Question

Inventory can take up to 5% of capital investment, and it's essentially a liability until it is translated into sales. Lean management has surfaced as an important paradigm to slash the inventory and further increase the productivity of an organization and change the mindset of employees. In 2-3 paragraphs, Discuss how lean principles and programs are helping organizations and employees to transform their inventory and business.

Answer 1

Insightful implementation of lean is necessary for high-value manufacturing and is complementary to strategic decision making regarding manufacture. However, lean can be difficult to implement in specific organizations. One of the difficulties is deciding which of the many lean tools to apply and when to apply them. A complicating factor is change management. Lean implementation is a transformational process and needs to support organizational development alongside process improvement. We develop a method based on risk management to identify which lean tools are most appropriate for a specific organizational setting. This permits the situational and contingency variables to be accommodated in the lean transformation. The method is demonstrated by application to a small manufacturing organization with a high-variety low-volume business model. Thus it is possible, given contextual knowledge of the organization, to predict which lean methods are most important in the situation. This enables the prioritization of organizational effort towards lean methods that are relevant to the organization at that particular time in its development.