Holding costs are all of the expenses a company incurs to hold inventory items over a period of time before they are used to fill orders. Generally speaking, Inventory carrying/holding costs are the costs you incur as a result of holding inventory. It is most often described as a percentage of your inventory value. The percentage is often unique to organizations and includes the amount of capital invested in inventory as well as depreciation, space occupied, insurance and opportunity costs. Inventory carrying or holding costs generally account for 15-30% of a business’s total inventory value.
A huddle is an action by a team to strategize, support and motivate one another towards accomplishing or aligning objectives and goals. Huddles are typically held before an activity takes place. Huddles can be held in any area or department of an organization, they do not need specific rooms just a format to conduct the huddle. The main difference between a huddle and a meeting is both how it is conducted and the amount of time the huddle takes compared to a meeting. Huddles can be performed in under 7 minutes.
The house of Toyota is a graphical representation of the Toyota Production System depicted in the form of a house. Taiichi Ohno was given credit for much of the systems development. The Toyota Production System works together with 5 key elements:
Hedge inventory finds its roots in the term ‘hedging’. Hedging which means reducing or controlling risk is a common practice in many industries and a not so common one in others. Hedge inventory is actually very similar to anticipation inventory, except there is more risk and quite a bit less certainty in increased demand and decreased supply.
Heijunka is a japanese term that can be translated as product smoothing or load leveling. The heijunka technique is used to assist and in many ways facilitate Just in time production. Heijunka is often used to smooth out production both internally and externally.
Reflection can be a great way to gather critical opportunities from a project. The term Hansei refers to the reflection and recognition of one's own actions. Hansei is often used to recognize one's own mistakes and commit to taking the appropriate actions in order to resolve and avoid recurrence of one's mistakes. The Hansei can be performed in a team environment or in a personal reflective manner, either way it is important that teams and individuals stretch their mind enough to find something they can improve upon.
The histogram is a type of bar graph which is used to visually display the frequency or spread of data in a data set.
Hoshin Kanri is a method used for strategic planning. The term refers to "policy deployment" or "directional deployment." The process of hoshin kanri aligns an organization vertically as well as horizontally . In general there are 7 steps to the hoshin or directional planning process.
1. Establish Vision.
2. Assess current state.
3. Set annual objectives.
4. Build a plan for implementation.
5. Execute your plan.
6. Review, evaluate and adjust as necessary (Monthly).
7. Repeat (annually).
The deployment of Hoshin Kanri will often start as a top - down process but as the organization reaches the second and third phase of hoshin planning it should become a top - down and bottom - up process that involves management, project teams and other resources to align resources and gain consensus of the direction. This process is often referred to as catchball, nemawashi or our own personal ©Vision methodology. Hoshin Kanri strives to get every employee pulling in the same direction at the same time. It achieves this by aligning the strategic goals of the company with the tactical plans of middle management and the work performed by all employees.
The House of Quality, is a diagram whose structure resembles that of a house. The tool aids in determining how a product/service is living up to customer defined attributes. Although quite intricate, it is capable of storing a lot of information and comparing large amounts of data used for defining the relationship between customer desires and the firm/product capabilities. The house of quality works through a six step process:
The house of quality is part of the quality function deployment (QFD) process and forces engineers, designers and developers to think about customer needs. The house also helps teams in creating a crossfunctional design so that probelms are not built into a new service or part.
Hard Savings are the tangible and identifiable savings as opposed to that realized from not spending. If we look at hard savings from a project perspective it can be defined as those savings that allow the organization, team or department to do "more" or the "same" amount of work with the same or less resource use.
Examples of Hard Savings:
Question: What is one other type of hard savings that you can think of? Have you ever had to document hard savings?
**Place answers in the comments tab.**
The "hidden factory" is the set of activities in a process or value stream that result in the reduction of quality or velocity of a business process. The reference to hidden insinuates that the process is not known to individuals who might be seeking to improve the process.
Examples of the Hidden Factory Concept
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