Presentation715 - Lean Accounting with Lean Manufacturing...

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Unformatted text preview: Lean Accounting with Lean Manufacturing By Chen Chen Ruoran Guo Overview-Part 1 The Rise of Lean Production What is Lean Manufacturing Two Pillars Main Principles of Lean Value Creation Seven Types of Waste Standard Cost Accounting Doesnt Fit What is Lean Accounting The Rise of Lean Production Toyota Production System (TPS) =Lean Manufacturing =Lean Production Toyota - birthplace of lean production Taiichi Ohno - father of Toyota Production System (TPS) After World War II - Japanese manufacturing industry Market was smaller What is Lean Manufacturing? Lean Manufacturing uses less of everything compared with mass production-half the human effort in the factory, half the manufacturing floor space, half the investment in tools, half the engineering hours to develop a new product in half the time. Also it requires keeping far less than half the needed inventory on site, results in fewer defects ... What is Lean Manufacturing? Lean Manufacturing A strategy designed to achieve the shortest possible production cycle by eliminating waste. The goal is to reduce inventory and produce only to meet customer demand. Benefits include lower costs, higher quality and shorter lead times. - Lowdown on Lean Accounting The Two Pillars of the TPS TPS is built on two pillars: Just In Time supply exactly the right quantity at exactly the right time, at the exactly the correct location Quantity control Technical heart of TPS The Two Pillars of the TPS Jidoka Intelligent automation or automation with a human touch Prevents the production of defective products Eliminates overproduction and Focuses attention on understanding the problem and ensuring the it never recurs. Main Principles of Lean 1. Define value Define value precisely from the perspective of the end customer 2. Identify the waste Identify the entire value stream for each service, product or product family and eliminate waste . Value Stream (VS) - ALL the activities and processes in your company everything that you must do to design, order, produce and deliver your products Main Principles of Lean 3. Make those actions that create value flow Main Principles of Lean 4. Only make what is pulled by the customer- what the customer wants only when the customer wants it. No signal = no production Signal = produce exactly what is asked for, no more, no less, and make it right the first time 5. Peruse perfection systematically and continuously remove the root causes of poor quality with the ultimate goal of achieving Zero Defects Value Creation Value - what the customer actually requires and is willing to pay for Value Creation Production operations can be grouped into three types of activities: Value-added activities Activities which transform the materials into the exact product that the customer requires Non value-added activities activities which arent required for transforming the materials...
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Presentation715 - Lean Accounting with Lean Manufacturing...

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