Why are we here?

Why are we
here?
• To discover how lean organization will help us
become more competitive

• To understand what must be done

• To have consistent direction

• To have a shared vision of how to apply the

concepts to create a lean organization

• To begin the change process that will make us

more competitive
 Price - Profit - Cost Equation

Past Profit Cost Price Mass

Production
0
 Price - Profit - Cost Equation

Past Profit Cost Price Mass

Production
0

Market
Present Profit Cost Price Mass
Production
0
 Price - Profit - Cost Equation
Past Profit Cost Price Mass
0 Production

Market
Present Profit Cost Price Mass
Production
0

Market
Future Profit Cost Price
Lean
Organization
0
Today We Are Confronted With

Global Competition!
 Operating Market Environment

Past Present
• Everyone growing • Slow market growth

• Limited competition • Many competitors (global)

• Fairly stable product lines • Many new products (greater complexity)

• Producer sets quality standards • Customer sets quality standards

• Capacity shortages • Excess capacity

 Operating Business Environment

Past Present
• Products in great demand • Fighting for every sale

• Focus was on meeting market • Working to rebuild quality image

demand at all cost

• Few resource constraints • Very tight resources

• Growth hid waste • Waste visibly impacts the business

 Competitive Edge Issues

• There Is No Substitute for Quality.

• There Is No Excuse for Failing in the Area of

Service.

• There is No Differentiator Without the Advantage

Provided by Technology.

• There Is No Future in Not Being Cost Competitive

on a Global Basis.

06/10/98
 Yeah, but....

• We have constraints from the larger system!!

• We don’t have time!!

• We don’t know how!!

• We don’t have the tools!!

I can’t...

but WE can !!
 Waste in the Value Added Supply
Chain
P & T = Packaging & Transportation

Raw P&T
Tier 2 P&T P&T
Car Manu- P & T P&T
Tier 1 Dealer Customer
Material Supplier facturer
Supplier
Supplier

WASTE exists in each link

of the value added chain
 Competitive Challenge

Improving Productivity
Higher Quality
Reducing Inventory
+ Lower Costs
Reducing Layout
Customer Satisfaction
Reducing Lead Time