The fourth principle of Lean is to ‘establish pull’, which means to set your systems up to meet customer needs at the time and rate they need it.
Your coffee at the cafe is made to order. It’s not pre-made coffee, retrieved from a shelf that you’re served. You want your coffee fresh, hot, and served to your particular needs, so the Barista will start making it as soon as your needs are known. That is operating in a ‘pull’ environment.
The coffee order creates demand, and the Barista responds by making it on the spot.
So, a customer request triggers demand or ‘pulls’ an order through your system, which is immediately responded to, and delivered. This is an ideal operating environment, customer demand creating pull, and the system responds to satisfy it immediately. It minimises queues of work and keeps a short cash cycle. It minimises effort and maintains focus on customer needs. Sometimes there are constraints which make it impractical to create an ideal system such as this, however, there will always be benefits moving as close as practicable to this situation.
In a lean scenario, we challenge obstacles that get in the way of achieving ideal outcomes. For example, if we get a glut of customers coming in simultaneously for coffee, they would have to wait as we are unable to keep up with a demand spike.
To address this we might have multiple Baristas’ on during peak periods. We would typically do everything we can to optimise the rate at which we can turn out coffees as the first strategy (using standard work), we might also conduct some analysis so that we are better able to predict the condition and timing of a spike in demand, so that we could schedule employees to be present when needed. We might extend the training of employees so they can do multiple tasks, and be adaptable when the situation calls for it.
Sometimes businesses are forced by their systems to process in large batches, which creates a mismatch between when the customer wants something, and when they can get around to delivering it.
If you ever drive past the car yards holding new car stocks, there will be hundreds of cars on hand, but they just don’t happen to be in the colour or with the features you are looking for, so you need to wait until the next batch is created to meet your specification.
When the industrial revolution was in full swing, demand was so great that it didn’t to matter to manufacturers what people wanted, as they would buy whatever was served up. The decoupling of the supply chain started, and making products which would be stored in warehouses until there was demand for it, was standard practice.
This scenario is called ‘push’ – and the rationale was that if we could make as many items as possible in a short period, our cost per unit was lower. The theory was fine in some instances, however, the flaws outweighed the benefits as customers became more demanding.
In a push environment, if there were quality defects, it was likely the whole batch was affected, and would be cast aside, or reworked. The cost of warehousing products is expensive when considered as part of the supply chain. Adding warehousing to production cost showed a truer reflection of the overall cost of a push system. Businesses were also slow to respond to customers needs, as they were busy making large batches of things people didn’t want, to store in warehouses, and simultaneously didn’t have resources available to meet customers real needs.
Sometimes we force ourselves into these situations by our own habits. I used to have a monthly spike in my production schedule, which would cause constraints in my plant. The sales team would call on customers each month, and return with large orders. When I encouraged them to visit weekly, we had a higher frequency of lower volume orders, which we much easier to manage, and were aligned more closely with our customer needs, and we could deliver them quicker. It was our first step towards establishing a pull system.
What might your first step to establishing ‘pull’ in your business be?
