Financial benefits of Lean improvements

“We see wonderful result in operations but, they don’t show up in the financial statements. If Lean is so great why doesn’t it hit the  bottom line”?

What happens in early phase of Lean …

What Lean improvements bring …

So what to do?

Three Choices:

1. Eliminate the resource
2. Use the freed up Resource to expand the business
3. Otherwise, do some combination of the above two

True analysis of Lean improvements can only come by giving due consideration to the freed up resource and by setting up a strategic team to “find the best option” for the free resources.

Acknowledgement: Practical Lean accounting by Brian Maskell

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