3H

• Lean management

  The process of systematically reducing waste in all areas of a business's operations system whilst simultaneously improving customer value
• Effect of lean management on the business operation system (advantage)

  • Reduce the amount of waste generated from discarded materials and unused time within its operations system
  • Enable a business to use resources more efficiently, meaning materials are not purchased as frequently and tasks are completed at a faster rate, reducing overall production costs
  • Benefit customers as the business is able to charge cheaper prices
  • By offering a lower-priced product that is delivered more quickly, a business can improve its level of customer satisfaction
  • Ensure the output meets the customer satisfaction
• Advantage of lean management

  • A business can improve its reputation as it is actively reducing and managing waste, which benefits the environment
  • Quality is improved as processes are streamlined to ensure all activities add value to the final product and customer expectations are met
  • Employees may experience greater job satisfaction as they are actively involved in reducing waste in operations and positively impacting the environment
  • Products can be produced at a faster rate when strategies such as takt and one-piece flow are introduced as they focus on continuous production
  • A business can reduce the amount of time that is wasted between tasks
  • Reduces the overall use of materials, which leads to fewer production costs
  • The quality of a business's products can improve, leading to greater customer satisfaction and sales
• Disadvantage of lean management

  • If suppliers do not deliver materials on time, the business may be unable to streamline its production process to meet customer demand
  • Employees may be reluctant to commit to an attitude of zero defects due to the effort and commitment required
  • It may be overwhelming for employees to implement lean management as there is a goal for constant improvement
  • It may be time-consuming to train inexperienced employees and provide them with the knowledge to commit to lean production methods
  • It can be costly to implement lean management as implementing new policies, procedures, and training employees can come at a high expense
• Pull


  A lean management strategy that involves customers determining the number of products a business should produce for sale
• Characteristics of pull management strategy

  • A business will only produce its goods or services to meet customer demand to ensure that no resources are wasted on unwanted products that will later be discarded
  • The customer need to give the order beforehand in order for the business to produce its output in the right time
• One-piece flow

  A lean management strategy that involves processing a product individually through a stage of production and passing it onto the next stage of production before processing the next product, continuing this process throughout all stages of production
• Characteristics of one-piece flow

  • One product moves through each stage of the entire production process without delay, while the new product takes its place
• Takt

  A lean management strategy that involves synchronising the steps of a business's operations system to meet customer demand
• Characteristics of takt

  • It allows for a continuous pace
  • To achieve a continuous pace, the output of one production stage is transferred to the next step in a timely manner. If implemented correctly, the business ensures items complete the production process with no delays between steps
• Zero Defects


  A lean management strategy that involves a business preventing errors from occurring in the operations system by ensuring there is an ongoing attitude of maintaining a high standard of quality for the final output
• Process of Zero defects

  When a business finds a defect in its operations system, production is halted so that the error is not passed on to the next stage of the production process. The business then identifies and fixes the error to prevent any further defects from occurring in the future