The 5 core principles of a Lean Organization were first written about in a book entitled: Lean Thinking by James P. Womack and Daniel T. Jones. The 5 core principles are widely accepted as a means implementing and establishing a lean organization. The 5 core principles have been adapted from the 5 original principles that were defined by Dr. Womack and Daniel T. Jones:
A pilot test is used to ensure that an experiment, process, tool or method works. The pilot test can be done with a lot, batch or single piece with the objective of proving something new that has not been used before.
The Pareto Priority Index or PPI is a method of performing a cost to benefit analysis. It is used in quantifying potential projects. The analysis weighs the savings and probability of success against the cost and time of completion. It is important to keep in mind that unless historical data is gathered and used the index is largely qualitative and often includes no customer input. When prioritizing your project options it is a good idea to take into consideration customer surveys and other qualitative means before final project selections are made.
Poka Yoke is a series of techniques used to error proof, mistake proof or create a fail-safe process that is designed to prevent errors, defects or mistakes. Even more specifically a poka-yoke is any mechanism in a lean manufacturing process that helps an equipment operator avoid mistakes. Its purpose is to eliminate product defects by preventing, correcting, or drawing attention to errors as they occur. The concept was formalized, and the term adopted, by Shigeo Shingo as part of the Toyota Production System.
Reference: Wikipedia - Poka-Yoke
PDCA or plan-do-check-act is a four step method used in lean, quality improvements and other continuous improvement strategies. In the first stage plan, a plan based on historical background data and root cause analysis is formed. This plan is designed to invoke or effect change in a positive way. In the second stage of PDCA (do) the plan is carried out. This is generally a small scale pilot or initial test run of the plan. The third stage of PDCA is the check stage. Here the outcome of the plan is analyzed or studied as it is often referred to in PDSA. The fourth step is act which is focused on adjusting the do based on lessons learned in the check stage. You may hear the PDCA cycle referred to as the Shewhart cycle because Walter A. Shewhart discussed the concept in his book Statistical method from the viewpoint of quality control.
A problem is a deviation or gap between what is actually happening and what should be happening. A problem can also be defined as any customer need that is not met on-time in the right amount and in acceptable quality (according to the customer).
Problems can typically be categorized into one or more of the following categories:
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Process variability is the variation or lack of consistency in a process. The variation causes the process to deviate from a fixed pattern in such a way that results in inconsistent, unpredictable and non-repeatable outputs (Y).
Process Stability is the consistency of a process in relation to important/critical process characteristics such as dimensions. When a processes outputs show consistency over a period of time that process can be considered stable or in control. Processes often become stable when variation in a process is reduced, resulting in a more consistent, repeatable outcome.
Pipeline inventory is the inventory that is still being transported through your network including, distribution and any intermediate stocking points. This inventory pipeline is one of the biggest reasons for low inventory accuracy. As you might have guessed when inventory items are in transit they are normally considered to be the shipper's inventory if the customer has not yet paid for the inventory, but if the customer has paid for the inventory, ownership normally transfers to the customer even if the customer has not obtained custody of their order yet. This is important to understand because ownership of the in-transit inventory more often than not tells us who's inventory list the order will go on.
Process improvement is any activity that is designed to close a process or systems performance gap. This can be done through the identification and elimination of COPQ, variation or various types of waste. Some methods that are commonly used in process improvement projects are: