Towards Improving Banking Services Quality - 7 - Pillars of Lean Management

Towards Improving Banking Services Quality

7.

Pillars of Lean Management

 

First Pillar – Continuous Improvement

 

The philosophy of continuous improvement is based on the belief that no process, product, or service is ever perfect and that relentless improvement is essential. It is closely intertwined with the second pillar, as improving processes, products, or services hinges on continuously building people’s capabilities.

 

To achieve long-term organizational vision and objectives, Lean organizations embrace challenges with courage and creativity. Management plays a key role in guiding employees to overcome obstacles and empowering them to enhance their awareness, knowledge, and skills. Organizations embracing Lean strive to challenge the status quo, recognizing that meaningful progress requires ongoing change.

 

Kaizen, a core concept of Lean, translates to "change for good" or "improvement":

 

·       Kai = Change

 

·       Zen = Good

 

Kaizen is both a mindset and a practice, emphasizing continuous improvement through innovation and evolution. It encourages small, incremental changes initiated by employees at all levels. Employees are inspired to enhance their individual performance while collaborating with others to improve team outcomes. Kaizen fosters a culture of accountability, where employees are empowered to take ownership of their work and actively participate in improving team performance.

 

Kaizen’s Key Features:

 

·       Promotes ownership and responsibility for work, boosting employee motivation.

 

·       Implements a bottom-up approach for incremental improvement, complemented by top-down approaches like radical change (Kaikaku) and radical innovation (Kakushin).

 

·       Develops a positive way of thinking, enabling everyone in the organization to challenge existing norms and identify opportunities for improvement everywhere.

 

Kaizen embodies the spirit of continuous learning and fosters a culture where improvement is a shared goal.

 

Figure 1: Pillars of Lean Management

 

As illustrated in Figure 1, Continuous Improvement relies on Respect for People, as empowering individuals fosters innovation and participation in improvement initiatives. Conversely, cultivating a culture of respect is sustained through a commitment to ongoing improvement, ensuring that employees remain engaged and valued.

 

Second Pillar – Respect for People

 

As previously mentioned, the two pillars of Lean management are interconnected. The second pillar, Respect for People, underscores the importance of valuing individuals across the organization. John Shook, Chairman of the Lean Global Network and a practitioner of Lean at Toyota, emphasized, “Lean is not lean if it does not involve everyone.” The second pillar, Respect for People, emphasizes that Lean is a people-centric philosophy. Organizations can only sustain continuous improvement by fostering trust, inclusion, and collaboration among all stakeholders—employees, customers, and partners.

 

Lean management prioritizes people as the cornerstone of organizational success. Toyota’s organizational philosophy reflects this ethos: “An organization makes people first, and then people make products.” This principle applies not only to employees but also to customers, partners, suppliers, and society at large.

 

Key Aspects of Respect for People:

 

·       Encourages engaging employees in improvement initiatives by involving them directly in identifying ways to enhance processes.

 

·       Fosters a significant cultural shift, requiring management to interact with employees in meaningful and inclusive ways.

 

·       Respect for people acknowledges that resistance to change often arises from uncertainty or lack of understanding. Lean management bridges this gap by involving employees directly in decision-making and demonstrating the value of their contributions.

 

Respect for people ensures that employees feel valued, fostering collaboration and mutual growth. Lean management thrives as both a top-down and bottom-up effort, integrating the insights of leadership and the hands-on experience of employees.

 

Although Lean management often appears operational, it is fundamentally a management philosophy that transforms how organizations interact with their people. It builds a culture of trust, engagement, and shared responsibility, ensuring sustainable and meaningful improvements.

 

Let us understand how these two pillars apply specifically to Lean banking. For instance:

 

o   Continuous Improvement in banking improves processes like loan approvals or customer service response times.

 

o   Respect for People involves engaging employees in process enhancements and fostering customer-centric interactions.

 

I welcome your comments, questions and suggestions.

Warm regards,

Keshav Ram Singhal