Analysis and improvement of the lean value networks
The paper describes how to use the principles of Lean Manufacturing to manage the value (supply) networks. This level of management is named a „macro" level. The fundamental lean tool for managing the value networks is Extended Value Stream Mapping (Macro-Mapping). Within the mapping process the material and information flows are depicted for the given value stream running through several cooperating enterprises. The value stream is defined for the particular product family. Here product family is seen from the technological point of view (not functional). Section 1 presents briefly the Lean Manufacturing philosophy. Lean Manufacturing is a worldwide proven approach for the improvement of production processes through eliminating wastes. The results are better quality, lower costs, and shorter lead-time. It also includes decreasing manufacturing lot sizes, which gives enterprises the ability to reach a higher level of flexibility. Single enterprise could gain many benefits after implementation of Lean Manufacturing but not all of them could be exploited without the propagation of Lean approach to the suppliers' and distribution networks. The paper interprets the Lean principles for area of supply network management. Authors use Value Network term to emphasize the role of the production facilities, where the value is created. Section 2 describes the new Lean tool to manage the Value Networks provided by Lean Enterprise Institute - Extended Value Stream Mapping. The tool is derived from the proven method of Value Stream Mapping addressed to the analysis and improvement of the single enterprise. Value Stream encompasses ail the actions performed on the product from raw materials to final products as well as accompanying information flows. The value stream could be defined on the „micro" level - within the single enterprise and on the „macro" level' - for the whole Value Network of several cooperating enterprises. For Extended Value Stream Mapping also the Macro-Mapping term is used. Section 2 shows the overall approach of Macro-Mapping to the analysis of the complex Value Networks. Section 3 depicts how to use the elaborated map to design the new Macro-Value Steam, improved according to the Lean measures (e.g. Lead-Time, Demand Amplification). The first step of the improvement relates to the changes within single enterprise, however it may also address the requirements of the whole Value Network. The benefits could be estimated. The next step is to redesign the way how companies cooperate together (e.g. using electronic Kanban system instead of purchase orders) as well as introduce the changes to the transportation and warehousing system. The third step is suggested for new investments and helps to allocate the production facilities geographically. It could be also used to justify the collocation of some suppliers with OEM. Section 4 describes the exploitation of Macro-Mapping for analysis and improvement of the relations between customer and supplier. It is based on the example of two production companies - 1st and 2nd tier suppliers. The example shows what kind of information could be obtained from the map and how to use it. The Macro-Mapping could be the first step for supplier and customer to built real win-win relation. Section 5 is the summary and gathers the conclusions for using the Lean Manufacturing philosophy and Extended Value Stream Mapping method to manage the value networks.
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