Lean Organizational Structure Tips

by Eric Dontigney; Updated September 26, 2017

Lean organizations aim to refine processes, reduce waste and deliver value to customers. As the lean mindset has transitioned out of pure manufacturing, it has led to a flatter organizational structure in other industries. Successful implementation of a lean organizational structure in your own business also includes attention to actionable metrics, learning and customer feedback.

Keep a Flattened Structure

Traditional business structures encourage rigid hierarchies and layers of bureaucracy. That structure often impedes information sharing and creates a fixation on advancement, rather than professional mastery. By reducing or eliminating the hierarchy, a business encourages better information sharing across the organization. Limiting the hierarchy also closes the traditional gap between management and workers, which reduces the friction that usually accompanies that gap. Rather than fixating on how to secure a promotion, workers spend their energy on maximizing their professional skills. While some hierarchy proves inevitable in larger organizations, lean thinking suggests that at least some of any given hierarchy creates unnecessary steps in the delivery of goods and services.

Actionable Metrics

Managers in an organization can develop an irrational attachment to a project or idea, which sometimes makes them ignore the data. Eric Ries, entrepreneur and lean advocate, recommends imposing an agreed-upon set of actionable metrics for evaluation. For example, once the project goes into action, its continuation depends on progress in the actionable metrics; if the project fails to progress, it gets dropped. Establishing agreed-upon, actionable metrics as part of the organizational structure encourages genuine accountability, particularly in combination with a flattened structure that promotes information flow.

Facilitate Learning

Organizations can treat learning as an afterthought and give it minimal support. The tendency of traditionally structured organizations to silo departments and processes exacerbates this issue. The lean goal of continuous improvement, however, requires ongoing learning. A lean organization builds the process of learning into the structure by budgeting for and arranging opportunities for employees to engage in external learning. The lean organization can also build internal learning into its structure by implementing regularly scheduled times that employees participate in related work processes. This allows for knowledge cross-pollination and also helps employees understand the larger work flow.

Facilitate Customer Feedback

A lean organization seeks to identify what represents value to the customer and deliver it, and its organizational structure needs to include a component that facilitates and analyzes customer feedback beyond offering an email address on a contact page. The organization may request customer feedback via email, phone or in-person interviews. While some customers always opt-out, initiating a request for feedback, rather than passively waiting for feedback, draws in larger numbers and generates a more useful cross-section of opinions. That feedback allows the organization to better define value, as the customer sees it, and refine processes to better deliver that value.