5 Principles of Lean

5 principles of Lean

* Value - specify what creates value from the customer’s perspective.

* Any process that the customer would be prepared to pay for that adds value to the product.

* The customer defines the value of product in a lean supply chain.

* Value-adding activities transform the product closer to what the customer actually wants.

* An activity that does not add value is considered to be waste.

* The value stream – identify all the steps along the process chain.

* The value stream is the sequence of processes from raw material to the customer that create value.

* The value stream can include the complete supply chain.

* Value stream mapping is an integral aspect of Lean.

“The Value Stream is those set of tasks and activities required to design and make a family of products or services that are undertaken with a group of linked functions or companies from the point of customer specification right back to the raw material source.”

(Hines et al, 2000)

* Flow - make the value process flow.

* Using one piece flow by linking of all the activities and processes into the most efficient combinations to maximize value-added content while minimizing waste.

* The waiting time of work in progress between processes is eliminated, hence adding value more quickly.

* Pull - make only what is needed by the customer (short term response to the customer’s rate of demand).

* Pull = response to the customer’s rate of demand i.e. the actual customer demand that drives the supply chain.

* Based on a supply chain view from downstream to upstream activities where nothing is produced by the upstream supplier until the downstream customer signals a need.

* Perfection - strive for perfection by continually attempting to produce exactly what the customer wants.

* The journey of continuous improvement.

* Producing exactly what the customer wants, exactly...