Frequently referred to simply as "Lean", it is an approach to production which views the expenditure of resources (people, equipment, space, training, etc.) for anything other than the creation of value for the end customer to be a waste. Waste is something to be eliminated where possible; otherwise it is to be minimized.  Identifying and eliminating waste is not a one time exercise, but an ongoing effort, involving all employees. 
 

Value is defined as any action or process that a customer is willing to pay for. Basically, lean is a systematic approach to creating value with less resources.   All activities are seen as “value adding” or as "non-value adding.”

As a company you need to be very clear about why your customers come to you instead of your competitors. You need to understand, from your customer's point of view, what does your company make or do that has value?

Unfortunately, Lean is too often just seen as the set of "tools" used in the identification and elimination of waste. Examples of such "tools" are Value Stream Mapping, Five S, Kanban , changeover reduction or SMED, Kaizen, visual management and mistake proofing. With this approach, the thinking is that as waste is eliminated, production speed will increase and costs will be reduced. This approach views Lean as just another project with a beginning and an end.

A “tools” approach to Lean is why so many companies will say, “we tried, it worked for awhile, but it does not work anymore.”

There is a second approach to Lean Manufacturing, one which is promoted by Toyota, based on the work of Henry Ford. In this approach the focus is upon improving the "flow" or smoothness of work, thereby steadily eliminating mura (unevenness) through the system and not upon waste reduction per se.  When creating flow, cycle times are reduced and problems are identified and waste eliminated.  Techniques to improve flow include production leveling, "pull" production, through the use of kanban and the Heijunka box.  Flow matters because it is the least expensive way to manufacture product. 

“One of the most noteworthy accomplishments in keeping the price of Ford products low is the gradual shortening of the production cycle.  The longer an article is in the process of manufacture and the more it is moved about, the greater its ultimate cost”—       Henry Ford, 1926

The real difference between these two approaches is not the goal itself, but rather how the goal is achieved. The implementation of smooth flow exposes problems and unnecessary activities that exist in the process. So waste reduction naturally happens as a consequence of creating flow.

Toyota's view is that the primary focus of Lean is not the tools, but the reduction of three types of waste: non-value-adding work (muda), overburden, (muri), and unevenness (mura), to expose problems systematically and to use the tools where the ideal cannot be achieved.

Many consider Benjamin Franklin as the starting point for waste reduction thinking.

Frederick Winslow Taylor, the father of scientific management, introduced what are now called standardization and best practice deployment.  These are two additional tools for reducing waste.

Shigeo Shingo, credited as the creator of single minute exchange of dies (SMED) and error-proofing or poka-yoke, cites Principles of Scientific Management as his inspiration.

After World War II, Taiichi Ohno, Chief Production Engineer at Toyota, spent considerable time in the U.S. studying Ford and other companies, looking for ways to dramatically improve production at Toyota. Ohno, after spending time in supermarkets, recognised the scheduling of work should not be driven by sales or production targets but by actual sales. At this time, Toyota’s finances were very tight and Ohno knew that over-production had to be avoided and so the concept of Pull came to underpin production scheduling. Pull is idea of building to order rather than being target driven, which is known as “Push.”

Today, poor arrangement of the workplace and doing a job inefficiently out of habit are major forms of waste in most modern workplaces.  These costly oversights are easily remedied using Lean principles and practices.