Business Communication
Operations Council™
Lean Manufacturing for Financial Services
Delivering Value by Eliminating Waste
Objective
Operations executives struggle to find new ways to reduce cost while delivering high-quality service. Lean manufacturing concepts enable institutions to expand existing cost-reduction opportunities while simultaneously creating customer value. This study aims to help Operations executives: Identify at least 40% waste in their cost base; Apply Lean techniques and tools to reduce waste across Operations; Improve process flow by optimizing touch time and minimizing cycle time; and Embed Lean thinking in staff and the organization to drive sustainable transformation.
© 2006 Corporate Executive Board. All Rights Reserved.
Executive Summary
Understanding Lean’s Potential
Council’s Definition of Lean Manufacturing
Lean Manufacturing is a production optimization methodology that relentlessly seeks out and eliminates activities that do not create value for customers (i.e., waste). Its outcomes are characterized by production systems that 1) minimize cycle times, 2) optimize touch times, and 3) generate continuous production flows.
40% of Operations Costs Are Wasteful Council research suggests that at least 40% of Operations expenses result from wasteful activities that add no value to the customer and therefore should be eliminated. The majority of these wasteful activities are caused by Operations executives managing increasingly complex service-fulfillment processes that contain multiple handoffs and decision points. Work is more difficult to track and less tangible in a service environment, making hidden waste more prevalent. Furthermore, business stakeholders define waste differently, resulting in institutions not measuring and reducing waste uniformly across the entire organization. Lean Adopters Identify More Waste and Operate More Efficiently Lean institutions identify two times more cost-reduction opportunity than non-Lean adopters by
Lean Manufacturing for Financial Services
Delivering Value by Eliminating Waste
Objective
Operations executives struggle to find new ways to reduce cost while delivering high-quality service. Lean manufacturing concepts enable institutions to expand existing cost-reduction opportunities while simultaneously creating customer value. This study aims to help Operations executives: Identify at least 40% waste in their cost base; Apply Lean techniques and tools to reduce waste across Operations; Improve process flow by optimizing touch time and minimizing cycle time; and Embed Lean thinking in staff and the organization to drive sustainable transformation.
© 2006 Corporate Executive Board. All Rights Reserved.
Executive Summary
Understanding Lean’s Potential
Council’s Definition of Lean Manufacturing
Lean Manufacturing is a production optimization methodology that relentlessly seeks out and eliminates activities that do not create value for customers (i.e., waste). Its outcomes are characterized by production systems that 1) minimize cycle times, 2) optimize touch times, and 3) generate continuous production flows.
40% of Operations Costs Are Wasteful Council research suggests that at least 40% of Operations expenses result from wasteful activities that add no value to the customer and therefore should be eliminated. The majority of these wasteful activities are caused by Operations executives managing increasingly complex service-fulfillment processes that contain multiple handoffs and decision points. Work is more difficult to track and less tangible in a service environment, making hidden waste more prevalent. Furthermore, business stakeholders define waste differently, resulting in institutions not measuring and reducing waste uniformly across the entire organization. Lean Adopters Identify More Waste and Operate More Efficiently Lean institutions identify two times more cost-reduction opportunity than non-Lean adopters by