Imagine applying lean principles to the most common batch-process in most offices; the monthly financial close. Many companies take days or weeks to close their accounting books and prepare financial statements every single month. While it may seem like lean principles could never be meaningfully applied to such a quantitative and seemingly foundational business process that couldn’t be further from the truth. In fact, many lean organizations reduce their month-end closing activities to a single day, while maintaining accuracy and significantly improving the efficiency of their closing process.
Simply put, performance measures are quantified measurements of how well an organization, value stream, or process performs. But not all performance measures are created equal. For lean manufacturers, lean success requires lean performance measures developed to drive high performance.
Cost-plus pricing can be fine when a lean manufacturer offers a standardized product with limited competition. Unfortunately, most manufacturers offer highly unique products or highly com