To develop a Lean Resilient Supply Chain, seven key capabilities must be mastered by Chief Supply Chain Officers.

The 4th capability is the Capability of Increasing Resource Efficiency.

Once we create Flow, our main blueprint for improving the Supply Chain, we can then focus on the Efficiency of individual resources.

We can look at the OEE in Production and make it better. We can improve Efficiency in Warehouses, Efficiency in Transportation, and innovate with digital and automation technologies, keeping an eye on high investment needs. If you really must spend a lot of money with Automation, you must mind the Flow Blueprint and the Time for the Investment Return. Be careful to avoid automation of waste.

To Eliminate Waste, we use a model called “The 16 TPM Big Efficiency losses”. Eight of them are Equipment Losses, the traditional Machine OEE. Five are the Labour Losses and the last three are Losses related to Energy, Material Yield, and waste of Consumables.

Doing Kaizen to Eliminate the 16 Losses will have a Huge Impact on your Resource Efficiency, but don’t forget to do it only after Creating Material & Information Flow.

The file 7 KEY CAPABILITIES for a Supply Chain Lean Transformation outlines the process for Increasing Resource Efficiency.

In our next post we will talk about Capability #5: Reinforcing the KAIZEN Culture

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