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Common-Sense Advancement

By Karl M. Kapp, EdD, CFPIM, CIRM | May/June 2012 | 22 | 3

Keep the big picture in mind for real results

Streamlined Process Improvement: The Breakthrough Strategy to Reduce Costs, Improve Quality, Increase Customer Satisfaction, and Boost Profits
By H. James Harrington

Published in 2012
McGraw Hill
432 pages

Organizations can easily become bloated with too many processes, too many sign-offs, and too many layers of interference. It seems that if one person ever makes a single mistake, a process is put into place to prevent it from ever occurring again. Inevitably, what really happens is that businesses become overrun with rules and procedures designed for exceptions. As author H. James Harrington says, “Processes should be designed for the majority of the employees, and management should have the courage to fire the dishonest ones.” It’s this type of insight, experience, and straightforward talk that permeates this book.

Harrington weaves the concepts of streamlining processes together with rich examples highlighting his ideas and the impact of certain decisions. He tells of a CFO who claims he needs only one minute to sign off on a purchase order. While in reality, it takes far longer to review the requisition, check the department’s budget, and verify that three vendors have been chosen to bid on the project. What the CFO thought was an insignificant act actually impeded the process.

The author also tells of an organization that incentivized employees to eliminate their jobs with promise of an engineering degree, and he highlights how NASA was able to streamline more than 30 complex procedures and cut the number of procedures by 60 percent without affecting technical content.

Don’t let the stories fool you into thinking the book doesn’t have solid academic content; it does. The author carefully explains complex concepts like value-added analysis, process charts, and process capability studies. He provides clear explanations and ideas.

The entire book is about streamlining process improvement. When you are finished reading, you’ll understand exactly what you need to do to fine-tune processes in every area of your organization.

Managing Indirect Spend: Enhancing Profitability Through Strategic Sourcing
By Joe Payne and William R. Dorn Jr.

Published in 2011
John Wiley and Sons
446 pages

To run a business you need supplies, insurance, an accounting department, a marketing department, telecommunication services, and a variety of other items not directly related to creating your product or service. Collectively, these types of expenses are referred to as “indirect spend.” Indirect spend can be considered any spending an organization does that is not tied directly to a finished product or service. It can be substantial—as high as 40 percent, according to authors Joe Payne and William R. Dorn Jr.

Payne and Dorn have divided this book into four parts to provide a broad overview and detailed descriptions of the problems organizations have with indirect spend. Then, they describe the solutions that can be enacted to reduce spending overall and keep organizations on track. Part one of the text provides a detailed, step-by-step examination of the sourcing process. It includes information on how vendors are typically chosen; how they accidently remain in place long after the initial decision; and a great section on what not to do, such as letting the supplier craft the request for proposal.

Part two is a careful examination of tools and technologies that can be used to effectively manage indirect spend. This section investigates the concept of market intelligence, such as global market conditions and benchmarking. Additionally, sources of market intelligence—including blogs, indexes, and social networking tools—are rated.

In the third part, the authors provide examples of experiences they have had helping customers reduce costs through strategic sourcing. Among other information, Payne and Dorn describe the creative methods they have used to get incumbent suppliers to help organizations create relationships that boost goals.

In the fourth and final section, the authors provide insight and sourcing strategies for specific indirect spend areas. They highlight many areas, including office supplies, cell phones, and even small parcel shipments.

This text provides a comprehensive look at indirect spend. The application of the suggested tools and techniques can help an organization effectively manage indirect spend and streamline supplier relationships. As an added bonus, the book has a website at strategicsourcingbook.com, which lets readers keep up with the latest on the topic.

Lean Supply Chain and Logistics Management
By Paul Myerson

Published in 2012
McGraw Hill
292 pages

One particularly exciting method of reducing costs and streamlining organizational activities is to “go lean.” Unfortunately, if not done correctly, the initiative can go terribly wrong. In fact, according to author Paul Myerson, more than half of all lean initiatives end in failure. This can be especially difficult because supply chain costs can range from 50 to 80 percent of a company’s sales, depending on the industry.

To help organizations avoid failure, Myerson has written a book that provides both a useful introduction to the field as well as a reference with information about a particular facet of lean that may prove useful very quickly.

The book examines many aspects of lean, and the author suggests expanding the traditional list of seven types of waste to eight. He lists inventory; transportation or movement; motion; waiting; overproduction; overprocessing; and defect or error; plus, he adds behavioral or underused employees. This is a great addition because underused employees can prevent an organization from reaching its peak performance level.

Lean Supply Chain and Logistics Management contains a brief historical perspective on lean, which frames the progression from lean manufacturing organizations to lean enterprises. There are chapters on lean opportunities in the supply chain, lean tools, logistics, warehouse operations, global supply chain issues, technology, metrics, and education. The book is comprehensive: It covers the most important information a manager, executive, or employee would need to know about lean.

One of the strengths of the book is the case studies contained in the appendix. They provide real-world examples of companies that have used different learn tools to enhance their supply chains and logistics. The examples help reinforce the lessons and information provided and show practical application of the concepts and ideas explained throughout.

Whether this is your first foray into lean or you have been involved in many failed lean projects, this book will help you better understand lean, examine the associated tools, and position your organization for success. This is a book you can read cover to cover to gain an understanding of lean or pick it up to find just the area of lean in which you are interested. One thing is certain: You’ll want it by your side during your next lean implementation.

Karl M. Kapp, Ed.D., CFPIM, CIRM, a professor at Bloomsburg University, is author of Gadgets, Games, and Gizmos for Learning and coauthor of Integrated Learning for ERP Success. He may be contacted at kkapp@bloomu.edu.

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