LEAN ENTERPRISE PRINCIPLES AND PRACTICES September 11, 2002 Prof. Deborah Nightingale Deborah Nightingale, MIT@ 2002
LEAN ENTERPRISE PRINCIPLES AND PRACTICES September 11, 2002 Prof. Deborah Nightingale Deborah Nightingale, MIT © 2002
Objectives >Enterprise perspective >Enterprise value streams Three levels of enterprises Stakeholders >Principles of lean enterprises >Enterprise value stream analysis Deborah Nightingale, MIT@ 2002
Objectives ¾Enterprise perspective ¾Enterprise value streams ¾Three levels of enterprises ¾Stakeholders ¾Principles of lean enterprises ¾Enterprise value stream analysis Deborah Nightingale, MIT © 2002
The Early Lean Message stressed minimizing waste Sometimes "less adds up to"more less waste less design time The emphasis less costs was on Lean fewer organizational layers Production fewer suppliers more employee empowerment more flexibility and capability more productivity more quality more customer satisfaction more long-term competitive success Deborah Nightingale, MIT@ 2002
3 Deborah Nightingale, MIT © 2002 Sometimes “less” adds up to “more.” ➣ less waste ➣ less design time ➣ less costs ➣ fewer organizational layers ➣ fewer suppliers ➣ more employee empowerment ➣ more flexibility and capability ➣ more productivity ➣ more quality ➣ more customer satisfaction ➣ more long-term competitive success … stressed minimizing waste. The emphasis was on Lean Production. The Early Lean Message
The Evolving Lean Message Moving beyond lean production"to an extended lean enterprise. Lean The emphasis Production is on value Added Activities Lean Enterprise Extended Lean Enterprise Deborah Nightingale, MIT@ 2002
4 Deborah Nightingale, MIT © 2002 The emphasis is on Value Added Activities Lean Production Lean Enterprise Extended Lean Enterprise Moving beyond lean “production” to an extended lean enterprise. The Evolving Lean Message
Enterprise Definition One or more persons or organizations that have related activities, unified operation or common control, and a common business purpose Blacks Law Dictionary, 1999 Deborah Nightingale, MIT@ 2002
Enterprise Definition "One or more persons or organizations that have related activities, unified operation or common control, and a common business purpose" -Blacks Law Dictionary, 1999 Deborah Nightingale, MIT © 2002
Lean Enterprise Defined A lean enterprise is an integrated entity which efficiently creates value for its multiple stakeholders by employing lean principles and practices Lean Aerospace Initiative, MIT, 2001 Deborah Nightingale, MIT@ 2002
Lean Enterprise Defined “A lean enterprise is an integrated entity which efficiently creates value for its multiple stakeholders by employing lean principles and practices.” -Lean Aerospace Initiative, MIT, 2001 Deborah Nightingale, MIT © 2002
Integrated Enterprise Customer Product Support Manufacturing Operations Finance, H/R Product Legal, etc... Development Supplier Network Deborah Nightingale, MIT@ 2002
Integrated Enterprise Customer Product Development Supplier Network Product Support Finance, H/R, Legal, etc... Manufacturing Operations Deborah Nightingale, MIT © 2002
Program Value Stream Value Deborah Nightingale, MIT@ 2002
Program Value Stream Value Deborah Nightingale, MIT © 2002
Multi-Program value Stream Value Value Value Value Value Value Value Deborah Nightingale, MIT@ 2002
Multi-Program Value Stream Value Value Value Value Value Value Value Deborah Nightingale, MIT © 2002
National and lnternational value stream NTERNATIONAL valu Value US Value Value 4 Value Value Value Value value Value NNN Value Value Value Value Value Value Deborah Nightingale, MIT@ 2002
10 Deborah Nightingale, MIT © 2002 National and International Value Stream Value Value Value Value Value Value Value US Value Value Value Value Value Value Value Value Value INTERNATIONAL INTERNATIONAL
