What is LEAN?
Lean is an improvement philosophy and management method that assesses every activity in a process for the value it adds for the customer, and step by step eliminates everything that adds no value (waste). The method stems from the Toyota Production System and is applied in manufacturing, logistics, healthcare, construction and services. Lean is not an acronym: the word lean was coined in 1988 by John Krafcik, a researcher in MIT’s International Motor Vehicle Program. Anyone applying Lean in a modern factory soon works with data from MES, SCADA and ERP, which is why Lean has become a fixed part of OT convergence.
The essence of Lean: do only what adds value - and eliminate everything else.
🕰️ Where does Lean come from?
After the Second World War, Toyota developed a production system that delivered high quality with little capital and small batches. The foundations were laid by Sakichi Toyoda (the automatic looms in which jidoka originated), Kiichiro Toyoda (just-in-time), Eiji Toyoda and above all Taiichi Ohno, who worked out the just-in-time framework. Shigeo Shingo added, among other things, SMED and poka-yoke.
| Year | Milestone |
|---|---|
| 1950–1970 | Taiichi Ohno builds the Toyota Production System with jidoka and just-in-time as its pillars |
| 1988 | John Krafcik introduces the term lean production in the article “Triumph of the Lean Production System” |
| 1990 | The Machine That Changed the World (Womack, Jones, Roos): lean production needs about half the human effort, space and investment of mass production |
| 1996 | Lean Thinking (Womack and Jones) formulates the five Lean principles |
| 2015 | ISO 18404 describes competencies for Lean, Six Sigma and Lean Six Sigma |
🧱 What are the five Lean principles?
The five principles from Lean Thinking form a cycle:
- Value - define what has value from the end customer’s perspective, per product family.
- Value stream - map every step from order to delivery and remove the steps that add no value.
- Flow - make the remaining steps connect without waiting, batches or detours.
- Pull - produce only when the next step or customer asks for it, rather than for stock.
- Perfection - repeat the cycle until value is created without waste.
Continuous improvement in small steps is called kaizen. Lean often uses the PDCA cycle for it: each improvement is an experiment that is measured and then standardised.
🧺 Which wastes does Lean distinguish?
Lean recognises three kinds of loss: muda (waste: activity that consumes resources without customer value), mura (unevenness, such as a schedule that swings back and forth) and muri (overburdening people or machines). Taiichi Ohno described seven forms of muda; Western practice later added an eighth: unused talent. Together they form the mnemonic TIMWOODS:
| Waste | Description | Factory example |
|---|---|---|
| T – Transport | Unnecessary movement of materials | Pallets shuttled between hall and warehouse |
| I – Inventory | Excess stock or work in progress | Buffer stock between two machines |
| M – Motion | Unnecessary movement of people | Operator walking to a central printer |
| W – Waiting | Waiting for materials, information or people | Line stopped awaiting a QA release |
| O – Overprocessing | Doing more than the customer requires | Double recording on paper and in the system |
| O – Overproduction | Making more, or earlier, than requested | Producing just to keep the machine busy |
| D – Defects | Rework, rejects and errors | Rejects caused by a wrong setpoint |
| S – Skills | Not using employees’ knowledge and ideas | Operators left out of breakdown analysis |
Lean distinguishes waste that can be removed immediately from waste that is (still) necessary, such as a legally required inspection.
🔧 Which Lean tools are used most?
| Tool | Application | Link with OT/IT |
|---|---|---|
| Value Stream Mapping (VSM) | Visualising the value stream with lead times and inventories | Cycle and waiting times from MES or a historian |
| 5S | Workplace organisation: sort, set in order, shine, standardise, sustain | Also applies to control cabinets and network racks |
| Andon | Signal board that lights up on a deviation; the operator can stop the line | Digital via HMI, SCADA or alarming |
| Jidoka | Machine stops itself on a deviation so defects do not flow on | Interlocks and quality checks in the controller |
| Poka-yoke | Error prevention by design | Sensor or scan that blocks a wrong part |
| Kanban | Pull signal for replenishment | E-kanban in ERP and MRP |
| SMED | Cutting changeover time to under ten minutes | Loading recipes automatically |
| TPM | Preventing breakdowns and downtime with the whole organisation | Predictive maintenance and condition monitoring |
SMED (single-minute exchange of die) separates internal changeover tasks (only possible while the machine is stopped) from external tasks (prepared while the machine runs) and moves as much as possible to external.
