Theory and Practice of Supermarkets – Part 2

grocery store market supermarket retail shop
How to use supermarkets correctly …

In my last post, I described how supermarkets work in theory. But while knowing the theory helps, actually creating a working supermarket is much more difficult. Are there situations where supermarkets are not so useful? (Hint: Yes!). And what is needed to have a working supermarket? Let’s find out!

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Theory and Practice of Supermarkets – Part 1

Supermarket in Brazil
All about supermarkets…

Kanban, FiFo lanes, and supermarkets are the backbone of many pull system. Some people even define lean production through its use of kanban and supermarkets. Yet why are supermarkets so useful? First we will look at what exactly makes an inventory into an supermarket. My next post will then give tips and hints on the practical use of supermarkets on the shop floor.

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Why Pull Is So Great!

Rope pulling
Pull your production! (even though the term “Pull” is quite misleading)

One of the most significant insights of the Toyota Production System is its concept of pull production. While often misunderstood, the essence of pull production is a clearly defined limit on the work in progress. Push or pull actually has nothing to do with the direction of the information or material flow. But why does this limit on work in progress make so much difference? Why do pull systems vastly outperform push production systems?

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The (True) Difference Between Push and Pull

Push Pull Illustration
Common, but misleading illustration of push and pull

One of the key differences in lean production is to use pull production rather than push production. While pretty much everyone knows (at least in theory) how to implement it using kanban, the underlying fundamental differences are a bit more fuzzy. But what exactly is the difference between push and pull? Also, what makes pull systems so superior to push systems?

It turns out that most definitions are going in the wrong direction. Even the names “push” and “pull” are actually not well suited to describe the concept. Neither are common illustrations, including the one here in the upper left.

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Lies, Damned Lies, and KPI – Part 3: Countermeasures

Kid with Glasses
How to measure good KPIs

There is an inflation of key performance indicators (KPIs) in industry. In my last posts I have explained how KPIs are often wrong, and why bad and fudged KPIs are a huge waste. Yet, you cannot really run a larger corporation without KPI. In this post I will finally give some advice on (1) what you need to do to measure good KPI, and (2) how to avoid fudged KPI.

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Lies, Damned Lies, and KPI – Part 2: Effects of Fudging

Business fraud
About the ills of number fudging

Modern manufacturing works with a lot of performance measures, often called key performance indicators (KPIs). Unfortunately, they are rarely accurate, and often even intentionally misleading. In my previous post I described some examples of commonly manipulated KPIs. In this post I would like to explain the ugly consequences of incorrect or manipulated KPIs. In a final post I will also show some ways that you can reduce this negative effect. But first, how do bad KPIs (and hence most KPIs) hurt your company?

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Lies, Damned Lies, and KPI – Part 1: Examples of Fudging

Upward Trend
Don’t get too excited about your numbers!

Statistical measurements, usually called key performance indicators (KPIs) are found on pretty much every shop floor and in every company. Many management decisions are made based on KPI. Unfortunately, these numbers often are not reliable at all.

Mark Twain popularized the phrase “Lies, damned lies, and statistics.” Winston Churchill famously said, “I only believe in statistics that I doctored myself.” Hence, both men were wary of trusting numbers. You should be too!

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