Lean IT: Enabling and Sustaining Your Lean Transformation was published in September 2010 by Productivity Press, a division of Taylor and Francis. It has now won the Shingo Prize for Operational Excellence, Research and Professional Publication Award. This is the highest honor bestowed in the Lean community, given to work that advances the body of Lean knowledge into new areas; in this case, the realm of Information Systems and Services.
This award signifies the importance of Lean IT, beyond the improvement of IT operations, towards the continuous
improvement of the overall enterprise. After all, an enterprise can only sustain continuous improvement of business processes when it's IT organization is agile and responsive to change. In many industry sectors, IT is the driver of growth and innovation, so Lean IT has become essential for these organizations to survive and thrive.
For years, organizations have been urging IT to "align/integrate with the business", establishing "business/IT partnerships" to create value and drive innovation. But we seem to be endlessly searching for the right formula, the special approach, to make this happen. Lean principles and practices have proven their worth in many industry sectors, and we believe they are the key to unraveling this Gordian knot that IT and the business often find themselves entangled within.
We asked the authors, Steve Bell and Mike Orzen, to share their thoughts on the significance of Lean IT.
At a recent IT service management conference, we heard a well-known thought leader make a provocative assertion -- that many companies tend to under-invest in their IT operations.
Gulp. Did he really just say that? As we're searching for a quick exit, certain that hordes of angry, pitchfork wielding CFO's will be charging the speakers platform at any moment, we realized that he may be on to something important.
Research firms regularly report that as much as 80% of IT budgets are often spent on existing IT operations: keeping the lights on, maintaining an increasingly complex infrastructure, while supporting an accumulating technical debt of obsolete application components. That leaves just 20% for projects that drive process improvement and business innovation.
No wonder so many organizations are intent on outsourcing many of their IT services, while moving their platforms into the cloud, hoping to squeeze out costs. So could it be possible that with all that spending, and cost-cutting, companies are still under-investing ... is this a contradiction?
Not at all. Consider this - many people today are overfed yet undernourished. They consume too many calories - sugar and fat - while not enough of the right food to promote health and vitality. With such unhealthy behaviors they become slow, lethargic, and prone to disease. Perhaps we can say the same for spending on IT operations and infrastructure. How do we avoid costly efforts that don't create value - the fat? By investing in Lean IT (no pun intended).
Since the mid-1990s, the principles and practices that originated from Lean Manufacturing have spread across many industry segments. Today Lean Thinking has been widely adopted in financial services, transportation, healthcare, and many other sectors - often with dramatic results.
The focus of Lean is to eliminate "waste" in all business processes, in order to deliver measurable value to the customer. Waste manifests in many ways -- as unnecessary complexity, waiting time, erroneous data and misleading information, poor quality workmanship, rework to correct errors and mitigate the damage, and so on. People naturally recognize waste, whether they're on the receiving end as a customer, or as workers trapped in a poorly designed process they are powerless to improve.
We have facilitated countless "Kaizens" (improvement events) across all dimensions of the IT function - the service desk, software development, operations, procurement, contracting, disaster recovery, application selection, implementation and upgrades, and more. In each case we gather a cross-functional team, comprised of business and IT staff, to Value Stream Map a process. Usually the team is surprised to find inconceivable amounts of waste - time, effort, cost, unnecessary complexity, and error correction - right under their noses.
Using Lean and Six Sigma problem solving tools and techniques in rapid, iterative cycles, the teams learn to quickly and systematically eliminate waste, improve processes, and measure results. What's more, they discover they can reinvest this time in value adding activities that support operational excellence, increased value and innovation and improved job satisfaction.
There's a great deal of attention on Lean IT these days, and deservedly so. Many IT organizations large and small, across the full spectrum of operating models, are reporting significant achievements. But there's a catch - Lean is not free, it requires investment -as the old architectures are being dismantled, new disciplines must replace them.
Lean Manufacturing practitioners learned decades ago that you must create sufficient slack time in the schedule to allow workers to perform continuous improvement activities. If the factory runs at 100% capacity, and workers are in git-er-done mode every day, there is no opportunity to make things better. So they continue working harder and faster, wasting valuable time fixing things after the damage is done, rather than creating stable, repeatable processes that ensure work is done right the first time.
How many IT organizations do you know that are not running at 100% capacity (or greater) with increasing backlogs? To reap the benefits of Lean IT, to drive out the waste and create real value for the business, the IT organization and the business must work together to create time and space for improvement to happen. How can this be done? We invite you to read Lean IT and learn for yourselves!
Understanding Lean Concepts
Bell and Orzen on Lean IT
From Lean IT: Enabling and Sustaining Your Lean Transformation by Steven C. Bell and Michael A. Orzen. Productivity Press, 2011.