I neglected to include bullet point 4. above:

4. Find and develop low cost methods to service and possibly grow the bottom 80% of customers which represent 20% of revenue and profit.

It is important to not lose sight of the bottom 80% of customers which do not posses all or most of the attractiveness traits. Software automation, contract labor, and / or self service incentives through the website are several alternatives which have worked for our organization. I am certain that your readers could develop more methods.

One area of lean to consider, other than production waste, is a company’s sales and marketing behaviors & actions toward the customer base.

Generally speaking, approximately 20% of customers generate 80% of revenue and profit, while approximately 80% of customers generate 20% of revenue and profit.

This Pareto mix is indicative of random sales and marketing behaviors and actions.

To change this mix, we attempt to understand the common reasons why the Top 20% are so heavily invested in a particular company. These reasons, to which we refer as ‘attractiveness traits’, offer the rationale to change sales and marketing behaviors and actions:

1. Sell additional products and services to the Top 20% of customers.
2. Filter the bottom 80% for customers with Top 20% attractiveness traits.
3. Prospect only for new customers which possess the same attractiveness traits as the Top 20%.

If you want to put on muscle you need to change your diet or you will just have your same body composition as you get stronger. I’ve wrote about the similarities of fitness and exercise:

http://theleanwayconsulting.blogspot.com/2009/12/being-lean-not-just-for-fat-people.html

http://theleanwayconsulting.blogspot.com/2009/10/how-comfortable-are-you-with-being.html

Ankit

Rob, you’re absolutely right. This is why I say you shouldn’t spend too much time on definitions. They don’t often help you on the ho. And they can be very limiting.

The ‘how’ is the differentiator between successful journeys and forgotten journeys.

Despite understanding and agreeing with the point you make based upon this simple yet powerful definition of Lean, it doesn’t highlight the specific way (the ‘how’) in which Lean pursues this goal of ‘doing more with less’. Therefore it leaves (too) much room for interpretation thereby making it easy to say: “that’s exactly what we’re doing!”. Not!

I feel it is always easy to define the objectives (doing more with less, or – as I’ve sometimes summarized its ultimate goal – “deliver value instantaneously and effortlessly”). I have even tried to make that more more specific: providing ever-more value, through ever safer, better and faster processes, executed with ever less effort and waste. In that way I tried to add in the “ever better” aspect of Lean. As for me Lean is not only about the “what”, it’s about continuously getting better at the “what”.

But for me it doesn’t stop here. Lean goes beyond the “what” as it also says something about “how” to do and reach the “what”. I feel this is somewhat missing in the above “definition”. The point hereby is not “definition” or semantics, but the understanding of Lean based upon which companies say they’re already doing it.

Best regards,
Rob

Mark describes lean very well, although I wanted a shorter phrase!

To Jim’s point, my take on lean is that it frees up resources and increases capability through waste reduction, enabling better service, performance, and growth. Interesting challenge to use that freed up space – the concept of adding more value as opposed to taking out waste – kind of the converse of what we traditionally do in lean thinking. I would think this is sometimes where the higher level admin. staff who have their eyes out toward the future of the org. – the high-level strategic planners – would have valuable input. And, yes, others as well…

To add to your post. “Doing more to meet the customer demand, with less” should be the actual definition.

With this definition, the Hollywood actors are doing great since they do just to meet the customer demand (look good not necessarily with out being strong and healthy). The athletes also meet the customer demand of being strong and performing above the average human standards. Each profession has its own demand and requirements. If the Hollywood actors start having processing waste (extra diet/exercise to look thin or muscular), the customers will be turned off.

-Harish