Supercharged Supply Chains

CHAPTER 16Business Improvement: Being Lean and Agile

This chapter is not an in‐depth discussion of Lean or Agile. Many books already cover those techniques well. Rather, this chapter addresses how Lean and Agile can contribute to excellence in Business Planning and Execution and, consequently, improve the overall performance of Business Excellence Planning:

FIGURE 16.1 Business Excellence Planning

Let us be clear, Lean is not about headcount reduction; it is about improving process velocity through the elimination of waste. One way to measure Lean progress is cash‐to‐cash cycle time.¹ All too often, senior executives say their companies are very Lean because they have reduced headcount, but this is not the purpose of Lean. If headcount is reduced to save cost or satisfy shareholders, then who in the future will want to improve business results? Who will be motivated to work on improvements if improvements mean elimination of their, or their colleagues', jobs?

Additionally, with improved process velocity, the business should be able to do more. In this example, fewer people are needed to operate high‐velocity processes rather than many people to operate broken processes having lots of embedded waste. People who are freed up should then be trained to support other parts of the growing business. In order to do this the business must have an improvement strategy based on delivering ...