Research on Lean Concepts Applied on Project Management - Essay Example

Research on Lean Concepts Applied on Project Management Name: Institution: Course Title: Tutor: Date: Research on Lean Concepts Applied on Project Management Introduction Project management can be defined as the application of techniques, knowledge, skills and tools to a range of activities that constitute a project with a central aim of meeting or exceeding the expectations and requirements of the stakeholders. According to Walesh (2000, p. 135), to achieve stakeholders requirements, manager of a projects has to keep balance between the time, cost, quality and scope of the project in question. In addition, it is important to take into account the competing demands among stakeholders who have different requirements and expectations. Finally, the project manager has to keep a balance between the identified stakeholders’ needs and expectations. In this sense, project management can be said to be "the process of combining systems, techniques and people to complete a project within established goals of time, budget and quality" (Walesh, 2000, p.135). This paper aims at assessing the comparative merits and demerits of contemporary project management methods and lean production delivery systems (LPDS). Contemporary Management Approaches Project management approaches are designed to help organisations overcome bottlenecks associated with projects. Currently, there are four standard project management approaches. The first of these is the traditional approach. The other ones which are hybrid of the first one are critical chain approach, extreme project approach and event chain project approach. The traditional approaches are normally rigid and done on the premise that scope and goal of a project will remain unchanged up to the completion phase. This approach usually follows the known criteria of project initiation, project planning and design, project monitoring and control, project execution and project completion (Wysocki, 2011, p.39). The traditional approach tool adheres to timely delivery of projects without focusing on the value (Wysocki, 2011, p.40). Moreover, they are plan driven and modelled in linear pattern (Wysocki, 2011, p.42).The major shortcoming of this approach is its rigidity that at a time does not accommodate project dynamics. Generally, it is good to learn that it is critical to make good decisions during the planning stage of a project. In this approach, the early stages of a project may not be costly. However, the later stages may prove to be too costly owing to bad decisions made during the planning stage and which were not rectified. Early identification and resolutions of potential problems in a project will help to save considerable costs and time during later stages. Thus this approach should only be used in projects with low risks (Wysocki, 2011, p.41) To be able to overcome these dynamics, some approaches have been designed. The first is the critical chain approach/ agile approach. This approach acknowledges the fact that within the course of the project at least one constraint that is ether behavioural oriented or process related is likely to emerge. These kinds of challenges are likely to occur in projects that utilise complex process and with a large number of cross-functional teams. This concept is built on the premise that project managers should adopt behavioural and mathematical sciences to predict, analyse and solve problems. This course of action guarantees quality deliverables on time by pro-actively removing constraints. Because of its agility, one major merit of this approach lies in its ability to be applied in a critical problem without solution and previously untapped business opportunity (Wysocki, 2011, p.45). The other current approach utilised by project managers is the extreme project approach. This approach is adaptive and iterative (Wysocki, 2011, p.448, 49 and 52). The strength of this approach is grounded on its ability to respond to dynamic situations like the ever changing customer requirements. This approach is suitable for sectors with a highly dynamic environment like the mobile telephony industry (Wysocki, 2011, p.53). This approach is best applied in technology without known application or a solution out looking for a problem to solve. The next is the event chain project management approach. This approach acknowledges the fact that a single point failure or constraint can give birth to numerous failures and thus, hindering the progress of the project. This approach takes system view to project management where each department performance or step is dependent of each other. This process relies on past data so as to overcome any unanticipated challenges (Wysocki, 2011, p.48). Advantages of Current Project Management Approaches For a project to befit the status of a successful engagement, it has to meet the following parameters. The first instance is that it has to overcome uncertainties. This means a project manager has to have in place risk management plans. In addition, a project has to deliver value which it was outlined at the inception. Moreover, it has to maintain project relationships. Bourne refers them as the "pillars of project success". Apart from the above, to attain the desired value, it is critical for personnel discharged with the mandate of actualising the concept to embrace participatory approach by consolidating views of the stakeholders. This calls for synchronisation of project management approach and performance metrics to the stakeholders needs so as to realise reasonable and realistic results (Bourne, 2007, p. 2). To realise unrivalled success, it is crucial to combine and apply the three above views. The greatest advantage of these hybrid project management approaches (apart from tradition project management approach) is their ability to accommodate unforeseen changes. Thus, these approaches are good in risk management (see figure 1). The hybrid approaches in a great deal helps firms detect areas of concern so as to prioritize allocation of resources. This in large extent will inform the management on how to formulate response and recovery measures by showing areas that are likely to suffer adverse effects from failures. Figure 1: The three pillars of success. Source: Adapted from Bourne (2007, p. 4) One of the integral pillars in risk management is risk assessment. This allows for identification and valuation of magnitude & cost attached to a certain risk that can arise due to threats and hazards. Qualitative approaches to risk assessment entails calculation of two components of risks, magnitude of the potential loss and the probability of loss occurring. In engineering field assessments are done especially in relation to a threat to life, social impacts, a threat to environment or machine functionality. Risk assessment can also be carried out in relation to financial stability and business recovery plan, and information system vulnerability/ security (Hurst, 1998, p.42 and 43). Disadvantages of Current Project Management Approaches One weakness that is associated with these approaches is there focus of project deliverables from initiation, design, ground breaking and hand over phase. However, they do not look at the value to be delivered during the projects whole life cycle. Karkland (1995) cited in Walesh (2000, p. 135) states that "We should seek to advise future generations contemplating the creation of very large infrastructural projects not to get carried away by the excitement of the design and construction process before they have clearly established the rationale, the relationships among the key players and the means by which the totality of the process is to be managed." a project may meet the three named requirements but still be termed as unsuccessful. Moreover, a project can be overtime, above budget and missing in scope yet be considered to be a success. In summary, the differences in the project management strategies are what make a project successful and not over focusing on deliverables. Lean Production Delivery Systems (LPDS) In relative terms, lean manufacturing or production system ranks highly among the efficient manufacturing approaches. The principal focus of the approach is to improve value and reduce waste associated with over production. Significantly, the concept has a perspective of marketing since it synchronises production and value creation for prospective clients. Hence, in a precise view, lean manufacturing concept is built on the premise of value creation with least amount of labour. Historically, the concept traces its root from the production system pioneered in the 1990’s by the Toyota automobile company. This wonderful concept was the brainchild of Sakichi Toyoda who wrote a manual and worked on the concept of enhanced worker productivity and quality (Emiliani, 2006, p.167). Presently, this approach has provided a platform for getting better performance through minimised production cost, quality improvement, increased market stake, product differentiation and innovation (Monden, 1986 cited in Emiliani, 2006, p. 170). Numerous works point that if lean management philosophy is domesticated and applied well in a firm, it supports strategic decision making that allows firm to gain market leadership. In analytical view and comparative terms, the concept of lean manufacturing offered a new paradigm that differed taylorism and fordism production concepts. The essence of lean production is to ensure smooth work flow through incorporation of empirical methods. Hence, the approach of lean manufacturing is viewed as a modern and improved version of the earlier production approaches by fathers of management. The supporting argument for this is because the approach was formulated based on the strengths of the two earlier versions. In addition, it avoided weaknesses associated with taylorism and fordism concepts of production. The ultimate goal of the process if adopted by any firm is to ensure waste free production with no irregularities. Just as in taylorism, the second goal is to ensure systemised work flow. Lastly, the goal of the concept is address the need for a production system that runs consistently. Figure 2: The essential elements of Lean production system Cited in Katayama & Bennett (1996: 9) The chief objective of lean production system is to ensure that the production process consumes fewer resources. On the other hand, in terms of output, the process stresses the need for maximum out of the few inputs. Consequently, this enables a firm to produce products of high quality and have unmatched technical specifications. As a result of these, a firm is able to gain considerable market stake and dominance (Katayama & Bennett, 1996, p. 9). This kind of dominance helps a firm to achieve its strategic visions and competitive strategies like locking in customer, reducing or increasing switching cost so as to be a market leader. Literature indicates that there exists many descriptions of Lean production and the philosophy itself has underlying components. Toyota production system as explained in the paragraphs above also gave rise to another system of production that sought to meet rising consumer demands for different models of cars with minimum delay. This production system termed Just- In- Time (JIT) focused on the critical components such as production smoothing (Kanban) and was set up ideally to reduce set up time. It expanded into including quality improvement (TQM) and employee involvement (HRM). In the U.S. JIT became popular as the system (TPS, Pull Production and Kanaban). Hence as observed Lean production philosophies diversified into a number of components that later became fully fledged production systems (Shah and Ward, 2003, p130). Advantages of LPDS One of the philosophies that mark the concept of lean manufacturing is Just in Time Production (JIT). This philosophy is anchored on the belief of producing high quality products. Moreover in this belief, high quality products can only be achieved through by reduction of waste and increment of productivity levels. JIT advocates for doing things on timely manner from raw material acquisition to the final point of sale. The slogan of JIT approach is to produce and deliver final end products just in time so as to be sold just in time (Sohal et al., 1989, p. 16). Therefore, in a broader view, this process is tied on how well a firm manages its supply chain and other logistics. There are numerous approaches that can be used to understand and categorise JIT system. The first approach of the system is based on low inventory costs. The second one addresses quality concern by ensuring fast detection and correction of problems. The third deals with design a concern that is addressed by JIT through quick response to customer change in tastes. The fifth category is how it responds to administrative