The words “lean” and “resilience” may seem like odd bedfellows, yet they share a common philosophy — one that’s focused on efficiency and optimizing performance.
In this post, we’ll explore how lean thinking and similar methods can improve organizational resilience and agility, allowing businesses to maintain business continuity, even during volatile economic conditions.
How to Use Lean Thinking to Boost Agility and Resilience
Lean thinking is a systematic method for identifying and eliminating waste in any processes.
First introduced in the manufacturing and production industries in Japan, it has now been adopted by organizations all over the world and applied in a wide variety of business disciplines.
In recent years, this method has been popularized through the book The Lean Startup, a book that advocates using lean thinking to deliver better products in less time.
Lean Thinking 101
Here is a quick overview of key concepts in lean:
- Continuous improvement. This is considered one pillar of lean thinking, which focuses on identifying opportunities that change work for the better.
- Respect for people. This pillar emphasizes the importance of respect at every level of the company.
These two pillars are complemented by the five principles of lean:
- Value. To deliver value to customers, organizations must first understand how their customers perceive value.
- Value stream. Once value has been ascertained, businesses must then design the best means of delivering that value economically.
- Flow. A “fluid flow” removes barriers, silos, and waste in the value stream.
- Pull. When the delivery pipeline is economized, customers will pull the products they want.
- Perfection. Perfection doesn’t end with lean thinking, instead, it is built upon the pillar of continuous improvement, as mentioned above.
Another useful process, highlighted in The Lean Startup, among other places, is the Build-Measure-Learn loop, a three step business process built around experimentation and learning.
Here are the key steps in this process:
- Build new prototypes or new iterations of an existing product
- Measure how that product is received by users
- Learn from that information
Once product creators have learned from their data, they take that information and incorporate it into the next iteration of the loop.
There is certainly more to lean thinking, but these are a few of the key concepts that can help businesses boost performance, resilience, and agility, as we’ll see below.
Benefits of Lean Thinking
Here are just a few reasons to embed lean processes into the business:
- Lean processes are less wasteful and less costly
- Products and services are more relevant to the end user
- Businesses can release products more quickly
- Design cycles are shortened
- Continuous improvement helps businesses continually evolve
In short, lean thinking assists with some of the most important goals in today’s business: speed, continual improvement, and responsiveness.
Lean, however, is only one of several business methods that can improve business resilience.
Beyond Lean Thinking
Here are a few other models and methods that can be used to improve agility and resilience:
The plan-do-check-act (PDCA) method is another step-by-step business approach aimed at continuous improvement.
This model’s key steps revolve around:
- Plan an action or business process
- Do the plan
- Check results and data
- Act, or improve the process
Like lean, the PDCA model is a great way to track progress, stay relevant, and improve efficiency.
Agile began as a software development methodology based on iterative and incremental development.
In this approach, requirements and solutions evolve through collaboration between self-organizing, cross-functional teams. It promotes adaptive planning, evolutionary development, early delivery, and continuous improvement, and it encourages rapid and flexible response to change.
Agile development is similar to lean in that they both focus on rapid development, continuous improvement, and customer success.
Also, like lean, agile has been applied to a wide range of other business areas, including:
- Agile change management
- Agile product development
- Agile manufacturing
- Agile supply chains
Agility has become a trending topic recently, since many businesses around the world have recognized that agility and resilience go hand-in-hand.
How to Apply These Models in a Business Context
Below, we’ll look at how the above models can be applied when developing a new product. But bear in mind that those same methods can be used in a wide range of business situations, not just product development.
1. Investigate the problem by learning from your target audience
When you’re trying to solve a problem for your target audience, always make sure you’re learning about the problem from your customers. That is, allow user-centric design principles to guide product creation.
For instance, why do people need or want your solution? What is the problem your competition is solving? What would make people switch from their current solution?
Remember that the best way to do that is to speak to them directly by asking questions about their problems, how they feel about them, what kind of solutions they’ve tried, what other people have told them, etc.
2. Incorporate that feedback into a prototype design
Start by testing your hypothesis with a small experiment – or, as it is called in the lean startup world, a minimum viable product (MVP).
This prototype should not be a complete product. Rather, it should contain the minimum set of features that make it viable for use.
Unlike other approaches to product development, such as the waterfall approach, lean designers continually stay in contact with their user base and other stakeholders.
That constant input assures product developers that their products are relevant, useful, and likable.
3. Run an experiment to test the solution
Next, think about what steps you’ll need to take to conduct your experiment and how you’ll measure success.
The purpose of any experiment is to test a hypothesis. You don’t know if something will work until you test it out, and you can’t test anything out without a hypothesis.
Again, during this stage, simplicity should be the top priority.
4. Measure performance and use data to drive decision making
You can’t improve what you can’t measure.
Starting from the core features and goals derived from user input, create metrics, KPIs, and indicators that track those goals.
In the build-measure-learn cycle, this step would be the “measure” step – the step that occurs between new iterations of a product or service.
5. Learn from the results, adjust the product, rinse, and repeat
Once data has been collected, it’s time to learn from that data.
Did people love it? Hate it? Were they indifferent to it? By analyzing the user experience, you’ll learn how people feel about a product, how relevant it is, and, ultimately, whether the product is economically feasible or not.