What Is Digital Lean Or Lean 2.0 In VUCA world?

Improvement usually means doing something that we have never done before.

Shigeo Shingo.

Lean 2.0 or digital lean constitutes a set of principles to minimize waste, enabling more productive time. Lean can work in any environment regardless of any industry. The final goal of lean is to seek & eliminate or change any part of a process that doesn’t add any value. A lean organization understands customer value & focuses its key processes to consistently increase it.

Unlock a world of knowledge with just one click: Navigating Lean Digital Transformation

LEAN principles have played a notable role in driving efficiency across organizations through their prominence on cost reduction. Focus on waste elimination and dependence on letting customer demands drive processes. In modern times, digital & physical technologies of Industry 4.0 have made possible new achievements of pliability, speed, continuity & automation. That have forever modified what production looks like. Advancements in robotics & artificial intelligence are all assured to be the future foregrounds of manufacturing & beyond. 

As a result, digital technologies & lean are intersecting in what is generally termed “Lean 2.0”. Which can be a strong union of enduring lean principles & consistently evolving digital technologies to reduce waste & alteration in processes. Digital Lean is a modern take on the production efficiency beliefs that generates leaner, powerful & more customer-oriented processes. It identifies where the waste occurs & improvements are integrated into everyday work to improve quality & the customer’s experience. 

Digital Lean is not a new set of lean principles, but it enhances lean principles to make their application stronger. Lean Digital transformation utilizes Industry 4.0 & other digital tools to provide more precise & timely information about operations. It also amplifies the impact of basic lean tools, such as Kanban.

Due to possibilities offered by digital technologies, Lean 2.0 depends on 2 levels: –

• Enlarging the Concern of the Operational Evaluation & Increasing the Impact of the Solutions Chosen– Digital technologies & ‘big data’ have now made it possible to gear the data collected by companies on a large scale. And to thus facilitate the exercise of carrying out an operational assessment: processing delays, identification of bottlenecks, understanding the expectations of internal & external customers, etc.
• Leveraging the Digital Lever as an Optimization Lever in its own Right in a Bid to Improve Process Performance- The deployment of tools not only helps simplify & optimize processes. Such as digitization of operations, task automation, decreased wait times, but also helps strengthen activity & performance monitoring & makes teams more supple. For instance, ‘predictive analysis’ tools have now made it possible to anticipate the upcoming workload & to attain notable gains through better resource allocation.

Hand-picked for you- Learn Transformation’s framework for Digital transformation Strategy and Tools.

Practical Ideas for Digital Lean or Lean 2.0

1. What are our goals?

• “Reduced waste & more customer focus” is a comprehensible wish. To get successful with Lean 2.0, you need particular & aspiring targets for an improved consumer experience, real economic benefits & higher employee engagement. Companies should compare their present position with where they see themselves in the future. Whether that’s next year or 3-5 years from now.
• The targets of a Lean Transformation must demand more than just bare process improvements. They require to involve prospects for reducing the business model, the organization structure, or the IT architecture

 2. Where do we begin?

Nothing is as powerful as solid results when it comes to set up internal support for lean efforts. Pilot projects are a suggested way to reveal the benefits of Lean 2.0 & build strength for further action. The processes selected for pilot treatment should wrap several organizational units to reveal the complete effect of lean processes. They should also be highly pertinent to the organization, which means they display high frequency & capacity.

Leader’s Tip
Adopt a lean philosophy and use lean 2.0 principles to streamline operations, get rid of waste, and spur digital innovation.

3. How can we Reach the Whole Organization?

• After a successful pilot phase, the growth of Lean 2.0 can start. Management must be clear about which processes have high, medium, or low priority & should use benchmarks & expert opinions to find processes that especially need improvement.
• Initially, a dedicated team must comprise lean experts from the pilot phase who have come back to their particular fields to put in their knowledge there. By revolving trained employees, lean 2.0 approaches can expand all over the company. The aim is to slowly have the lean culture incorporated into the company. So that it is part of everyone’s daily routine for effective lean digital transformation.

Read Also: Best 30 Lean Manufacturing Tools: How To Implement Them?

4. How can we Make Sure That Change is Considerable?

Finally, any Lean 2.0 program should reward itself. For that to happen, organizations need some particular preconditions. A dynamic network of employees who have experience with lean, an infrastructure with suitable tools & methods, and fluent arguments from senior leaders for easing processes, effectively communicating management’s expectations of a Lean 2.0 program & energetically cooperating to execute changes. 

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Digital Lean In Practical Application

A global leader in plastics had long exercised traditional lean principles in its manufacturing processes, but the company still lacked data visibility. Consequently, the company faced crumbling margins from lost manufacturing productivity & was unable to achieve its innovation goals.

To attain productivity, feasibility & innovation goals, the company began to use Lean digital transformation. Particularly, the company developed a digital manufacturing base by capturing high-frequency machine data. 

