Lean manufacturing in Russia: Assessments from experts and practitioners

Digital solutions in lean manufacturing can help companies improve productivity at all levels faster and more efficiently. During the 4th Lean Pro Forum 2023 international conference, experts discussed current trends in lean manufacturing in a session moderated by Mikhail Pleshanov, founder and CEO of IN.TOP, a supplier of original import-substitution software included in the Unified Register of Russian Software.

What potholes can a business face when implementing a lean manufacturing system?

The main problem in introducing lean manufacturing culture at your company is insufficient involvement of senior executives. The top corporate management taking an active interest in and supporting lean practices motivates employees and sets a precedent. Senior executives establish strategic goals; they need to be actively involved in incorporating lean principles into the company’s overall strategy. They can also encourage employees and create financial incentives for implementing change by approving the necessary budgets and providing resources.

A situation where employees do not have a clear idea of how lean principles can benefit them personally or the company can be a challenge for the business. Being aware of how their help in process optimization and cost reduction can improve overall performance and help the company grow encourages workers to become more engaged. Sometimes line workers also have a deeper understanding of processes than the management and can suggest valuable ideas on how to optimize them.

Finally, as experts point out, certain motivation and incentive systems can hinder a successful transition to lean manufacturing. Many KPI systems focus on short-term results, such as monthly or quarterly targets. Lean manufacturing, on the other hand, focuses on long-term improvements. If employees are exclusively motivated to achieve quick results, they may ignore longer-term, but no less meaningful, changes.

What technologies could promote lean manufacturing in the next few years?

The specific technologies companies will tend to use to introduce lean manufacturing practices would depend on many factors and vary across industries, types of business, and current technology trends. However, it is possible to identify a few general trends that companies can target.

  • Internet of Things (IoT). IoT solutions can collect and analyze process data in real time, alerting everyone to potential problems and helping companies optimize equipment utilization.
  • Artificial intelligence (AI) and machine learning. AI and machine learning systems can help optimize manufacturing operations, forecast demand changes, evaluate quality, and improve efficiency.
  • Automation and robotization. Automated systems and robots can perform many operations more accurately and efficiently, reducing costs and improving quality.

Solutions that help avoid human mistakes in manufacturing will be the most in-demand.

Modern manufacturing processes, technologies, and products are becoming increasingly complex, which may be overwhelming for employees. A device or mechanism will handle such complexity with more efficiency.

What is the time horizon for project planning today?

Businesses have not practiced planning for ten years ahead for a long time. Most strategic plans are limited to a period of two to three years.

Even more often, a business would focus on a general planning horizon of one to two years; longer plans are less specific and more flexible. Corporate planning usually starts with broad strategic plans for the coming years; further work involves more specific plans quarter by quarter.

What metrics help track project implementation?

The most common metrics for assessing business performance are time and money. These metrics need to be tied to strategy. However, based on the experience of the past few years, a company’s problem may be the lack of any strategy. With added external risks, the company will be struggling with two major problems, forcing management to resort to a “hands-on” approach in decision-making.

Therefore, metrics are based on a company’s strategic goals. For some companies, it is important to conquer a market and for others to increase profit or business effectiveness. KPI and OKR metrics are selected depending on these specific goals.

Do companies set non-material goals?

The expert notes that non-material goals are as important for businesses as material goals these days. Many textbook non-material values, such as occupational safety or sustainability are gaining particular significance. One example is the growing interest in lean manufacturing as a concept and the principles of ESG that are related to each other.

  • Environmental (E). Combating climate change and protecting the environment are gaining importance. Companies strive to reduce their carbon footprint, switch to renewable sources of energy and apply eco-friendly practices in production.
  • Social (S). Companies understand that taking care of their staff is a key factor of success. Social measures include improving work-and-life balance, physical and mental health, and financial wellbeing.
  • Corporate governance (G). The importance of smart corporate governance is growing. This aspect includes transparency, effective management and legal compliance.

Companies also strive for innovation and digital development as means to improve their competitive ability and create higher customer value.

What instruments do companies use to evaluate how projects move through a funnel?

Companies use different tools and methods for project analysis depending on their specific needs, the industry or project. Effective funnel management requires having a clear strategy, monitoring and analyzing data and regularly optimizing processes to achieve desired results.

The most common tools today include CRM systems for tracking customer interactions, data analysis tools, business analysis tools, reports and data visualization, and project management systems.

Here, it all depends on a project’s timeline and complexity. Projects that are more complex may need more serious tools. Methods like Agile and Scrum are effective for simpler projects.

How do companies hire professionals for specific projects?

Sometimes one professional with key skills turns out to be irreplaceable. It is important to understand that working on a project involves many aspects, including collaboration, conflict resolution, persuasion and finances.  

Some companies rely on idea factories trying to use internal competences such as technical, managerial and economic skills. At certain stages, many companies turn to external experts if they lack some knowledge or skills among their own staff.

The expert notes that internal potential is most significant for implementing projects inside an organization. Sometimes a company has substantially more opportunities inside than it exploits.

In what situations is it helpful to rely on external specialists?

External specialists may offer the same ideas as company staff but their opinions may be taken more seriously. They are capable of improving communication between departments or business units, which is often challenging to do within an organization.

Experience and specialization. External experts may bring new knowledge and experience, especially in areas where organizations need ad hoc knowledge. This may help expedite processes and improve results.

Solving specific problems. In some cases, an external specialist may look at a problem from a different perspective and help overcome problems that were difficult to tackle for internal teams.  

Efficient use of resources. Engaging external specialists may be a more cost-saving option than hiring more staff. This way, more internal resources can be spent on other projects.

New opportunities. Sometimes companies do not see a solution that lies on the surface. A detached view may help unlock new opportunities and potential.

If you decide to engage an external expert, make sure that they leave enough competence with the company for the team to continue smoothly without them.

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