Lean Thinking

A frame of reference for enabling people to join together in a shared aim.

“Lean” in this sense was originally derived from industrial lean production in the post-war period, and the concept is widely applied in industry, as alluded to in this book’s Introduction. Lean Logic applies this frame of reference to the shared aim of rebuilding a political economy in place of the failing market.L181

The essence is this. Two ways of making something happen can be compared. One of them—top-down management—is to tell people what to do: issue instructions, regulations, incentives, penalties, targets; exert managerial control; do the thinking for them; give orders, make sure they are carrying them out, check that they have done them right and, if they haven’t, tell them to do it again.

The other way is to set people up with the necessary resources, the skills and equipment, a common purpose, and the freedom to apply their judgment. This has advantages: it brings to life the imagination and tenacity of the people; it transforms the quality of decisions; it is flexible; it sets up conditions for alert feedback: it makes the needs of the system quickly apparent, responding to the local and real, rather than to a distant caricature.

An example of what we are looking at here is the difference between, on the one hand, policy in which the government tells us what to do and is then obeyed with sceptical resignation; and, on the other hand, an agreed direction, enabled by a leadership which knows the difference between management and inspiration, and which makes it clear what the aims are and why they matter, switching on minds, ingenuity and motivation. Those aims are general—e.g., “to achieve this long-term reduction in collective energy use, as defined by the Energy Budget, in order to preserve a benign climate. And it is up to you how you do it, though you will get all the help you ask for”—as distinct from detailed instructions backed by rewards and penalties.

This is regime change—from disjointed regulation to freedom to think, from command-and-control to concentration on the matter in hand. And in lean thinking such a radical break is called kaikaku; whereas incremental improvement is kaizen. The switch into lean thinking itself is almost always a radical break, prompted by crisis and reluctantly done. Whether further radical breaks, or creative destruction, are needed after that switch has been made is a more complex matter (Paradigm, The Wheel of Life).

And yet, in a sense, there is nothing new about lean thinking. It is as old as politics and community, but it was business that rediscovered it and made it explicit in our own time, so the business context of the principle is still present. This turns out to be quite helpful because business, especially lean production’s home territory of vehicle manufacturing—though far removed from post-market communities—provides a real-life setting for the five rules of the grammar of lean thinking. Lean Logic suggests its own labels for three of them; the original names are given in brackets:

 

1. Intention (Specify value)

The Intention defines what you want to achieve; it is the core around which every activity is organised and given shape. In industrial lean production, the Intention is to achieve “value”, and value is . . .

[a] capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer.L182

So, it works like this. We have a complex intention, and here again there are two ways of thinking about it. One way is to adopt a single task within that wider aim. It might be:

Require all workers to account for and record their time in full.

Now, why is that relevant to the Intention? What value does it bring? You might be able to think of ways in which customers get better value if all workers account for their time in full than if they don’t do so. But if, as we shall suppose for this example, it turns out that, after examination of the matter from all angles, it is just a case of bureaucratic form-filling, a tedious encumbrance which takes workers’ minds off their jobs, then it should not be there. Lean thinking travels light. It concentrates on what contributes to value—to the Intention—and does without things that don’t.

It sounds obvious; in action, it isn’t. Organisations sustain many practices that are irrelevant to what they are there to do. Sometimes they do so because other practices require it, such as a structure based on top-down command-and-control which requires exhaustive recordkeeping—if the recordkeeping were removed, the whole structure could collapse. That could be exactly the kaikaku event that is needed, but to the people around at the time, it is anything but obvious.

Another possible subsidiary task:

Make sure the handbrakes work.

Here we have identified an aim which at least has some relevance to making cars, though given such prominence that other aims, which are also intrinsic to “value”, risk being forgotten-about: you could end up with cars in which nothing worked but the handbrake. That is a caricature, of course, but it is not a remote one in the context of schools with state-of-the-art security cameras and collapsing discipline, farms with awesome labour-saving equipment and a deteriorating soil structure, urban districts whose smoothly-functioning social security system underwrites their crime and futility, factories whose milling machines work to a speed and accuracy far ahead of the rest of the system’s ability to keep up, or societies paralysed under the weight of regulation and control.

It is, of course, the aim that is wrong. The aim (again, it sounds obvious but it often isn’t to the harassed people in nominal command-and-control) should not be simply to produce handbrakes that work, but to produce cars that the customers want. Here, then, is reductionism in its most characteristic form, where it seems to let us off the need to think about working with the system as a whole, offering instead the satisfaction of concentrating on a simplified, one-item, to-do list. This will only destroy the shared focus on the overall aim and rule out the possibility of discovering a common purpose.

