DP8: Lean Management

Lean Management

Aim to deliver customer value by systematically reducing waste and focusing on continuous improvement.

Pull

Production of the good or service is only started when the customer places an order.

• Ensures inventory is kept to a minimum, waste is reduced, and customer satisfaction is assured as orders received are less likely to be damaged.

One-piece Flow

An uninterrupted flow of process from the beginning until the end of the production process.

• When all steps are aligned, value is added on piece at a time and unnecessary activities that are wasteful are removed from the process.

Takt

The operations process seeks to create a rhythm whereby all the steps in the production of the good or service are synchronised to create a ‘continuous flow’.

• The speed.

Zero Defects

Focuses on quality, identifying potential defects as soon as possible so any issues are resolved quickly and efficiently, resulting in high quality.

Advantages and Disadvantages

ADVANTAGES

• Less infrastructure is required, only essential building space, equipment and manpower. (effectiveness)

• Responsive to customer needs develop strong customer relationships (effectiveness).

• Reduces waste production and improves productivity as unnecessary resources are removed (efficiency).

DISADVANTAGES

• Focus on short-term gain and waste reduction may be made at the expense of long-term, sustainable solutions.

• Time consuming to actively review all procedure and make changes to reduce wastage.

• Employees may be resistant to removing certain processes or resources.

Link to Efficiency and Effectiveness

EFFICIENCY

• Wastage in all areas are reduced.

• Products are made faster and with fewer resources.

EFFECTIVENESS

• Can lead to increased profits and market share.

• Can improve customer value.