Achieving African Competitiveness Through Lean

Lean operations seek out and create flow between value activities in organisations delivering goods and services demanded or pulled by their customers. As a consequence of removing all non-value added activities, lean organisations have less duplication and waste, are faster and better able to cope with change. Lean implementation requires not only the deployment of a range of tools (aided by technology) but also perhaps more importantly, an embed of its principles in organisations from senior management to staff and factory workers.

The lean principles as specified by Womack and Jones (1996) include specifying customer values, identifying the corporate value stream, developing a continuous flow, introducing a pull between processes and continuously improving the process to produce goods and services which better serve the customer. Although lean was conceived in a manufacturing environment, it has increasingly been embraced by the service sector and not just the private service sector, but also the public service – perhaps in vindication of Haque (2001) who argued that business-like reforms have led to an “erosion of publicness” in public service.

So while lean methods and tools are known and documented to deliver quantifiable benefits in monetary terms to private corporations like Motorola, GE, ABB IBM etc it has also been used to deliver benefits in public service for example, the National Health Service in London which funded a lean programme, Productive Ward, to improve the time nurses spent with patients. Similarly, HM Revenue and Customs, used a lean programme to achieve a 50% improvement in the lead time for customer issues. (Deloitte, 2010)

While it is true that the deployment of lean to deliver streamlined and efficient organisational processes is fairly recent (late 20th century), it is also true that the timeline for efficiencies in public services cannot be complete without taking cognisance of the politics and the ideological differences between the Socialist Left and the Conservative Right especially in a world where many advanced economies, have transformed their public service from one of active involvement in socioeconomic activities to that of being a facilitator to the private sector.

This change and drive for improvement in public service has not been restricted to the developed economies but has likewise been taken up by emerging and developing economies, especially those in Africa. The urgency for efficiencies in African organisations could not be made any clearer than the Global Competitive Index report from the World Bank which indicates that 14 out of 20 of the least competitive countries in the world are African, The World Bank (2013).

While some would argue, and rightly so, that in the recent past, Africa has embarked on many waves of public and private sector reforms – after the ‘60s in which the African Civil Service doubled in size with the result being that by the 70s something like half of the continent’s workers were employed by the state (Gordon 2001). This was the status quo when Africa faced Structural Adjustment Programs (SAPs) of the 1980s, which aimed at downsizing and restructuring the African Civil Service. Further reform initiatives to improve African public service performance continued through the 1990s and beyond into the new millennium under banners such as New Public Management.

The effectiveness of these programs have been disputed, ADB (2005). But if the report from the Institute for the Study of Labour (2011) is anything to go by then it can be said that there has been a sizeable shift in the African Labour Market, as the labour market data indicates that 90% of all employment opportunities in Africa are now in the private sector. The fact that only 10% of these jobs are formal employment or the fact that according to the report the jobs are “low productivity”, makes the current 5% average growth rate for the region basal and vindicates the stark message from the GCI report that more needs to be done to improve the continent’s competitiveness.

The GCI distinguishes three stages of development. In the first stage, economies are “Factor-driven” and countries compete on unskilled labour and natural resources where maintaining competitiveness requires a well-functioning public and private sector with continuous flow in delivering to customers and public at large. Countries in the second stage are “efficiency-driven” and compete through amongst other things, having efficient goods and services markets with the elimination of waste and duplication – simply put, being faster. In the third category – these countries use continuous improvement and “innovation” to compete in the production goods and services.

In all three levels, there are aspects of the Lean philosophy, which if adopted, without doubt would not only improve the continent’s competitive standing but also the growth rates beyond their current standing. Therefore to improve its global standing in terms of competitiveness, Africa’s private and public institutions must become Lean. Lean in its service provision and manufacturing. Lean in its bureaucracy and civil systems. Lean in training and capacity development.

Although Fatile and Adejuwon (2010) find that the drivers for public sector reforms in Africa have been externally driven, i.e. imposed by donor and lending agencies, this has not been the case in the West where public sector reform has principally been the political football fuelling arguments about the depth, breadth or speed of change. This perpetual debate has done much to retrench the role of the public sector in most developed economies where public services are now more often than not, streamlined into delivering a comparatively efficient service with relatively little waste.

Nevertheless, as recognised by Omoyefa (2008), who argued that meaningful reforms can be achieved only when the “polity” had been reformed, if Africa is to move beyond the low ranks of the global competitive index, then public and private sector reform in combatting waste needs to go hand in hand. Therefore, changing to become lean cannot be the preserve of government in its reform of public services, or confined to the domain of private organisations. This is because organisations which are streamlining operations, reducing waste and adding value to goods and services, depend on the citizenry in both formal and informal employment to adopt the Lean philosophy. The citizens are found on both sides of the equation, producers and consumers, both gaining from the deployment of lean philosophy – in terms of time and cost.

Lean cannot be the panacea for corrupt or incompetent management, but if the philosophy is adopted and the culture imbibed into the fabric of society, it can be expected that all forms of waste would be driven out of organisations – both public and private. In actual terms lean would mean for example, citizens could expect an African public service without the usual delays, duplication and ping-pong of work. It would deliver a continuous transparent flow of improved streamlined services and reduce the centralisation which has typified some African civil services. With lean, taxpayers could also expect a smaller public service, which listens more to their needs and costs less. Furthermore, the increased efficiency and streamlined state bureaucracy would undoubtedly reduce inherent costs to business and increase opportunities for private and foreign investment and employment. Increases in private investment would inevitably provide opportunities to heal the continent’s Achilles heel, its infrastructure, and boost African manufacturing beyond the 10% it currently contributes to the African GDP.

Lloney Monono
Bristol, UK

Sources
ADB (2005) African Development Bank, Public Sector Management in Africa, Economic Research Working Paper Series, No 82 (November 2005)
Deloitte, (2010) Lean and Fit, Improving frontline services in an age of austerity.
Fatile, J. O. and Adejuwon, K. D. (2010) , PUBLIC SECTOR REFORM IN AFRICA: ISSUES, LESSONS AND FUTURE DIRECTIONS, Journal of Sustainable Development in Africa (Volume 12, No.8, 2010), ISSN: 1520-5509
Gordon, D.L. (2001) “African Politics”, Understanding Contemporary Africa, 3rd ed. (Boulder/London: Lynne Rienner)
Haque, M. Shamshul, (2001) The Dimininshing Publicness of Public Service Under the Current Mode of Governance, Public Administration Review January / February 2001, Vol. 61, No. 1
Marco, M. Leung, R, Diarra S. M., Pla L.(2011), How Large Is the Private Sector in Africa? Evidence from National Accounts and Labor Markets, Institute for the Study of Labor.
Omoyefa, P.S (2008). The Politics of Public Sector Reforms in Africa. Lesotho: National University of Lesotho.
OECD (2013) African Economic Outlook Report, 2013
The World Bank (2013), The Africa Competititve Report 2013
Womack and Jones (1996), Lean Thinking, Simon and Schuster, New York, NY

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Categories: Management

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