Lean Supply Chain Management
With intense competition in today’s global economy, it is imperative that organizations try to achieve maximum productivity and profits. One way of doing this is to apply lean principles to business activities. Supply chain management can also be improved by retailers, wholesalers, manufacturers, and logistics service providers by reducing waste and creating value with growth. There are seven wastes that can be identified and eliminated in a supply chain by:
- Supplying only what is necessary, neither less nor more
- Reducing unnecessary and slow movement of goods
- Minimizing inventory, whether it is raw materials, work-in-progress, or finished goods
- Eliminating waiting times by avoiding delays in supply chain steps
- Minimizing movement of machinery and people, especially in warehousing operations
- Adding quality to the product or service by eliminating defects, scrap, and rework
- Avoiding over processing
In addition to following the above rules, a lean supply chain will meet the 5 Rs of logistics – providing the Right PRODUCT, in the Right QUANTITY, in the Right CONDITION, at the Right PLACE, and at the Right TIME.
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