February 28, 2020

Lean in The Service Industries

Is Lean Thinking Only Applicable to Manufacturing?

Lean’s effectiveness has been well established in manufacturing with Toyota’s Lean legacy leading the way to stellar business performance.   However, with the fast growth of the service industry, many businesses are becoming aware that the same Lean principles may be applied to their sector to reap similar successful outcomes.  Lean principles, methodologies, and concepts be be readily applied to Services with very effective results.  

The fundamental concept of Lean is to establish what is ‘Value’ to the customer. Then it is a case of streamlining this Value Stream by optimising business processes while reducing waste and striving for a Service that promotes ‘Flow’. Although it can be more difficult to locate intangible wastes in a service environment, the principles of Lean remain the same i.e. for systems to be effective and efficient while culturally embarking on a journey that ensures continuous improvement becomes part of the business’s DNA.

Lean in the Financial Sector

Companies in the service sector are constantly under pressure to deliver excellent customer service, fast response times, and accurate support for their customers.  Lean can help to optimise processes by identifying wastes and then either removing them or minimising their impact.

Financial firms are a prime example of a Service sector that have many business processes that have inherent wastes such as department hand-offs, waiting, re-working forms, duplication of data gathering etc.  It is estimated that over 40% of costs are spent on wasteful activities that have no real Value Add to the customer.  Lean thinking can provide businesses such as banks, insurance, and investment companies with more productive and cost-effective solutions, reducing costs, improving employee satisfaction while promoting excellent customer experience through delivering value.