What is Lean IT? – A New Focus on Old Ways

“Lean” can be a scary word… It can represent headcount reductions, offshoring, overturning established work practices, or cutting corners – all of which will inevitably be meet with resistance. But it’s not about going hungry; and these fears must be quashed so the benefits of Lean IT can be realised.

Our teams are increasingly asked about Lean IT — what it can do for organisations (public and private) and how to embrace what seems to be a highly effective approach to lowering IT costs and more efficiently delivering IT services to the business. So, what are the origins of Lean IT and how does it propose to “reduce waste” in the enterprise?

Where Did Lean IT Come From?

Lean Manufacturing

To understand where the Lean IT approach originated, we need a potted history of Lean Manufacturing. Lean concepts of manufacturing were around for centuries – from shipbuilding to musket-making – long before they provided the foundation of Henry Ford’s innovative Model T production line. However, Ford’s production lines were inflexible: “You can have any colour you like as long as it’s black!” (Compare this with today’s options for pre-ordering wheel or upholstery styles and on-board options.)

In the aftermath of World War II, when the US was assisting Japan to rebuild its manufacturing capabilities, a number of forward-thinking consultants were sent to help. One of these was W. Edwards Deming, propounding his philosophy on Management and Quality which had failed to gain followers in the US.

Toyota and other companies listened and – unlike Ford, which maintained a limiting “us and them” approach – learned how to involve their entire workforce and management in continuous improvement. Ultimately, the premise of Lean Manufacturing was to make it obvious as to what does add value by eliminating everything that does not add value. Toyota also developed the concept of Just in Time (JIT) supply chain management which, along with their own Jikoda (automation with a human touch), became the foundation of their world-beating production line. (Oh, what a feeling!)

There is much more jargon involved in Lean Manufacturing – CANDO, World Class Manufacturing, Six Sigma (or 6S), Kanban, Quality Circles, value stream mapping – involving many Lean tools. As Japanese manufacturing outstripped that of the west, the Lean philosophy spawned generations of consultants. Extending their influence way beyond automotive manufacturing, they introduced concepts such as Kaizan (ongoing incremental improvements) as a way of business life.

So, What is Lean IT?

Waste not want not

Lean IT is an example of the extension of Lean disciplines to service industries. Instead of manufacturing goods, IT is ‘manufacturing’ services to provide value to the organisation and its customers. Essentially, it also involves value streams and the effective management of resources, quality, security, demand and change.

Lean IT is principally about identifying and eliminating waste in the “production processes”. The possibilities for waste in IT are legion:

  • Defects which increase costs and lower customer service
  • Overproduction from misalignment between IT and the business
  • Over-provisioning due to inaccurate capacity planning
  • Waiting for applications to perform, manual processes to happen or issues to be escalated and resolved
  • Processing that adds no value, such as writing (or reading) irrelevant reports
  • Transportation, which could mean onsite visits to resolve hardware or software, or inefficient collaboration within project teams
  • Excess inventory such as server sprawl or multiple data repositories
  • Excess “motion” or effort spent fire-fighting, reworking or performing maintenance
  • Unused expertise due to lack of knowledge retention, inability to capture ideas and innovation, or repetitive, mundane tasks resulting in loss of talent

We can all think of projects where a domino effect of cascading waste from the examples above results in going over budget, over time and under user expectations.

What Goes With Lean IT?

Projects & benefits, IT & service management, process & value, Lean IT & … ?

Going Lean doesn’t mean throwing out the way you’re currently doing things – it offers a better approach to meeting today’s business imperatives. At DXC, we treat it more as a philosophy, rather than a specific methodology or series of prescribed processes.

Agile has become the byword for business. Lean IT’s approach to reducing costs, delays and complexity supports business agility and works hand-in-hand with an Agile approach and the concept of DevOps – where agile team structures, practices and tools bridge the gulf between IT teams developing systems and those implementing and maintaining them.

Lean IT fits right in with other efficiency-oriented methodologies adopted by ITOs. Six Sigma process improvement and JIT, which were also adopted from the manufacturing industry, are naturally complementary.

Lean IT is also compatible with any number of other IT service delivery standards: ITIL, ITSM, PRINCE2, MSP P3O, PMBOK, COBIT and USMBOK, to drop another set of acronyms!

Finally, Lean IT benefits from being combined with Lean Change Management – an approach increasingly adopted by larger organisations wanting to maximise the success of change initiatives. After all, major organisational change now inevitably includes significant investment in the creation and delivery of technology.

Where is Lean IT Going?

It isn’t going anywhere

IT has become so very fundamental to business operations – as well as an ever-increasing business cost – that doing more with the same has become an imperative, waste has become a burden, and project failure has become an unacceptable risk. The focus is now on reducing complexity and getting to market faster than your competitors, as well as innovating to mitigate the risk of being left behind in our industry.

The Lean IT approach is just as applicable to IT operations and delivery as it is to service and product development. As the development and maintenance of applications typically represents the largest proportion of IT budgets for larger organisations, that’s where Lean IT usually starts. Business analysts and application designers are already familiar with mapping value from the very start of a new initiative.

In Lean Manufacturing, visualising a production line (including the physical processes and assets needed to make it work) is somewhat easier to achieve than the Lean IT approach for digital applications and systems. In many cases, it calls for support from tools and systems to help pin down and quantify abstract value.

The Lean IT approach doesn’t only apply to application development. It’s just as applicable to IT operations and delivery. Service catalogues, for example, are a Lean IT way of provisioning business technology services. Lean IT also contributes to Green IT, which will become increasingly critical in coming years – both in reducing energy costs and becoming more socially responsible – given that IT accounts for around 70% of a typical organisation’s power usage.

Why is Lean IT Still Relevant?

Who’s doing it and why?

Like Japan in the 1950s, our current environment demands that we continually rethink the way we deliver IT services. Lean IT has never really gone away; it just keeps being reimagined.

In the public sector, the concept of Lean Government demands the adoption of Lean IT. And it’s not just in IT; as government departments and agencies recognise improvements in their IT departments, we’re now being asked to apply these same principles across their business processes.

As a recent example, a large state government organisation is using Lean IT principles to review the full series of processes that manage the “customer idea” to “project initiation”. As a result, they have seen a major transformation from multiple unwieldy processes – that were wasteful and unsatisfactory – to a single, aligned and efficient process, that has signifcantly improved turnaround times from three months to just a few weeks. Understandably, the business is ecstatic!

In organisations with limited budgets or those with a focus on profits, the push for leaner, more efficient IT service provision is driving the adoption of Lean principles to continually eradicate waste and improve efficiency. This leads not to reductions in headcount, but more effective use of resources in activities that provide higher value to the business.

Similar to its manufacturing parent, Lean IT involves value-stream mapping – which involves visualising and documenting services into a series of component processes. This is critical to eliminating those processes (or, indeed, whole value streams) which will not, on analysis, deliver sufficient value.

These organisations are now spending less effort on “keeping the lights on”, able to repurpose the resources into providing improvements to existing services and implementing new services faster, with less errors and rework, and more aligned to their actual needs.

ITIL®, PRINCE2®, MSP® & P3O® are registered trademarks of AXELOS Ltd.


Darren Burgess

Darren Burgess is a Managing Principal at DXC Consulting, with over 20 years’ industry experience. A qualified IT Service Management Expert and accredited Program Management Practitioner, Darren is also well versed in IT strategy and governance and has extensive experience as a certified trainer and consultant.

 

 

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