educate and
customer needs and culture train everyone

Motivate

6 © 2008 Cordial Business Advisers AB


Selected Client References

Investors/
owners

Large
Companies

Growth
Companies

Public
Authorities

7 © 2008 Cordial Business Advisers AB


Table of contents

Î About Cordial
Î About the study
Î A few words about Lean
Î Results of the Lean Study 2008
Î Conclusions and reflections
Î Contact information

8 © 2008 Cordial Business Advisers AB


Background and purpose of Cordial’s Lean Study 2008
Î Lean is one of the most far-reaching management philosophies when it comes to process
improvement. The manufacturing industry has for a long time been the pioneering industry in
which Lean has been developed and successfully implemented.
Background Î In recent years Lean has made the leap to the service industry. In order to support our
customers in further developing their businesses, we wish to gain an understanding of the
status of Lean programs and the relation to other process improvement initiatives at Nordic
service companies.

Î To perform a “pulse check” regarding state-of-the-art development of Lean in selected


Purpose service companies in Nordic and Japan to get an understanding of how these companies
work with process improvements
Î Pinpoint overall trends, challenges and success factors for companies working with Lean

Definition of
Lean in this Î Continuous process improvement work based on Lean principles or Lean inspired methods
study

9 © 2008 Cordial Business Advisers AB


The study includes a wide range of industries in the
Nordic service sector…

Comments:
Î Focus lies on the service sector
and service related processes at
7% manufacturing companies, e.g.
5% 15% procurement, sales and
Healthcare
Telecom & Media
business development units
Retail Î The interviewed companies
11%
represent 11 different industry
Public organizations
segments
14% IT Consulting
Î At each company, Cordial has
Transport & Logistics interviewed key persons, e.g.
7%
Manufacturing business developers, process
Construction owners, vice presidents, Lean
7% Banking
Managers etc.
11%
Energy
7% Hospitality & travel
7% 9%

Total: 44 companies

44 interviews with key persons of Nordic companies have been conducted

10 © 2008 Cordial Business Advisers AB


… and interviews have been conducted with some
major players in each segment
Healthcare Retail Banking

Telecom & Media Transport & Logistics Other

11 © 2008 Cordial Business Advisers AB


All 44 participating companies in various
industry segments
Healthcare: Public organizations: Banking:
Î Centralsjukhuset i Kristianstad Î Vara kommun Î Swedbank
Î Universitetssjukhuset MAS Î Mittuniversitetet Î GE Money Bank
Î Karolinska Universitetssjukhuset Î Migrationsverket Î Nordnet
Î Kronans Droghandel Î Apoteket Î Nordea
Î Capio S:t Görans sjukhus Î SEB
Î Universitetssjukhuset i Lund
Î SATS

Telecom & Media: Retail: Energy:


Î Ericsson Î Indiska Î Telge Energi
Î Teracom Î Coca-Cola Î Fortum
Î3 Î Dagab
Î Canal Digital Î COOP
Î Talentum Î Oriflame
Î Tele2
IT & Consulting: Hospitality & Travel
Transport & Logistics: Î Solectron Î Sheraton
Î SJ Î FujitsuServices Î Fritidsresor
Î Scania Î SWECO Î Granvia
Î Volvo Logistics
Construction:
Manufacturing: Î Skanska
Î Perstorp AB Î Arcona
Î Partnertech Î NCC Construction
Î Sandvik Materials Technology
12 © 2008 Cordial Business Advisers AB
Table of contents

Î About Cordial
Î About the study
Î A few words about Lean
Î Results of the Lean Study 2008
Î Conclusions and reflections
Î Contact information

13 © 2008 Cordial Business Advisers AB


What is Lean all about?

Lean is about optimizing a company’s processes and working


methods by counteracting waste, focusing on the value-adding
activities and creating a culture characterized by continuous
improvements.

14 © 2008 Cordial Business Advisers AB


Lean’s basic principles – Lean Thinking

Place the customer as • Always doing or making the choices that are best for
number 1 the customer

• Remove all obstacles that are preventing the customer


Remove obstacles to get what they want.

