Some of the most common issues raised when I’m speaking with managers are the  impacts that initiatives undertaken by one area of the organization may have on another  area, or the fact that an initiative didn’t go far enough in creating a lean environment throughout the organization. For instance, a Quality-At-Source initiative that concentrated on the purchasing, receiving and quality control aspects of operations but did not include accounts payable. Although the initiative should deliver benefits in inventory availability and reduction of handling and inventory costs, it didn’t take the lean  thinking through to the accounts payable side and create a lean payment process.  A cost/benefit factor that is often  overlooked is time. Time is a commodity.  It could be viewed as “The Commodity” of competition. Let’s look as some hidden time wasters in the sales order booking process. The time that it takes to print a copy of a sales order to file is a waste. The time that it takes to print a sales confirmation to mail or fax to a customer is waste. The time that it takes to print a copy of a sales order to take over to credit management for approval is a waste. Other wasters include the time that it takes to get information from one system, or process, to another. For example, some organizations have warehouse management systems that are not real-time integrated to the rest of the systems in the organization. This means that a customer service rep may need to check two systems when a customer requests status of a shipment. Any business process within the organization that is not providing all parties requiring information or notifying them of actions to be taken in a timely manner is not lean. Essentially, the point being missed by these organizations is that to effectively have a lean enterprise, all business processes within the organization need to be mapped prior to determining the initiatives that are going to be employed to become leaner. The obvious warning here is that being lean is good but organizations, like people, can go overboard and become anorexic. The process by which you map the processes is as important as the mapping itself. There are three essential basics: Each process must support the targets of the business plan.

  • The business plan itself must be thought through and documented including KPI (Key Performance Indicators) for finance, sales/marketing, R&D and operations.
  • Then the operational processes must be identified for each area. These have various dimensions or targets: revenue/cost; customer service and retention; new products and/or service introduction; human resources management; asset investment, etc.

Therefore, each process tree must be driven from the top down.

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