Discussion Week 6
Discussion Week 6
How can lean thinking be used to increase planning accuracy in projects? Use the key elements described in the following paper to answer this question in your initial post:
Moujib, A. (2007).
Lean project management (Links to an external site.). Paper presented at PMI® Global Congress 2007—EMEA, Budapest, Hungary. Newtown Square, PA: Project Management Institute.
Connect your post to the assigned reading from Week 6. You will not see other’s postings until you post your first one, and importantly, you need to reply to at least two of your peer’s postings. This medium is instrumental in gaining an understanding through peer sharing.
· Prepare your initial post (a minimum of 250 to 300 words) response by Wednesday at 11:59 p.m. ET, and provide a minimum of two peer responses (a minimum of 150 words for each) by Sunday at 11:59 p.m. ET.
· Be sure your posts make substantive contributions. A substantive post will explain or analyze the topic in detail, ask a thoughtful question about the topic, or share a relevant personal experience or additional resources concerning the discussion topic.
· Cite current credible references and format your posts according to the
APA style (Links to an external site.)
.
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Lean project management
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Lean project management
CONFERENCE PAPER ǀ 2007
Moujib, Aziz
How to cite this article:
Moujib, A. (2007). Lean project management. Paper presented at PMI
®
Global Congress
2007—EMEA, Budapest, Hungary. Newtown Square, PA: Project Management
Institute.
Introduction
This paper explores the principle of Lean Manufacturing as applied to project
management processes. This will be an introduction to the advantages of applying
Lean tools and techniques to Projects. It is time for the world of projects to reap the
same kind of benefits that Lean has achieved for manufacturing – maximize value
and minimize waste.
Objectives
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Proper use of Lean techniques will result in cutting waste in your projects, producing
greater customer satisfaction and improved profit margin. This will be accomplished
by examining how companies like Toyota and Motorola achieved excellence through
the Lean methodology.
The goal of this paper is to provide participants with an understanding of how using
Lean principles can help ensure project success. The objectives are:
Identify the five principles of Lean
Discover how Lean principles can be applied to project management
Determine the various kinds of waste that exist in projects
Issues
How important is time and money for a project manager? Wouldn’t it be nice to wave
your wand and bring your schedule and budget back in line?
A Lean Project Management toolbox might very well be the answer. Numerous
surveys and studies have documented that nearly half of all projects are behind
schedule and/or over budget. While the Lean Project Management toolbox is highly
valuable, it is not a magic wand. Rather, it requires a disciplined approach to
examining all the activities throughout the entire project life cycle.
Only a thorough process analysis will identify how the process is actually handled
and identify inefficiencies. Too often people think that the way they have done it in
the past is the best way to conduct the process. Understanding each process step
will identify waste and non-value added process steps, which have become an
accepted and unquestioned part of the process over time.
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Lean is a business philosophy, not just a tool set or method for improvement. This
business philosophy was derived from Toyota experiences and in particular from its
Toyota Production System (TPS). The focus is on reducing waste in all business
processes. The result is reduction of cost and lead-time as well as an increase in
quality.
Lean Manufacturing – Toyota Production System
Following the 1973 energy crisis, Toyota was the only Japanese firm resisting by
working efficiently and effectively. The company managed to overcome this crisis by
deploying a culture of empowerment. Toyota employees were embarked in a
continuous improvement journey and were working to drive inefficiencies out of work
processes. Results are reduction of manufacturing lead-time and costs as well as
improving quality and customer satisfaction.
This is a study of the automobile industry (Womack, J. P., Jones, D. T. & Roos, D.,
1990) that introduced this business philosophy lean production for the first time to
the western world. The Toyota success story base waste elimination has since kept
all industries enthusiast about the lean approach.
It was also a breakthrough step from mass production to lean production, from a
push system to a pull system.