• Make sure that all employees have the relevant skills


Competence & mandate and competence which makes it possible to meet the
customer’s expectations.

• Leaders involve their co-workers in the decisions that


Involvement affect their work and coach them on a daily basis.

• Always be on the look out for waste and when the


Eliminate waste!!! waste is discovered it must be eliminated.

Source: Cordial research

15 © 2008 Cordial Business Advisers AB


Where is Lean applicable in the service industry?

Î Lean can be used to improve people and information intensive


processes such as:
• Sales processes
• Service (delivery) process
• After-sales / customer support processes
• Front-office processes (meeting customers)
• Administrative processes
• IT processes

Example: Visualization of the workflow


at a Japanese fabrics manufacturer in
Kansai 2005

16 © 2008 Cordial Business Advisers AB


The 7+1 wastes: the manufacturing industry
Manufacturing

Overproduction To manufacture more or earlier than necessary

Waiting To wait for something to happen

Stock To keep larger stock than necessary

Unnecessary movements and actions which are


Motion performed in order to fulfill a task

Repairs and re-work which do not


Re-work
add value to the customers

Overwork To do more work than the customer requires

Transports Unnecessary transports

The unexploited This was not part of the original wastes,


creativity of the staff but has been added as the eight waste

17 © 2008 Cordial Business Advisers AB


The 7+1 wastes in the service industry - examples
People Information

Overproduction Performing a task that a colleague is going to Producing too much information related to a given
perform anyhow purpose

Waiting Waiting for answers from customers, partners or for


Waiting to receive important information
a decision to be taken by management

Stock Scattered information which is stored in different


Hiring more employees than there is occupation for
locations but which is not compiled for optimal use

Motion Sending documentation physically instead of using


Educating new people when senior people leave
digital formats

Constantly recapitulating results from the last


Re-work Discarding already collected information and
meeting if too much time has elapsed between from
compiling new information if needs have changed
the previous one

Overwork Over-working delivery to a new customer Performing too much research for a given objective

Transports Traveling to different meetings instead of e.g. using Information transport through long office turnaround
telephone conferences time, several authorization levels etc

The unexploited Unexploited knowledge among the staff as for


Unexploited information of already performed
creativity of the staff instance language skills, earlier experience,
studies, earlier experience, reuse of ideas etc
academic records

18 © 2008 Cordial Business Advisers AB


There is currently a large interest for Lean Services
• Toyota received 600 000
suggestions for improvement
”Lean” during 2006 from their
employees. 91 per cent of these
65 million hits were implemented.
• How many suggested
improvements has your
company implemented?

”Lean
”Lean Management” ”Lean Services” Manufacturing”
735 000 17 200 000 2 800 000

Source: www.google.com [2008-09-03]

19 © 2008 Cordial Business Advisers AB


Lean is also a hot topic in the business press

Lean Management Lean Production Lean Services


Financial Î 1022 articles Î 626 articles Î 1023 articles
Times* Î 286 FT comment & Î 122 FT comment & Î 263 FT comment &
analysis analysis analysis

Lean Management Lean Production Lean Services


Harvard
Î 186 articles Î 113 articles Î 188 articles
Business
Review**

* Archive search Jan 1st 2003 and onwards


** Complete online publications about Lean

20 © 2008 Cordial Business Advisers AB


Table of contents

Î About Cordial
Î About the study
Î A few words about Lean
Î Results of the Lean Study 2008
Î Conclusions and reflections
Î Contact information

21 © 2008 Cordial Business Advisers AB


Lean is a well recognized concept in the Nordic
Service industry

Comments
Are you familiar with the concept of Lean? Î Most of the respondents are
familiar of the Lean origin from
5% the manufacturing industry and
Toyota
Î The curiousness for Lean
services is high in general
among the respondents

Yes Quotations from interviews:


“I have heard about The Toyota
No way and Lean in the manufacturing
industry sector”
“I’m familiar with the concept and it
is exciting to see what results it can
bring”

95%
Total: 44 companies

95% are familiar with Lean as a concept

22 © 2008 Cordial Business Advisers AB


Lean is used by 65% of the companies working with
continuous process improvements
Do you feel that your processes are optimized today or do Do you currently work with continuous process improvements
you work with continuous process improvements? based on Lean principles?
2%

