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Activity -
The task or function that when performed produce
a product or service.
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Agile - An
Agile organization is one that is nimble and can
turn quickly in reaction to market changes.
Agility has become a requirement for success in
today's rapidly changing, globally competitive
landscape.
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Andon board -
A term for a visual control device that allows
anyone to see and manage the real-time status of
the value stream.
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Appreciative
inquiry - An approach to bringing change to
organizations that builds on the holistic
history of positive stories and successes.
Appreciative inquiry engages people to link the
positives of the past with current capabilities
to consciously construct a better future.
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Auto-documentation - Building into the
process the ability to automatically document
both the process and the output of the process.
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Baka yoke - A
term for the design of a process so that it is
impossible for mistakes to be made. Also known
as error proofing.
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Balanced flow
- Smoothing the workload throughput and variety
such that the total available resources are
applied consistently; avoiding overburden or
underused resources when performing the
activities of a value stream.
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Batch - A
collection of multiple items for processing at
some future step.
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Bottleneck -
Any point in the value stream where the capacity
to produce work is less than the work needed to
be performed.
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Business friction
- Barriers to workplace productivity that build
when the five M's of operational performance are
not aligned with the stakeholder value
priorities of a value stream and with each
other.
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Capability -
A functional combination of expertise and
resources necessary to produce a product or
service. Example capabilities are project
management, requirements analysis, training,
risk management, quality assurance, etc.
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Catch-ball -
A consensus building, iterative process that is
used in policy deployment to develop the vital
few initiatives to link organizational strategy
to tactical operations.
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Complex system
- A holistic view that recognizes everything is
connected to everything else. For example,
business environments are complex systems where
you can't just do one thing; that every action
has multiple planned and unplanned reactions.
Lean Office is an approach to improve complex
business systems while reducing the risk of
unintended consequences.
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Constraint -
Anything that limits the value stream from
achieving higher performance; i.e., throughput,
cycle time, quality.
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Continuous flow
- The constant flow of work from one activity to
the next with no interruptions or downtime. In
an ideal continuous flow system, the work time
and the cycle time are identical.
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Continuous
performance improvement - An approach that
engages employees in an unrelenting focus on
improving the effectiveness and efficiencies of
the value streams of an organization.
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Cost of
non-quality - The financial impact due to
the production of waste by the organization.
Here waste refers to all seven wastes and their
financial impact, not just the waste of defects.
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Current state
value stream - a snapshot view of a value
stream as it exists at the time of observation.
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Customer -
The internal or external recipient of the
product/service produced by an organization's
value stream.
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Customer value
- The worth to the customer of the
product/service produced by an organization's
value stream. Sometimes used interchangeably
with stakeholder value.
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Cycle time -
The wall clock time necessary to complete one
item of value. For example, the cycle time to
process one order is the time from when the
order is received to the time the order is
complete. Also known as Service Time.
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Effectiveness
- Maximizing the performance of the entire value
stream; sometimes at a cost of reduced
efficiency of certain individual activities.
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Efficiency -
Maximizing the performance of a single activity
of a value stream.
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Error proofing
- Building into the process the ability to
prevent errors from occurring and/or the ability
to immediately recognize errors when they occur.
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Feedback -
The output of an activity that in turn causes a
positive or negative reinforcement for other
activities. An example of a positive feedback
loop is selling razors increase the number of
razor blades sold. An example of a negative
feedback loop is building roads increases
traffic congestion. Feedback is an important
aspect in designing value streams.
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First in, first
out - The order something is taken from a
queue or batch; also known as FIFO.
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Five M's -
Five terms beginning with "M" that are the
primary resources of an organization and the
drivers of operational performance.
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Five S's -
Five terms beginning with "S" used to create a
clutter free workspace.
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Flow - The
movement of information or material from one
activity to the next in a value stream.
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Four D's -
The four stages of a cycle of continuous
improvement associated with the "appreciative
inquiry" approach.
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Future state
value stream - a snapshot view of a value
stream as it might appear to an observer at some
point in the future.
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Gemba - A
term for the workspace of an organization. The
workspace is an important concept in Lean Office
because that is where stakeholder value is
created.
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Hoshin kanri
- A term for a top down planning process that
ties strategic direction to the vital few
tactical initiatives for realizing the desired
business outcomes. Also known as strategy or
policy deployment.
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Just-in-time
- An activity of a value stream occurring just
prior to its being needed, with the assets
needed to produce the value of that activity
becoming available just prior to the activity
being performed.