And that would in turn opens the way to Advanced Reductionism, where those iconic single-focus aims multiply, infesting the system like an extended family of clothes-moths. The cost of administering that collection of reductionist targets is high; inconsistencies either paralyse the system or impose a culture of pretence; creative invention is disallowed. The system becomes rigidly connected up; paralysed into incompetence. There is disempowerment—the task imposed on that busy ecology is to labour, but not to ask for any reward save the joy of catching each other out. The only participants who are happy with the situation are the managers, who think that more control is needed. Despite being rushed off their feet, they still can’t keep control, so it appears at first breathless glance that they have a point.

In contrast with all this, the Intention identifies the system’s deep, central, aims. That does not mean that the idea of “value” should be so focused that it itself becomes a reductionist aim, for the “capability provided to a customer” may in fact be quite complex and require reflection. The customer does not, for instance, want the company to go out of business, so she will expect it to make a profit; nor does she want to buy products from a company that pollutes the groundwater. So value—the Intention of an industrial enterprise—can be expressed in terms of responding to the claims of its numerous stakeholders, such as customers, shareholders, staff, the local community and the environment. The “triple bottom line” recognises companies’ obligations in terms of quality and income, and of the environment and social justice too.L183

What is non-negotiable is that the enterprise, having decided what it wants to do, must avoid being burdened either by a host of other kinds of urgent commitments which are nothing to do with that Intention, or by iconic reductionist obsessions which crowd out encounter with the system as a whole.

So, value is defined in terms of what the enterprise is ultimately for, and leaves out all the other things it may want to do, unless they are also relevant to that defining purpose. Since an enterprise is a complex system, many unexpected things may well be relevant, such as blue skies research and a generous pension scheme, but the connection between them and the Intention needs to be explicit. There may be seductive reasons for being distracted from what you are trying to do, but unless there is a plain reason in support of something being part of the enterprise’s Intention, it should be left out.

 

2. Lean Means (Identify the value stream)

The Intention is defined, so now is the moment to purge the irrelevant—the legacy of stuff that clogs up and weighs down the system. For instance, in the case of a manufacturing company—the original setting for lean thinking—you don’t have to maintain and pay for large numbers of supervisors to regulate the front-line workers on the assumption that no one can be trusted to think for themselves; you don’t need a large inspection and testing establishment if quality and judgment are intrinsic to every stage in the process. You don’t need arbitrary targets if there is a structure of motivation and trust, and a widely shared agreement on the Intention. Controls and written reports may in some circumstances be needed, but they do not in themselves add value, so they should be used only if they are essential to value being added. You don’t need centralisation if localisation will do as well or (more likely) better.

So get rid of all the irrelevant activities, elaborations and hassle (collectively known as muda) which tend to accumulate in organisations—that is, everything that isn’t part of the “value stream”. With the shock of kaikaku comes the sacrifice of much that may have been thought of as important or indispensable, and its replacement by lean-intelligent design, which is in turn followed by kaizen: incremental improvement, working out how to do what is necessary, and how to avoid what is not.

But, at the same time as purging the irrelevant, it is necessary to recruit the relevant—the set of means that is needed. There may be a lot of them, and not all of them will reveal themselves at first. For example, good ventilation is essential to good patient care, as Florence Nightingale discovered, too late for most of her patients at Scutari; soil structure depends on rotations and on the use of natural fertility and compost; a shared commons requires well-established conditions to be met if its users are to sustain it with the necessary autonomy, understanding and competence. Sifting the lean means from the irrelevant and achieving the needed convergence of focus and complexity may be difficult; it is an idea which, as is the way of systems, resists summary. In the end, learning about it means living it: heartbeat and respiration respond faithfully to—are pulled along exactly and promptly by—what the body needs.

 

3. Flow

Flow keeps the system moving at an even pace. The lean industrial system delivers parts and finished goods as they are needed; it avoids large batches, bottlenecks and storage. There is no waiting time between frantic bursts of work; the system is synchronised. It is also connected up, so that tasks are arranged close to each other and in sequence; the people who are doing them can sort out problems together; their conversation enables their cooperation. There is a convergence of the system’s aptitudes, timings, circumstances and purpose (for wider meanings of flow, see the separate entry).