Continuous process improvement


35%
Optimized processes
Y es

No

65%

98% Total: 44 companies Total: 43 companies

Comments
Î Nearly all companies (98%) claim to work with continuous improvements (not always expressed as Lean)
Î A majority (65%) work with continuous process improvements based on Lean principles/methods

23 © 2008 Cordial Business Advisers AB


Lean is also of high interest for companies currently not
working with Lean methods

Comments
Are you planning to work with Lean in the future?
Î Out of the 15 companies (35%)
that doesn’t work with Lean,
53% plan to start work with Lean
in the future

Quotations from interviews:

Yes ”We will definitely work with


47% something Lean-inspired in the future”
Plats för diagram eller tabellNo
53% “It is an interesting method and we will
definitely evaluate it later on”
“We will start working with Lean next
year. We are currently working with
an extensive overview of our
processes”

Total: 15 companies*

53% of the companies not currently working expressed with Lean are planning to implement Lean in the
future

* 15 companies doesn’t work with Lean principles today

24 © 2008 Cordial Business Advisers AB


Lean puts a greater emphasis on customer focus as
opposed to other continuous improvement initiatives

What’s the main reason(-s) for your Lean work?* What’s the main reason(-s) for your continuous process
improvements work?

12%
12% 32%
0%
30%
Cos t ef f i c i enc y
Cost ef f iciency 8%
16% I nc r eas ed c us t omer f oc us
Incr eased cust omer f ocus
St r ong c ompet i t i on
St r ong compet it ion
0%
Qualit y 16% Qual i t y
All of t he above A l l of t he abov e
Ot her
12% 20% Ot her
42%

Comments Quotations from interviews:


Î Main reason for the Lean work is increased customer focus (42%) “Everything we do aims to increase customer focus”
and continuous process improvements concentrates mainly on cut
costs “Management is pushing hard on costs, but for me
customer focus is most important”
Î Other reasons include: increased productivity, reduced waste,
engage workers etc.

25 © 2008 Cordial Business Advisers AB


Bottom line results can be achieved through general
continuous process improvement work…

Comments
Have you achieved bottom line effects due to your work with continuous process Î Cost efficiency and increased
improvements? revenues are some examples of
success gained through using
19% continuous process
improvements work
Yes

No Quotations from interviews:


”Increased revenues thanks to
Don't know , don't Lean!”
14% measure
”Cut costs have resulted in
increased profitability”
”We have achieved better managed
67% costs as well as cost efficiency”
“We have reduced waiting-time in
our emergency room which leads to
reduced costs”

Total: 43 companies*

67% have achieved bottom line results from their work with continuous process improvements

* One company does not work with continuous improvements

26 © 2008 Cordial Business Advisers AB


…but it’s more likely to achieve bottom line results working
with Lean!
Bottom line results achieved by Lean Bottom line results achieved by general process
improvements work (a part from Lean)
0%
21%

47%
Yes
No
Yes
Do n't kno w/do n't measure
53% No
Don't know/don't measure

79%
0%

Comments
Î Among the 29 companies working with Lean, 79% have seen bottom line results
• Out of the 21% who hasn’t seen bottom line results, some have not yet started to measure and some don’t measure fiscal
results
Î Among the companies working with general continuous process improvements only 47% achieved bottom line results

79% of the companies working expressed with Lean achieved bottom line results compared to 47%
working with ordinary continuous process improvement work

27 © 2008 Cordial Business Advisers AB


Employees are overall positive towards the implementation
of continuous process improvements

Comments
How does your employees react to continuous process improvements?* Î A vast majority, 84%, claims that
the continuous process
improvement work has been
positively received by the
employees
Î Some companies have received
both reactions
84% * Quotations from interviews:
”If the workers are part of the
process change and have the ability
2% Positively to influence it, the change is received
much better”
Negatively ”Initially we get a negative reaction
Mixed but when the employees see that the
14% change works the reactions turn
positive”
”How the process change is received
depends on what kind of change it
Total: 43 companies**
is”

84 % believe that their employees are positive towards continuous process improvement work

* Only key persons have been interviewed except from 7 companies where in depth interviews have been made with employees
** One company does not work with continuous improvements

28 © 2008 Cordial Business Advisers AB


Fråga Linda B!!
Checka titel!!!
Greater involvement of employees in Lean initiatives

How does your organization seek improvement of processes?


