Richard Keegan and Eddie O’Kelly on the value of a lean strategy: The creation of value in a service business starts with their primary resource, which is its people, and ends with what their clients or customers perceive as value. A Lean Service business needs to understand its people and how they add value, in order to optimise their value-adding process.
Retaining value is absolutely essential to a service business, it gives them the potential to make a profit. The way a business organises its resources of people, systems, processes and premises determines just how much of the value stays with the business.
If you are to identify, develop and retain value in your business, the very first thing you need to do is to look closely at how your people are trained. This will help you know and understand how well your customers’ needs and wants are understood, and how closely your internal processes are aligned to most efficiently meet customers’ requirements.
Adding value: step by step
The first challenge for a service business is to understand what their customers consider to be valuable, and then to define and develop the internal processes to be able to deliver this value-added service in a highly effective way.
After determining what the customer wants, needs and values, we need to know what are the ‘right things to do’, and then we need to develop an efficient way of delivering that value, or in another words: ‘doing the right things well’. In order to do so, we need to develop the capability and capacity of our people and processes to do them effectively and efficiently. Efficiency of processes depends on both the hard infrastructure as well as the ‘soft’ elements.
It is all about mapping
In comparison with the manufacturing process, where managers are able to ‘see’ the physical flow of materials and deliveries, or where things are getting jammed up, in the service business these process can be a little more complex. However, they are really not all that different.
Process Mapping and Physical Flow Mapping are the core Lean tools in the service process. Before we can ‘understand’ or ‘do’ something to improve the process, we need to ‘look’ at the overall perspective in order to design the best implementations.
For example, managers in a service environment need to realise (to ‘look’) that their departments are, in effect, production units. People come in for a service and leave serviced. Data comes in, gets processed and the output leaves the department. This will help them in the ‘doing’ that will be to implement developments in the process based on their knowledge and expertise.
As Richard Keegan and Eddie O’Kelly have explained, the trick for a Lean Service implementation is to find a way to see these processes: to show a physical ‘picture’ of the processes to let people look for and identify the value-adding, the necessary and the wasteful elements of the work.
The Lean Service approach is based on two basic, but mutually supportive, elements:
- Lean tools and techniques
- The ‘Way’ – capturing the hearts and minds of the people.
These tools, techniques and engagement of people has been with us for many centuries. Nowadays, the idea of ‘caring’, where people are committed to ‘doing their best’ has largely been misplaced, but it is not lost. The best service businesses is the one that cares about its customers and their staff, the one that ensures its service is well-delivered and well-received.
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Staff is the core of Lean Service
Many businesses try to improve their processes just by relying on the tools and techniques, without considering their staff. This can be helpful for a time but, if the staff is not aware of the value the business wants to offer and their important role in that process, eventually the results will be disappointing.
The hearts and minds of the staff in any business or organisation are very important. If so much of what customers see from a service is dependent on its people. That is why it is utterly important that the staff cares about the process, the client and the company in order to get involved in developing the process and service and in enhancing the value delivered and retained.
In all cases, the effectiveness of a business staff and processes decide whether we have a good, profit-making, sustainable business. That is why the Lean approach focuses not only on the tools of Lean but also and even more importantly on the ‘Way’ of Lean – the hearts and minds of people.
In addition, it is also necessary to know, understand and share what are the things that can go wrong with our service delivery and also know, understand and share ‘recovery methods’, to quickly, effectively and efficiently fix issues if and when they arise.
The very best people are the ones that constantly challenge themselves to get better, to improve from where they are, to push their capabilities to the highest level they can. In a practical sense in a service business, we want and need our staff to build and develop their capabilities to deliver true value to our clients and the business.
Extracted from: LEAN SERVICE: A PRACTICAL GUIDE FOR SME OWNER / MANAGERS by Richard Keegan and Eddie O’Kelly, published by Oak Tree Press and available from www.SuccessStore.com and good bookshops.