In order to remain competitive, companies have to look for ways to differentiate themselves from the competition. Many companies try to create distance from their competitors through major “bet the company” type initiatives. While there are sometimes a time and place for such bold endeavors, there is also a lot to be gained from maximizing your own business processes. The courageous and wise Heller Keller stated, “I long to accomplish great and noble tasks, but it is my chief duty to accomplish humble tasks as though they were great and noble. The world is moved along, not only by the mighty shoves of its heroes, but also by the aggregate of the tiny pushes of each honest worker.” For years, manufacturing companies have been seeking this type improvement utilizing lean principles, which were pioneered by Toyota.
I recently visited with Thomas Agostinelli, business process manager at HORNE LLP and lean expert, to learn more about lean principles and the opportunities for businesses to utilize them. Thomas grew up in a hard-working family in Clarksdale, Mississippi. He majored in industrial engineering as an undergraduate at Mississippi State University where he went on to receive his M.B.A. He went to work right out of school for Diversified Technology, part of the Ergon family of companies, that produces embedded computer systems and industrial electronics. During his 12-year tenure with the company, he rose to be manufacturing manager where he managed up to 50 people producing high-technology goods for some of the world’s largest corporations. He also led the lean implementation program for Diversified. He shared that Lucent Technologies, a customer of the company, had completed an audit, which provided a number of recommendations for process improvement. Thomas headed up the effort to improve these processes, and two years later he noted that, “we were similarly audited by Intel who gave us great reviews on our processes.”
In 2009, he went to work for HORNE LLP in their Specialty Practice Group, which provides support at the state level with federal compliance for disaster recovery programs. He was hired in this growing practice area to define processes, create maximum efficiency, and to work with the technology team to automate processes as applicable. According to Thomas, lean in a nutshell is the idea “to deliver for the customer what is needed, when it is needed, with the minimum amount of materials, equipment, labor, and space.” In lean, you start with a focus on adding value to the customer. Anything that does not add value to the customer is considered waste and should be eliminated. Lean pioneer Shigeo Shingo stated, “The most dangerous kind of waste is the waste we do not recognize.” Therefore, a big part of lean thinking is to identify the value stream and to recognize waste in the processes.
Lean principles also focus on the people of the organization and the importance of teamwork. Thomas pointed out that, “Many people misunderstand lean and think it is about eliminating employees. That is not true. Lean is about respect for the employees and the value of each team member.” Ultimately, a lean system is about a streamlined flow that is a “pull” by the customer rather than a “push” at the customer. This type change and value creation comes in the culmination of all of the small improvements by the individual team members. Thomas emphasized to me, “In lean thinking, you never arrive at the destination of perfection. Instead, it is an ongoing pursuit of trying to improve.”
James Womack, founder of the Lean Enterprise Institute, makes the argument that “it is actually easier to implement lean in a small company than a big company because you have fewer people to retrain to lean thinking.” I agree that lean thinking presents a tremendous opportunity for small and mid-size businesses as well as large ones. Lean systems are just now really making their way into service industries. As companies continue to try to do more with less, I believe that lean will be necessary for companies to even remain competitive. The opportunity is to be the first amongst your competitors to successfully implement lean thinking and to reshape the culture to focus relentlessly on adding value to the customer and eliminating waste. I am excited to see respected companies like HORNE leading the way by investing their resources in maximizing their business processes. With our background in car manufacturing, Mississippi has the resources and expertise to lead the charge in applying lean thinking in all sorts of business to help compete on a global playing field.
Martin Willoughby, a business lawyer in Jackson, is a regular contributing columnist for the Mississippi Business Journal. He can be reached at email@example.com.