Benefits of Lean HR

Benefits of Lean HR
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When the term ‘Lean Thinking’ was coined in 1996 by renowned financial analysts James P. Womack and Daniel T. Jones in 1996, they wouldn’t have anticipated its usage in the HR domain. The lean thinking principle was popularized by Toyota in the nineties as a method of combining functioning excellence with strategies based on inherent company values. It helped achieve steady growth even under varying economic conditions.

 

In the 21st century, HRs have adopted lean thinking principles to achieve the same benefits in the HR domain. This has given rise to the term ‘Lean HR’ and it is heralded as the next big step in improving the company processes to achieve better productivity with reduced stress.

 

Definition of Lean HR

Lean thinking is a way of looking at a process and dissecting it into its basic components to remove excess and keep only the necessary stuff. Lean thinking takes an agile approach towards creating profitable outflows by refining the processes.

 

The lean method tries to trim down the process by removing any redundant activities so that valuable resources are saved. It ensures that every process is working at its maximum efficiency. It also includes the stakeholders to let them understand the principles of working and let them take major decisions to streamline the process.

 

Hence, the Lean HR system tries to eliminate all of the excess baggage and tasks associated with HR processes to make them more streamlined and efficient. To achieve this, the HR department partners with the management to trim down the processing that are wasting valuable human resources.

 

Basic Principles of Lean HR

Lean HR and the lean way of thinking is based on the following five basic principles:

 

Value

The ‘Value’ principle tries to answer the question ‘What processes provide value to the customer?’. In the case of HR, ‘customer’ is the employee and hence, answering this query helps HR identify the processes that are related to their job satisfaction. Hence, they concentrate on improving these processes to improve the overall job satisfaction of the employees.

 

It deals with breaking down the entire process and rebuilding it from the ground up keeping employee satisfaction as the top priority. It includes optimizing the workflows to help the employees finish their work efficiently with the least amount of stress.

 

Value Streams

Understanding the time taken to finish a task is of utmost importance since it helps in estimating the time required in completing the task by the employees. This would help in developing stable value streams that work on a stable set of processes with a predefined set of tools.

 

Optimizing the process in this manner helps in creating a stable mode of processing that is independent of market changes. It helps the employees work peacefully with zero stress, thereby improving their productivity and efficiency in the long term due to the extended practice of repeating their tasks.

 

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Flow

‘Flows’ refer to the smooth traversal of a fixed set of steps that are required to complete a task. The lean approach looks at following the best flow to finish the process in the most efficient manner possible to remove any redundancy and increase the overall output efficiency.

 

The flow-based method contrasts the traditional method of completing a process in the fact that legacy methods use a rigid pre-defined workflow. The HR is meant to follow the same to complete their requirements irrespective of the changes in the employees’ collective mentality. However, the flow method encourages HR to think differently and tweak their processes to achieve maximum output.

 

Pull

Pull tries to answer the query ‘What steps can be taken to optimize the processes in the best way possible?’ This query is especially relevant in the case of HR since the processes deal with the employees of a company. Hence, any change in the established processes would affect them directly.

 

With the help of ‘pull’, HRs would be able to divide their workflows and processes into the basic units and ‘pull’ the redundant ones. This reduces the time and effort required in completing the task and hence, makes the process ‘leaner’.

 

Perfection

The overall lean HR method aims to improve HR efficiency with the help of multiple smaller steps to continuously refine the system instead of making big changes overnight. Such a steady approach to changing the HR processes ensures that everybody affected by the processes gets ample time to adjust to the changes.

 

It also helps in attaining ‘perfection’, which has to be defined beforehand. ‘Perfection’ might refer to different objectives that have to be attained by the HR department. Whatever might the result be, the goal is to ensure that this result is attained eventually with small, yet concrete steps.

 

Advantages of Lean HR

There are several advantages and benefits of Lean HR methodology over a traditional approach towards HR improvement. The most common advantages are:

 

Make processes more efficient

The readily visible benefit of implementing the lean methodology is the tangible increase in the efficiency of the process on which it is applied. Applying the same philosophy to different processes increases the overall HR efficiency, which is profitable for the company.

 

Increasing the HR processes’ efficiency also reduces the time and effort required in completing the administrative clerical tasks generally assigned to the HR department. They can better utilize the time saved in undertaking productive tasks such as strategizing employee engagement activities, streamlining onboarding, etc.

 

Decrease process complexity

Another major advantage of lean HR is the reduction in process complexity. Since lean HR promotes the breaking down of processes into smaller basic units, it helps HR understand the basic elements that make up the process and hence, decide whether to keep or remove them based on their relevance and utility in the process.

 

Additionally, reduction of complexity also helps in making changes to the HR process simple. The HR department would be able to gain additional clarity in understanding the variables that are changed when changing a process. Hence, they can make better decisions to improve the processes.

 

Better priority management

When dealing with processes, ‘priority’ is a major concern. When a process is changed, it results in changes in priorities of the process too. Since the lean HR philosophy deals with reducing the individual processes to their most basic form, it helps in understanding and dealing with these priority changes easier.

 

The lean methodology can be used in various areas of HR processing such as recruitment, hiring, onboarding, training, performance management, benefits administration, the retirement of the employees, and much more. Since these processes are vital for the correct functioning of the company, optimizing it with the lean philosophy ensures that the priority returns to become the major reason for the process’ existence instead of being lost in dealing with the nuances of the process itself.

 

Improved project visibility

With the implementation of the lean method, HRs gain improved project visibility. This visibility helps in allotting the right time and resources to complete the task on time. Hence, the lean method indirectly helps in improving the project management of a company.

 

Additionally, due to the improved project visibility, HRs can understand whether they are understaffed and help the management take the necessary steps to ensure project delivery on time. It also helps them undertake newer projects in cases where they understand that they are overstaffed.

 

Increased productivity

Due to the changes brought about by implementing lean principles, HRs can observe increased productivity. The basic aim of lean HR is to achieve better efficiency and hence, increased productivity is its direct by-product.

 

An increase in productivity also ensures better project management and higher chances of success for the company. Additionally, it would also lead to a better workforce since the staff would be happy with their performance due to the enhanced efficiency brought about by the deployment of lean HR.

 

Enhanced quality

In addition to improved efficiency and increased productivity, there would be an improvement in the quality of the products and services developed by the employees owing to the changes brought about by the lean philosophy.

 

Implementing the lean method leads to an attention-to-detail mindset. It helps in optimizing the workflow and hence, results in a reduction of manual errors. This improvement also helps in enhancing the overall products and services, thereby improving the company’s prospect as a brand.

 

Improved employee experience

Since the tasks are more streamlined and efficient, employees need to spend less time on the process itself. The lean method lends itself for constant process improvement, thereby encouraging the employees to provide their inputs to increase the efficiency of the processes further.

 

Observing the fact that their suggestions are being accepted and considered would also motivate them to provide further enhancements, that could improve the process as well as increase their engagement with the company.

 

Conclusion

To summarize, lean HR has multiple benefits in improving the company’s processes as well as increasing engagement among the employees. There are multiple benefits for the company in implementing lean HR. However, it is not to be confused with cost-cutting tactics as that could easily backfire. Your employees would be able to distinguish between the two and the results would be detrimental to your company’s growth. Hence, lean HR must be applied diligently after letting the management understand its importance and philosophy.

 

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