Lean logistics is defined as a method in the supply chain process in which wasteful activities in a supply chain are recognized and eliminated in order to increase product speed and flow. "Leaner" thinking involves constantly attempting to trim the fat, so to speak. Activities and events that occur without producing at maximum capacity are considered worthy of being readjusted or even removed entirely in order to maintain balance and increase the efficiency of any given system.
A Brief History Lesson
This theoretical process was first introduced by Japanese manufacturers of automobiles. Due to limitations revolving around minimized resources and frequent shortages, the manufacturers were forced to develop thinking and logistics that focused on maximizing efficiency and ridding themselves of any waste. This early form of lean logistics quickly spread to other areas of manufacturing and now is a common practice used today, especially in supply chain links.
A Four-Step Process
Companies looking to enrich their production and general flow capacity can do so with lean logistics through four very simple, yet very elegant, steps.
- Specifying Values. In this stage, customer value must be identified. This value should be added along the chain network and maintained as a fundamental number to the process of waste elimination.
- Mapping the Value Stream. Creating a map of the entire system along the supply chain network offers a unique opportunity to visualize where value is being added and where value is being detracted from the finalized and overall product.
- Creating Product Flow. This is where companies, using the mapped value stream and applied factors, must establish regulations to minimize downtime, inventories, and detrimental interruptions.
- Establishing Customer Pull. In this step a limitation is put into place on the manufacturing of a product. Using demand information from across the supply chain, manufacturing should only occur in response to a need, specifically of that from a customer.
Lean logistics offers a theoretical and practicable way of thinking about supply chain processes. Maximizing value and eliminating wasteful, unnecessary byproducts can make a drastic difference in any organization.
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