Lean Manufacturing Benefits
“Lean manufacturing uses less of everything compared with mass production – half
the human effort in the factory, half the manufacturing floor space, half the
investment in tools, half the engineering hours to develop a new product in half the
time. Also it requires keeping far less than half the needed inventory on site and
results in fewer defects.” (Womack, et al., 1990. p. 256)
The typical short-term improvements are:
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90% Inventory reduction
90% Lead-time reduction
35% Productivity/Capacity increase
15% Quality improvement
60% Floor space reduction
20% Cost reduction
10% Value added/person
25% Improved profit margins
5% Overall effective efficiency
Principles of Lean Thinking
Over the years, Womack and Jones refined their strategy and published in 1996
Lean Thinking: Banish Waste and Create Wealth in Your Corporation. They provide
in this book a set of management principles, tools, and best practices designed to
identify and eliminate waste in work processes and increase efficiency. The goal is
to help organizations achieve operational excellence.
To be Lean is to provide what is needed, when it is needed, with the minimum
amount of materials, equipment, labour, and space.
The book Lean Thinking introduced five core principles:
1. Specify value in the eyes of the customer
The first lean principle is to specify value. Womack and Jones (1996) define value of
a product or service as “a capability provided to a customer at the right time at an
appropriate price, as defined in each case by the customer.” (Womack & Jones,
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1996, p. 353) Value is stated in the customer’s word. The challenge here is to focus
on what the customer is willing to pay.
2. Identify the value stream for each product
A value stream includes “all the actions, both value added and non-value added,
currently required to bring a product from raw material to the arms of the customer
or through the design flow from concept to launch.” (Morgan, 2002). First we need to
create a value stream map that reflects the current state of the process being
treated. This map is then analyzed for waste and value creation, and a future-state
map is created, which represents how the process could and should operate.
We generate then an improvement plan, which will enable the transformation from
the current state to the future state.
Rother and Shook (1999) in their Learning to See have developed a powerful
technique to map value stream which facilitate the identification of wastes and allow
process improvement. A sample of a Learning to See map is shown below.
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3. Make value flow by eliminating waste
Once the value is defined and the value stream is identified, the step here is to
create continuous flow by eliminating backflows, scrap, rework and interruptions. No
stoppages, no waste is the central tenet here. In analyzing value streams, work will
fall into one of three types:
Value-Added Work: Those works are essential changes to product/service. You
would look at maximizing this category as there are providing customer value
(Form, Fit, Function).
Value-Enabling Work: Value-Enabling Work is a category that has potential for
elimination in the future (with identified improvements) but can’t be eliminated
immediately. There are necessary to run the current process. Technology,
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environment, culture require these activities. You would look at minimizing this
category of work.
Non Value-Added Work: Non Value-Added Work can usually be eliminated
quickly and is not dependent on improvement of other areas. This is the work
nobody needs and it is pure waste. You would look at eliminating this category
of work.
All of the waste (“pure” or “necessary”) in a process can be classified as one of the
following 7 types:
Over Production: Producing more than is needed before it is needed
Waiting: Any non-work time waiting for approval, supplies, parts, etc.
Transportation: Wasted effort to transport materials, parts, or finished goods into
or out o storage or between processes
Over Processing: Doing more work than is necessary (customer requirements)
or double work
Inventory: Maintaining excess inventory of raw materials, parts in process or
finished goods
Motion: Any wasted motion to pick up parts or stack parts, also wasted walking
Defects: Repair or rework
4. Let the customer pull the flow
The challenge here is to avoid delivering value before the customer request it. Also
you should not provide to the customer more than the agreed initial scope. In
manufacturing, we let the customer pulling the flow by means of a Kanban system.
Kanban allows the implementation of a just-in-time system. It uses cards to signal
the need for an item by triggering the movement, production, or supply of a unit.
5. Continuously improve in the pursuit of perfection.
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The final step is pursuing perfection which would lead the transformation to a lean
culture. The pursuit of perfection implies process improvement is endless. We
should constantly question the value of all activities. Obviously we would certainly
not achieve perfection, but we must constantly strive to get closer.
Common Causes of Project Failure
Real Life
Project Manager’s world is about focusing on the product, focusing on the team,
keeping the customer happy. Project managers face here a serious challenge. In
addition, they have to deal with a matrix organization, with people that they don’t
have power on.
Project management processes and the lean six sigma tools kit would certainly help
project managers become more efficient by focusing on value added activities and
limiting processes variation. In real life, project managers overlooked the following:
Establish real Customer Value:
Set up a scope baseline control to avoid our baseline to creep.
