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The basic concept of Lean was popularized by Toyota and gained traction in the manufacturing environment. The lean concept has since been adapted for services industries. And now, for the MSP. In this book you will learn the core concepts of Lean, so that you can apply them to your business and start to see the benefits of lean philosophy - efficient processes, perfect execution, better margins and higher profits.
CORE CONCEPTS OF LEAN
Waste Identification (The 8 Wastes)
Waste Reduction
Continuous Improvement
TECH COMPANIES THAT USE LEAN
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com Lean philosophy is built around the concept of eliminating errors and waste. There are three critical concepts, commonly known by their Japanese names - muda (“waste”), mura (“unevenness”) and muri (“over- burden”). In this book, we’ve specifically conceptualized these ideas for the MSP.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com WASTE 1 DEFECTS
Mistakes are sources of waste.
EVERY ERROR MADE IS WASTED
TIME AND MONEY.
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In the managed service business, mistakes also lead to dissatisfied customers and more tickets. A dissatisfied customer is less likely to recommend you. And more tickets are, well, more tickets.
The good news is that there are a lot of ways to eliminate defects, so gains can be made here fairly easily. At the big- picture level, your hiring process influences the quality of employees you find. Your rt aining process influences their on-the-job ability. Well-written SOPs can significantly reduce task ambiguity. At the transactional level, when a mistake is made, evaluate it carefully, and then take steps to ensure the same thing never happens again.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com WASTE 2 SKILLS
Each worker you have is an organizational asset. Aligning skills with roles is critical to reducing waste. Consider this:
A TECH WORKING BELOW HIS OR HER LEVEL IS WASTING POTENTIAL.
A TECH WORKING ABOVE HIS OR HER LEVEL WILL BE INEFFICIENT AND ERROR-PRONE.
There are a few ways to reduce waste at the skills level. Your HR efforts are a big asset here in terms of identifying skills and matching those with roles. However, you’ll also need to identify who is ready for more training - it’s easier to increase the skills of someone already on your team than it is to hire someone new. Don’t waste talent, develop it.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com WASTE 3 MOTION
In manufacturing, this waste refers to physical movement. In an MSP, this is really about the number of steps it takes to do something. How many clicks does it take your tech to solve a problem? How much searching is required to find the latest pass- word? The processes may be mental, but they can take time. Shorten the time it takes SOUND FAMILIAR? to perform tasks and you’ll eliminate a lot of time waste. Common inefficiencies in the IT industry include:
34% Have a shortage of 34% IT Staff and skill set
29% Struggle to keep 29% infrastructure secure
28% Find it hard to do 28% more with less budget
24% Struggle to support 24% business expansion and aggressive development
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com WASTE 4 TRANSPORT
This waste relates to the speed at which information moves through your system. You can interpret this a couple of different ways. The first is basic: Make sure you’ve got blazing-fast Internet and up-to-date hardware.
DON’T SLOW YOUR TEAM DOWN WITH ANCIENT GEAR.
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The second way to look at this is to automate as much information flow as possible. Having to view RMM data in one platform, then PSA data in another, and passwords in another to pull the infor- mation required to deliver services to a client is wasteful. A fully automated process is by far the fastest. Documenting a new client with automatic sync from your PSA and RMM?
