Lean production philosophy when one adds value while

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Lean Production Philosophy When one adds value while doing more with less is the essentials of lean production philosophy. When manufacturing is associated with lean production it then takes on the meaning that eliminates waste sources by shortening the time from the point of the customer’s order to
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COST ACCOUNTING 4 building the product to shipment. Office administration and service industries are using this term more frequently in different types of industries. In this philosphy, there are work teams, gain sharing, flexible work assignmnets, enhanced communications and employment security that is also using this pioneering practice. Traditional and Lean Management Differences There are noticeable differences between traditional and lean management. Several of these differences are as follows: Traditional Management Lean Management Projections are the center of products/services Made to order products/services Refill inventory are designed by products/services Customer orders are covered by products/services Months and weeks shown in times cycle Days and hours shown in times cycle Departmental functions design the departments/stations Product/service flow design the departments/stations Samples and random checks is to review quality Each station and department review quality Improvements are not identified by employees because they have little to no input Improvements are identified by empowered employees Adjustments in schedules are difficult and inflexible Adjustments in schedules are easy and flexible Costs are difficult to control and also increasing Costs are controlled and decreasing Lean methods are very important in all industries and thinking the lean way is helpful to eliminate irrelevant administrations in the office. Budget Preparation and Reductions To assist Dr. Smith in preparing for and reducing the budgets, the need to conclude what are fixed and what are variable costs is necessary first. Invariable costs, otherwise known as fixed, are known as expenditure(s) that do not fluctuate no matter the activity levels. Examples of costs that are fixed are rent and insurance. The opposite is invariable costs that fluctuate
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COST ACCOUNTING 5 depending on the activity level changes. There are also costs that are a mix of fixed and variable that combines elements of both (“Cost Classifications,” n.d.). An established amount of $94,000.00 must be cut from the budget by Dr. White. While making decisions on cutting costs, there should not be any negative impacts on the clinic’s operations or cause the quality care level from the clinic to be less. The following will give a
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