 

4. Pull

Once the system is connected up, action in one part of it is the cue for fitting responses in adjacent parts. Action and information converge. Everyone involved can see—or recognises that they must work out for themselves—what needs to be done to achieve the Intention; actions are focused responses to the particular.

This is how the two leading exponents of lean thinking explain it (“downstream” refers to activities nearer the completion of the process; “upstream” refers to activities nearer the start of the process):

[Pull is] a system of cascading production and delivery instructions from downstream to upstream activities in which nothing is produced by the upstream supplier until the downstream customer signals a need.L184

Each activity responds to the needs of the next one along: it is pulled along in sequence. No one has to stand there giving instructions about what to do; participants respond to the demands of the processes downstream from them, whose needs they have to supply. The people involved see what is needed, and engage their brains.L185

 

5. Feedback (Perfection)

Reflect on results; improve the system incrementally. Check outcomes against Intention. Decide in the light of all this: is what you are trying to do realistic? Where are the gaps? Where is the room for improvement?

This is another of the features of lean thinking which seems obvious but which, on close inspection, turns out not to be. You can look at a system from the outside—and perhaps from a little bit above—and come to the conclusion that it is all working just fine, just as scale models of horrendous proposed city developments, with their tiny figures and tree-lined walkways, tend to look nice litter-free places to live. So, how is this error of misty-eyed complacency to be avoided?

Well, the first rule is: don’t look down at it from the sky. It is the people who are inside it who know it, and it is usually the dissidents, complainers and troublemakers who are most perceptive about it. What they are quite likely to see is the ways in which the bits do not join up: they will see the trade-offs: this can only work properly at the cost of this. But complex systems, given time and feedback, can usually do better than that: instead of trade-offs, with one part having to bear the cost of another, they develop ‘trade-ons’, where the service being provided by one part of the system for another is felt as a benefit by both the recipient and by the supplier. In contrast with the exchange relationships of economics, participants in such complementary relationships benefit directly from the very act of providing the goods and services to other parts of the system. Intrinsic advantage rolls through the system.L186

 

Lean thinking is a radical approach. It begins with the break of kaikaku, which may be hard to bear, as it is a profound change from previous assumptions and methods and so is usually resisted until a shock intervenes. The changed thinking that follows, approaching the system in a profoundly new way, moves ahead with incremental improvement and evolution, guided by experience and local detail.

It is a philosophy with wide application, shaped by the context. But there are significant differences between lean thinking as it is now widely applied in industry and the use that Lean Logic makes of it—apart from the obvious one that the industrial case is about extending the flying-time of the market state and Lean Logic is about bringing it in to land.

One of the differences—in fact it is more apparent than real, as we shall see—lies in the attitude to standard practice. Industrial lean production requires its procedures to be carried out to a standard, and in a standard way. Individuals are encouraged to invent and develop new ways, but they are not adopted without testing and widely shared agreement that this is to be the new way of doing it. The reason for this becomes obvious when you think about what it means to introduce, say, a new procedure in an aircraft cockpit. Each cockpit is used by many different pilots and co-pilots, who must be confident that all the cockpits they enter are virtually identical; they need to be able to use the equipment with certainty, not only as a routine, but in the dark, in an emergency and when tired. Innovations in equipment and practice are constantly introduced in response to pilots’ suggestions—this is key to the debugging process which is needed for every new model—but only after an established routine of evaluation, followed by briefings to everyone involved, and then the change is made to all aircraft of that type at the same time. A similar case for standard practice can be made for any system in which a number of people use the same equipment, where customers want to know in advance what service they can expect, and where “trial and error” has to be strictly contained, and cannot be allowed to escape into actual practice.L188

 

For a panarchy, or ecology, of communities, matters are more relaxed. The people who work in them and who depend on them tend to stay in the same place; it does not matter that they don’t know much about how things are done elsewhere; trial and error is not only acceptable, it is at the heart of their working practice. Their “errors” rarely have fatal consequences, and experiments can be extended and refined over many years; surviving mistakes; allowing successes to be gradually copied and locally adapted. At the same time, there is a presumption in favour of local practice, allowing a lack of standardisation that would be impractical in an industrial organisation.