Build a communication plan to streamline the information flow
Assess stakeholder needs and get internal stakeholder commitment
Define Project Value Stream
When those previous factors get overlooked then project wastes start building. What
happen if we are not collocated with our customer? Then it could be really difficult to
establish real customer value. If we allow our customer to redirect our project team
member then we would end up with scope creep.
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Normally, our project management plan should describe the project value stream.
The Work Breakdown Structure would decompose end deliverables into value-
added work package and value-enabling work package. The precedence diagram
network would make the value flow. First it is recommended to have an unconstraint
approach. The project manager would then negotiate with the customer to which
extent planned milestones could be pulled but customer target milestones. If we
accept up front customer’s constraints without any proper practical and logical
planning effort, we would then certainly start building wastes and increase cost.
We have a good project management plan so why are we in trouble? We have to re-
plan the project and finally we face schedule and budget overruns. Let’s discover
now how Lean principles can be applied to project management processes.
Current State of Project Management Value Stream
Value
We specify value in project management by identifying objectives, deliverables and
requirements. We define also here acceptance criteria. Value or end result of the
project is what the customer is truly purchasing. It is stated in the customer’s words
and comes directly from the customer. Initial requirement may not be clear at first,
but must be established through close customer contact and establishing a good
working relationship. A statement of work or a requirement document is not the end
state, but just one of the items that makes up customer value. If value statements
are in conflict, the project manager must work with the customer to resolve that
conflict. To avoid building up wastes from the beginning of the project, the project
manager must therefore establish close client relationship and good communication.
Value Stream / Flow
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Value Stream is a critical area for the project manager. Many of the “things” that take
place in the project may very well be outside their span of control, especially in a
strong matrix organization. The current state project management value stream
could be mapped and analyzed in order to eliminate waste in processes, make the
remaining value added flow and move project management processes towards the
future value stream state. The future state would show short and rational response
to customer expectations for new products or services and change requests.
By analogy to the physical material that flows through the manufacturing process,
we can assume that it is information that flows through project management
processes.
As the information flows through this process, project management activities
performed add value to the information. It would transform initiating inputs data into
deliverables such as scope statement, project management plan, risk register, etc.
We would inevitably also build wastes depending of the level of accuracy of initial
product scope and business data. If we apply the seven manufacturing waste
categories to information, we would end up with the following table:
Wastes Description
Transportation Communication failure in between
processes, multiple & complex sources
Inventory Excessive information, inadequate
configuration management, complex
retrieval system, work in progress
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Over
Processing
Scope creep, overtime unplanned,
excessive approvals, resources overloaded,
excessive reviews, hand-offs, producing
intermediate deliverables, too many
iterations, unnecessary data conversions,
excessive verification
Defects Rework, poor estimation, conversion errors,
inaccurate information, inappropriate design
verification, unclear acceptance criteria
Motion Searching for information, required manual
intervention, lack of direct access, no
collocation
Waiting Information pushed too early, information
unavailable, no work being done, stop & go
activities
Over
Production
Signoffs, Too many details, unnecessary
information, redundant activities, over-
dissemination, pushing rather than pulling
information
In particular for project management processes, unplanned overtime waste can
come from an uncontrolled scope change or also called scope creep. This is the
consequence of adding new functionalities without assessing the impact on the
project objectives and without getting a formal approval from the steering committee
and/or the customer. We can imagine situation where the customer is bypassing the
project manager and addressing scope change requests to project team members
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ending into scope creep. To avoid such a waste, the project manager must manage
customer’s intimacy. Possibly, an extreme improvement would be that the project
manager collocates with his customer.
Additional inspections waste would improve the performance or the end result but
not the process delivering the result.
Continuously eliminating those wastes are at the heart of adopting a Lean Project
Management approach. Project managers need to learn to see them by putting
together a value stream map such as the one below.
Future Lean State of the Project Value Stream
Flow
The ideal flow is to have the product or service move through the value steam
without interruption. You should remember to begin from the end of the value
stream.
The Lean Aerospace Initiative (LAI) suggest factors to apply to a product
development value stream maps to move them towards a lean state. Those factors
are listed hereafter and could be apply to a project management value stream:
Remove redundancy, simplify, and standardize1.
