Lean Principles and Core Concepts
This section covers lean principles and core concepts. The exam tests whether you can apply lean thinking as a system rather than recite tools, and whether you can recognize which principle explains a given situation.
The five principles
- Specify value from the customer's perspective.
- Identify the value stream for each product family.
- Make value flow.
- Let the customer pull.
- Pursue perfection.
A step adds value only if the customer would pay for it, it transforms the product or information the first time, and it is done right the first time. Everything else is non-value-added: either necessary (compliance, statutory records) or pure waste.
TPS as a system
The house rests on stability: heijunka (leveling), standard work, and 5S. Just-in-time means producing at takt with pull, not simply holding zero inventory. Jidoka means stopping to protect quality and building judgment into the process. Kaizen and respect for people are the foundation: the people closest to the work improve it.
Worked example
A mortgage process has 380 minutes of underwriting work and 18 days of queue time. At 480 productive minutes per day, lead time is 8,640 minutes, so process cycle efficiency is 380 ÷ 8,640 ≈ 4.4%. A proposal to add two underwriters attacks the 380 minutes and leaves the queue untouched. The reasoning: cut batch size, level application arrivals, and establish FIFO pull between steps before adding capacity.
Traps that cost marks
- Calling necessary non-value-added work value-added.
- Equating lean with headcount reduction; respect for people is a principle, not a slogan.
- Chasing muda while ignoring muri (overburden) and mura (unevenness).
- Treating tools as the system, so improvements never connect.