🔄 What is the difference between Lean, Six Sigma and TPM?
Lean focuses on flow and waste, Six Sigma on variation and defects using statistics (such as SPC), and TPM on machine availability. In practice they are combined: Lean Six Sigma pairs the speed of Lean with the measurement discipline of Six Sigma, and TPM provides the stable machines that make flow possible. A quality management system to ISO 9001 also requires continual improvement and therefore fits well.
📊 How do you measure Lean in practice?
Lean only works with reliable numbers. Commonly used KPIs:
- Takt time - available production time divided by customer demand. With 450 minutes of production time and a demand of 900 units, the takt time is 30 seconds per unit.
- Lead time - time from order to delivery; in a VSM it is compared with the actual value-adding time, which is often only a small fraction.
- OEE - availability × performance × quality; 85% is regarded as world class for discrete production with long runs.
- First pass yield - the share of products that are right first time, an input for root cause analysis.
A practical approach for a production line:
- Choose one value stream and draw a current-state VSM together with operators, maintenance and planning.
- Automate the measurement: take downtime, cycle time and rejects directly from the PLC via OPC UA or MQTT instead of manual recording.
- Tackle the largest losses with kaizen events and FMEA or root cause analysis.
- Standardise the improvement in work instructions and change management procedures.
- Sustain it with short daily meetings based on a real-time dashboard.
🏭 How is Industry 4.0 changing Lean?
Within Industry 4.0 and Smart Industry, digital lean is emerging: andon calls appear on screens and phones, OEE is calculated automatically and a digital twin tests line changes before they are made. A Unified Namespace makes the same production data available to MES, ERP and analytics. Toyota applies an important lesson here: perfect the work manually first and automate afterwards, otherwise you automate the waste.
Lean also has a downside for resilience. Just-in-time means minimal inventory and a strong dependence on suppliers and IT links. On 1 March 2022 Toyota halted 28 lines at all 14 of its Japanese plants for a day after a malware attack on supplier Kojima Industries; around 13,000 vehicles were not built. Anyone digitalising Lean should therefore include supply chain risk and business continuity in the design.
❓ Frequently asked questions
Is LEAN an acronym?
No, Lean is not an acronym but the ordinary English word. John Krafcik introduced the term lean production in 1988 for Toyota’s production system. Writing it in capitals is common, but strictly speaking incorrect.
What is the difference between Lean and TPS?
The Toyota Production System is Toyota’s concrete production system, with jidoka and just-in-time as its pillars. Lean is the Western, generalised description of those principles, so that other companies and sectors can apply them too.
What are the eight wastes of Lean?
The eight wastes of Lean are transport, inventory, motion, waiting, overprocessing, overproduction, defects and unused talent, or skills (TIMWOODS). The first seven go back to Taiichi Ohno; unused talent was added later in Western practice.
Does Lean work in the process industry?
Yes, Lean also works in the process industry, although the emphasis there is more on changeover times, batch scheduling and stability than on manual motion. The distinction between discrete, batch and continuous processes determines which tools deliver the most.
What role does OT data play in Lean?
OT data makes Lean objective: downtime reasons, cycle times and rejects come straight from PLCs, SCADA and MES instead of manual tally sheets. This makes OEE, value stream analyses and kaizen results reliable and continuously measurable.
Is there an ISO standard for Lean?
ISO 18404:2015 describes the competencies of people and organisations that apply Lean, Six Sigma or Lean Six Sigma. The standard is not widely adopted; most organisations embed Lean in their quality management system, for example to ISO 9001.
📌 In summary
Lean stems from the Toyota Production System and revolves around five principles, eight wastes and a standard set of tools such as VSM, 5S, andon, kanban and SMED. In modern factories, OT and IT systems supply the data to measure losses objectively, while just-in-time demands attention to resilience and supply chain risk.
Lean is a practical method for streamlining processes, eliminating waste and creating maximum customer value - with people and reliable process data at the centre of the improvement process.