The transformation from Lean to Lean 2.0 is expected to produce improvement in earnings before interest, taxes, depreciation & amortization of US$20 million yearly, decrease costs by 15% per line per year & improve complete equipment effectiveness (OEE) by 11% yearly. Perhaps more significantly, the transformation deployed a digital mindset in the organizational culture. 

Traditional Lean Vs Digital Lean

• Lean 2.0 stimulates waste identification & reduction quicker than traditional lean methods. By offering selected, complete information straight to those who can reduce waste.
• Lean 2.0 provides an opportunity to target hidden components of waste. Such as information asymmetry & latency, that often go unseen & which aggregately add up to higher support costs & decreased efficiency and output, resulting in real bottom-line impact.

Promoters of Digital Lean

Lean 2.0 commonly needs 3 promoters at a plant & every plant will have distinct requirements across these areas. 

1. Attaining the Data: IT & OT Cooperation

Before Industry 4.0, operational technology (OT) & information technology (IT) were 2 areas with little to no overlap. To unbolt its full potential, Lean digital transformation needs an amalgam of IT & OT (control systems, industrial networks, etc.), which brings plant & operations data to business users.

2. Standardized Processes: Process & Data Management

Plant processes produce data that work as input for Lean 2.0. But if processes are not executed with standardization & discipline, we would not obtain precise & consistent data & the impact of a Lean 2.0 initiative would be deadening. So, the Key in this matter is the role of plant leadership in defining processes to finally attain more precise data.

Read also: Top 10 Artificial Intelligence (AI) Examples you must know

Ledaer’s Tip
To ensure the effective adoption of Lean 2.0, promote a culture of cooperation, experimentation, and continuous improvement.

3. Bringing the Process to Life: Data-enabled Technology Platforms

As important as IT & OT collaboration and disciplined process & data management are, pertinent technological platforms should be leveraged to truly harness the benefits of Lean Transformation. When selecting a technology platform, such as a digital twin, organizations should be sure to consider factors such as platform pliability, unification with other systems & data administration.

Benefits of Digital Lean or Lean 2.0

• A New Productivity Boundary- A manufacturer that unrelentingly focuses on removing waste & consistently improving the manufacturing process equipped with only traditional tools, such as kaizen, can make great progress initially, but its productivity increases mostly diminish over time.  With Lean 2.0, the manufacturer can build on its lean foundation & leverage new technologies, such as machine learning & predictive maintenance, to solve formerly impossible business problems & unbolt formerly unattainable productivity boundaries.
• Enhancing Performance Measures– When manufacturers implement digital solutions integrated with Lean & Six Sigma, many manufacturers can attain higher ROI. Lean turnaround targets long-established performance measures such as improving safety, decreasing cost & improving sustainability.
• To attain the greatest ROI, manufacturers should focus Lean 2.0 initiatives & programs in the widest areas of opportunity. These commonly involve unbolting the capacity of restricted assets, improving strategic asset efficiency, decreasing high total costs of poor quality, decreasing labor spend, and decreasing or eliminating unnecessary raw material costs.

Final Word

Digital lean isn’t a one-time feature used to optimize processes for short-term successes. Instead, it looks for long-term transformation by identifying all activities that generate waste & do not add any value only serve to weaken the company. Lean digital transformation is effective & vigorous. It is more than a set of Industry 4.0 tools enclosing reassessing recent processes using a digital mindset, transforming behaviors & changing decision-making away from experience-based to data-based far more effectively than lean processes solely could ever do.

Each & every employee has the responsibility for improvement by making problems visible & treating them at their root rather than simply diminishing the symptoms. Ultimately, Lean 2.0 is successful when organizations show a willingness to rethink behavior on a fundamental level and, if necessary, effect a forward-thinking cultural change.

4 Best Lean Principles Books

Global Reader’s Click Below:

1. A Factory of One: Applying Lean Principles to Banish Waste and Improve Your Personal Performance
2. The 12 Principles of Manufacturing Excellence: A Lean Leader’s Guide to Achieving and Sustaining Excellence, Second Edition
3. The Lean Six Sigma Pocket Toolbook: A Quick Reference Guide to 100 Tools for Improving Quality and Speed
4. The Lean Turnaround: How Business Leaders Use Lean Principles to Create Value and Transform Their Company

India Reader’s Click below:

1. Lean IT – Principles to Practice: Toyota Way to Create Value for the Customer & Wealth for IT Organization
2. Creating a Lean R&D System: Lean Principles and Approaches for Pharmaceutical and Research-Based Organizations
3. Lean Principles and Application in BPO
4. The Principles of Product Development Flow: Second Generation Lean Product Development

FAQs

Key Takeaways

• Lean 2.0 improves operational effectiveness, customer value, and organisational agility by fusing Lean concepts with digital technologies.
• Organisations can use data, automation, and advanced analytics to promote process innovation and optimisation by implementing Lean 2.0.
• To realise the full potential of the digital transformation, a successful Lean 2.0 implementation needs strong leadership backing, cross-functional cooperation, and a customer-centric focus.