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Lean Performance ERPProject ManagementAU0532.indb 111/19/07 12:10:26 PM

Series on Resource ManagementRightsizing Inventoryby Joseph L. AielloISBN: 0-8493-8515-6Integral Logistics Management: Operations andSupply Chain Management in ComprehensiveValue-Added Networks, Third Editionby Paul SchönslebenISBN: 1-4200-5194-6Supply Chain Cost Control Using ActivityBased ManagementSameer Kumar and Matthew ZanderISBN: 0-8493-8215-7Financial Models and Tools for ManagingLean ManufacturingSameer Kumar and David MeadeISBN: 0-8493-9185-7RFID in the Supply ChainJudith M. MyersonISBN: 0-8493-3018-1ERP: Tools, Techniques, and Applicationsfor Integrating the Supply Chainby Carol A. Ptak with Eli SchragenheimISBN: 1-57444-358-5Introduction to e-Supply Chain Management:Engaging Technology to BuildMarket-Winning Business Partnershipsby David C. RossISBN: 1-57444-324-0Supply Chain Networks andBusiness Process Orientationby Kevin P. McCormack andWilliam C. Johnson with William T. WalkerISBN: 1-57444-327-5Collaborative Manufacturing: UsingReal-Time Information to Support theSupply Chainby Michael McClellanISBN: 1-57444-341-0Handbook of Supply Chain Management,Second Editionby James B. AyersISBN: 0-8493-3160-9The Supply Chain Manager’s Problem-Solver:Maximizing the Value of Collaborationand Technologyby Charles C. PoirierISBN: 1-57444-335-6The Portal to Lean Production: Principles& Practices for Doing More With Lessby John Nicholas and Avi SoniISBN: 0-8493-5031-XLean Performance ERP Project Management:Implementing the Virtual Supply Chainby Brian J. CarrollISBN: 1-57444-309-7Supply Market Intelligence: A ManagerialHandbook for Building Sourcing Strategiesby Robert HandfieldISBN: 0-8493-2789-XIntegrated Learning for ERP Success:A Learning Requirements Planning Approachby Karl M. Kapp, with William F. Latham andHester N. Ford-LathamISBN: 1-57444-296-1The Small Manufacturer’s Toolkit: A Guideto Selecting the Techniques and Systems toHelp You Winby Steve NovakISBN: 0-8493-2883-7Velocity Management in Logistics andDistribution: Lessons from the Militaryto Secure the Speed of Businessby Joseph L. WaldenISBN: 0-8493-2859-4Supply Chain for Liquids: Out of the BoxApproaches to Liquid Logisticsby Wally KlatchISBN: 0-8493-2853-5Supply Chain Architecture: A Blueprintfor Networking the Flow of Material,Information, and Cashby William T. WalkerISBN: 1-57444-357-7AU0532.indb 2Basics of Supply Chain Managementby Lawrence D. Fredendall and Ed HillISBN: 1-57444-120-5Lean Manufacturing: Tools, Techniques,and How to Use Themby William M. FeldISBN: 1-57444-297-XBack to Basics: Your Guide toManufacturing Excellenceby Steven A. Melnyk andR.T. Chris ChristensenISBN: 1-57444-279-1Enterprise Resource Planning and Beyond:Integrating Your Entire Organizationby Gary A. LangenwalterISBN: 1-57444-260-0ISBN: 0-8493-8515-611/19/07 12:10:26 PM

Lean Performance ERPProject ManagementImplementing the Virtual Lean EnterpriseSecond EditionBrian J. CarrollNew YorkAU0532.indb 3London11/19/07 12:10:27 PM

