The Lean Front-End: Implementing a Lean Front-End - How Do You Measure Success
By BigMachines, Inc.
Published on: April 2005
Type of content: VENDOR WHITE PAPER
Format: Adobe Acrobat (.pdf) (509 kb)
Length: 10 pages
Price: FREE
Overview:
Lean manufacturing arrived on the scene several years ago as a result of the success Toyota and other Japanese manufacturers were having with this system as Womack and Jones described in their revolutionary book "The Machine That Changed the World." A growing number of companies are now adopting Kaizen initiatives for continuous improvement, kanban replenishment, and demand-driven flow manufacturing processes based on a "pull" rather than "push" philosophy. The purpose of lean manufacturing is to eliminate waste, reduce inefficiencies and inventories, and improve on-time delivery rates.
The success of implementing lean techniques and technology solutions for back-end production and fulfillment processes has spurred an extension of the lean philosophy, as many manufacturers have begun to apply lean strategies beyond the shop floor. Manufacturers are now applying lean thinking to streamline their front-end selling processes, from opportunity to order. This includes automating product selection and configuration, pricing and quoting, and order processing. By applying lean thinking and web technology, manufacturers can eliminate the delays and errors inherent in the cumbersome front-end processes typically used to sell complex
products across multiple channels. Just as they have done on the back-end, manufacturers must eliminate front-end "waste" to remain agile and competitive in today's global economy.
A recent study conducted by AMR Research, a leading manufacturing industry analyst, indicates that maintaining quote and order accuracy using a manual, spreadsheet-based quoting process for configurable products across multiple sales channels is a huge challenge. Such manual methods typically lead to high quote error rates, invalid configurations and extensive intervention by engineering and customer service resources. Frequently the net result is lengthy quote response times and low quote-to-order conversion rates.
To alleviate these "pain points," manufacturers of configure-to-order (CTO) and engineer-to-order (ETO) products are increasingly turning to web-based sales solutions in the hopes of achieving the business benefits made possible by a lean front-end. This article examines how front-end process optimization contributes to establishing a customer-centric value stream and describes several Key Performance Indicators (KPIs) by which a company can measure the success of a lean front-end initiative and its impact on overall business performance.
