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Lean Six SIGMA Logistics: Strategic Development to Operational Success

Lean Six SIGMA Logistics: Strategic Development to Operational Success

by Thomas J. Goldsby, Robert Martichenko

ISBN-10: 1932159363

ISBN-13: 9781932159363

Pub. Date: 07/28/2005

Publisher: Ross, J. Publishing, Incorporated

Logistics, Lean, and Six Sigma form a natural union. Logistics is about managing inventory; Lean is about speed, flow, and the elimination of waste; and Six Sigma is about understanding and reducing variation. Lean Six Sigma Logistics features the Logistics Bridge Model to serve as your roadmap for continuous improvement, leveraging value, eliminating waste, and


Logistics, Lean, and Six Sigma form a natural union. Logistics is about managing inventory; Lean is about speed, flow, and the elimination of waste; and Six Sigma is about understanding and reducing variation. Lean Six Sigma Logistics features the Logistics Bridge Model to serve as your roadmap for continuous improvement, leveraging value, eliminating waste, and enhancing your abilities to view the supply chain with a critical eye. It provides a method for developing strategies as well as tactical steps that will help you achieve successful operational implementation of Lean Six Sigma Logistics. The primary focus is on logistics flow, capability, and discipline as the guiding principles for solving any logistics challenge. Whatever the status of your supply chain, this book provides the essence for developing and implementing a successful logistics strategy.

Product Details

Ross, J. Publishing, Incorporated
Publication date:
Product dimensions:
6.20(w) x 9.10(h) x 0.80(d)

