Does the phrase “Lean Thinking” mean anything to you? Several years ago, a group of academics studying the rapid growth of automobile manufacturer Toyota began to research ways of optimizing the flow of products and services in companies. Instead of trying to improve isolated technologies or systems, this group focused on the end result, value to the customer, and sought to improve the entire process horizontally across technologies, assets, and departments all the way to the end user. The emphasis was on value and a strict mandate to eliminate waste. Every process had to increase value to the customer. Anything that did not increase value to the end customer was eliminated from the process.
For the next week, this column will explore the concepts of Lean Thinking and how they might apply to your travel practice. We will examine the types of waste travel agents and clients often experience in the travel planning exercise and how by eliminating waste we can improve your profit margins and the client’s experience and perception of your value. The concept is simple, yet powerful: fulfill clients needs and wants with a minimum of waste for either you or the client. Then, top off the mix with what Lean theorists call “Delighters” – an upside to the client that raises the perception of value to a new height.
Lean Thinking advocates have developed their own vocabularies, ways of measuring their results and have moved from an emphasis on manufacturing to service industries. In particular the health-care industry at the level of primary and hospital care has received significant attention.
But what are the possibilities for travel agencies?
What if you could introduce new values to your clients while simultaneously eliminating all waste from both your own processes and those experienced by your client? Would your own value be more evident? Would your client be more likely to increase their business with you? Would your clients be eager to refer others to you?
Let’s begin the conversation by asking how well you understand what your clients value. The concept of “value-add” is much discussed in our industry, but how well do we really understand the concept as it relates to what our individual clients see as valuable? How much time, energy and money do you put into “value-add” efforts that may or may not enhance the perception of value to your clients? In the Lean Thinking mindset, the client’s assessment of value is everything. According to Lean Thinking, if anything you do, anything, does not add value to the client experience, it must be eliminated from your company. Further, you want to seek ways of adding processes, services and products that will be perceived by the client as truly valuable. Is it possible, just possible, that we instead are adding services that we perceive as a value-add but which matter very little to our clients? Would your client be willing to pay for what you have “thrown in” as a value-add? If not, is it truly a value-add for you or simply a wasted cost? A simple example – you send a very expensive bottle of wine to a client on a cruise, but, unbeknown to you, the client and his wife are non-drinkers.
What about those episodes where we fail to convey value? For example, you know your clients should purchase travel insurance, but only a minority percentage of them do. What might we do that would increase the number of people perceiving the value of the insurance, thus protecting themselves against unforseen events, and earning you greater commissions in the process as a nice, incidental consequence? Finding the most efficient and effective answer to that problem would be a good exercise in Lean Thinking.
It’s clear that a consulting based business like travel planning is an ideal candidate for Lean Thinking. A travel consultant is capable of customizing each and every client experience to pack it with the optimal client value. The secret is to properly understand the process you are undertaking, the needs and wants of the individual client, and the places in the process where waste can be eliminated. By making the value highly visible to the client, you will earn their repeat business and referrals!
So let’s explore together the concepts of Lean Thinking and learn to operate our travel practices like the lean, client-friendly, value-packed machine it can be.
Tomorrow we will begin by analyzing our existing processes and procedures.