Five Lean Principles

O M T D G R

1. Specify Value

A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer.

Specify value from the standpoint of the end customer Ask how your current products/services and processes disappoint your customers value expectation:
price? quality?

Waste:
Activities that add no value, add cost and time Symptoms; need to find root causes and eliminate them 7 types of waste

reliable delivery?
rapid response to changing needs? fundamental definition of the product?
Incidental Incidental Work Work

Pure PureWaste Waste

Pure Waste
Value Value

Typical Operation: 1-10% Activities are Value Adding

Value

Five Lean Principles

O M T D G R

2. Map the Value Stream

Whenever there is a product or service for a customer, there is a value stream. The challenge lies in seeing it. (Womack, Learning To See)

Identify all of the steps currently required to move products from order to delivery

Value stream
All activities, both value added and non-value added, required to bring a product (or provide a capability) from raw material (initialization) into the arm of the customer

Challenge every step: Why is this necessary? Would the customer think the product is worth less if this step could be left out?
Many steps are only necessary because of the way firms are organized and previous decisions about assets and technologies

3 Main Value Streams:

1. 2. Raw material to customer Concept to launch

3.

Order to cash

Mapping the VS See the whole and improve the system