1. Identify Value

Sometimes in Operations we can spend a lot of time and money doing work that seems important to us. 

Thinking about the first Lean principle (Identify Value) can really help us see clearly if this is worthwhile.  But how….?

Value : The regard that something is held to deserve; the importance, worth, or usefulness of something: www.oxforddictionaries.com value-proposition

The key different that Lean adds to this is that value (i.e.regard, importance, worth and usefulness) must only be seen from the eyes of the paying customer.

Therefore, Value is a defined as how well a product or service meets a customer’s requirements. If it’s something a customer is willing to pay for, it has value.asda-self-service-checkout

Speaking plainly, the different activities performed during a process either add value to the end product or they don’t.  So activities can be either

  • value-add activities – make a product or service more valuable from a customer’s point of view
  • non-value-add activities – don’t add any extra value to the end product or service from the customer’s perspective

To determine if a procedure or activity adds value, you need to be able to answer “Yes” to three questions:

  • Does it fulfil a customer’s need or preference?
  • Does it change the product or service in some way?
  • Is it done right the first time in the process?

bigstock_Cost_Value_Matrix_-_Arrow_And__9732935Be warned: Understanding this this may result in certain tasks, people or whole departments having an unpleasant shock when they realise that what they do and feel is important, does not add any value to the customer!!

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Operations Excellence – finding your way