The term simplicity is one of the concepts affecting the marketing, business and management disciplines and tried to be implemented as of the early 1900s. However, the application of this concept is based on very difficult and principled studies, and it is possible to be implemented as a result of these systematic studies. Lean first came into our lives as the concept of lean manufacturing, and the main contributions in this regard were provided by the giant Japanese automaker Toyota. In fact, the roots of the Toyota Production System (TPS) go way back than the term "Lean Manufacturing".
The foundations of TPS were laid in the 1950s by II. In the post-World War era, when Toyota was forced to produce a wide range of different models for small volume markets (Özkeser, 2018). Although the basic ideas were published by Shigeo Shingo in the study "Study of Toyota Production System" in 1980, the new taxonomy developed by Toyota remained largely unknown in the Western world until the early 90s of the 20th century (Özkeser, 2018).
The foundations of lean production are actually based on the principles of reducing the waste generated during the production process to zero (Womack, 1990). And wastes; It is the minimum equipment, materials, parts, space and everything else outside the time of the worker that are absolutely necessary to add value to the product. In addition, if stressful and hard-working people in lean production and machines working beyond their limits (overload) are working to exceed 90% of capacity (in a simple operation), they will create errors and targets will begin to be missed (Womack, 1990). Similarly, the presence of irregularities will often affect the customer's orders or supplier deliveries.
So what is this simple concept of innovation? Lean innovation, "How can our innovation processes be more efficient?" is a possible answer to the question. In the hierarchy of goals, all improvement initiatives have the same purpose. So it's tempting to argue that lean innovation doesn't offer anything new. As an approach to a process that creates improved performance, lean innovation has many special strengths. Lean innovation is a management philosophy and a terminology for continuous improvement, but it is also a set of specific methods for information sharing and management.
Lean thinking defines how to focus on creating real value as a core principle and how to prevent waste generation. The purpose of lean innovation is to systematically transfer lean thinking principles to innovation management (Womack, 1990). Lean innovation, continually finding better ways to meet customers' needs; It is to search in two areas of utilitarian and emotional value to improve the value-waste equation. Lean innovation is based on lean product development, but offers new perspectives on the nature of customer value (Sonnenberg & Sehested, 2011). Lean innovation is concerned with developing operational guidelines to maximize customer value. Lean thinking is not a universally applicable method, it is a concept with different basic principles that must be transformed individually (Sonnenberg & Sehested, 2011). Lean innovation represents the systematic interpretation of lean thinking principles in relation to product or process innovation development. Guiding themes comparable to lean manufacturing are still missing for lean innovation. Lean innovation is becoming more systematic today.
So what is lean innovation not? Lean innovation; A production method applied to innovation is not a method that kills creativity and idea generation in innovation and a way to make employees work faster.
There are three dimensions to achieving efficiency with lean innovation and these are (Sonnenberg & Sehested, 2011):
- external efficiency,
- internal efficiency,
-it is continuous improvement.
Doing the right "affects external productivity." Doing right "affects internal productivity." Doing always better "provides continuous improvements (also referred to as the Continuous Improvement Deming Cycle) (Sonnenberg & Sehested, 2011).
Especially the concept of leanness, which is used frequently in recent times, is also seen in entrepreneurship. The usage of this concept in entrepreneurship literature appears as “Lean Entrepreneurship” or “Lean Start-Up”. Eric Ries (2006, 2011) was the first to use the concept in this field; Eisenmann and Steve Blank were the ones who did the most important work afterwards. The methodology called "lean start up"; It includes detailed planning, intuitive customer feedback, and iterative design experiments on the development of the traditional "front-line design". According to the lean start-up concept, young startups test hypotheses, collect early and frequent customer feedback, and offer “minimally viable products” to potential customers, instead of implementing business plans, working in secret and leaving fully functional prototypes.
Lean method has three basic principles (Blank, 2013). First, entrepreneurs summarize their hypotheses in a framework called a business model canvas, rather than months of planning and research and writing a complex business plan. Secondly, lean start-ups use the so-called “leaving the building” approach to customer development to test their hypotheses (Leaving the building; describing the profile of observing what is happening around and being an open business). Third, lean start-ups are implementing something called agile development that emerged in the software industry (Agile development eliminates wasted time and resources by iterative and incremental development. This is the process of minimally creating suitable products that beginners are testing).
Simplicity is about doing things more effectively, better and cheaper and together. Lean wants perfection (Excellent quality, zero waste, perfect customer satisfaction). Lean is a continuous improvement process. Errors in simplicity are seen as opportunities for improvement.
Why it should be done (Nolan, 2017):
• It helps you organize things better so that customer demands can be better met.
• It improves the skills of the employees especially in the field of problem solving and helps them to do more interesting work.
• It helps the company to be stronger so that it can sell more and keep it alive.
• If competitors are doing this and you don't, then it can result in falling behind and losing customers.
Examples of businesses that make "Lean Innovation" using lean philosophy:
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Tesla is a perfect example of lean innovation. It developed the Model S, which is the sales leader in the price range, using less resources in a shorter time than its competitors. And the Tesla example shows us a structure that goes beyond traditional innovation processes. New business models include new ways to interact with the customer and additional sources of income. The Roadster product that Tesla sells about 2000 units has been an excellent beta test for them. Battery management technology, transmission, etc. They were able to list our technology problems such as, and learned the wants and needs of the first adopters. Tesla relied on strong partners to develop the Roadster. It got the battery technology from Panasonic, the Elise sports car chassis from Lotus, and the much-needed capital from Daimler-Benz. With these supports, it shortened the duration of marketing and significantly reduced R&D costs.
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If we look at the Apple example given frequently; diving into new markets (e.g. iPod and iPhone), creating new services (e.g. iTunes), developing and improving high-margin systems (e.g. iMac and MacBook lines) and reintroducing these products / services to the consumer in new ways (e.g. Apple stores, Genius Bar), has brought Apple to new heights in profitability and market capitalization.
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Cirque du Soleil has created an entertainment segment that has never been before. Even though the story of the real departure is the circus logic, it has brought the concept of entertainment to a different dimension and developed a new service concept under the name of the circus without animals rather than the normal circus atmosphere; It aimed to offer its customers a completely different experience.
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Another example is Saunders Farm, the 400-acre family farm that attracts tens of thousands of guests each year and has been offering seasonal events, bush mazes, tours, and water games since 1976 to create agricultural tourism near Ottawa. These organizations have fundamentally created new businesses by leaning on what people don't want and focusing on developing new ideas that really excite the market.
Sources
Blank, S. (2013). Why the lean start-up changes everything. Harvard business review, 91(5), 63-72.
Nolan, M. (2017). Lean Innovation part of Pembroke Alliance.
Ozkeser, B. (2018). Lean innovation approach in Industry 5.0. The Eurasia Proceedings of Science, Technology, Engineering & Mathematics, 2, 422-428.
Reis, E. (2011). The lean startup. New York: Crown Business, 27.
Sonnenberg, H., & Sehested, C. (2011). Lean Innovation: A Fast Path from Knowledge to Value. Springer Berlin Heidelberg.
Womack, J., Jones, D. and Roos, D. (1990) The Machine That Changed the World: The Story of Lean Production, Toyota’s Secret Weapon in the Global Car Wars That Is Now Revolutionizing World Industry. Free Press, New York.
