Many of you have read these e-bulletins. Most of the articles were discussing various issues about “production” matters. But what is production? Most of us think of production as the actions of changing the form, fit and function of raw materials with tools or machines. It is all done on the production floor, right —- Wrong.
Production is also the creation of custom designed products to meet a customer’s needs. Production is the writing of computer software. Production is the development of quotes for a customer. Production is the processing of purchase orders for payment; or customer orders for invoicing. Production is the processing of medical bills to invoice a patient. Production is the processing of insurance claims.
Each of these activities has multiple steps and requires input to produce a “finished product” or end result. The three basic elements of a production stream are input: the raw materials such as physical components, information or paper work that must be used to make the finished product. The second element is the output: the final result that the customer is paying for; (This could be an internal or external customer). The third and final element is the process: the steps necessary to convert the input materials into the final product to send to the customer. The principles used in manufacturing can also be employed in any of the process flows listed above. Each of these process streams requires similar tracking and recording actions: the scheduling of resources; release of work to the process stream; recording the progress of the batches of work; tracking the flow of a particular piece of work; and confirming the completion of a particular order are all actions that must be monitored and controlled to have an efficient process flow.
The Theory of Constraints, Lean Principles and Six Sigma philosophies can be applied to any business process either on, or off, the production floor. In fact, there has been a corollary theory of Lean called “Office Lean” which applies Lean Principles in any office setting.
The challenge is to approach the business problem with an open mind. Look at the problem as a process flow problem, rather than a narrowly defined task problem. The skills and knowledge gained from the APICS body of knowledge can be applied to any business discipline to produce positive results.
In conclusion, I would say that the problem solving skills and improvement theories learned in production operations can be applied throughout the business. You can address flow problems in any functional department with the same techniques you use in production. Accounting and Finance, and Sales, as well as manufacturing can benefit from using the major improvement philosophies of Constraints Management, Lean Principles and Six Sigma to improve business performance and profits.
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