The LEAN Business Model and Customer-Related Processes
The core goal of LEAN is to minimize waste. Many organizations would benefit if they applied a broader and less literal definition to the term “waste”.
It’s obviously beneficial to any manufacturing organization to identify and correct problems in their processes that create nonconformities. This will maximize their yield, and minimize the costs associated with wasted materials and time.
Applying Lean to Customer-Related Processes
In addition to directly applying the LEAN system to their manufacturing, organizations would also benefit from applying LEAN to their customer-related processes. In many cases, there’s a strong argument to be made that the application of LEAN to customer-related processes will provide an even greater long-term benefit compared to the reduction of manufacturing waste.
Understanding how customers value a product is essential to the success and growth of a manufacturer. However, this is often overlooked or misunderstood. Marketing, Quality, and Design departments can almost always do better to understand their customers’ needs, and how customers value a particular product. Note that we are discussing product “value”, and not simply product “cost”.
Cost differences between similar products are only one aspect of value. Consistency, quality, lead times, and customer service are all examples of other facets of value. It takes superior relationship-building with customers, and a great deal of empathy, to reach an understanding of how customers truly value a product.
Here’s an example of recognizing product value in the Optometric/Ophthalmic professions:
Doctors are obviously busy people. And to apply LEAN principles to their profession, maximizing the efficiency of their “chair time” is incredibly important to the success of their business. Now consider two separate manufacturers of a specialized custom contact lens:
Manufacturer A focuses on providing a quality product with excellent and consistent timeliness of manufacturing. However, Manufacturer A uses a carrier service that provides inconsistent delivery times, with the transit time often being two days. But, because of the carrier’s logistical challenges and general disorganization, there are a significant number of orders that take a week or more to be delivered or are perhaps even lost-in-transit.
Manufacturer B also makes a quality product and has excellent timeliness with their manufacturing. However, Manufacturer B uses a different carrier service that reliably delivers the product to their customers within 2 days.
When you consider the importance of “chair time” efficiency and the challenges of scheduling patients, it’s obvious that doctors are going to assign more value to Manufacturer B’s product.
The Bottom Line:
Companies that have a truer understanding of how their customers value their product are going to focus on the most important opportunities for improvement. This leads not only to better customer satisfaction and growth, but also eliminates the vast amount of waste that is created when a manufacturer mis-prioritizes the goals for their Marketing, Quality, and Design departments.
Sept 5th, 2024
Written by:
Rob Ahern
Valley Contax Operations Director