Sustainable Solutions for SCM

evaluates only real customer demand (output demanded by customer/input) and thus supports the pull flow in the supply chain management. The following case study dedicated to computer production [31] enables for the accurate differentiation between productivity of batch production and one-piece flow production, which is the first fundamental problem in the transition from mass SCM to lean SCM. The case study quantifies the difference in the lead times as the production of 10 computers take 30 minutes by batch production and 12 minutes by one-piece flow production (see Figure 1.5).

Figure 1.5 Production of computer set by mass SCM and by lean SCM (modified according to [31])

The production process provided in Figure 1.5 is linked for the purpose of this paper with the management of the whole supply chain, in both concepts of mass SCM (batch transformation) and lean SCM (OPF – one-piece flow transformation). The number of value-added activities necessary for computer finalisation (customer order completion) is used for comparison of productivity of both concepts in Figure 1.6. These activities are considered to be added value by the current recognition of what is and what is not added value.

Figure 1.6 Traditional mass vs. lean productivity performance indicators The general understanding of added value is the production added value. Nevertheless, because of the latest market changes, logistics added value has at least the same importance. Lean divides any activity in business processes into a value added activity (production and logistics) and waste (production and logistics). The critical

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