1. Lean Logistics Lean – Green – The Future

2. Process and the Supply Chain
“Brilliant Process Management is our Strategy”
“We get brilliant results from average people managing brilliant processes”
“We observe that our competitors often get average (or worse) results from brilliant people managing broken processes”
Toyota Motor Manufacturing
Oh No ! What happened !

3. Is Anything For Certain These Days ?

4. Adds value to the output and customer is willing to pay for.
Certainty # 1
Process
Non-Value Added
Does not add value to the output, and customer isn’t willing to pay for.
Business-Value Added
Does not add value to output, customer will not pay for, but is necessary.
(Legal, Safety, Etc.)
Value Added
Adds value to the output and customer is willing to pay for.
CZV Lab double inspection
Eliminate
Minimize
Optimize

5. Certainty # 2 Processes Want to Fall Apart
In a system, a process that occurs will tend to increase the total entropy of the universe.
Second law of thermodynamics
Entropy
A measure of the disorder or randomness in a closed system
A measure of the loss of information in a transmitted message
Inevitable and steady deterioration of a system or society
Processes alone will self destruct/fall apart. System left on own will move to state of chaos…Idea that business is a system, lean recognizes that…Whole point about PDCA
System: A group of interacting, interrelated, or interdependent elements forming a complex whole.
Property of LeanCor, LLC; Confidential Information

6. Lead Time is Only Made of Two Things!
Certainty # 3
Lead Time is Only Made of Two Things!
Customer Consume
Supplier Build
Product Design
Manufacture
Waiting
Inventory
Rework
Value
Waste
Value
Waste
Value
Waste
Value

7. Overproduction is the King of waste…Make to order is utopia
Certainty # 4
Overproduction is the King of waste…Make to order is utopia
Supply LT
MLT + OL +
<
Customer LT
= MTO
Supply LT
MLT + OL +
<
Customer LT
= Forecast

9. Manufacturing Lead Time
Certainty # 5
Cash to Cash Cycle
All we are doing is looking at the time line, from the moment we get an order, order material from our suppliers ( and pay cash to our suppliers )… to the point where we collect that same cash ( and a little profit) from our customer.  And we are reducing the time line by reducing the non-value adding activities.
Cash to Cash = Accounts Receivables + Inventory – Accounts Payables
Inbound Supply Chain
Manufacturing Lead Time
Outbound Supply Chain I I
12/30/2018

10. What Does The Future Hold ?
Who is going to blink first ?
Who is going to lead and/or follow ?
Is it about incentives or disincentives ?
Why do we need to wait…is green not obvious ?

11. Do I need Calculus to Show this Ain’t Green ?

12. A Quick Look…
Let’s examine transportation variables. Drawing assumptions from data that has been released by several organizations, we conclude that it is possible that in North America our truck load transportation system has the following characteristics:
Truck Load carriers ( and private fleets ) run from 5% to 15% empty (unpaid) miles to service their customers
Average truckload shipment sizes range from 20,000lbs to 28,000lbs when measured by weight and 40% to 65% when measured by trailer cube utilization
For purposes of discussion, let’s assume average empty miles are 10% and average trailer utilization is 60%. This means that theoretically, on any given day, with proper coordination (we eliminated all empty miles and had fully utilized trailers), we could move all freight in North America with 50% of the existing trucks
12/30/2018

13. Its Going to Take Real Work…

14. Principles of the Lean Supply Chain
Manufacturer to cadence of customer demand
Make customer consumption visible
As lead time is full of waste
Reduce lead time
Avoid overproduction and excess inventories
Use pull systems
Create problem solving culture
Create velocity and reduce variation
Move smaller lots more frequently
Collaborate and focus on process discipline
Optimize the System
Measure and manage Total Cost of Fulfillment

15. Lean - Green & Systems Thinking
All New Products every year with 100% new components…
The defining characteristic of a system is that it cannot be understood as a function of its isolated components. First, the behavior of the system doesn't depend on what each part is doing but on how each part is interacting with the rest ...
Kofman and Senge,
1993
You’re a fool if you don’t focus on BOM costs
What we need are more sales promotions !
I love it when a plan comes together…did it ?

16. Supply Chain & Logistics Management A Practical Viewpoint
Supply Chain Management
Logistics

17. Lean and Green Just Make Sense
Forcing More Work Through a Broken System…No Way!
Growth
Raise Efficiency Through Continuous Improvement…Yes Way!
SRI ex turned warehouse into manufacturing
TRU story
Air force story
Growth

18. Thank You Robert@leancor.com