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Various strategies and philosophies have been developed to achieve effective results in the supply chain. One of these applications is the lean philosophy, which is a cost and time orientated strategy. While businesses want to adapt to rapidly changing market orientations and consumer demands, they also desire to achieve this goal at minimum cost. Lean supply chain management is a strategic application arising from this goal.
What is Lean Supply Chain? What is Lean Transformation?
In a supply chain, "wasteful" elements that may occur in all operational processes starting from raw materials to product delivery are analyzed, identified and eliminated. In this sense, with the prevention of waste, cumulative costs are reduced and delivery time is saved. This strategy is called "lean". The adoption of this strategy as a philosophy by businesses is known as "lean transformation". In the lean supply chain, not only in the raw material and material process in the production phase, but also in other operations such as stocking, logistics and other operations until delivery to the customer, all stages are considered as a whole of processes.
Lean Supply Chain Management and Lean-Agile Mix
Lean philosophy was born from the Toyota production system. Although conceptually born in Japan, the term "lean" as a term has no equivalent in Japanese. The reason for this is that J.F. Krafcik from the USA, who introduced the concept and brought it into the literature and is also known as the CEO of Google smart cars Waymo today, defined this Japanese-specific philosophy with the English word "lean". This word is translated as "lean" in our language. We can express the lean philosophy as a kind of cost recovery, but we would like to add that it does not consist of this and that it is based on a philosophy and a deep understanding. The Kanban production system constitutes the production part of lean procurement. Other operational processes are strategically managed in line with various analyses to serve the whole. Article on Toyota's JIT - Kanban production philosophy, a fluid and balanced production style: https://www.map.com.tr/tr/otomotiv-tedariginde-jitjust-in-time-kanban/
In supply management, needs are analyzed and action is planned according to the needs and directional forecasts. In lean supply management, some strategies are followed to reduce costs in processes. Solutions are applied to accelerate the progression of cash flow from the customer to the supply chain. It is ensured that the service of products or services is accelerated by eliminating unnecessary costs. In some businesses, lean strategy in supply management can be used in a way that can support each other with agile strategy to reinforce the same goals. However, in the agile approach, there is a strategy described in detail in our other article. Lean transformation, on the other hand, systematically focuses on valuing employees, requires an attitude that values and puts people at the center, and requires process orientation rather than result orientation. It also supports a management approach that addresses improvement in all operational processes at different layers. A continuous improvement endeavor forms the basis of the philosophy.
Lean Procurement and Sustainability
Lean supply chain management encompasses the management of operation processes extending to delivery to the customer, such as operation analyses, strategic planning within the scope of cost analyses, up-to-date and balanced ordering, efficient packaging and storage, efficient logistics (kaizen), efficiency in shipment (loading modelling with simulation) and customs process where losses are prevented, as a whole with lean philosophy. On the other hand, the lean thinking that forms the basis for this is based on the principle of uninterrupted transfer of any value along the value-added chain starting from the raw material and rapidly delivering it to the end user. This means a stance that contributes greatly to sustainability and respects the environment, people and humanity.
Lean supply management is the attitude of presenting all activities to the end user with a holistic management by creating a perfect value by minimizing or completely eliminating waste. This means that the business adopts and demonstrates lean thinking and sustainability both intellectually and in action. Avoiding waste and even eliminating waste means offering the consumer to whom the goods or services will reach as a result of operations that are free from excess cost, waste and environmental damage that may contradict the sustainability approach. The benefits of lean thinking in the supply chain include more efficient and environmentally friendly use of resources, increased customer satisfaction by providing better quality and cheaper products, and contribution to corporate reputation.
Sources: Krafcik JF (1988). Triumph of the Lean Production System, Sloan Management Review, 30(1): 41-52 https://www.lean.org/downloads/MITSloan.pdf Access Date: 24.12.2022
