Various constraints characterizing the climate under which many organizations operate today underscore the significance of conceptualizing the lean theory at different organizational levels. Lean tools, methods, and techniques can be employed at different levels such that lean production is embraced as an inclusive philosophy that continuously improves not only the production aspects of an organization but also its contextual physical production processes. In this paper, I discuss how lean principles would help in the strategic planning of an organization. I assume the position of Chief Executive Officer of the organization. I also discuss how the current philosophy can be put to use in a specific industry. In addition, I uncover the main operating costs an institution such as CSUN would have and proceed to explore how the lean philosophy would be applied to eliminate any steps that would be considered unnecessary.
Q1.
Assuming the organization where I were the CEO was a production organization, the lean philosophy would be employed in strategic planning, particularly as can be conceptualized on the process level, project level, and organizational (management) level. As such, an effective lean implementation would cover various aspects directly or indirectly related to business. Such aspects include production and transport as well as supply and service operations just to mention but a few. More specifically, the principles under discussion would be helpful in the following areas:
Design and/or Development: The manner products and services are designed and developed must be such that they meet customer needs. While it is important to keep in mind such needs during production, it is imperative that the needs of the manufacturing process also be taken into consideration. Manufacturability in this context emerges as an integral element of the production aspect of an organization. It basically entails product-proto-typing, value engineering, analysis of the product life cycle, product specification, as well as market research. Lean principles would ensure that, for instance, a product is designed and developed to suit the needs of customers so that unnecessary specifications are avoided.
Quality: This aspect of production calls for a need to determine what makes a product qualify as being of (high) quality. Lean principles would help inform just what costs are related to a product’s quality, so that such costs are minimized even as quality is maximized. Alternatively, any costs that do not significantly contribute to quality could be eliminated all the same. More precisely, the lean philosophy would ensure focus is placed on how to achieve quality and what degree of quality should be achieved.
Inventory Management: This is concerned with the manner a certain product has to be produced so that stock is not too little or excess. Another concern of inventory management is how to store and handle stock. In a production organization, lean principles would help in strategic planning by ensuring that there is a balance between what is being produced and what is sold out. In other words, with application of the lean philosophy, production would be planned in such a way that only what is needed is produced. This would save waste in terms of raw materials, inventory space (storage) and labor that would go into production processes and moving stock.
Supply Chain Management: Considering that this involves managing external and internal resources like raw materials and supplies besides complimentary/support operations and services, lean principles would be applied in strategic planning so that the organization sources only what it needs. There would be surplus raw materials or additional support services that do not significantly contribute to production.
The points mentioned in a) above could be applied to the construction industry where a construction firm would incorporate lean principles into its strategic planning as would have to do with design and development, quality, inventory management, and supply chain management.
Q2.
A major university such as CSUN would have the following operating costs:
Inventory
Material/document processing e. g reports
Waiting time e. g when approval has to be sought from senior administrators
Costs related to human resource /Hiring and maintaining staff
Transportation/Material movement
In the above process, steps in red are non-value added or unnecessary whereas those in green are value-added.
The logic behind labeling each of the items is as thus:
Ordering extra papers-it would be more of a waste to order surplus papers that will stay idle and not go into production. There is also a waste in terms of inventory space and the labor that goes into handling the extra papers.
Ordering items in case they are needed- Assuming that items might be needed sometime and ordering to have them ready in such an event is a gamble and a waste as it is possible that nobody or no process will need them. Inventory space and labor are other aspects of waste in this regard.
Keeping multiple copies of order items- It is needless to have extra copies of order items or documents if only those needed can be handled with care. For instance, if the order files are in soft copy, they will just take up computer memory, one that would otherwise be used for something else. The same logic can be applied to physical space.
Faxing and e-mailing extra information-It is only logical to e-mail and fax only what is needed to save time.
Preparing reports that are not read: It would be a waste of time and resources to prepare reports that will not be read by anyone.
Reaching for commonly used tools: It is imperative that the tools that are commonly or frequently used be availed close to the workstation or process where they are needed. A lot of time and energy (labor) is wasted when the converse is the case.
Ordering only what is required, making just enough copies of everything, faxing and emailing only what is needed, making just enough copies of everything: Following the above logical; viewpoints, reverse logic can be applied in the context of these steps so that it can be realized that ensuring these saves time, labor, inventory space and associated costs.
Eliminating the non-value steps:
This could be done by:
Ordering just enough papers
Ordering only needed items
Keeping single copies of order documents and where necessary just back-ups
Avoid producing extra copies; produce only that which is needed
Fax and e-mail only what is necessary
Avoid entering repetitive information on work documents
Produce only reports that will be read or put to use in one way or the other
Make sure commonly used tools are near workstations or processes
After eliminating the above steps (hence applying lean principles), the process would be as follows:
