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Summary Business processes 2 KMO3 KdG
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This is a summary of the course Business Processes 2. The course is taught in the 3rd year of SME Management KdG by Peter Hoedemakers.
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BUSINESS PROCESSES 21 INTRODUCTION TO LEAN
1.1 LEAN HISTORY
1.1.1 BPA
We speak of the history of Lean. We might have spoken of Fordism as well.
“One of the most noteworthy accomplishments
in keeping the price of Ford products low
is the gradual shortening of the production cycle.
The longer an article is in the process of manufacture
and the more it is moved about,
the greater is its ultimate cost.”
1.1.2 THE RISE OF THE EAST – TOYOTA PRODUCTION SYSTEM
1.1.3 TOYOTA’S LEAN STRATEGY
“Brilliant process management is our strategy.
We get brilliant results from average people managing brilliant processes.
We observe that our competitors often get average (or worse) results from brilliant people managing
broken processes.”
Lean thinking = Process thinking
1.1.4 LEAN THINKING= THE WOMACK & JONES DEFINITION
“In short, lean thinking is lean because it provides a way to do more and more with less and less – less
human effort, less equipment, less time and less space – while coming closer and closer to providing
customers with exactly what they want.”
1.1.5 HISTORY OF LEAN
1
, Poka yoke: make sure you can do a task in only 1 way so even a fool can do it, then you can make it
foolproof (mistakes are not possible). Example: there is only 1 way to put in a HDMI cable in your laptop.
SMED = Single Minute Exchange of Die: completing an equipment changeover withing 1 minute.
Mass customization: producing a big batch, all the produced products have the same characteristics,
measures, etc. The production flow remains the same, its is automatically.
1.2 LEAN PRINCIPLES
1.2.1 7 LEAN PRINCIPLES
→ Value
→ Value creation
→ Pull
→ Flow
→ Roles, responsibilities and culture
→ Goal alignment
→ Continuous improvement
A process must contain at least the first 4 principles to be able to call it lean. But to make sure it remains
lean, the principles 5,6 and 7 need to me implemented too.
1.2.2 VALUE DEFINITIONS
Customer Value Added (CVA)
- Customers are willing to pay for your product/service IMPROVE
- It physically changes the form, fit or its function (3F’s)
o Form: you need a bottle to be able to sell water
o Fit: you need a cap that fits the bottle for it to be able to close, but it is also important for it
to be able to close again
o Function: you van refill the bottle anytime
- It is done right the first time (= dirft)
o You only need to go through the process 1 time
o This avoids the waist of over-processing
Over-processing: you spend too much time and money on the process
Business Value Added (BVA)
- You need to do activities to get information about the product REDUCE
- Internal: required to sustain the business
o The water bottle needs to be inspected > date gets printed on the bottle
- External: required by law/industry regulators
- Customers are not interested in this type of information
Non Value Added (NVA)
- Waste: creates no value and is not absolutely required ELIMINATE
1.2.3 THE 7 + 1 DEADLY WASTES
Motion Inefficient layouts/workplace design, offline resources, lack of proximity of
machines
Idle Time Operator waiting time, breakdowns, long setups
Over-production Making more than required to fulfill a customer order
Over-processing Rework, multiple batches, testing materials that were already tested
Defects Product that doesn’t meet de requirements, rejected raw meat, rejected bathes
Inventory High level inventory: raw materials, WIP, FG in DC and affiliates WH
Transportation Extra handling, shipping via the DC instead of direct to customer
Talent Not asking employees for their improvement ideas
2
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