A product family are products which pass through similar processing steps and share common equipment prior to leaving your company (shipping to customer). In general product families share about 80% or more processing steps or equipment. The significance of the "product family" as it relates to lean or six sigma is that the value streams of our organizations are in some way related to a product/service, when we group them into product/service families we are then able to see which product/services share the same processes and which value stream will be the greatest improvement opportunity for the organization.
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