Create continuous flow of information2.
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Getting into this lean state, the organization would improve its project management
organizational maturity by eliminating the wastes identified in table N°°° while doing
due diligence regarding planning and control value-enabling work.
Pull
By adding out of scope functionalities, you can expect that it will impact negatively
your project triple constraint. If you make more work than required at a certain time,
it will be pilled in waiting to be expedited to the next step. You should also avoid
here to execute project management activities in a batch. Indeed if there is any
product change request then you would end up with obsolescence and therefore
waste.
Perfection
Senior management support is critical here. They must set the standard and lead
the transformation to a Lean culture. Middle management and project managers
must constantly question the value of all activities, asking questions like why are we
doing this, is this signature really necessary, etc.
People essential to create a lean culture
Minimize information handoffs3.
Balance reviews and responsibility4.
Improve communication systems5.
Implement integrated product and process development6.
Maximize concurrent processing7.
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People are the keystone of any continuous improvement initiative. To detect the
problems and wastes is one necessary thing, but it is not sufficient to improve the
performance of the organization. For each dysfunction, a solution needs to be
implemented. This second stage is the most complex one because it mainly rests on
the human capacity to create and innovate.
Whatever the improvement required, the capacity to mobilize and involve personnel
in this action is fundamental. The transition to a lean organization requires a change
of culture and from all a new way of thinking.
In the context of poject management, the project manager need to involve its project
team in planning activities.
They know that anyone else the work content and the contrainsts.
This teambuilding approach would certainly prevent the creation of wastes.
If the project manager was to force its project team to commit to milestones fixed by
the customer, we could expect to have rework, low moral and high employees
turnover.
Empower employees is also cirtical in developping cultivating a human friendly and
supportive environment.
Conclusion
We could wonder to which extent a Lean Project Management tool box could help
us.
Well, first you need to perceive your project as a value stream. Value stream
mapping can be an important tool for project management processes improvement.
Then you need to ensure that the value is specified from the customer point of view.
Project managers must also address those wastes by founding the best possible
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environment for its project team members. He will have to involve functional
managers and to sensitize them so to eliminate wastes and to ensure project
success. Finally, the project manager must manage customer’s intimacy. Possibly,
an extreme improvement would be that the project manager collocates with his
customer.
Therefore I advocate the following roadmap:
Establish your Project Value Stream
Value from Customer’s perspective
Eliminate every waste possible
Work to develop Customer loyalty
Lean PM Tool Box
The flowchart below illustrate a possible Lean Project Managent tool box. It
reconciles the project management process group model based on the PMBOK
framework with the Lean principles described in this paper. One could consider here
Lean and Six Sigma principles as a common methodology to reach excellence in
projects. We will have project management processes and those must be carried
out with a certain level of excellence. But at the same time, we need to deploy Lean
principles to early define the value in the customer’s word.
One would expect to see project managers collaborating functional managers to
determine and measure capabilities to meet customer requirements. Value added
and value-enabling activities would flow triggered but customers need.
Continuous improvement of project management processes will ensure that you
maintain an acceptable level of performance. Ultimately, this will lead to project
excellence.
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References
Morgan, James, High Performance Product Development: A Systems Approach to a
Lean Product Development Process, Doctoral thesis in Industrial and Operations
Engineering, University of Michigan, 2002.
Shook, J., Rother, M., Learning to See. Value Stream Mapping to add value and
Eliminate Muda, Brookline, MA: The Lean Enterprise Institute, 1999.
Womack, J., Jones, D., & Roos, D., (1990) The Machine that Changed the World:
The Story of Lean Production, New York : HarperCollins,,.
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Womack, J. & Jones, D.. (1996). Lean Thinking: Banish Waste and Create Wealth in
Your Corporation. New York: Simon & Schuster,
This material has been reproduced with the permission of the copyright owner.
Unauthorized reproduction of this material is strictly prohibited. For permission to
reproduce this material, please contact PMI or any listed author.
© 2007, Aziz Moujib
Originally published as a part of 2007 PMI Global Congress Proceedings –
Budapest
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