Lean is an approach
based on the elimination and prevention of waste throughout every
part of an organisation and its supply chain with the aim of improving
competitiveness and ultimately customer service. Any organisation
with a genuine and visible commitment from senior management can benefit
from the application of lean principles.
Lean focuses on
waste in all its manifestations with any activity that does not add
value for the customer being waste and a potential candidate for reduction
or elimination. The true cost of waste in a typical organisation will
range from 10 to 40% of its turnover with any savings going directly
to the bottom line. Toyota originally developed the "7 wastes"
or Muda to encapsulate the waste that exists in manufacturing organisations.
Today it is recognised that similar categories exist in service industries.
There is a large
array of tools and philosophies available to the organisation pursuing
lean; some are well known some are less so. Again most were originally
developed for application in manufacturing industries however their
considerable potential in other sectors of commerce is still largely
untapped.