Lean Solutions: How Companies and Customers Can Create Value and Wealth Together
by James P. Womack and Daniel T. Jones, The Lean Enterprise Institute, Inc. ‘an education, publishing, and research “do” tank.’
Clever ideas about applying lean, JIT manufacturing successes all along the value chain in the customer service, provisioning and delivery side, not just backwards down the supply chain.
They suggest that reducing cost in service and retail comes not from hiring the cheapest employees and reducing the time per task, but in doing the right thing, the first time, every time. If the task repeated over and over, quicker and quicker, with a lower paid employee has zero value to your user, to what high-value task should this cost actually be going? End-to-end lean analyses push consumption chains towards more sustainable solutions. A thought provoking and compelling alternative.
Womack and Jones run through typical service and buying experiences with a rough calculation of the cost of waste in the system from the hold time making an appointment to the cost of service technicians waiting for parts while a half-completed item fills the available workspace. They also look at the cost to buyers, retailers and producers of stock-outs on popular items while shelves overflow with deeply-discounted, unwanted leftovers consumers are settling for.
Lean principals: give the end-user what he needs, when he needs it, where he needs it, in a complete solution. Ruthlessly remove process steps that don’t support that. Lean adds a necessary level of complexity to business analysis by measuring the true cost of processes, goods and services end-to-end and cradle-to-grave, including steps outside a business unit. IT systems have the data, but often only apply analysis to a tiny silo. True BI solutions will be more sophisticated and collaborative from raw material supplier to consumer to recycler to provide optimized solutions reducing total cost of ownership. Lean thinking can result in improvements in any process chain as participants concentrate on replacing steps that add little value with solutions that users will be happy to pay for.
Lots of opportunity for IT to provide information users need, when and where they want it, meeting real needs at lower TCO.