And yet, a group of independent communities will still not be without its standard practice. For instance, the principles of organic food production and permaculture are widely agreed. It helps, of course, that those principles advocate a high degree of diversity in application, depending on soil, climate and the needs and numbers of the people involved in it, but the insights of teachers like Eve Balfour, David Holmgren and Patrick Whitefield have universal application, once the local intention has been settled. These enabling principles are, in a sense, a standard practice; they can be learned.

And the same applies to the whole cluster of practical and cultural skills discussed in Lean Logic and beyond—in surgery and computer programming, for instance. This is not a case, then, of inventing everything from scratch, but of having a foundation of skills and relevant expertise opening up possibilities and degrees of freedom which, without that foundation, would not be available. As any musician will tell you, you must know the rules before you can invent interesting ways to break them.

The key to the freedom and flexibility of the Lean Economy, then, consists of a range of skills, needing hands, mind, memory, judgment, emotion and cooperation. It will be a case of lifetime learning, starting not long after the first breath, and continuing with experience and conversation for as long as a person is able to take part in making community work.

With that platform of competence, it is possible to sustain flexibility and pragmatism in the bloodstream of the Lean Economy, and this affects such fundamentals as the “The Plan”—the Energy Descent Action Plan, for instance. There is nothing wrong with long-term plans: to learn from them is instructive, and to deliberate about them engages the wits, but to believe them is a betrayal of the creative imagination which is the heart of the matter (see “Flexibility and Invention” sidebar).

FLEXIBILITY AND INVENTION
Reflection and Learning

I once did a course with Australian permaculture teacher Dave Clark, who talked about his experiences implementing permaculture in refugee camps in Macedonia. He was dealing with large numbers of people moving to places with no infrastructure, all of which had to be created. He did amazing work, erecting straw-bale buildings, food gardens, putting in miles of swales and hundreds of thousands of trees.

He spoke of having to work with professional engineers who would design something such as a drainage system, which Dave could see wouldn’t work, but which, because the person was a ‘professional’, could not be questioned. He saw much money wasted through this unchallengeable ‘rule’ that the professional is always right.

He talked about how in his work he always worked from the premise that he was wrong. This designed into the process the openness to reassessment at any stage. An Energy Descent Action Plan should be like this. It is a collection of ideas that should be reworked and revised regularly.

Some ‘Plans’ become carved in stone, immutable and fixed: “We are working our way through the plan”, even though that Plan may be long since irrelevant. By designing flexibility into the process, we can make it infinitely more powerful, and give the community a far stronger sense of ownership and involvement.

~ Rob Hopkins, The Transition Handbook, 2008.L187

And a more profound difference between mainstream lean thinking and its application in Lean Logic lies in the idea of a slack economy. The lean enterprise is designed to be so taut that problems immediately show up, with dire consequences, and everyone involved has the maximum incentive to make sure they don’t happen. This is the “Just-In-Time” (kanban) principle which does not allow backup stocks, so that supplies are delivered at the last minute. It certainly concentrates the mind but, even in industry itself, it has its risks, leading to stock outages if, for instance, there is a problem in supply which the company can do nothing about. And yet, there is slack even in the industrial version of lean thinking, in the sense of its responses to such challenges: it is unencumbered; it can respond quickly and effectively; it travels light. There is extended freedom for the people involved in it—not just a remote well-intentioned management—to engage their minds.

The lean approach is not about apple-pie-sensible practices. It is about listening acutely to what a system needs and responding accurately. It is not an ecology in which the waste of materials, money, labour, health, or environmental quality is cut: some waste may indeed still be present, but here it is not inadvertently designed into the system.

Lean thinking switches on the information technology that we keep in the space between the bridge of the nose and the top of the head. Regulatory management has not been made aware of its existence.

 

Related entries:

Lean Food, Incentives Fallacy, Paradigm, Metamorphosis, Lean Education, Harmonic Order, Relevance Fallacy.

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David Fleming
Dr David Fleming (2 January 1940 – 29 November 2010) was an economist, historian and writer, based in London. He was among the first to reveal the possibility of peak oil's approach and invented the influential TEQs scheme, designed to address this and climate change. He was also a significant figure in the development of the UK Green Party, the Transition Towns movement and the New Economics Foundation, as well as a Chairman of the Soil Association. His wide-ranging independent analysis culminated in two critically acclaimed books, Lean Logic and Surviving the Future. A film about his perspective and legacy - The Sequel: What Will Follow Our Troubled Civilisation? - was released in 2019, directed by BAFTA-winning director Peter Armstrong. For more information, including on Lean Logic, click the little globe below!

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