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What is Lean Project Management? Principles & Benefits

Posted by Maggie Millard

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Sep 29, 2022 10:21:00 AM

Business man pointing to transparent board with text Next StepsLean project management is the application of Lean manufacturing principles to the discipline of project management. While most of the ideas germinated at Toyota in the 1940s, they have widespread utility across every industry and for organizations of any size. Modern organizations have adapted Lean project management for today's business challenges and technology landscape. 

The Five Principles of Lean Project Management

The ultimate goal of Lean project management is to deliver the most value possible with the least amount of waste. This is accomplished by applying the following five principles.

Principle 1: Understand value from the customer's point of view.

Traditional project management focuses on the business case. On the other hand, lean project management focuses on providing value to the customer. Customers can be internal or external, but either way, they are the ultimate judge of value. Lean project managers must get the customer's perspective by identifying goals, requirements, deliverables, and acceptance criteria. Surveys, focus groups, and direct observation determine the pain or problem the customer would pay to have solved. It is essential to have open communication with the customer during the project duration to ensure that every activity adds value.

Principle 2: Map the Value Stream.

Lean project managers use value stream mapping to identify and eliminate waste. By visualizing the current state of any process, managers can quickly find and reduce each of the eight types of waste, including:

Defects: Anything that caused rework or materials to be scrapped is a defect. In project management, defects frequently result from inaccurate data collection, poor understanding of requirements, and communication misfires.

Inventory: The waste of inventory occurs when components or finished goods are procured before they are needed. In project management, excess inventory also applies to online tools that are rarely used or supplies gathering dust in closets.

Transportation: Unnecessary transportation occurs when products or components are moved more often or further than needed. Excess inventory frequently causes the waste of transportation.

Motion: The waste of motion involves unneeded activity by team members. It may result from poorly designed workspaces or lack of easy access to needed information.

Overproduction: Overproduction happens when teams create more products, information, or features than the customer needs. In project management, overproduction frequently involves communicating unnecessary information or producing documents that are not used.

Overprocessing: Overprocessing means adding more complexity to a project or process than is necessary to create customer values. It may involve multiple levels of approval for simple decisions or duplicate data entry.

Waiting: Waiting happens when forward progress is stalled because information, materials, or other inputs are not available. Project managers experience waiting, for example, when decisions from leaders are pending.

Human potential: Although it is not as easy to spot as the other wastes, the waste of human potential has the potential to do the most damage. It occurs when the talents, skills, and perspectives of all team members are underutilized

Principle 3: Ensure continuous flow.

Once the customer's needs are well understood and as much waste as possible has been removed from the process, the next step is to ensure that there are no bottlenecks or blockers to interrupt the continuous flow of value. Project managers should identify the resource, time, and materials constraints that may delay the production of customer value and work to reduce or eliminate them.

Principle 4: Develop a pull system.

A pull system is a way to limit work-in-progress by ensuring that work only enters to workflow when there is an immediate demand for it. When work-in-progress is limited, the process flows more smoothly, there is less waste, and value creation is more efficient. The concept originated in manufacturing when organizations began to practice "just-in-time" fulfillment, but it is broadly applicable in other industries.

Principle 5: Improve continuously.

Lean project managers provide value to customers by constantly looking for ways to improve the process, the product, and their work. Lean leaders accept that conditions and customer need frequently change and that continuous improvement is the only way to meet the challenge. As a result, lean project management looks at problems as opportunities for improvement, and managers constantly question the status quo. What's more, every team member's input has high value because process operators and people who work directly with customers are in the best position to know when change is needed.

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Kanban for Lean Project Management

Kanban is one of the most widespread tools for visualizing work-in-progress and making Lean projects more efficient. Kanban boards contain cards representing work elements as it moves from one stage of action to another. Toyota initially borrowed the idea from shopkeepers who used signs to manage inventory, ensuring that customers could purchase what they needed without necessitating a huge inventory of products. Next, Toyota applied the principle to parts inventory management on the factory flower.

Today, Kanban is used in every industry, from healthcare to software development. Rather than physical boards, organizations have the option to use digital Kanban to make the information available to everyone from anywhere.

By visually representing the flow of work, managers get insistent information about how the project is progressing and know immediately if there is a block in flow. Additionally, Kanban boards help leaders limit work-in-progress so that only a reasonable number of open activities are at any stage at any one time.

Kanban Board

PDSA for Lean Project Management

Another critical tool used by Lean project managers is the PDSA improvement cycle, also known as the Deming cycle. This four-step process is a simple yet effective method to understand the problem, apply a potential fix, and assess the results. The stages are:

Plan: The project manager works with others to define the problem to be solved or the product to be created based on the customer's definition of value. They assemble the team and set the timeframe and expectations.

Do: Potential solutions or action steps are investigated and implemented. Communication is essential at this step so that everyone knows what is happening and why.

Study: The results of the change are assessed by objective measurements laid out in the planning phase. Adjustments to the process are implemented if the results fail to meet expectations.

Act: Any changes that have resulted in improvement are formalized and made part of the Standard work. In addition, the project manager defines how results will be measured over time to ensure that the positive change is long-lasting.

PDSA is called a cycle for a reason. Once a change is implemented, the cycle begins again to ensure that the process is continuously improving.

The Benefits of Lean Project Management

It is difficult to overstate the potential benefits of Lean project management. Of course, the number and extent of the benefits will depend on how well the project is executed, but the advantages of Lean management often include:

  • Improved customer satisfaction by focusing on delivering precisely what the customer needs when needed.
  • Better financial results. Eliminating waste makes projects and organizations more efficient and profitable.
  • Higher quality outcomes. Waste leads to defects.
  • Increased employee engagement. When people see that their ideas are valued and they see the results of improvement, they become more emotionally invested in outcomes.
  • Shorter lead times. Establishing flow and implementing a pull system speeds up the project cycle by eliminating bottlenecks and backlogs.

Our customers have used Lean project management to save hundreds of thousands of dollars, inspire innovation, transform customer sentiment, and improve staff and patient safety. Let us know if you'd like to chat with one of our improvement experts about exactly how.

Topics: Lean, Improvement Process, Improvement Methodology

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