When you hear the term ‘8 Wastes’, what springs to mind? Some inhospitable realm in a fantasy novel series? Maybe, but the 8 Wastes are actually a central element in lean management philosophy. And when you understand what the 8 Wastes are, and more important how to eliminate them, your MSP will also be leaner and more profitable. The Lean MSP series will provide a roadmap for how an MSP can adopt lean philosophy to achieve better operating results.
The Origin Story
The modern concept of lean management was created by Toyota, and initially gained popularity in the manufacturing environment. The concept has since been developed for services. Lean is especially well-suited to process-driven environments. Repeatable processes make lean a powerful tool for MSPs, as most of you deal with the same types of tickets over and over.
Key Elements of Lean
Key to lean is eliminating waste. A lean organization is one that strives to eliminate waste, and seeks pathways to standardization, in order to achieve that. To really implement lean requires a shift in the organizational culture, and a lot of reading you’ll do on lean comes complete with Japanese buzzwords. We’ll get to those later. The important thing to remember is that lean is a systemic approach to waste reduction, and requires buy-in from the entire organization. But it’s worth it.
Lean vs. Six Sigma
Lean is tied to the concept of Six Sigma, which is a quality control system that seeks to all but eliminate errors. The focus of Six Sigma is to identify errors, determine their causes, eliminate them, and then start the process over again. Once the big errors are out of the way, this work becomes about finding pathways to incremental improvements, especially ones in standardized, repeatable processes. In lean, the process of continuous improvement is known as kaizen.
8 Wastes (Mudas)
The original Toyota system had seven wastes, or muda in Japanese. A commonly-cited 8th waste is underutilized staff - a waste of obvious relevance to an MSP. The original seven wastes focus on inefficient movements, errors, wasted time, doing too much or too little. The key to each waste is that it is an area where there is room for efficiency gains, and by focusing on those opportunities for improvement, the organization as a whole will perform better.
You might be wondering how this applies to you. At IT Glue, we do a lot to address the issue of wasted time and inefficient transfer of information in MSPs. That’s two wastes right there. Each of these wastes has been applied in service industry firms. BCG has outlined how this can be done in a general sense.
The next article in this series will explain how the different wastes apply to an MSP, and what that means for transforming your MSP into a fully lean organization. Until then, if you want to learn more about the basics of either lean, check out the following resources:
25 Essential Lean Tools
Lean is Even More Important in Services than Manufacturing