![]() ![]() The arrows are intended to “spin” in circles as a sign of “being alive” or working as they should, indicating that if one is not working, all others will stop as well. In reality, both systems have been successful across a range of environments, and both share a similar set of foundational objectives: to deliver value efficiently for a customer discover better ways of working to continuously learn and improve transparently connect strategy and goals to give teams meaningful purpose and enable people to contribute and lead to their fullest potential (Exhibit 1).Ī cogwheel made up of four interconnected, circular arrows representing the four integrated disciplines of the lean management system. However, that argument reflects a fundamental misunderstanding of both lean management and agile. Therefore organizations, departments or functions need to pick one and focus on it exclusively. Lean management is for routine, repeatable operations, this thinking goes, while agile only applies to projects or creative tasks. Better togetherĪ common misconception is that lean management and agile are mutually exclusive, based on fundamentally different principles and approaches and applicable for very different types of activities. Agile approaches have since expanded beyond the realm of product development, and companies are increasingly organizing for agility across all their activities. Teams then capture feedback and iterate via quick cycles, refining the product or service over time. Agile models call for iterative development that aims to get an early prototype of a new product or service out into customers’ hands as quickly as possible. Rather than the traditional process of developing a new product or service-which used to be highly sequential and time-consuming-agile is much quicker and more flexible. Over the past decade, agile has rapidly expanded into other industries, such as telecommunications and banking-and, more recently, heavy industries such as mining and oil and gas. Freed from non-value-generating tasks, people focus more on what matters to customers.Īgile is more recent, originating in software development in the 1990s accelerating after the release of the Agile Manifesto in 2001. Moreover, these companies apply a mindset of continuous improvement and flexible working processes in which all employees contribute new ideas and suggestions, so that the organization becomes better over time. This systematic analysis of processes and value streams to reduce waste, variability, and inflexibility boosts performance in cost control, product quality, customer satisfaction, and employee engagement-often simultaneously. Lean organizations seek to identify and eliminate activity that is not valued by the customer or end user. Starting in the 1940s with its roots in the Toyota Production System, lean management has spread from manufacturing to service operations and just about every other department and function at companies, governments, and non-governmental institutions around the world. Lean management has helped organizations create value for over 70 years. ![]() Visit our Service Operations page Lean’s legacy, agile’s momentum Under this best-of-both approach, top-performing companies combine tools, ways of working, and organizational elements from each to form a custom solution that meets the company’s unique needs more completely and quickly than has been possible. Not only is choosing unnecessary, but the two methodologies complement one another in ways that increase the impact they generate, often by deploying Industry 4.0 technologies to speed transformation. The mistake we find many leaders and organizations making is believing they need to choose between the two. Both methodologies have proven their worth as integrated systems for helping improve performance. Institutions ranging from aerospace manufacturers to tax authorities have nevertheless persisted, focusing their efforts on lean management and agile. It complicates leaders’ efforts to make lasting changes in their organizations-efforts that historically have required years of sustained effort to take root. Has there even been a time when customers were more demanding of the companies serving them? Industry 4.0 technologies-many barely imaginable only a decade ago-have already enabled genuine breakthroughs in cost, convenience, and customization, creating extraordinary value for buyers while raising the performance bar for producers ever higher.Īnd then there’s the volatility that never entirely disappears, flaring up in crises that can upend everything from supplier relationships to entire business models-all prevalent in today’s current landscape as Covid-19 creates widespread disruption. ![]()
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