What is Lean project management?
Using Lean practices will allow you to manage your projects more effectively, all while wasting fewer resources.
To understand how this is possible, we need to look back at the roots of Lean manufacturing.
Back in the 1990s, MIT researchers James P. Womack and Daniel T. Jones noticed that Toyota was consistently able to achieve more with less.
They investigated why this was the case and presented their findings in The Machines That Changed the World (1990) and Lean Thinking (1996) — the first books to use the Lean moniker for codifying the set of 5 Lean principles as we know them today.
Lean project management is merely the application of Lean manufacturing principles to project management.
In this guide, we’ll go over:
- The 5 principles of Lean,
- The advantages and disadvantages of Lean, and
- Some tips you can use to make your projects Leaner.
What are the 5 principles of Lean?
If we had to sum up Lean in one sentence, it would be this:
Deliver value from the customer’s perspective.
Maximizing this value is at the heart of all 5 principles of Lean.
Presented in an actionable manner, these principles state the following:
- Identify value
- Create the value stream
- Create flow
- Establish pull
- Seek perfection
Lean principle #1: Identify value
In Lean project management, value is anything that the customer is willing to pay for — be it a product or a service.
So, make sure you have a clear picture of what it is your customers want.
In the case of Toyota, their customers — car dealerships — want them to deliver cars to said dealerships.
The car dealerships don’t care how long it takes to assemble the cars, so long as they are free of any defects.
They don’t care how efficient the production line is.
They don’t care how much it costs to keep a large inventory of car parts before they get assembled.
Any costs accrued by inefficient production or oversized inventory are of no concern to the customers.
After all, none of this brings them additional value.
Costs that don’t add value to the customer are referred to as waste in Lean project management.
Lean principle #2: Create the value stream
Step two of Lean project management is eliminating waste, which is done by creating a value stream map.
A value stream map is used to visually represent the flow of value in your project.
Using a value stream, you are able to distinguish, at a glance, which steps in your production offer values versus ones that only create waste.
Let’s take video production as an example. We’ll use exaggerated numbers to keep things simple.
Let’s say the cycle time for this video production is 10 days:
- The content writer takes 2 days to write the script.
- They pass the script off to the editor, but 1 day passes before the editor takes a look at it.
- The editor takes 1 day to go over it.
- The editor sends the script to the voiceover artist, who also takes 1 day to start working on it.
- The voiceover artist takes 1 day to record the audio.
- The voiceover artist sends the audio file to the video editor, who takes 1 day to start working on it.
- The video editor takes 2 days to wrap everything up from the moment they start editing.
- The video gets uploaded the next day.
This is the general idea. Normally, value stream maps deal with hours and minutes, but large, round numbers make for more effective examples.
Now, let’s see — throughout this 10-day cycle time — how much value is being added to the task versus how much waste.
In this example, we have 6 days of activities that add value and 4 days of waste caused by waiting.
Waiting waste is just one of the many types of waste that can affect your project.
To help make you better at identifying waste, it’s best to be familiar with the waste terminology used in the Toyota Production System:
Muda — a waste of resources
Muda refers to a waste of resources — something that doesn’t increase value from the customer’s perspective yet still costs you.
You can think of it as manufacturing waste.
In actuality, the term Muda (無駄) is the only one among these three that can be translated as waste — although a more common translation would be useless or futile.
Taiichi Ohno, the man behind the Toyota Production System, categorized the following 7 types of Muda:
If you’re in doubt as to whether or not some of these processes constitute waste, simply ask yourself whether they provide value from the customer’s perspective.
Let’s circle back to the video production example mentioned earlier.
If, during the production of a video, it takes the video editor a whole day to start the editing process upon receiving the audio file, this day of waiting doesn’t add any value to the customer — from their perspective, being able to watch the video is the value.
Tangential trivia: Don’t be surprised if, when searching 7 Muda, you are shown results of anime characters punching each other.
In the manga series JoJo’s Bizzare Adventures, one of the main characters has a habit of repeatedly shouting muda (useless) while hitting his enemies to remind them how useless resistance is.
In what has become a fan favorite moment, the manga author stretched out one of these scenes to 7 whole pages, which the fandom refers to as the 7-page muda or simply the 7 muda. It has nothing to do with Lean project management, but search engine algorithms haven’t completely caught on to this.
Muri — a waste of effort
Muri refers to a waste of effort, generally brought about by overburdening workers or equipment.
In the context of Lean project management, you’ll often see the word overburden mistakenly presented as the translation for muri.
