Is Your Supply Chain Lean?

Use analytics to improve the efficiency of your supply chain management

Supply chain management is critical for many different types of businesses. The Lean Approach to supply chain management originated with Toyota and quickly became popular with other manufacturing businesses. It has since been applied in virtually every industry, but especially in retail, distribution, and service-based businesses.

What is Lean?

Lean isn’t a specific set of rules or practices to force on your business. It’s more of a philosophy that engages everyone in the company to work together to develop logical, disciplined practices that result in a smooth and balanced supply chain flow. This requires eliminating the three things that Toyota identified as causing inefficiency:

• Muda = Waste
• Mura = Unevenness in operations
• Muri = Overburdening of people and equipment

In practice this means improving these 8 areas:

Transportation

Shipping or transporting items from one place to another takes time and money. Therefore you want to minimize shipping and/or consolidate shipments to be more efficient.

Inventory

Whether you are talking about finished products or parts, you want to limit the amount you have in inventory to the specific amount you need at any given time, to avoid tying up space and working capital.

Motion

Unnecessary motion of any kind is wasteful. There may be many opportunities to eliminate inefficient motion from your processes.

Waiting

If time is money, you do not want to have any unnecessary down time while you are waiting for parts to arrive, processes to be completed, or products to ship.

Overproduction

Making too much of a product, or producing items too soon (before they can be sold or used) is inefficient. It may even cost you money if you end up being unable to use what has been produced because the market has changed while you were waiting to sell.

Overprocessing

All your processes should be geared towards adding value for the customer. If you have processes that are not required to get your product or service to the level the customer will pay for, you should consider eliminating those processes.

Defects

Defective products that you can’t sell are a waste of raw material and may lead to additional costs for disposal, recycling, or reworking.

Employee Creativity

Your employees have a detailed understanding of how various processes at your business work and how they may be improved. If you’re not engaging your employees and creating a forum where they can share their ideas, you’re wasting their creativity and intelligence.

Don’t Overlook Analytics

Analytics can help provide background information that will help you eliminate the above types of waste to create a more lean operation. With an analytics tool such as MyFieldAudits, you can create audits and checklists for evaluating various processes and then run reports that will help you identify areas of concern. You can then have what the Lean Approach calls a “kaizen” event in which employees and stakeholders come together to brainstorm solutions and improvements.

To learn more about MyFieldAudits, contact us at info@MyFieldAudits.com today.