13 June 2016 | 6:44
Reinhard Wagner

Lean Project Management – old wine in new bottles or a real gain?

Like all other management disciplines, project management is subject to new concepts and developments – and not free of fashionable words. “Lean” project management is such a concept that is marketed as new concept for project managers and organisations as a “must have” for success. Lean should not be mixed with “meager” or “slim”, it refers to a philosophy developed by Toyota in the late 1950s in order to overcome the struggles the company was in. After the devastating bombing during the second World War, materials, equipment and financial resources were scarce … and managers of Toyota were forced to utilize them in the best possible way. Building on Taylor and Ford, the Lean Principles emerged at Toyota and were used as a holistic concept, first in manufacturing, later also in other functions such as engineering, services and administration.

In his Bestseller “The Toyota Way” J.K. Liker mentions the following fourteen key principles:

  1. Base your decisions on a long-term philosophy, even at the expense of short-term financial goals
  2. Create continuous process flow to bring problems to the surface
  3. Use “Pull” systems to avoid overproduction (e.g. Kanban)
  4. Level out the workload (“Heijunka”)
  5. Build a culture of stopping to fix problems, to get quality right the first time
  6. Standardized tasks are the foundation for continuous improvement and employee empowerment
  7. Use visual control so no problems are hidden
  8. Use only reliable, thoroughly tested technology that serves people and processes
  9. Grow leaders who thoroughly understand the work, live the philosophy, and teach it to others
  10. Develop exceptional people and teams who follow your company´s philosophy
  11. Respect your extended network of partners and suppliers by challenging them and helping them improve
  12. Go and see for yourself to thoroughly understand the situation (“Genchi Genbutsu”)
  13. Make decisions slowly by consensus, thoroughly considering all options; implement decisions rapidly
  14. Become a learning organisation through relentless reflection (“Hansei”) and continuous improvement (“Kaizen”)

First of all, these principles make sense and are practiced in the industry I have most experience in, the Automotive Industry. However, two factors need to be considered before transferring the Lean Principles to the domain of projects. Firstly, Automotive Industry is an industry based on mass production, thus repetition, processes and huge numbers of products. This is a context highly receptive to the aforementioned principles. On the contrary projects are unique. They certainly cover some repetitive processes and functions, but in essence it´s all about innovation, creation of unique deliverables through a one-off management effort. Secondly, the Lean principles were mainly developed in the Japanese context with a culture that differs from most of the Western or other countries´ cultures. The Japanese Culture is long-term and context oriented (e.g. information are rather implicit and strong focus on relationships), people dislike uncertainties and typically there is a high power distance. This might be a reason why the adoption of the Lean Philosophy is not always successful.

Nowadays, Kanban is highly appreciated in Agile Methodologies, not mentioning that Kanban only works in connection with aforementioned Principle 1, the long-term philosophy. For me, the right balance between the long-term benefits and (strategic) goals of a project together with the “Pull” system for the work performed is key to success. Principle 2 is a perfect fit for manufacturing and repetition. For projects we rather need a situation-specific adaptation of project management standards. Not “one size fits all”, but a tailor-made approach, e.g. a “lean” process model for less complex projects, with soft methods and tools for the change intended by the project. Project managers need to flexibly align their knowledge of standards to the needs of the project and may change this throughout the life-cycle of the project in order to avoid waste (“muda”). The fourth principle can be applied for managing portfolios of projects and programmes, balancing the workload according to the available resources. Principles 5 through 7 are core principles of project management, the visual controls can be either used on project, programme or portfolio management level. Principle 8 in my opinion does not really fit to projects. Principles 9 through 11 are dedicated to developing people and partners. This is another key success factor for projects. As the supply chain is taking over vast parts of the value creation (in projects), a closer coordination, communication and cooperation is necessary. The Automotive Industry developed collaborative project management methods and tools, which may be helpful for other project-oriented areas as well. Finally, the last three principles are helping to achieve a learning organisation, which fits to the repetitive processes of Automotive Industry as well as to the one-off projects. In my opinion, Western-style management needs to improve a lot in this regard.

Using “Lean” to advance project management is beneficial. We can use the good and stay away of the approaches that do not fit the specific circumstances of unique projects. However, using “Lean Principles” in project management requires a certain culture, otherwise the principles do not work. The context orientation and social relations are very different to the Western Culture and may cause troubles in the adoption of the “Lean Principles” in Western regions. This is why we need to decipher the philosophy before simply doing “copy & paste”.

Written by
Reinhard Wagner

Reinhard Wagner has been active for more than 30 years in the field of project- related leadership, in such diverse sectors as Air Defense, Automotive Engineering, and Machinery, as well as various not-for-profit organizations. As a Certified Projects Director (IPMA Level A), he has proven experience in managing projects, programmes and project portfolios in complex and dynamic contexts. He is also an IPMA Certified Programme and Portfolio Management Consultant, and as such supports senior executives in developing and improving their organizational competence in managing projects. For more than 15 years, he has been actively involved in the development of project, programme and portfolio management standards, for example as Convenor of the ISO 21500 “Guidance on Project Management” and the ISO 21503 “Guidance on Programme Management”. Reinhard Wagner is Past President of IPMA and Chairman of the Council, Honorary Chairman of GPM (the German Project Management Association), as well as Managing Director of Tiba Managementberatung GmbH.

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