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Kaizen - A
term for incremental improvement. Kaizen is a
people and process-oriented way of thinking as
opposed to innovation- and results-oriented
thinking.
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Kaizen workshop
- A term is used to describe extended
improvement workshops (generally a week long)
for reengineering a value stream.
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Kanban - A
term for a visual indicator that it is time to
execute an activity in a value stream.
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Kitting - A
term for collecting all of the required
resources and information to perform a
subsequent activity in the value stream.
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Last in, first
out - The order something is taken from a
queue or batch; also known as LIFO.
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Lead time -
The time from when a request is made for a
product or service until the product or service
is available.
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Lean - An
umbrella term for a powerful combination of
techniques to increase business performance.
Lean is a term used in the U.S. for what was
originally known as the "Toyota Production
System". Lean was developed by Toyota to improve
the performance of their manufacturing
environment. Also referred to as Lean Production,
Lean Thinking, Lean Enterprise, etc.
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Lean office -
The application of Lean techniques in an office
environment.
-
Lean production
- A manufacturing approach attributed to Taiichi
Ohno of Toyota in the early 1950's. It defines
work as a series of steps performed by
cross-functional teams under distributed
control; with the standardization of each of the
five M's of operational performance. Lean Production concepts are now being used to
dramatically increase office worker
productivity.
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Matrix management
- An organizational structure that establishes
roles and responsibilities for each domain of
its value matrix. Matrix management structures
can have varying levels of formality; from
generally understood but unwritten
responsibilities, to organizational charters
documenting specific cross-domain roles and
responsibilities in detail.
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Mass
customization - The ability to produce a
high volume throughput that is tailored to each
individual customer of the product or service.
-
Mass production
- A manufacturing approach attributed to Henry
Ford in the early 1900s. It defines work as a
series of specialized activities under
centralized control; with the standardization of
product components. Today mass production is
still the basis of most processes within the
office environment.
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Mistake proofing
- Designing the value stream so that it is not
possible for errors to occur.
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Monument - A
role or tool within the value stream that is
very expensive to operation and maintain. As a
result the organization feels it must insure the
monument is always fed by establishing queues
and special handling; adding costs and reducing
flexibility.
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Muda - A term
for waste.
-
Non-value add
- Activities that do not create the appropriate
stakeholder value.
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Outcome - The
measurable results of work performed by the
organization. Outcomes are set in advance of the
work performed to help align the organization
with a defined strategy.
-
PDCA - The
four stages of a cycle of continuous improvement
popularized by W. Edward Deming.
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Performance
principles - A rule or standard used to
align day-to-day tactical decision making with
organizational strategy and value propositions.
Value statements establish worth; a principle is
a standard for achieving that worth. If values
are the what; principles are the how.
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Poka yoke - A
term that means mistake proofing.
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Policy deployment
- A top down planning process that ties
strategic direction to the vital few tactical
initiatives for realizing the desired business
outcomes. Also known as hoshin kanri or strategy
deployment.
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Policy
intervention - The tendency for an
initiative to be delayed, diluted, or defeated
by the natural feedback responses of the system
to the initiative itself.
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Principle - A
rule or standard; especially of good behavior.
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Productivity
- The amount of stakeholder value produced from
a given amount of resources. For example,
productivity can be measured as the revenue per
employee.
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Process -
Rules for performing activities. Process rules
describe when an activity is to be performed,
how it is performed, and what resources should
be used.
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Pull system -
When the downstream activity pulls work from the
activity that occurs prior to it. The opposite
of a push system.
-
Push system -
When the upstream process pushes work to the
activity that follows it. The opposite of a pull
system.
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Ramp-up time -
The time it takes to be fully productive on a
new task.
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Resource -
The assets of the organization including:
people, products, tools, and materials.
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Right sizing
- Designing the resources of a value stream such
that they are just sufficient to perform the
balanced flow of work throughout the value
stream.
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Role - A
collection of activities performed by one or
more individuals of an organization.
-
Roles and flows
- One form of a value stream map that focuses at
a particular level on the activities of a value
stream.
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Segregate
complexity -
Establishing parallel branches in a value stream
where each branch is optimized to handle the
complexity of the work assigned to that branch.
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Service time -
The wall clock time necessary to complete one
item of value. For example, the service time to
process one order is the time from when the
order is received to the time the order is
complete. Also known as Cycle Time.
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Seven information wastes
- The seven forms of non-value added information activities.
The seven information wastes listed here are slightly
modified to apply to the office environment.