Now we’re talking.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com WASTE 5 OVER PRODUCTION
This waste is obvious for a factory, but the same “ I.T. IS THE NEXT principle can be applied to an MSP. Don’t over- FRONTIER FOR THE hire. Don’t pay for more technology than you need. APPLICATION OF Solve your customers’ problems proactively, but don’t do a bunch of things for them that they don’t LEAN IN BUSINESS.” need. If you do that, then you’re just wasting your – McKinsey time doing things that don’t generate income. TWEET THIS QUOTE
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com WASTE 6 OVER
PROCESSING
LEAN WORKS You could rephrase this as overcomplicating processes. This is especially important Research from the Lean Business Report with routine processes. Make a list of the 2016 from LeanKit indicates that: processes you do the most. Then analyze them to look for ways to make them more 92% of respondents say implementing 92% efficient. Implement, measure, repeat. Lean has led to moderate-to-significant improvements in project success
48% 48% say Lean initiatives start in IT
TOP BENEFITS OF LEAN
51% of respondents say Lean has 51% simplified management of team and process complexity
51% say more efficient business 51% processes are the biggest benefit they’ve seen
50% cite better management of 50% changing priorities
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com WASTE 7 INVENTORY
This can be summarized in three words: simplify your stack. There’s a lot of opportunity for waste reduction in streamlining the tech assets you utilize for providing services to your clients. What’s quicker: training a tech on five different firewalls, or on one firewall?If it’s quicker, it’s also cheaper. And they’ll learn it better, too.
WAITING
WASTE 8
The best way to conceptualize waiting waste is in terms of resolution times. The waiting waste you’re measuring is the downtime your clients experience. The goal should be to make it so easy for techs to solve problems that you always hit your SLAs. Your customers will be happy, and if you can offer better SLAs than your competitors, you’ll be in a much better position to win new customers as well.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com MURA
村 MURI
Mura refers to unevenness in production. An example would be scheduling staff to ensure that capacity exists to handle expected workloads. Not enough staff means clients experience delays in service. Too many staff and you’re paying them to 無理 do nothing. Striking the right balance is key here and usually requires a data-driven approach.
Muri refers to overburden, which can result in needless errors. This includes tasks beyond their ability, which tends to lead to “WE LIVE LEAN errors. It also includes overloading work on AND AGILE VALUES, someone, which causes them to rush their work, again leading to mistakes. Addressing WHICH ARE AT muri requires emphasis on training, SOPs, THE CORE OF OUR making sure they have the right tools for SUCCESS AS AN the job, and ensuring that help is available ORGANIZATION.” if needed. – Kristian Lindwall, Agile Coach, Spotify
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Get in touch with IT Glue! • +1-844-235-4583 • itglue.com ELIMINATING WASTE
By now, you’ve probably already thought of quite a few areas of waste in your MSP, and you want to start eliminating them. Muri is the third and final Lean enemy, resulting from tasks that overburden workers.
1 IDENTIFY THE WASTE
2 BRAINSTORM SOLUTIONS
3 CHOOSE A SOLUTION
4 EXECUTE
5 EVALUATE
6 REPEAT
The key is that waste reduction is an itera- tive process. The Lean term for this is kaizen, which refers to continuous improvement. Start with the most glaring wastes and the easy fixes. Get a few quick wins under your belt so that the process starts to feel natural. Pretty soon you’ll start seeing waste every- where - even in processes you thought were pretty good.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com BUILDING A LEAN CULTURE
The key to being a Lean MSP is to make lean thinking a part of your organizational culture. No one person has a monopoly on creative problem solving, so you want to engage your entire team in lean thinking. It’s a philosophy, and for lean to work best, you’ll need buy-in throughout the organization.
“LEAN IS ABOUT CREATING THE MOST VALUE FOR THE CUSTOMER WHILE MINIMIZING RESOURCES, TIME, ENERGY AND EFFORT.” –Steve Bell, Lean IT Coach
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Building a Lean culture starts at the top. You need buy-in from your entire leadership team, as they’ll be driving the bus on the day-to-day implementation. The culture of the organization is going to change. When you introduce Lean, you’ll need to provide a roadmap that includes training on Lean thinking, and a sense of vision for where lean is going to take the organization. It could be transforming your MSP into a well-oiled machine, or it could be an ambitious growth target that you’ve set out. The key is there has to be a “why” to going Lean.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com One of the fun elements of Lean is the use of Japanese terminology. As with any jargon, these terms can be a bit confusing in the beginning, but the use of Japanese actually helps your team embrace lean culture over time.
