Lean enables companies to increase the responsiveness and flexibility of their processes, and significantly reduce lead times and inventories. What's more, Lean takes us "out into the field", moving away from computers to make flows visible, with visual management , pull flows, "piece by piece" flows, and so on.
Under these conditions, one might think that this would eliminate the need for medium- to long-term planning, which may seem superfluous?
In fact, the opposite is true: reactivity, short deadlines and flexibility, as well as delegation at field level, need solid medium- and long-term planning.
Read on to find out more!
Why?
Firstly, to formalize and keep up to date customer lead times and inventory policy choices: in which markets do we need to deliver to customers by letter-read, within 1 week, etc., and can we deliver certain products to order, etc.? Depending on the constraints of the logistics and industrial system (what we'll call "the Supply Chain "), what stock levels will be required? Is this compatible with the company's financial capacities? What changes are needed to adapt to and anticipate market trends? The lean website can be used to define the optimum storage points for a given flow, but this must be done in line with customer needs and company strategy. The answer to these questions lies with General Management. It's up to the company's various functions to identify and prepare the elements required for decision-making.
But this is just one of the entry points!
Secondly, to prepare for the balancing of expenses against resources at the best economic conditions.
The flexibility of lean solutions relies on a good load/capacity balance, which is regularly re-evaluated and adjusted: based on assumptions about business volumes and variability, what capacities should be installed internally, and externally for supplies? If necessary, intermediate stocks should be set up (or eliminated ....). To be reactive, you need to have components and raw materials available within the required lead times!
Depending on the constraints of the flow system, it may be profitable to smooth activity in order to stabilize production and supply volumes. This means deciding to anticipate sales (by building up inventories) or to spread out production (by extending customer lead times).
Here again, the choices made will be the result of trade-offs between the targeted ideal, the company's financial possibilities, market constraints and system constraints.
These decisions are the responsibility of the company's General Management.
Finally, to guarantee the alignment (coherence) of these options and tactical choices throughout the supply chain, across all corporate functions. This may seem obvious, but it's not easy to achieve.
Medium- to long-term planning, drawn up and shared at Executive Committee level, is the answer. Here too, General Management is responsible for making the necessary decisions, sharing information and monitoring the implementation of decisions.
So don't imagine that the path to operational excellence ( lean) makes these medium- to long-term planning stages, which cut across all corporate functions, unnecessary.
On the contrary, they are a prerequisite for moving towards Excellence and ensuring its operational sustainability.
The experienced reader will have recognized the ICP process from the above. More than ever, this SOP process is the key to the performance of the flow system, and is also the key to the development of flexibility and responsiveness.
