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One of the biggest challenges in applying Lean to Product Development is the ability to “see” waste. Manufacturing has traditionally led in Lean implementation, possibly because it is much easier to identify waste in manufacturing. Inventory can be seen. Wasted motion can be seen. Non value-added manufacturing activity can be seen. When you can see it, you can measure it and you can use the tools of Lean to reduce it.

“Seeing” waste in Product Development is much more of a challenge. There is a person at a CAD or simulation terminal – it looks like she is working hard. There is a technician in a lab – he is setting up and running a specific test. There is a design review, or a program review meeting. Where is the waste?

Lab work and other work that can be characterized by Value Stream Mapping is a traditional target for waste reduction, and this remains a great place to start. There is almost always opportunity to define and streamline the repetitive processes that exist in Product Development, and these are roughly analogous to manufacturing work. The traditional tools of Lean work well here.

I would argue that most of the “waste” of product development is NOT addressed with these tools, however. In my experience, a holistic view of waste in product development must include knowledge management – the ability of the organization to retain and apply knowledge once it was acquired the first time. Put another way, any mistake that has been made more than once by an organization is a failure of knowledge management. This can extend to not just the exact mistake that was made, but logical inferences that should be made based on the original mistake.

Wow! What a high bar. In this case in a global organization, a “lesson learned” in China should be able to be immediately applied around the world so that the mistake, or similar mistakes, will never be made again. Impossible?

Most enterprises pay lip service to “application of lessons learned”, but realistically the “check the box” program management oriented systems put in place are simply not effective. The simple proof is by looking at any measure of Product Development waste – quality metrics, design changes, or cost overruns – when root cause is determined, can you really say the organization has never encountered the issue before? In many organizations, the issues have been encountered many times before, but the knowledge has not been successfully captured and applied at the right time in the design cycle.

Well, the argument goes, design is different. It is not possible to perfectly accumulate knowledge in Product Development. It is art, not science. There will inevitably be waste, because it is a creative process.

Except that this argument is a bunch of hooey. I have been privileged to work at a company that took the challenge of never making the same mistake twice to an extremely high level, which resulted in a vary sophisticated knowledge management system. Importantly, this had nothing to do with a sophisticated “PLM” or computer system (nothing against PLM systems, but they are an enabler of knowledge management, not a knowledge management system). Key parts of an effective knowledge management system include both a process and a people component – specifically a sophisticated Design Review cadence and dedicated Subject Matter Technical Experts. PDCA is methodically applied to both, and waste is methodically driven from the Product Development process. Further, when an effective knowledge management system is applied to a traditional PD organization results are dramatic – in quality, cost, innovation and timing – because instead of “nibbling around the edges” the bulk of the waste in Product Development is being addressed.
Intrigued? Learn more at https://theleadershipnetwork.com/course/lean-powered-innovation or contact Charlie Baker at inthearena@mac.com.

Charlie Baker is former Vice President at Honda R&D Americas

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