Lean Distribution

Value Chain Synchronization: Creating a Global Lean Replenishment System

Many manufacturing and service companies have initiated their Lean transformation efforts focusing on creating flow within their respective organizations. However, the journey to move closer to becoming a Lean Enterprise requires synchronizing the request from the end user through the entire value chain.

As a manufacturing or service provider how often do we self inflict our own misery. When you look at order entry, do we take time to question whether we can level the production or service request over a longer period of time to better reflect the actual usage? If we asked questions like this we could reduce the spikes in demand to manageable levels.

How do the requests for orders from your distributors match up with end user pull? Are your distributors carrying more inventory because you have not been able to achieve"Just in Time" production?

Lean distribution is a never-ending task. It is a natural extension of eliminating waste in the material replenishment process by synchronizing or linking the entire value chain. As a distributor look around at the materials you manage. What would have to change in order to reduce your space requirements by 75%? What would have to change to reduce your labor by 50% while constantly growing your business?

The world has changed dramatically in the last twenty years. The idea of a small company in the United States partnering with suppliers all over the world is common practice today. The ability to get products and resources at a perceived lower cost has driven many distributors to carry large amounts of inventory.

The transformation to becoming a Lean Enterprise requires global organizations like GE and the armed forces to create effective global distribution services. These services will have to embrace the concepts of eliminating the seven wastes in material replenishment.

Seeing the Seven Wastes of Distribution