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Understand what creates value for customers

lean terms, optimization means creating a product that generates the highest possible customer value, is extremely high quality and is manufactured at a competitive cost.

businesses – public and private – need to be the best at delivering more content and higher quality for less money. Customers now tend to switch faster to competitors that can offer better, cheaper insurance, while taxpayers demand lower taxes and a higher level of public servic

We can break down effective management into four elements: strategic management, personnel management, professional management and operations management, as illustrated in Figure 2

survey results were presented in The Machine That Changed the World – The Story of Lean Production, the book that brought forth the concept of lean production

he driving force of lean is its constant pursuit of a vision – a perfect production system with the following characteristics:
• Constantly falling costs
• No waste
• No errors
• Minimum throughput time
• No tied-up stocks
• Minimum space consumption
• Maximum capacity utilization
• Unlimited flexibility
• High job satisfaction
• High customer satisfaction.

1. Understand what creates value for customers and see the value chain by which raw materials are given increasing value, ultimately becoming the finished product that satisfies the customer’s needs.
2. Identify activities in the value chain that do not create value for customers – that is, waste – and eliminate the easiest ones. In the long term, focus continuously on eliminating the remainder under steps three to five.
3. Create flow in production to enable products to flow through the processes with the minimum of stops and transfers of responsibility.
4. Make production pull managed, meaning that the needs of the internal or external customer always determine what is to be produced and when.
5. Mobilize the entire organization and enhance the skills needed to implement ongoing improvements based on steps one to four. Delegate process responsibility and distribute skills in the organization to improve and make transparent the entire value chain – from concept to product delivery – rather than individual elements alone.

Considering the administration and service sector from a lean perspective means realizing and acknowledging that the sector’s tasks encompass production, and, as such, that industrial production can inspire their management.

Intrinsically understanding tasks is the key to establishing the right organization: which tasks are uniform, which are different, how can they be grouped, what can be kept separate? Once a pattern has been established, the correct structure can be set up.

Two key planning and control tools are:
• A capacity plan – a general plan showing the relationship between the future incoming volume of work and the department’s available staff resources. The capacity plan reveals capacity shortages or surpluses in the department. As a rolling plan, it continuously projects the historic task flow and compares it with current staff capacity, taking into account such factors as holiday, training courses and absences. The capacity plan can be drafted at the overall departmental level or right down to task type, if necessary.
• A staffing plan – a detailed plan that ensures a satisfactory service level for telephone calls, emails or personal enquiries. Staffing rotas are the operational manifestation of the capacity plan – a schedule for each individual staff member. The staffing plan takes into consideration such factors as capacity fluctuations in the course of the day.