The word Lean conjures up several images in people’s mind whenever it is mentioned. On a physiological dimension, when you give people a choice asking them if they would like to be obese or lean, the likelihood of getting “Lean” as an answer is quite high. All of us intuitively understand the health benefits of being “Lean”.
But being how much lean is actually “Lean”? How do we ascertain that being lean is at the same time being healthy? Even skeletons are lean.
In the physiological context, being lean is not having excess flab. But not having excess flab is not the same as not having even just enough muscle mass that is required for basic traction. So everyone intuitively know that in order to be healthy while at the same time being lean, a bare minimum amount of body weight and muscle is required.
In this context, then how do we measure if being Lean is also at the same time being healthy?
This is where the metric called Body Mass Index comes into play, which in simple terms is the weight of a person divided by the square of the height. Higher this measure, higher is the obesity index and lesser is the health quotient. Similarly, if this value is below a certain threshold it is once again treated as being undernourished and unhealthy. How to interpret BMI? For a given height of a person, a certain range of weight would be required to be in the operating range of being healthy.
How does the word “Lean” and the above understanding in a physiological dimension, then translate into a manufacturing context? Why does the word implementing lean, bring in anxiety? Why does the word bring in perceptions of massive cost reduction, head-count reduction, reduction in anything and everything? Does being “Lean” in a manufacturing context point towards being unhealthy? Unhealthy in this context means, poor profitability. Is that the objective of Lean? Certainly not.
If I have to apply the BMI metric to a manufacturing set-up, perhaps it would look like costs divided by the square of revenues. This means, higher this number, less healthy the organization is. Is it not? Do we minimize this number, or find an optimum operating range? That is the question.
Minimising this number, would mean bringing costs lower and lower, for a given value of revenue. But taking the parallel in the physiological context, we should relate to what we discussed earlier. Being a skeleton is not being lean and healthy. If a Manufacturing BMI has to be as minimum as possible, what would be the minimum number? A zero cost would result in zero BMI . Is this healthy? We know that with zero costs, one cannot have any revenues. Even gambling has stake costs.
So, “Lean” in a manufacturing context necessarily has to have some costs, not minimum but optimum. Optimum means, not a penny more, not a penny less.
The manufacturing BMI should be interpreted as: For a given level of revenue, there should be an optimum operating range of costs in order for the organization to be categorized in the performance category of being “healthy” and being a growing organization.
Hence, Lean is not a blind cost reduction exercise but the art of bringing the manufacturing BMI to an optimum operating range.
The optimum range can also be brought about by increasing revenues, in case the BMI is in a higher range.
Interestingly this may not always be the case in a physiological context. I can’t think of any physical exercise programme that focuses on increasing the height of an individual for bringing BMI to an optimum range for a given weight!
However in a manufacturing context, for a given BMI, Lean can focus on optimizing costs within a range, or improving the revenues to a range to the extent that the BMI does not go below the required threshold.
So, Lean is Manufacturing BMI Optimisation!
But is this BMI only applicable for a Manufacturing environment? Well, the short answer is no.