Companies working with Lean Companies working with general process
improvements
20%

39% Employee driven Employee driven

Management driven 47% Management driven


50%
Both Both

33%

11%

Comments Quotes from interviews:


Î “Management-only”-driven improvement work is less common “The decision to work with Lean came from management but
among companies working with Lean the “pull” from employees keep on increasing”
Î It is common for the management to setup guidelines but the “Each employee can make a suggestion directly to a process
employees execute and optimize specific processes owner who evaluate and decide on what to do”

29 © 2008 Cordial Business Advisers AB


Process improvement work is more prioritized by
Management in companies working with Lean
How is the work with continuous process improvements prioritized on the management’s agenda?

Priority on the Management agenda in Priority on the Management agenda with general process
companies working with Lean Improvements
3%
10% 20%

High
High Average
Average Low
Low 53%

27%

87%

Comments Quotations from interviews:


Î A vast majority consider their continuous process ”Without the strong commitment from the management it
improvement work as a top issue by management wouldn't been possible to launch Lean so widely”
Î Only 3% consider the work with Lean as a low priority by ”Lean is a top priority by our management, it is a critical
Management compared to 20% in companies working with success factor”
general process improvements

87% consider their continuous process improvement work to be highly prioritized by management in
Lean companies compared to 53% in companies working with general process improvements

30 © 2008 Cordial Business Advisers AB


There is an equal share in how companies choose to
implement their Lean work…

Comments
How extensive is your Lean work? Î The most common processes to
start with are core processes,
52% product & service development
48% and administrative processes

Quotations from interviews:


Selected processes ”We’ve used pilots so far but have
Plats för diagram ellerWhole
tabell organization a very good impression and our
ambition is to take it to the whole
organization”
”We’ve started with Lean in our
emergency rooms and now we will
expand to other departments as
well”

Total: 29 companies*

… but many plan to expand their process improvement work to other units/the entire organization
utilizing the “power of successes”

* 29 companies work with Lean

31 © 2008 Cordial Business Advisers AB


5S and VSM are the most common tools for
companies working with Lean

Comments
Do you follow a given method within your process improvement work? If yes, which one? Î More than 60% are using Lean
tools
64% • Value Stream Mapping
(VSM) & 5S are the most
5S common tools
Number of responses

11 Î DMAIC is the most common tool


VSM
when working with Six Sigma
Standards
9 Plats för diagram eller tabell Whiteboard meetings Quotations from interviews:
Other ”We use a combination of both
4 methods, we choose what fits our
DMAIC organization best”
2
28% Other ”The two systems (Lean, Six
8% Sigma) complement each other
9
5 well”
3
”We have our own methods based
Lean Tools Six Sigma Other on the more traditional Lean tools”
Total: 43 responses*

64 % of the companies working with a given method in their process improvement work choose Lean
basic tools

* Not all companies work with Lean, possible to chose multiple alternatives for the ones who did reply on this question

32 © 2008 Cordial Business Advisers AB


There are challenges and success factors to consider
when working with the implementation of Lean
CHALLENGES SUCCESS FACTORS

Having the right leadership 100% management attention & commitment


Î To have a coaching leadership that makes room for a Lean Î Management needs to understand, support and believe in
culture to grow as well as creating a leadership characterized Lean for successful implementation.
by trust toward the employees.
Keeping the employees motivated
Achieving a sustainable organisational commitment Î Share success stories, good impressions and experiences
Î To break down the process’ KPI to an individual level. from customer meetings with the rest of the organization.
Î Invest in long-term employee development
To answer “What’s in it for me?

Having the right communication Education & training


Î Continuously train and educate during the implementation
Î To communicate early and in the right way to both direct and and tailor it for every phase of the implementation.
indirect involved stakeholders.

