A Land Divided, A World United, Lean Ignited

I visited Panama City in April and, as a tourist, one of the first places I wanted to visit was the Panama Canal. Connecting the Atlantic and Pacific oceans, it has been ranked as one of the Seven Wonders of the Modern World The American Society of Civil Engineers. The history and the maintenance of the Panama Canal is a tale of engineering brilliance, international collaboration, and strategic significance, with lean principles playing a significant role:

Early Vision and Initial Efforts:

• The concept of a canal through Central America dates back to the early 16th century, when Spanish explorers sought a shortcut between the Atlantic and Pacific Oceans.
• In the late 19th century, the French, led by Ferdinand de Lesseps (who successfully built the Suez Canal), began constructing the Panama Canal in 1881. However, they faced severe challenges, including tropical diseases like malaria and yellow fever, difficult terrain, and financial issues. The French effort ultimately bankrupted in 1889 after 22,000+ workers died.

?U.S. Involvement and Construction:

• In 1903, after Panama gained independence from Colombia, the United States secured the rights to build and control the canal through the Hay-Bunau-Varilla Treaty.
• Construction resumed under U.S. direction in 1904, led by Chief Engineer John Frank Stevens and later George Washington Goethals.
• The U.S. effort overcame many challenges by implementing better health measures, such as widespread mosquito control to combat malaria and yellow fever, and innovative engineering solutions like the use of massive locks and a dam to create Gatun Lake.

**Lean brilliance:

1) Identifying waste & Problem Solving: Mosquito-borne diseases led to sickness, decreased productivity, and even death among workers, resulting in wasted resources and time. Identifying the root cause of these diseases and addressing them effectively was crucial to eliminating this waste.

2) Continuous Improvement: Lean emphasizes continuous improvement to eliminate waste and optimize processes. Similarly, efforts to combat mosquito-borne diseases required ongoing improvement in prevention methods, such as implementing better drainage systems, improving housing conditions, and developing more effective insecticides.

• The Panama Canal was officially opened on August 15, 1914, significantly reducing the maritime distance between the Atlantic and Pacific Oceans and transforming global trade routes.

Later Developments and Control:

• The Panama Canal remained under U.S. control until 1977, when the Torrijos-Carter Treaties were signed, agreeing to transfer control of the canal to Panama by the end of the 20th century.
• On December 31, 1999, the Panama Canal was officially handed over to Panama, which has since managed the canal through the Panama Canal Authority (ACP).

Modern Enhancements:

• Recognizing the need to accommodate larger vessels, the Panama Canal underwent a significant expansion project, known as the Panama Canal Expansion or the Third Set of Locks Project.
• Completed in June 2016, the expansion included the construction of new, larger locks and widened and deepened existing channels, allowing the passage of New Panamax (or Neo-Panamax) ships, which are substantially larger than the previous limit.

**Lean brilliance:

?1) Continuous Improvement: Lean emphasizes continuous improvement. The Panama Canal has undergone numerous improvements and expansions, such as the addition of the new set of locks in 2016. These enhancements reflect a commitment to continuous improvement to meet the growing demand for larger vessels and increased traffic.

2) Just-In-Time: JIT aims to reduce inventory and increase efficiency. The Panama Canal operates with a similar principle by scheduling ship transits to minimize waiting times. Efficient scheduling ensures that ships pass through the canal as smoothly and quickly as possible, akin to a JIT production system where parts arrive exactly when needed.

3) Waste Reduction (Muda): Lean aims to eliminate waste (muda). The Panama Canal can identify and reduce waste in various forms, such as time wasted waiting for transit, unnecessary fuel consumption during idling, and inefficient use of resources. By optimizing processes, the canal can improve its operational efficiency.

4) Standardized Work: Lean emphasizes standardizing processes to ensure consistency and efficiency. The Panama Canal uses standardized procedures for navigating ships through the locks, ensuring safety and efficiency. Regular training and adherence to these standards help maintain high operational performance.

5) Flow Optimization: Lean focuses on creating smooth, uninterrupted flows. The Panama Canal’s operations center continuously monitors and manages ship traffic to optimize flow and reduce congestion. This ensures a steady and efficient passage of ships, similar to how Lean aims to create a smooth production flow.

The Panama Canal remains one of the most strategic and economically important waterways in the world, embodying the spirit of "land divided, world united" by facilitating global maritime trade and connecting diverse regions and economies. And by incorporating the lean concepts into their business system, the canal and Panama's economy prospered tremendously.

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About the Author: Ezgi Caliskan is a Lean Leader, Waste Buster and Bookworm. She is passionate about two worlds: Continuous Improvement and the captivating realm of books.

With nearly 20 years of experience in organizations like GE and Duke Energy, she had the privilege of collaborating with diverse organizations to drive operational excellence guided by the principles of Lean thinking, continuous improvement, and fostering a culture of innovation.

Beyond the realm of Lean, she is an enthusiastic bookworm, averaging about 100+ books per year in diverse set of categories such as self-improvement, world classics, business, and management. Ezgi shares her book reviews & insights with her followers regularly.

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