LEAN MANAGEMENT

Lean means creating more value for customers with fewer resources. Lean Management
is defining the purpose of the organisation in terms of customer value, designing and
executing the right value streams and processes for achieving the purpose, and aligning
the people touching the process and building problem solving capability in them.

A lean organization understands customer value and focuses its key processes to
continuously increase it. The ultimate goal is to provide perfect value to the customer
through a perfect value creation process that has zero waste. Eliminating waste along
entire value streams, instead of at isolated points, creates processes that need less human
effort, less space, less capital, and less time to make products and services at far less costs
and with much fewer defects, compared with traditional business systems.

The term was first coined by John Krafcik, a Massachusetts Institute of Technology
(MIT) scholar in 1988. Lean is the set of "tools" that assist in the identification and
steady elimination of waste which can be applied in different spheres of activity. Lean
implementation is focused on getting the right things to the right place at the right time in
the right quantity to achieve perfect work flow, while minimizing waste and being
flexible and able to change.

LEAN RETAILING
It is a set of principles of tools for delighting customers by reducing all kind of wastes &
non value added activities with creative involvement of all the employees in the system.
Lean retailing is an approach to re-inventing a long established business practice by using
new information technologies to cut out waste and make operations more profitable. Lean
bounds all employees in an organisation for carrying out operations in a simple manner.

Waste in lean is anything which does not add value. In lean waste is measured in
consumption of resources-time and capital. The different waste in lean are
• Defects
 • Out of stocks
• Waiting
• Non- utilization of people talent
• Transportation
• Inventory
• Motion
• Extra process

Major attention is given to "just in time" delivery to cut inventory costs, and to
investments in IT infrastructures to allow stores to share sales data in Real Time with
their suppliers. It focuses on providing the full value that consumer desire with the
greatest efficiency and least pain. The key is to reduce processes and effort to key value.

Benefits of lean Retail are:

• Good store upkeep
• Simplifies store operations
• Multi Skill
• Improved supply chain visibility
• Improved operational performance
• Customer Satisfaction ensured by total employee involvement
• Better bottom line of business

The major tools used in lean retail are

1) Kaizen
The word means continuous improvement. The word ‘kai’ means change to and ‘zen’
means good. Kaizen involves every employee in making change--in most cases small,
incremental changes. It focuses on identifying problems at their source, solving them at
their source, and changing standards to ensure the problem stays solved. These continual
small improvements add up to major benefits. They result in improved productivity,
improved quality, better safety, faster delivery, lower costs, and greater customer
satisfaction. On top of these benefits to the company, employees working in Kaizen-
based companies generally find work to be easier and more enjoyable--resulting in higher
employee moral and job satisfaction, and lower turn-over.

Kaizen reduces waste in areas such as inventory, waiting times, transportation, worker
motion, employee skills, over production, excess quality and in processes. Kaizen
improves space utilization, product quality, use of capital, communications, and
production capacity and employee retention. Kaizen provides immediate results. Instead
of focusing on large, capital intensive improvements, Kaizen focuses on creative
investments that continually solve large numbers of small problems. Large, capital
projects and major changes will still be needed, and Kaizen will also improve the capital
projects process, but the real power of Kaizen is in the on-going process of continually
making small improvements that improve processes and reduce waste.

2)7 S
It is a Japanese technology of world class housekeeping. It is a part of establishing
visual work place which is a part of kaizen and a component of lean manufacturing. The
concept of PEEP (place for everything, everything at place) is observed in 7S.

The 7 S stands for

• Sorting- what is needed and what is not needed
• Shine- the place after sorting
• Systematic- systematically arranging the stored materials
• Standardise-standardize the arrangement
• Self Discipline—to maintain what we have
• Safety- for all employees
• Spirit-in employees

3) Multi Skilling
It helps employees to realize their actual potential .It is a continuous
learning process. Training activities are conducted regularly. This enables an
employee to perform different kind of work. Training with feedback is of paramount
importance. Training could be cross-functional or in related fields as per the
requirements of the organization’s business demands and a person’s own career
aspirations. It is important that the employee should be keen on getting trained and
not just do it as a stop gap option. Multi-skilled employees are a great asset to an
organization, irrespective of industry conditions. From the perspective of the
employee, multi-tasking would allow them to become diversified and maintain high
levels of motivation and enthusiasm. The most obvious advantages of multi-skilling
are—retention of employees and avoiding of retrenchment.

4) Kanban
This is type of a production system. The word Kan means visual in japan
and ban means card. So it s a visual card triggers action. It is highly responsive to
consumers. It is directly associated with just –in-time delivery. It involves industrial
re engineering. It is continuous improvement
They are two types of kanban
a) Min-Max
b) Bin1-Bin 2
There is a Kanban card attached to every BIN. The card comprises the description
such as product type, place of availability (market or factory), to whom to contact,
phone number and mail id. When the inventory in the BIN is used up the card goes to
the Kanban post and it is ensured that the BIN is replaced before the other BIN gets
empty.

The benefits of Kanban are

• Reduces inventory and product obsolescence.
• Reduces waste and scrap
• Provides flexibility in production
• Increases Output
• Reduces Total Cost