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The Lean Benchmark Report

Exceeding Expectations: Behind the Numbers

We took a closer look at those companies that reported exceeding expectations in Table 4, both within the top-three industry sectors (Figure 6) and by the top-two software cate- gories (Figure 7).

When it comes to exceeding expectations by industry sector, automotive companies have been in the forefront for many years (Figure 6). Lean has been driven by the major OEMs and has been considered a requirement for doing business in this sector for close to ten years. Automotive suppliers often co-locate plants near their customers and have sophis- ticated systems that enable them to synchronize in-line production between facilities. Not only are forecasts and plans shared, but also sequence numbers are simultaneously as- signed by their customer so that materials are received just-in-time (the right line at the right time) for assembly.

Although industrial equipment and machinery companies may have been slower to adopt Lean, companies in this industry sector are also reaping rewards from their Lean initia- tives. As shown in Figure 6, improvements in manufacturing and supply chain flexibility have exceeded expectations for a quarter of these firms; and they appear to be on the way to exceeding expectations in other core performance areas as well.

Figure 6: Exceeding Expectations by Industry

Reduce MFG costs and supply chain

8%

13%

25%

21%

Customer Service

13%

4%

21%

Product Quality

10%

4%

Improve MFG and supply chain flexibility

11%

12%

23%

21%

Inventory and assets

12%

4%

0%

5%

10%

15%

20%

25%

Automotive

Industrial equipment manufacturing

Metals and metal products

Source: AberdeenGroup, March 2006

We further analyzed the data relative to those organizations that reportedly exceeded ex- pectations to understand if there was a direct correlation between this level of perform- ance and major software categories (ERP vs. homegrown vs. Lean Specialty/MES). Fig- ure 7 shows the relative performance of ERP and homegrown (we have not included Lean Specialty/MES implementations because their numbers are statistically insignifi- cant).

All print and electronic rights are the property of AberdeenGroup © 2006. 16 • AberdeenGroup

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