Table of Contents

About the Authorsxv
Web Added Valuexvii
Section 1Lean Six Sigma Logistics: Why Bother?
Chapter 1What Is Lean Six Sigma Logistics?3
What Is Logistics?4
What Is Lean?4
Lean and the Logistician4
What Is Six Sigma?5
Six Sigma and the Logistician5
What Is Lean Six Sigma Logistics?6
The Logistics Bridge Model7
Chapter 2The Importance of Logistics and Supply Chain Management9
Discovering the Dark Continent of Logistics9
This Thing Called "Supply Chain Management"11
The Logistics Wastes14
Section 2The Logistics Wastes
Chapter 3The Waste of Inventory19
Logistics and Inventory Management19
The Temptation of Inventory20
The Costs of Holding Inventory22
Chapter 4The Waste of Transportation27
Logistics and Transportation Management27
Transportation and Logistics Trade-offs29
Transportation Carrier Relationships31
Minimizing the Day-to-Day Wastes in Transportation32
Chapter 5The Waste of Space and Facilities35
Logistics and Warehousing35
How Many Facilities? How Much Space?36
Are Advanced Technologies a Cure or Merely a Crutch?37
Chapter 6The Waste of Time39
Logistics and Time Wastes39
Order Transmission39
Order Processing41
Order Filling42
Order Staging and Verification43
Order Shipping and Delivery44
Chapter 7The Waste of Packaging47
Logistics and Product Packaging47
Packaging as a Source of Waste48
Packaging as a Waste49
Packaging as a Visual Control50
Chapter 8The Waste of Administration51
Logistics and Administration51
Administration as Help and Hindrance52
Technology and Administration52
Chapter 9The Waste of Knowledge55
Logistics and Knowledge55
Cultivating Knowledge56
Managing the Flow of Knowledge57
The River of Wastes59
Section 3The Logistics Bridge Model
Chapter 10A Tour of the Bridge65
History of Lean Six Sigma Logistics66
The Importance of the Logistics Bridge Model66
The CEO's Perspective67
The Implementer's Perspective69
The Logistics Bridge Model: Getting Started70
Chapter 11Logistics Flow: Asset Flow71
People Flow72
The People "Perfect Order"73
Organizing People73
Bridging the People Gap74
Inventory Flow75
Understanding Safety Stock76
Inventory Management77
Starting with the Systems Approach77
Inventory and Cause and Effect78
Inventory Management Fundamentals79
Fixed Resources Flow80
Identifying and Mapping Fixed Resources81
Questioning the Need82
Vision of Excellence and Fixed Resource Flow83
Chapter 12Flow: Information Flow85
Data Flow86
Historical Data86
Event and Real-Time Data87
Future and Deterministic Data87
Data Excellence89
Knowledge Flow89
Continuous Improvement and Knowledge Flow90
Standardized Work and Knowledge Sharing91
Getting Knowledge to Flow92
Communication Flow93
Strategic Communication93
Hoshin Planning94
Operational Communication95
Chapter 13Flow: Financial Flow97
Income Statement Flow98
Logistics Activities and Hidden Operating Costs99
Logistics Costs Flow Across the Organization100
Inventory Carrying Costs and the Income Statement101
Vision of Excellence and the Income Statement102
Balance Sheet Flow103
Inventory as a Current Asset104
Inventory Turns and the Balance Sheet105
The Balance Sheet and Business Strategy106
Cash Flow107
Cash Flow Drivers108
Accounts Payable and Cash108
Accounts Receivable and Cash110
Revenue Growth and Cash110
Gross Margin and Cash Flow111
Selling, General, and Administrative Expense and Cash Flow111
Capital Expenditure and Cash Flow112
Inventory and Cash Flow113
Vision of Excellence and Cash Flow113
Chapter 14Capability: Predictability115
Highlighting Waste and Creating Visibility117
Standardized Operations and Setting Priorities118
The Organized Workplace: Clutter, Complexity, and Quality119
Measurement and the Organized Workplace119
Coordination and Value Stream Mapping121
Coordination and Detailed Planning122
Coordination and Measurement124
Complexity of Products125
Complexity of Processes126
Chapter 15Capability: Stability129
The Key Aspects of Standardization130
Standardization and Continuous Improvement131
Developing Flexibility and Back to Basics133
Flexibility and Lead Time134
Logistics Infrastructure Flexibility135
Planned Network Design and Visibility136
Today's Capability Is the System's Capability138
Common and Special Cause Variation139
Chapter 16Capability: Visibility141
Beginning to Understand143
Channel Partners and Their Important Role143
Opportunities and the Moment of Truth144
Voice of the Customer146
Creating Internal Measures of Meaning148
Chapter 17Discipline: Collaboration153
Processes and Knowing the Customer155
Building Teams156
Complementary Skills and Opposing Views156
Natural Stages of Team Development157
Strategic Sourcing158
Raw Material Suppliers159
Standardization, Complexity, and Dual Sourcing160
Beware the Term "Partnership"160
Collaboration and Logistics Services161
Third-Party Logistics162
Developing a Lean Third-Party Logistics Relationship163
Project Management165
Project Management: The Basics166
Meeting Agenda (Compass)167
Gantt Chart168
Failure Mode and Effects Analysis169
Chapter 18Discipline: Systems Optimization173
Total Cost174
Explicit and Implicit Costs174
Horizontal Integration177
Perceived Difficulty and System Constraints179
Compensation and Incentive Programs179
Teamwork, Imperfection, and Defensive Behavior180
Breaking Down the Walls181
Vertical Integration181
From Customer to Supplier182
Vertical Integration and Information182
Variability, Leveled Flow, and Vertical Integration183
Chapter 19Discipline: Waste Elimination185
Quality at the Source186
The Benefits of Quality at the Source187
Logistics and Quality at the Source189
Continuous Improvement190
Continuous Improvement: The Bare Facts190
The Challenges of Continuous Improvement Implementation192
Bridging the Gap193
Getting People Trained194
Acting as Lean Six Sigma Logistics Leaders195
Section 4Building the Bridge: Lean Six Sigma Logistics Tools
Chapter 20Strategy and Planning Tools201
Surveying the Tool Kit201
Voice of the Customer202
Voice of the Business204
Value Stream Mapping206
Pareto Analysis and ABC Classification208
The XY Matrix211
Chapter 21Problem-Solving Tools213
DMAIC (Define-Measure-Analyze-Improve-Control)213
Causal Analysis Tools218
Cause-and-Effect Diagrams219
Five-Why Analysis220
Design of Experiments222
Inferential Statistics223
Chapter 22Operational Tools227
Flow Concepts227
Just-in-Time and the Pull System227
Lead-Time Management, Speed, and Flexibility229
Leveled Flow230
Frequency and Lot Size232
Organization Concepts232
Standardized Work Plan233
The SIMPOC Model233
5S Organization and Visual Control234
Red Tag Initiatives235
Chapter 23Measurement Tools237
Data Collection Plan237
Process Capability238
Defects per Million Opportunities241
Sigma Calculations242
Conventional Measures of Logistics Performance245
Total Cost Analysis246
Chapter 24Case Study: GoldSMART Products, Inc.249
Lean Six Sigma Logistics: A Real-World Story249
GoldSMART Products, Inc.: A Cast in Lean Six Sigma Logistics250
The Calm Before the Storm250
The Approach of Ominous Clouds251
In the Eye of the Storm252
Riding Out the Storm255
Seeing Daylight Again260
Chapter 25Summary and Conclusion267

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