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Silo - A term
describing a functional area of an organization,
e.g., customer service, that has very little
communication or integration with other
functional areas. Communication only flows up
and down within the organization - forming a
silo. In an office environment having a "silo
view" is the opposite of having a "system-wide
view."
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Six sigma - A
statistical approach for reducing variability of
a value stream.
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Span-of-coordination - The reach of an
individual's or team's responsibilities;
involving both leadership and support
responsibilities in addition to authority
(span-of-control). Span-of-coordination is an
important concept for maintaining the
system-wide performance of Lean Office value
streams.
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State - A
snapshot view that provides an observer the
picture of the situation.
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Stakeholder -
Any party that has an interest in the
product/service produced by an organization's
value stream.
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Stakeholder value
- The worth of the stakeholder's interest in the
product/service produced by an organization's
value stream. Sometimes used interchangeably
with customer value.
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Stop-the-line
- An approach to managing a value stream that
allows anyone to halt work while defects are
occurring so they are not propagated through the
system.
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Strategy
deployment - A top down planning process
that ties strategic direction to the vital few
tactical initiatives for realizing the desired
business outcomes. Also known as hoshin kanri or
policy deployment.
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Supermarket -
A collection of a queues where the minimum and
maximum amount of inventory that can be stored
in each queue is regulated. Supermarkets form
the boundaries between push and pull systems of
a value stream.
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System-wide view
- Evaluating the performance of the organization
by considering the complex interactions between
all of the activities that produce value added
work – not just those of a single functional
department or product line.
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Takt time - A
term for the beat or rhythm of the activities
that make up a value stream. For example suppose
the takt time of a value stream is set at 30
minutes. This means that the activities are
designed and resourced so that every step in the
value stream is completed every 30 minutes. When
every step of the value stream executes to the
same beat or tact time, the output of each
upstream step is finished at the same time each
downstream step becomes ready for its input.
This helps continuous flow; reducing wait time
between value stream steps by synchronizing
their start and stop times.
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Theory of
constraints - Streamlines operations by
focusing on end-to-end throughput, not
individual efficiency. Seeks to identify
bottlenecks and provide alternatives for their
elimination.
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Throughput -
The velocity of work performed by a value
stream. Throughput counts the units of
stakeholder value produced in a given time.
-
Toyota production
system - The various techniques developed by
Taiichi Ohno of Toyota to increase manufacturing
performance. Outside of Toyota these techniques
are better known as "Lean”- such as Lean Production or
Lean Office.
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Value -
Something of worth in usefulness or importance
to the possessor.
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Value add -
The activities that transform the resources of
an organization into a product or service
someone is willing to pay for.
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Value equation
- Received Value = Created Value – Created
Waste. Where Received Value is what the
stakeholder is willing to pay for, Created
Value is the value produced by the
organization, and Created Waste is the
non-value produced by the organization a
stakeholder is not willing to pay for. Each
variable of the value equation is calculated at
the price or the fully burdened cost plus profit
margin.
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Value matrix
- A matrix that is defined for each organization
by the multiple domains of stakeholder value
creation. Every organization has a value matrix
consisting of at least two or more of the
following domains: 1) customer, 2) employee, 3)
region, 4) product/service, and 5) process.
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Value priorities
- The relative ranking of the stakeholder values
generated by a single value stream.
-
Value statement
- Establishes the way or direction that
stakeholder worth or usefulness is created by an
organization. Value statements say what the
organization is committed to do. In contrast,
principle statements say how the organization is
going to do it.
-
Value stream
- A holistic collection of value added and
non-value added activities that chain together
to create a product or service.
-
Value stream map
- The visual documentation of the activities
creating stakeholder value and how information
and resources flow between them.
-
Visual controls
- The methods to see and manage the real-time
flow of work through a value stream.
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Wall clock time
- The total elapsed time from the starting point
to the ending point of an event.
-
Waste -
Anything that does not directly add to or
support the creation of stakeholder value.
-
Work-in-process
- Material or information resources currently
in-work and not complete within a
value stream. For example batches of sales
orders that are waiting in a queue for further
processing are work-in-process. Also known as WIP.
-
Work - The
execution of activities that consume resources
and produce new a product or service.
-
Workspace -
The area where stakeholder value is created.
This is an important concept in Lean Office
because the design and state of the workspace
has a direct impact on the efficiency and
effectiveness of a value stream.
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Work time -
The wall clock time that is spent performing
direct value added activities within a value
stream. For example, the work time on an order
may only be a half hour; although the total time
from order start to completion might be 8 hours
(its cycle time).
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