Establishing clear work process, roles & a toolbox Communication Strategy & Plan
Î A well thought-through communication plan (top-down
Î To establish proper structure (roles, responsibilities and approach), connected to a stakeholder analysis, will
mandate) before, during and after the Lean implementation in minimize resistance and maximize acceptance within the
order to achieve permanent effects. organization.
Î To know which tools to use and how to apply them effectively
in the work process
Let the customers be one of the driving forces
Î Continuous improvements should not be driven by
Linking the bottom line effect to the Lean work customer complaints but rather by a understanding of
Î To be able to link the process KPIs to the bottom line effect customer needs.
resulting from the Lean work.

33 © 2008 Cordial Business Advisers AB


Summary of results from the Lean Study 2008 (1/2)
Î Lean is a well recognized concept in the Nordic Service industry
• 95% are familiar with Lean as a concept
Î There is currently a high interest in Lean Services in the Nordic service sector
There is
currently a • 65% of the companies working with continuous process improvements are using
large interest Lean principles
for Lean Î Lean is also an up-and-coming opportunity for companies currently not working with Lean
Services methods
• 53% of the companies not currently working with Lean are planning to implement
Lean in the future

Î Lean puts a greater emphasize on customer focus opposed to general process


improvements
• General continuous process improvements is foremost used for cost efficiency
Î It’s more likely to achieve bottom line results working with Lean
The Lean work
often show • 79% of the companies working with Lean achieved bottom line results compared to
great results 47% working with general process improvement work (not Lean)

34 © 2008 Cordial Business Advisers AB


Summary of results from the Lean Study 2008 (2/2)
Î Process improvements are mainly suggested by employees in a Lean
environment
Employees are
frequently • “Management-only” driven approach is less common in Lean cases.
involved in the Î Process improvement work is higher prioritized by Management in companies working
Lean work and with Lean
the priority on
the • 87% consider their continuous process improvement work to be highly prioritized by
Management management in Lean companies compared to 53% in companies working with
Agenda is high general process improvements

Î 64% of the companies working with continuous process improvement use methods
commonly recognized as Lean tools
• 5S and VSM are the most common tools
VSM and 5S are
the most Î 28 % of the companies use Six Sigma method
commonly
used Lean
tools

35 © 2008 Cordial Business Advisers AB


Quotations from the interviews (1/2)

Working with Lean The easier it is to see concrete


Management has their
made it possible to results, the higher interest in
own result board for their
expand without the organization
Lean work
taking on new staff Transport & Logistics
Energy
Healthcare

A critical success factor is


Revolutionary results! At the same time as the costs
the interest and high priority
have been reduced, the quality
Healthcare from management
has increased
IT & Consulting
Telecom & Media
We’ve seen a prominent
improvement in
Our productivity has increased with Dramatic cut in costs
productivity as a result of
5-10% per year and during the same and increased control
Lean
time the complaints have diminished at the same
Transport & Logistics
Retail Retail

The management has to


We’ve managed to
work in it themselves to As long as the staff can be part of
attract contracts thanks
fully understand what the planning of a change they are
to our Lean-thinking
Lean is about in reality satisfied when it arrives
IT & Consulting
Retail Manufacturing

36 © 2008 Cordial Business Advisers AB


Quotations from the interviews (2/2)
Quotations on employee level Quotations on PL and Top Management level

The project leaders Lean has had a


small effect on the The goal is to create a
must possess new culture standing
I was stripped of empathy and culture
my responsibility above quick fixes
experience (delivering bottom line
when the Lean
implementation results)
started We don’t see
We have to find Lean as a
time outside regular mindset but
working hours rather as a tool
(evenings, Lean in our company is more
Working with Lean about cutting costs than
has given us a new weekends) in order
to work with Lean – creating satisfied customers
mindset even in 800 opinions from
other areas it is difficult
customers in 3-4
months which
stimulate the The halo must change: it
continuous has to sit on the person
improvements that who finds and
The success Service in is all about
of Lean timing – e.g. to know when solves problems and not
depends it is suitable to refill the on the person who hides
75% on the It is important to them away
water to a restaurant
leadership know “HOW” to
customer, that is what
and 25% on motivate others
makes the difference in the
the project customer experience!
leaders We plan to include EQ tests in
our recruitment process

