Relation Between Value Chain and Lean?




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moreno
Student (Other), Denmark

Relation Between Value Chain and Lean?

What is the interrelationship of the Value Chain and Lean?
 

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Samuell Yew
Project Manager, Malaysia
 

Value Chain and Lean

Dear Moreno, we know if something happens upstream, it will have a whiplash effect on downstream.
It is the same in a value chain. If a value chain is formed between lean partners, trust must develop for each partners to enjoy reduced wastes in inventory, leveling, lead time, logistic, and cost. As long as the trust exist and is being honored, this is a good model for all.

 
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Johan Moberg, Sweden
 

Value Chain and Lean

Hi! That is a good question. There is a common misunderstanding between value chain and value streams:
- In Lean you mostly talk about value streams, that is, a value creating end to end process flow. Typically a flow similar to "order to cash".
- The value chain on the other hand is based on Porter's description of core functionalities a business needs to have to deliver its business model. A value stream can stretch over one or several parts of a company's value chain.
So if lean here focuses on how to deliver the capabilities in the value chain, the value chain describes on a higher level "what" a company needs to do in a certain business logic.

   

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