Auerbach PublicationsTaylor & Francis Group6000 Broken Sound Parkway NW, Suite 300Boca Raton, FL 33487‑2742 2008 by Brian J. Carroll. Performance Improvement Consulting.Auerbach is an imprint of Taylor & Francis Group, an Informa businessNo claim to original U.S. Government worksPrinted in the United States of America on acid‑free paper10 9 8 7 6 5 4 3 2 1International Standard Book Number‑13: 978‑0‑8493‑0532‑0 (Hardcover)This book contains information obtained from authentic and highly regarded sources. Reprintedmaterial is quoted with permission, and sources are indicated. A wide variety of references arelisted. Reasonable efforts have been made to publish reliable data and information, but the authorand the publisher cannot assume responsibility for the validity of all materials or for the conse‑quences of their use.Except as permitted under U.S. Copyright Law, no part of this book may be reprinted, reproduced,transmitted, or utilized in any form by any electronic, mechanical, or other means, now known orhereafter invented, including photocopying, microfilming, and recording, or in any informationstorage or retrieval system, without written permission from the publishers.For permission to photocopy or use material electronically from this work, please access www.copyright.com (http://www.copyright.com/) or contact the Copyright Clearance Center, Inc. (CCC)222 Rosewood Drive, Danvers, MA 01923, 978‑750‑8400. CCC is a not‑for‑profit organization thatprovides licenses and registration for a variety of users. For organizations that have been granted aphotocopy license by the CCC, a separate system of payment has been arranged.Trademark Notice: Product or corporate names may be trademarks or registered trademarks, andare used only for identification and explanation without intent to infringe.Library of Congress Cataloging‑in‑Publication DataCarroll, Brian J.Lean performance ERP project management : implementing the virtual leanenterprise / Brian J. Carroll.p. cm.Includes bibliographical references and index.ISBN 978‑0‑8493‑0532‑0 (hardcover : alk. paper)1. Production control. 2. Production management. I. Title.TS155.8.C37 2008658.5‑‑dc222007024944Visit the Taylor & Francis Web site athttp://www.taylorandfrancis.comand the Auerbach Web site b 411/19/07 12:10:27 PM

ContentsFigures.xiForeword. xvPreface.xxviiAcknowledgments.xxxviiAbout the Author. xliPart I: Introduction to Lean PerformanceChapter 1Foundations of Lean Performance.3When the ERP Project Manager Is the Lean Champion.3The Organizational Consequences of Mass Production.8The Origin of Lean Production.10What Is Lean Production?.14Why Aren’t More Firms Lean?.16What Is Required to Become Lean?.18Chapter 2Extending Lean Performance Foundations.21Implementing Lean Cross-Functional Processes.21Lean Quality Management.23Lean Maintenance.24Lean New Product Introduction.25Lean Design and Engineering.26Lean Accounting.27Chapter 3Lean Performance Methodology.33What Is the Virtual Lean Enterprise?.33Lean and ERP: Why Can’t We All Just Get Along?.35The Failure of ERP Implementations. 42Lean and Six Sigma. 44Why Should Our Enterprise Be Lean?.45The Three Levels of Lean Business Process Management.49 AU0532.indb 511/19/07 12:10:27 PM

vin ContentsLean Business Process Strategic Level: Lean Policy Deployment.50Lean Business Process Organizational Level: Lean Process Innovation.53Lean Business Process Activity Level: Lean PerformanceImplementation.62What Is Lean Performance?. 66How Does Lean Performance Improve Processes?.68Why Lean Performance Is the Best Lean Methodology.69Chapter 4Lean Cross-Enterprise Processes. .81What Is Lean Commerce?.81Lean Customer Relationship Management.88Lean Production Smoothing. 90Lean Supply-Chain Management.100Lean Performance China Strategy.103Supporting a Lean Factory Flow.104Toyota Production System and Lean Commerce.108Implementing a Virtual Lean Enterprise. 110Chapter 5Lean Principles, Tools, and Practices.113Lean Cultural Principles.113Process-Oriented Thinking Means What Before How. 115Product Quality Results from Process Quality. 115Every Process Needs a Process Standard. 116The Process Owners and Operators Are the Process Experts. 117The Next Process Is Your Customer. 119Loyalty to People Enables Continuous Improvement. 119Process Data and Measurements Drive Process ContinuousImprovement.122Lean Cultural Principles Checklist.122Process-Oriented Thinking Means What Before How.122Product Quality Results from Process Quality.123Every Process Needs a Process Standard.124The Process Owners and Operators Are the Process Experts.125The Next Process Is Your Customer.126Loyalty to People Enables Continuous Improvement.126Process Data and Measurements Drive Process ContinuousImprovement.128Lean Transformational Principles.129Precisely Specify Value by Product or Family.129Identify the Value Stream for Each Product.129Make Value Flow Without Interruption.129Let Customer Pull Value from the Process Owner.129Pursue Perfection.129AU0532.indb 611/19/07 12:10:27 PM

