pc pointed out a great little article in a post on the discussion forum. The article touches lightly on why ERP implementations are so hazard prone, and then lists the “Biggest Failures” of 2010. Of note is that the majority of the listed failures are governments. I can see why. Governments, by their nature, have [...]
Bob Hanover has a great little article about applying visual controls to household laundry on his “Thoughtput Solutions” site. (cute way to use TPS as the name for the company, too.) The concept he outlines is the same one that is (or should be) used to trigger batch run points for kanban managed machines. But [...]
I have known Russ Field since working with him on a few projects in a large Seattle (now Chicago) based aerospace company. Recently he posted a very (typically Russ) thorough reply on NWLEAN to a question about value stream accounting. I asked him to take the same basic material, clean it up a little, and [...]
Almost every shop I have visited has, or is thinking about, initiating a “vendor managed inventory” program of some kind. The pressure to do this is especially strong when there is a big push to improve working capital positions and increase inventory turns. And, to be honest, the way traditional accounting counts inventory turns, getting [...]
Lean Accounting’s Fat Problem – Forbes.com I am really encouraged when I see a mainstream business publication like Forbes.com begin to discuss how better flow can cause problems for traditional cost accounting. I would refer this little piece to any executive, at least as a starting point for a discussion. Key points: Unless the accountants [...]
This post on Kevin Meyer’s Evolving Excellence blog brings up some good challenges to the traditional “avoid fixed costs” rationale for outsourcing. The post (and the comments) point out Wall Street’s obsession with achieving a total variable cost model. There is certainly a lot of appeal. Traditional cost accounting works hard to “assign” fixed costs [...]
A couple of interesting comments to the last post (as well as the original question) got me thinking some more. I’d like to go back to basics. There are no specific practices and behaviors that are “lean principles.” I believe the principles operate at a higher level. The principles have to do with creating a [...]
Steve Fonseca asks an interesting question on The Whiteboard. Are lean companies really transparent with their customers and suppliers as to cost/profits. Is this a lean principle or not, or to what extent? I am going to offer an opinion, then perhaps other readers can chip in. First, there is no real definition of what [...]
How does kaizen actually show up on the bottom line? This is a question that gets asked a lot, and honestly, we owe the asker a better answer than “it just does, trust us.” (Even though this is true.) Here’s my thinking – it shows up two ways. One is intangible. By that I mean [...]
We have created an entire generation (or two) of managers who are very savvy with cost accounting models. They know exactly how “costs” and “profits” are calculated, and they know exactly what inputs to manipulate in order to make the numbers as good as possible. They know, for example, how “inventory turns” are calculated, that [...]