efficiency needs. Whereby, JIT achieves the administrative efficiency through fewer suppliers and simple communication. The last point of view is on and productivity, in this case JIT ensures low workload and reduced supervision. In a nutshell, the process calls for efficient and effective supply chain management and logistics management ( Schonberger, 1988) cited in Sohal et al. 1989) JIT offers major benefits to a production system such as reduction is setup time, constant flow of goods from warehouses to shelves, enhancement in the skill levels of employees and efficient production scheduling. Within the JIT system philosophy resides another major topic known as Kanban. Its literal translation means signboard and is conceptually related to the Lean management philosophy of production. Taiichi Ohno, the father of Lean management philosophy states that Kanban is one means of achieving the JIT system. Kanban is a production approach that addresses time concerns, quality, quantity and value (Shigeo, 1989). Kanaban is based on production according to demand. In this case, the process attempts at matching supply with demand by not producing haphazardly and the wait for customers to buy. Kanban cards, a key component of Kanban signal the movement of material within the manufacturing process and create the demand driven system. One major benefit is that is leads to faster turnaround in production and helps in lowering inventory making them more competitive (Shigeo, 1989). A working example of the use of Kanban is depicted in figure 2. Figure 3: Kanban Lean manufacturing as explained in the above section is termed as a Pull strategy of production. In other approaches to manufacturing, firms avail products for the market without determining the required supply in the market (mass production without analysis of demand). It is from this that they try to sell the products. This kind of approach leads to mismatch as either there is oversupply of the product or undersupply of the product. Consequently, if overproduction is done there is likelihood of wastage and if it is under production, the firm is likely to lose its market share to other competitors. Significantly, this is how lean production differs with the traditional approaches. In lean production, the approach only produces according to demand that is there. It means this approach is demand and supply based where nothing is produced until that product is needed. The beauty of this is that it allows for reduction of wastes while at the same time giving opportunity for meeting customer requirements on timely basis (Spearman & Zazanis, 1992). A good example of a pull system is of a custom manufacturer of high quality Pianos. The manufacturer would only start production when a customer demands. Disadvantages of LPDS The major demerit is on the complex nature of the process and how to align it with the changing global trends in supply chain management where different parts of a product are produced in different geographical locations. Moreover, Maskell & Baggaley (2003) warns that lean production should not only be focused on cost cutting, but also on designing of the product so that the product itself flows within the principles of Lean manufacturing system. This therefore means that some organisation in attempt at following concept of lean production focuses more on cost cutting and ignores other factors like design and functionality. In nutshell, while cost cutting should be a priority, other elements that make a product acceptable and sellable in the market should not be ignored. In fact, Murty (2008) proposes that firms should combine and integrate tools based approach with a flow based approach. This is because, lean production is more focused on flow of product to the market. Conclusion At the time of completion, projects undergo different experiences, some fail; some succeed while some muddle through an incremental basis to meet their goals. As seen earlier, at a time the success of the project is not based on the cost, time and resources spent or not spent but the impact it will have on its later stages of life. Levy (1996, p. 96) posits that one of the contributory factors to failure is as a result of reduced support by top level management. This experience normally erupt as result of numerous underneath problems like boardroom, change of the top level management and reduced euphoria. Thus, as a project manager one has to deeply interrogate which of the current approaches is suitable for which project. As seen in the discussion, lean production offers a platform of meeting the project deliverables constraints like time, cost, quality and resource while at the same time creating value to the end client. In addition this process is tied to supply chain management and logistics. Moreover, approach like lean production will only inform manager if there is any demand for the project as opposed to traditional approaches. Lean production has become very popular given recent advancements in technology and market dynamics. It forms a platform for gaining competitive advantage which is an ultimate goal of any for many organisations. Moreover, this connects with the goal of project which is to achieve a desired position over a period of time by giving them opportunity to be low cost producers (Levy, 1997). But Lean production usually falters when communication gaps exist or value chain activities become geographically dispersed. Just in time can suffer if products have to travel over long distances. But the core principles of just in time production and total quality management can certainly enhance globalization since firm will only outsource their supplies from those that meet stringent requirements. References Bourne, L. (2007). "Avoiding then successful failure". Hongkong: Mosaic Project services Pty Ltd. Retrieved 23 April 2012 from: http://www.mosaicprojects.com.au/PDF_Papers/P046_Successful_Failure.pdf Emiliani, M. L. (2006). “Origins of lean management in America: The role of Connecticut businesses.” Journal of Management History, Vol. 12; No. 2, pages 167-184. Hurst, N. W. (1998). Risk assessment: the human dimension. Cambridge: Royal Society of Chemistry Katayama, H. and Bennett, D. (1996). “Lean production in a changing competitive world: a Japanese perspective.” International Journal of Operations and Production Management, Vol. 16; No. 2, pp. 8-23. Levy, D. L. 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