37 © 2008 Cordial Business Advisers AB


Table of contents

Î About Cordial
Î About the study
Î A few words about Lean
Î Results of the Lean Study 2008
Î Conclusions and reflections
Î Contact information

38 © 2008 Cordial Business Advisers AB


The study indicates two principal approaches when it
comes to the implementation of Lean

Process oriented
All-
This approach is about streamlining
embracing prioritized processes which are
approach considered to generate the largest
impact on the overall performance.
All-embracing
This approach is about establishing a
plan for how the total enterprise shall
be transformed in order to increase
overall performance.
Early
Enterprises that have worked with
LEAN and process improvement less
than one year.
Process Mature
oriented Enterprises that have worked with
approach LEAN and process improvement
more than five years.

Early phase Mature phase

The common denominator is to increase customer orientation and to obtain cost rationalization.

39 © 2008 Cordial Business Advisers AB


Final conclusions and our reflections

Î In recent times the concept of Lean has found its way in the service industry probably because the challenges
facing the service industry are on an overall level similar to those in the traditional manufacturing industry. The
service industry has, by looking at the manufacturing industry, realized the great potential that Lean can
release within the organization, helping it to stay competitive on a increasingly harsh market by focusing on
customer value and reducing waste. Waste typically found in the service industry relates to the collaboration
abilities between its value network, e.g. customers, suppliers and partners.

Î The majority of the companies state that they have achieved concrete results while working with Lean.
Moreover, the study reveals that companies experience that it is more likely to achieve bottom line results when
working with Lean, rather than working with continuous process improvements. The reason for the strong
‘belief’ in the payoff by Lean might be put in relation to the rather tedious process work conducted by major
companies in the 80s and 90s when BPR was introduced in the Nordics.

Î In order for the employees to get involved and stay involved in the Lean work, the companies need to develop
a common and company specific Lean language in order to provide the organization with a positive vocabulary
that engages the employees. Crucial for the success is to keep the employees motivated, and thus the need to
answer the employees’ question of “What’s in it for me?”. Kaizen is in Japanese business context often seen as
a peer together with investment. Kaizen together with continuous investment in company resources and
competencies, wherein the growth and development of employees is an important part, increases the chances
for the sustainability of Lean programs.

Î It is a major challenge for the companies to make Lean imbedded in the company culture. A commonly held
view is that current organizational culture is rather acting as a barrier than a possibility when it comes to fully
implementing a culture that supports continuous improvements. This suggests that companies working with the
implementation of Lean need to also think about how to support the ongoing Lean work partly by incorporating
the cultural dimensions, partly by actively working with management of change and building a learning
organization. The preferred leadership style holds key elements such as trust and coaching – a culture which
allows employees “to raise their hands to identify mistakes made” without fear.

40 © 2008 Cordial Business Advisers AB


Table of contents

Î About Cordial
Î About the study
Î A few words about Lean
Î Results of the Lean Study 2008
Î Conclusions and reflections
Î Contact information

41 © 2008 Cordial Business Advisers AB


Stockholm
Contact information about
Kungsgatan 26 the Lean Study 2008:
111 35 Stockholm
Tel: 08 723 87 00
Fax: 08 723 87 01
Project leader:
Sanja Miteva

Göteborg sanja.miteva@cordial.se
Rosenlundsgatan 3 +46 706 10 45 33
411 20 Göteborg
Tel: 031 711 04 50
Fax: 031 750 90 99 Responsible for Lean at
Cordial:
Linda Bradley
Tokyo linda.bradley@cordial.se
3-31 Kioicho n-KI1, Chiyoda-ku +46 708 50 55 22
Tokyo 102-0094 JAPAN
Tel: +81 (0)3 3556 0481 (building reception) +81 80 5512 9722 (Japan)
www.cordialasia.com

www.cordial.se

42 © 2008 Cordial Business Advisers AB


2008-05-08 Projektnamn och konsult Fil: filnamn.ppt
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43 © 2008 Cordial Business Advisers AB

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