The Definition of Lean Operations
Lean operations help businesses save money. Essentially, they are a broader category of lean manufacturing techniques that can be applied to a wider variety of businesses. Many businesses have strategies to help them make more profit by selling more to wider groups of consumers, but lean operation tactics try to make profit from the other end of the business, where products and services are created.
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Definition
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Lean operations are business practices that use as little time, inventory, supplies and work as possible to create a dependable product or service. The less that is used, the less waste occurs, and the more money the business saves. Accuracy is also very important in POS (Point of Sale) systems, and the most accurate systems produce products and services without flaws, so nothing needs to be thrown away.
Applications
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The most common type of lean operations is lean manufacturing, a method popularized by Six Sigma business practices, a widespread course designed to make companies efficient. Because there are so many steps to manufacturing a product, from getting supplies to running the product through at least one factory, there are many opportunities to spot waste and increase efficiency by changing practices. In service-oriented businesses, lean operations are used to help communicate more effectively than before and use less office space, computer space and physical materials to complete a transaction.
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Just in Time
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Just in time inventory is an important part of lean operations. The concept is that if a business is completely efficient and has a tight hold of supply management, products can be made as they are ordered by the customer, not before. This allows a business to save money on unused inventory and storage space.
Benefits
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The key benefit to lean operations is, of course, the higher profit that businesses realize as they save more money while doing the same processes. However, lean operation tactics also encourage out-of-the-box thinking and innovative approaches to both production and distribution. This can help the company be more flexible in the face of unexpected changes.
Considerations
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Lean operation practices can be very difficult to apply in some businesses, especially those unwilling to accept drastic change. In other businesses, changing practices may be too expensive and not fit in the company budget. There are some industries, especially service industries, which cannot apply many lean operations tactics to their existing businesses and must be very creative when finding ways to eliminate waste.
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References
Resources
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