However, the two kanji used to depict Muri (無理) are more accurately translated as unreasonable.
The idea is that overburdening people and equipment is unreasonable, as it inevitably leads to burnout and malfunctions.
This, in turn, leads to errors that detract from the value of your project. And, anything that detracts value is anti-Lean.
Mura — waste caused by uneven workload
Mura refers to waste caused by uneven workload.
In Lean project management, the term Mura (斑) is correctly translated as uneven.
Mura points to unevenness in the workflow.
The idea is that uneven input is bound to result in uneven output, and uneven output is patently undesirable.
Those seeking to be Lean should make every effort to ensure their processes are standardized.
Lean principle #3: Create flow
Identifying and removing waste is only half the work.
The other half is reconfiguring your workflow to function without the waste.
If you’ve been wasting a lot of resources by keeping an unnecessarily large inventory, you can’t just say “we’ll keep less inventory” — that’s half the work.
Instead, you need to take a systemic approach to reevaluating and reconfiguring your inventory management.
If you’re renting a needlessly large storage facility and you start keeping less inventory, your storage facility should be made to reflect this change. After all, keeping storage space is expensive in and of itself.
Alternatively, if you’re making cars and you’ve discovered that the production line moves the chassis around too much, you can’t just stop moving the chassis — this would bring production to a complete halt.
Instead, you need to create a new production line that will maximize the value flow without unnecessary movement.
Lean principle #4: Establish pull
The fourth principle of Lean instructs us to establish a pull system.
Just in case you’re unfamiliar with the terminology of pull and push systems, here’s a brief explanation:
- In pull systems, production is initiated in response to customer demand.
- In push systems, production is initiated in anticipation of customer demand.
The recent pandemic restrictions have made us all a bit more familiar with pull systems, as we’ve been part of them for a while whenever we’ve gone shopping.
For example, let’s say a pharmacy has a maximum occupancy of 3 customers. Surplus customers wait outside, preferably in a queue. When one customer leaves, the first person in the queue enters the pharmacy.
Pull systems are related to supply and production more so than waiting in queues to buy medication. But, this example accurately illustrates the locomotion of a pull system.
In Lean project management, pull systems are used to ensure that your supply closely matches the demand for your product.
That’s because — looking from the eyes of the consumer — overproduction is a waste.
One of the simplest ways to introduce pull into your projects is by using the Kanban project management methodology.
Kanban operates by severely limiting the work in progress — i.e., the number of tasks — each worker is allowed to work on at the same time.
This ensures that workers focus all their efforts on the work at hand and only start working on a new task once they’ve finished the previous one.
Kanban and Lean are somewhat related anyway, with both finding their roots in Toyota.
This is to say that Toyota, the progenitor of Lean manufacturing, uses Kanban as an integral part of their Toyota Production System.
Lean principle #5: Seek perfection
Lastly, it’s important to note that Lean project management is a continuous process.
It entails continuously reevaluating your processes and seeking ways to optimize them even further.
There is no room for complacency in Lean project management.
Advantages of Lean project management
The two biggest benefits Lean projects receive are:
- Reduced costs, and
- Higher customer satisfaction.
Lean reduces costs
Identifying and eliminating waste in your project workflow is guaranteed to reduce overall costs.
If we look back at the 7 Muda, these are all processes that don’t add value but cost resources:
- Needless transportation — costs both time and money.
- Overproduction — freezes up your business equity in inventory that exceeds demand.
- Keeping a large inventory — as mentioned, it simply is a pricey endeavor.
We could go on.
The point is that the biggest advantage of using Lean is its ability to maximize profits by eliminating unnecessary costs — and it works.
Lean increases customer satisfaction
Since Lean focuses on delivering value from the customer’s perspective, it stands to reason that Lean practices lead to higher customer satisfaction.
It is also possible for a reduction in waste to only reduce the costs of production while leaving the quality of the product as is.
But, in this case, you’re still benefiting from the primary advantage of using Lean, i.e. reduced costs.
Disadvantages of Lean project management
For all of its advantages, however, Lean project management also comes with several hidden disadvantages that you should be aware of.
The two major ones are:
- Little room for error, and
- Counterproductive results
Lean leaves little room for error
In a sense, Lean is all about producing the desired results with the minimum investment:
- Minimum workforce,
- Minimum equipment,
- Minimum transportation, and
- Minimum everything.
Your goal is to do just enough work, just in time to provide value to the customer.
This shouldn’t be confused with delivering a subpar quality product or service — it should be free of any defects.