ContentsnviiLean Transformational Principles Checklist.130Precisely Specify Value by Product or Family.130Identify the Value Stream for Each Product.130Make Value Flow Without Interruption.131Let the Customer Pull Value from the Process Owner.131Pursue Perfection.131Lean Diagnostic Tools.1323 MUs.1325 Ss.1375 Ws-1 H.1424 Ms.146Lean Performance Practices. 152Management Policy Deployment. 152Lean Performance Teams.154Visual Management. 155Lean Performance Analysis. 155Chapter 6Steering a Lean Performance Project. 161Management in the Lean Performance Project. .162Motivator.163Team Builder/Team Player.163Educator/Developer.163Change gotiator.164Completing the Lean Performance Assessment.166Lean Performance Assessment.167Lean Enterprise Future State.167In Our Future Lean Enterprise.171Enterprise Lean Vision Elements (Add/Change to Fit Your LeanEnterprise).172Our Process Owners (Managers and Supervisors).173Company Readiness.173Opportunity to Make Lean Applications. 176Company Capability to Become Lean.177Lean Performance Project Constraints.180Analyzing Lean Performance Assessment Results.183Preparing for the Lean Performance Project.184AU0532.indb 711/19/07 12:10:27 PM

viii nContentsPart II: Lean Performance Planning ModulesChapter 7Deploying Management Policy Module.189Management Tasks.189Organizing the Steering Committee.189Confirming the Lean Vision. 191Identifying and Deploying Lean Business Policies. 191Identifying and Deploying Lean Project Strategies.192Defining the Project Mission.195Defining the Project Scope.196Setting Up the Project Organization.197Identifying and Deploying the Project Objectives.199Conducting Steering Committee Meetings.203Chapter 8Evaluating and Selecting Software Module. 209Management Tasks.212Organize the Software Evaluation and Selection Project Team.212Project Team Tasks.213Organize the Project Office and Conference/Education Room.213Determine Key Lean Software Features Workshop Attendees.213Review All Lean Strategy/Policy/Project Objectives LPA Masters. 214Conduct Process Area Workshops. 214The 9 Forms of Office MUDA Checklist. 215The 5 Ss in the Office Checklist.216The Office 5 Ss Checklist. 2175 Ss in the Computer Room Checklist. 219Conduct Key Lean Software Features Workshops. 220Process Stream Key Lean Features Checklist.221Prepare a Draft of the Key Lean Software Features Checklist.223Report Progress to Management Steering Committee.223Chapter 9Managing Project Module.229Project Team Tasks.229Maintaining the Project Summary Bar Chart.229Maintaining Project Communications.229Maintaining the Project Plan. 230Maintaining an Open Issues Resolution Process. 230Maintaining the Project Organization.235Maintaining the Quality Assurance Process.236Reporting Progress to the Steering Committee.239Chapter 10 Developing Lean Performance Teams Module. .241Project Team Tasks.241Finalizing Projects and Strategies.241AU0532.indb 811/19/07 12:10:28 PM

Contentsn ixDeveloping the Site Configuration. 242Identifying All Processes. 244Developing Site Teams.254Developing Lean Performance Team Training.254Reporting Progress to the Steering Committee.265What Follows Lean Performance Planning?.265Part III: Lean Performance Improvement ModulesChapter 11Improving Process Performance Module. .273Management Tasks.273Maintaining Lean Performance Teams.273Conducting Steering Committee Meetings.274Project Team Tasks.275Lean Performance Team Education.275Human Resource Team Tasks.278Finance Team

New York London Lean Performance ERP Project Management Brian J. Carroll Implementing the Virtual Lean Enterprise Second Edition AU0532.indb 3 11/19/07 12:10:27 PM