First, there are the conceptualizations of waste and sources of rre or. Mudas (the 8 wastes) define activity ath t wastes your time, mura is unevenness, and muri is overburden.
Next, are the other terms under the lean umbrella. There are a lot of them, but the ones listed here are the most relevant to the MSP context.
KANBAN POKA-YOKE a term meant to reflect lean is the principle of error-proofing. manufacturing, has been adopted An examination of your SOPs and for the IT industry. The key prin- errors in service delivery can help ciple is to map workflows and reduce the likelihood of mistakes processes to identify op tential from your service desk. bottlenecks. It is one of the best lean concepts for identifying HOSHIN KANRI waste. reflects the alignment between high-level organizational strate- KAIZEN gies and actions taken throughout is the concept of continuous all other levels. Lean is most improvement. If your team effective when activities support achieves a few victories in waste waste reduction and are in line reduction, this only means that with upper-level goals (such as they now have the time to find increasing margins by reducing more areas of waste. And so on. service errors).
YOKOTEN JIDOKA refers to the spread of informa- translates to ‘automation with tion throughout the organization. a human touch.’ Your techs Instead of having key processes are the human touch, but with locked inside the heads of your great documentation, they can best people, document them so be faster and more accurate in knowledge can be shared with servicing tickets. the entire company.
Get in touch with IT Glue! • +1-844-235-4583 • itglue.com GLOSSARY
BOTTLENECK - The point in a system or process that is congested, blocked, or limits flow
HOSHIN KANRI - A strategic planning meth- odology that aligns higher-level organizational LEAN HISTORY goals with the activities of all other levels in the organization
JIDOKA - Automation with a human touch”, Lean management originally began as a where machines and humans work together to manufacturing process in the automotive limit errors industry. In 1913, one of the first early devel- KANBAN - Reflecting the mapping of workflows opments was made by Henry Ford of Ford to better achieve efficiency Motors. Ford developed a process called The Ford System which created a continuous KAIZEN - Continuous improvement involving all flowing assembly line. This system was great employees in the organization for consistent flow, however, it did not allow KEY PERFORMANCE INDICATORS (KPIs) - for a production of a variety in products. Measurable values that, when measured against, indicate how well objectives are being achieved Around the conclusion of World War II, Kiichiro Toyoda, Taiichi Ohno, and others LEAN - The core philosophy of maximizing customer value and minimizing waste through at the Toyota Motor company built on the alignment of people, process, and continual Ford’s original ideas and created the Toyota improvement Production System. This innovative system used a quick batching process to maintain MUDA - A traditional Japanese term for an activity or process that is unproductive or does flow, but was also able to produce a wide not add value array of products. MURA - A traditional Japanese term for uneven- Today, Toyota is one of the leading car ness or variation in an activity or process companies built on efficiency and is evidence MURI - A traditional Japanese term for over- of the effectiveness of lean manufacturing. burden and the errors that can arise from that Now, Lean has morphed from a manufac- turing process, into a way of doing business POKA-YOKE - A Japanese expression meaning and a way of thinking. With its waste-re- “error-proofing” ducing ideology, Lean continues to grow in YOKOTEN - Knowledge sharing and a constant popularity among the IT and service sectors. flow of information across the organization
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RESOURCES
If you’d like to learn more about lean, here are some great resources you can check out:
Lean Terminology definitions This comprehensive webpage lists over 350 lean terms and definitions - including Japanese jargon and lean buzzwords.
The Lean Enterprise website The official educational and research center for lean is an excellent resource to learn about lean management through workshops, case studies, FAQs and more.
Harvard Business Review, Lean Strategy by Dave Collis A must-read article about implementing lean strategy in an entrepre- neurial environment and the benefits it can bring.
Lean Thinking by James P. Womack and Daniel T. Jones In the updated version, this is an in-depth book that discusses the Toyota Production system and corresponding history, strategy, and principles of lean.
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