Reduce the Units of Input Not Producing Output

Reduce units of Input (I) available but not producing Intermediate Cost Drivers (ICDs). This action makes Input levels more directly variable with the quantity of the ICD by reducing the amount of the available Input that is wasted or idle. For example, an employee (I) might produce one subassembly (ICD) per day. During that day, the employee spends a total of one hour waiting for parts for the subassembly. If the Company could eliminate that one lost hour of the employee's work day by providing parts in a more timely manner, the Company could reduce the number of employees (I) needed to produce the same subassembly (ICD) by 1/8th.

F. Speed the Process

1. Warnings and advice

No.	Industry SIC	Year	Notes
1	0	2004	Sony also broke with tradition in their media choice for distributing their games. Sony chose CDs instead of the cartridge technology used by Nintendo. This choice had profound implications on both the market presence as well as the agility of the internal software development and commercialization processes for game titles.
2	0	1996	When engaging in process management of product development, remember that: 1. Projects get done faster if the organization takes on fewer at a time; 2. Investments to relieve bottlenecks yield disproportionately large time-to-market benefits; and 3. eliminating unnecessary variation in workloads and work processes eliminates distractions and delays, thus freeing the org to focus on the creative parts of the task.
3	2000	2004	In studying the trade off between service quality and costs, the logistics costs of the high performers were 25% lower and they moved goods four times faster out of inventory. They had better quality ratings and delivery times on the service side. What is obvious is that the best companies refuse to bow to the trade-off: they have informal contacts with customers and partners which serve to bypass slow formal lines of communication through companies' buyers and sales staff while also allowing market knowledge to be acquired. They also participate with their customers in capacity planning.
4	2030	1990	At Heinz's Ore-Ida plant, high-speed machines were making tater tots much faster, but gave poorer quality. Ore-Ida managers slowed down the production lines, allowing machines to produce better quality. Efficiency went down, but effectiveness went up as sales shot back up.
5	2300	1986	Staying stateside is profitable for Cherokee, due to an unpredictable fashion market. If they have a fast-selling product, they can fill reorders much more quickly.
6	2800	2008	Training Within Industry (TWI) is a technique designed to improve supervisory skills, a good asset in lean manufacturing. TWI can lead to operational improvements, such as reduction in lead time, reduction in work-in-process inventory, reduction in space utilization, increased productivity, and improved product quality. It can also lead to administrative improvements, such as reduction in order processing errors, streamlined customer service functions, reduction of paperwork, reduction in turnover and attrition costs, established job standards, and increased employee performance.
7	3661	1988	By speeding production and distribution, Northern Telecom has reduced by a quarter the number of days' worth of its telecom equipment it has to keep in stock.
8	3861	1990	In 1980s turnaround, Xerox cut development cycles from 7 to 2 years, and introduced 6+ major technical innovations in its five new models. Achieved a 3-year lead over competitors in these technologies.
9	3949	1991	One problem with speeding up production is that it gives workers little time to think and come up with new ideas.
10	3949	1991	Any program to increase speed should make sure the compensation system doesn't penalize people who slow down operations to ensure quality. Coleman's old system paid employees by the number of pieces they produced (even if defective). Coleman switched to an hourly wage in 1990.
11	6300	2004	Given Progressive's 96 combined ratio target, on a $700 premium the 4% underwriting target gives the company only a $28 expected underwriting profit per policy. $28 of underwriting profit is the equivalent of one day of storage or rental reimbursement in the event of a claim, thirty minutes of sheet metal work at a body shop, or twenty minutes of an attorney's time in the event of litigation. The company receives 10M claims a day and has used TQM and six Sigma principles to design the claims process and has motivated and well-trained claims adjusters. The company believes there is so much waste in the industry that if it could just move claims faster through the claims factory it can achieve both lower costs and better service so that there is no trade-off between service and cost.

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