But, the goal is to use the minimum input needed for the desired output.
In theory, this sounds great.
And, in practice, it does work.
But, using Lean leaves you with very little room for error.
Taken to its extreme, progress on a Lean project can be compared to walking on a tightrope, where one misstep can cause serious issues.
Even though Lean teaches us not to overburden equipment, breaks and malfunctions still happen. And, with no redundancy, they can completely halt the progress of a project.
This one disadvantage can have a range of consequences, like missing deadlines or producing defective products.
Lean can lead to counterproductive results
The initial return on investment for using Lean is typically great.
This is most noticeable when low profits caused by inefficiencies serve as the impetus for a project or production to switch to Lean.
That first batch of waste elimination and value flow reconfiguration tends to have universally positive effects:
- The customers are happy — they receive more consistent value,
- The workers are happy — they work more efficiently instead of just working more, and
- The leaders/management are happy — they reduce costs and increase profits.
But, Lean is a process of continuous improvement.
And, it’s not uncommon for leadership to get drunk on the potential improvements of subsequent value flow reconfigurations.
When performed in quick succession, these reconfigurations bring diminishing returns, while frustrating the workers.
Toyota is able to produce 10.1 million cars a year, but it limits its output to 5.6 million.
For Toyota, this perceived discrepancy is worth it. It allows them to allocate more time to research and development (R&D) and integration of new technologies.
But, Toyota also has the benefit of being Lean the longest.
For someone new to Lean, the costs of continuously reconfiguring the value flow can greatly exceed the benefits.
This is a waste of resources and therefore counterproductive to the goals of Lean.
This happens when overzealously tracking productivity and waste starts to negatively affect production, turning a means to an end into an end unto itself.
Now, you shouldn’t take this as advice to forget all about the 5th principle of Lean — seeking perfection.
Just make sure that the improvements you make are as beneficial in practice as they are in theory.
What’s the difference between Lean and Agile project management?
Rather than being concrete project management methodologies, both Lean and Agile are best thought of as project management mindsets:
- Lean teaches you to deliver value from the customer’s perspective by cutting down waste and aiming to accurately meet the demand for your product or service.
- Agile (to oversimplify it) teaches you to take an iterative and flexible approach to managing projects by making sure to incorporate customer feedback into the production/development process. For a more detailed explanation, it’s best to refer to our guide on Agile project management.
Interestingly enough, Lean and Agile are not mutually exclusive.
You can be both Lean and Agile at the same time.
Standing testament to this is Kanban, which is, at the same time, an Agile framework and one of the best ways to integrate a pull system mandatory for Lean project management.
Looking at Toyota’s six rules of using Kanban, we can see that they perfectly complement Lean:
- Never pass on defective products
- Take only what is needed
- Produce the exact quantity required
- Level the production
- Fine-tune production
- Stabilize and rationalize the process
In this sense, you can think of Kanban as the intersection where Agile and Lean — two otherwise different project management paths — meet.
How do you implement Lean project management?
So, now that we know what Lean project management is — all advantages and disadvantages included — let’s see how you can start making your projects Leaner.
Needless to say, this demands that you follow the 5 principles of Lean.
But, to avoid repetition, we’ve divided the process into two parts:
- Conduct introspective analysis
- Use Lean project management tools
Conduct introspective analysis
In the context of this guide, introspective analysis refers to analyzing the current processes and procedures of your project once you’ve defined value.
In other words, you should check to see which parts add value and which parts add waste.
Then, revamp the process to keep it functional while removing as much waste as you can.
Unfortunately, it’s hard to be more specific here, as there’s no telling which types of waste a certain project will suffer from.
The best thing you can do is map out the value stream and check for the 7 types of Muda, as well as Mura and Muri.
Use Lean project management tools
Once you’ve figured out a way of eliminating waste and maximizing the value you bring to the customer, it’s time to implement a pull system.
The best way to do this is by utilizing a Lean project management tool like Plaky.
Plaky allows you to organize all tasks using customizable Kanban boards, without limiting the number of boards, tasks, or users you can add to your workspace.
This way, you can ensure that your workflow is pull-centric, regardless of the size of your project.
You can learn all about Kanban and how to use it by reading our guide on Kanban project management.
Conclusion: Lean allows you to achieve more with less
With 70 years of history through the Toyota Production System, Lean project management is a proven way to increase value and reduce costs by eliminating waste and utilizing a pull system.
This is beneficial not only for startups, who cannot afford to waste any resources, but also for well-established companies seeking to improve their profit by cutting costs without sacrificing quality.
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