We are making outstanding progress through our Lean journey at this point! If you have been following along, we have identified our customer's desire. We then identified the steps of our process that bring value to the customer. Last week we worked to streamline our product flow. If you haven't had the opportunity to read the previous blogs, you can find them here.
The next step in the Lean Process is to create Pull Systems. Let's first discuss what a Pull System is. The best analogy for a Pull System is that of a Supermarket. Have you ever witnessed the folks going through stocking shelves? If you have, you probably noticed they don't stack overflow products on the floor or pallets next to their place on the shelf.
This concept is key in Pull Systems. The "Pull" of the customer triggers the re-stocking of the shelves. When the customer makes a purchase and removes it from the shelf, the team refills the void as needed. In a Pull System, the customer dictates the pace.
How often do we dictate our own pace in the context of work? We set goals based on our machine capability, our labor availability, fill in the blanks. We then get frustrated when we over-produce and create bottlenecks in our process.
So why does it matter if we over-produce, we will use the product eventually? Lack of a Pull System can have huge impacts on financial performance. When you use a "Push" System you start tying up additional raw material into your Value Stream. All the extra work you have laying between work centers has a cost associated with it. Now you have more dollars invested in unfinished goods.
Companies don't realize revenue until they sell a finished product or service. If you can move your product or service through your process more quickly, you will reduce costs and increase customer satisfaction.
How do we determine the pace? Just like our Supermarket example from earlier, the customer dictates the pace. In simple terms, if your customers purchase or "pull" 400 widgets from your company every day and you work 400 minutes a day. You will need to "Pull" one widget through your process every minute. All the processes that support should be capable of meeting that demand.
Creating a Pull System can be daunting. Some industries find it very difficult to implement Pull Systems. This can be due to their sector or the maturity of their forecasting systems. Pull Systems are most effective when you are great at forecasting. The good news is you are not in this alone.
At StonePath Business Solutions, we love helping companies be their absolute best! We partner with our clients to build Better Leaders, Better Teams & Better Process through Lean & Six Sigma tools & techniques along with Talent Strategy Solutions and Leadership Training and Coaching. Drop us a line at mystonepath.com and let us know how we can meet your customer's desire!