Lean vocabulary: the dictionary for your organization's performance

Master the meaning of lean terms and concepts. Get clear definitions that turn the language of management into practical results in your day-to-day work.

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A

1 term

A-B Control

A way of regulating the working relationship between two machines or operators that controls overproduction and ensures the balanced use of resources.

See : Inventory, Overproduction.

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C

1 term

Cross-Dock

A facility that selects and (re)combines a variety of items coming from various suppliers so that they can be shipped to the various customers, such as assembly plants, distributors or dealers.

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D

1 term

Demand Amplification

A tendency observed in multi-step processes, in which the production orders received by each upstream process are more erratic than the actual production or sales of the downstream steps. Also known as the Forrester Effect (after Jay Forrester of MIT, who first characterized this phenomenon mathematically in the 1950s) and the Bullwhip Effect.

See: Build to Order, Heijunka, Level Selling.

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E

1 term

Every Part Every Interval

The frequency with which each part is produced in a production process.

See: Heijunka.

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F

1 term

First In, First Out (FIFO)

The principle and practice of maintaining precision in the sequence of production and material movement, ensuring that the first part to enter a process or storage location is also the first part to exit. This ensures that stored parts do not become obsolete and that quality problems are not hidden in inventory. FIFO is a necessary condition for implementing a pull system.

See: Kanban, Pull Production

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I

3 terms

Information Flow

The movement of information from customers to the point where it is needed to trigger each operation. See : Value Stream Mapping and Product Family Matrix.

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Inventory

Materials (and information) present along a value stream between processing steps.

Physical inventory is usually categorized by its position in the value stream and by its purpose. Raw materials, work-in-process and finished goods are terms used to describe the position of inventory in the production process. Buffer stock, safety stock and shipping stock are terms used to describe the purpose of inventory.

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Inventory Turns

A measure of how quickly materials are moving through a plant or through an entire value stream, calculated by dividing a given cost measure by the amount of inventory on hand.

See : Inventory.

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J

1 term

Just-in-Time (JIT) Production

A production system that makes and delivers only what is needed, when it is needed, and in the amount needed. JIT and Jidoka are the two pillars of the Toyota Production System. JIT relies on heijunka and is made up of three operating elements: the pull system, takt time, and continuous flow.

See : Continuous Flow, Heijunka, Jidoka, Pull Production, Takt Time, Toyota Production System.

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K

1 term

Kanban

A kanban is a signaling device that authorizes and gives instructions for the production or withdrawal of items in a pull system. The term means "signals" or "signal board" in Japanese. See : Heijunka, Heijunka Box, Just-in-Time (JIT) Production, Pull Production, Supermarket.

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L

2 terms

Lean Logistics

Lean logistics focuses on logistics activities and their connections, using the pull system and continuous flow to put the lean supply chain into practice. See : Cross-docking, heijunka, supply chain

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Level Selling

An attitude toward customers which assumes that demand for many products is relatively stable but is often disrupted by the production and sales systems themselves.

See : Demand Amplification, Heijunka, Make-to-Order.

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M

4 terms

Make-to-Order Production

A situation in which the production lead time and the order lead time are shorter than the time the customer is willing to wait for the product, so the manufacturer builds to confirmed orders rather than to a forecast.

See: Demand Amplification, Heijunka, Level Selling.

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Material Flow

The movement of physical items along the value stream. In mass production, products travel to centralized processes in large batches, pushed by instructions from a master schedule. In lean production, the process steps for different product families are carried out, whenever possible, in a tightly defined sequence of processes, so that small quantities of product can flow directly from step to step, pulled by the next downstream process and by the end customer.

See : Information Flow, Just-in-Time (JIT), Lean Production, Mass Production.

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Material Handling

The movement of the necessary materials along a production process within a plant. In the lean production system, material handling goes far beyond the simple delivery of materials. A lean material handling system can serve as a means of conveying instructions to production. See: Heijunka Box, Paced Withdrawal.

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Milk Run

A method for speeding the flow of materials between plants, in which vehicles follow a route to make multiple pickups and deliveries at many plants. See : Lean Logistics, Material Handling.

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O

1 term

Overproduction

Producing more, sooner, or faster than is required by the next process. Ohno considered overproduction the most serious form of waste because it generates and hides other wastes, such as inventory, defects, and excess transportation.

See: Batch and Queue, Ohno, Seven Wastes.

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P

10 terms

Paced Withdrawal

The practice of releasing production orders to work areas and withdrawing finished goods from those areas at a fixed, frequent pace. This practice can be used as a way to link material flows to information flows.

See: Every Product Every Interval, Heijunka Box, Milk Run, Pull Production.

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Pacemaker Process

Any process in a value stream that sets the pace for the entire stream. (The pacemaker process should not be confused with a bottleneck process, which necessarily constrains downstream processes due to a lack of capacity.)

See: First In, First Out.

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Pack-Out Quantity

The number of items a customer (whether internal or external) wants packed and stored in a container for transport and shipping. Note that a pallet of a product may consist of numerous containers.

See : Pitch.

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Plan for Every Part

A detailed plan for each part used in a production process, showing every detail relevant to managing the process without errors or waste. It is a fundamental tool of the Toyota Production System.

See: Material Handling, Pack-Out Quantity.

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Point-of-Use Storage

Storing parts and materials as close as possible to the operations that use them.

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Product Family

A product and its variants that pass through similar processing steps and common equipment just prior to shipment to the customer. The significance of product families for lean thinkers is that they are the unit of analysis for value stream maps, which are defined starting from the last step before the customer.

See: Product Family Matrix and Value Stream Mapping.

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Product Family Matrix

A chart created by lean thinkers to identify the appropriate product families. See : Product Family, Value Stream Mapping.

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Production Control

The task of controlling and setting a pace for production so that products flow smoothly and quickly to meet customer requirements.

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Pull Production

A production control method in which downstream activities signal their needs to upstream activities. Pull production strives to eliminate overproduction and is one of the three major components of a complete Just-in-Time production system. See : Just-in-Time (JIT), Overproduction.
Compare with : Push Production.

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Push Production

Processing large batches of products at maximum speed, based on forecast demand, and moving them to the next downstream process or into storage, regardless of the actual pace of work in the next process. Batch and Queue, Production Control.

See : Batch and Queue, Production Control.
Compare with : Pull Production.

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R

1 term

Replenishment System

A pull production system in which upstream (supplier) processes produce only enough to replace or replenish the product withdrawn by downstream (customer) processes.

See: Kanban, Pull Production, Supermarket.

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S

2 terms

Standard Inventory

The amount of inventory needed before each processing step so that it flows smoothly. See: Inventory .

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Supply Chain

Lean Supply Chain is the right material, in the right quantity, at the right place, at the right time, with the right quality and in the correct packaging, without waste, focusing on problem solving and prevention through people, with a view to achieving high performance. See : Lean logistics

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V

1 term

Value Stream Mapping

A simple diagram of every step involved in the material and information flows needed to serve customers, from order to delivery. See : Information Flow, Material Flow.

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It is a glossary of terms and concepts used in lean management. It helps you understand lean terminology by aligning definitions and examples for study, reading and day-to-day application.

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