Relevance of Lean in Today’s Service Sectors
Cost Cutting is not the answer and today, many organizations are still outsourcing, downsizing, facing merger and acquisitions to survive. Cost cutting is not the answer and that is where Lean principles can help organizations achieve operational excellence. Lean’s purpose is to create “robust, waste-free, flexible” processes (Sakar, 2008, p. 3). Lean Thinking focuses on specifying product and service value from the customer’s perspective and not from leadership and management or technology. All steps in the value stream must be defined or as you learned previously in a process map and any non-value added activities must be removed or eliminated from the process. Improve process stability by making the value-added activities flow or run smoothly. As ...
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...s discussed in the process oriented section of the previous week (Taylor, 2013). Problem solving becomes preventative instead of reactive. The delivery of products and services are value driven and customer focused. The elimination of non-value added activities and waste improve the quality of products and services. Using a pull system reduces costs because of low inventories, using a JIT methodology (Russell & Taylor, 2011). Continuous improvement should be pursued, improving the quality of products and services to customer.
In conclusion, “a study of the average benefits among US manufacturers over a five-year time frame revealed 90% reduction in cycle time, 70% reduction in inventory, 50% reduction in labor costs, and 80% reduction in space requirements” (Russell & Taylor, 2011, p. 740). There are many benefits to embracing Lean, and interest is growing.
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