GENERAL MANAGEMENT
CHECK POINT 3: THE LEAN BUSINESS ENGINEERING METHOD
Please Select Any Topic In Check Point 3 Below And Click. |
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DO I NEED TO KNOW THIS CHECK POINT?
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WELCOME TO CHECK POINT 3 |
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HOW CAN YOU BENEFIT FROM CHECK POINT 3? |
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| The main purpose of this check point is to provide you and your management team with detailed information about the Lean Business Engineering Method, or the LBE Method, and how to implement this method in your organization. |
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| In this check point you will learn: |
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• About small business statistics.
• About main reasons and costs of small business failure.
• About the critical importance of business knowledge in business success.
• About the prime purpose and benefits of the lean business engineering method.
• About the basic tasks of the lean business engineering method.
• How to implement the lean business engineering process in your company.
• About the four steps in achieving your personal objectives in business.
• About the three steps in achieving your business objectives.
• How to complete your company’s lean business analysis and develop a lean business plan.
• How to implement your company’s lean business solutions... and much more. |
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LEAN MANAGEMENT GUIDELINES FOR CHECK POINT 3 |
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| You and your management team should become familiar with the basic Lean Management principles, guidelines, and tools provided in this program and apply them appropriately to the content of this check point. |
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| You and your team should adhere to basic lean management guidelines on a continuous basis: |
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• Treat your customers as the most important part of your business.
• Provide your customers with the best possible value of products and services.
• Meet your customers’ requirements with a positive energy on a timely basis.
• Provide your customers with consistent and reliable after-sales service.
• Treat your customers, employees, suppliers, and business associates with genuine respect.
• Identify your company’s operational weaknesses, non-value-added activities, and waste.
• Implement the process of continuous improvements on organization-wide basis.
• Eliminate or minimize your company’s non-value-added activities and waste.
• Streamline your company’s operational processes and maximize overall flow efficiency.
• Reduce your company’s operational costs in all areas of business activities.
• Maximize the quality at the source of all operational processes and activities.
• Ensure regular evaluation of your employees' performance and required level of knowledge.
• Implement fair compensation of your employees based on their overall performance.
• Motivate your partners and employees to adhere to high ethical standards of behavior.
• Maximize safety for your customers, employees, suppliers, and business associates.
• Provide opportunities for a continuous professional growth of partners and employees.
• Pay attention to “how” positive results are achieved and constantly try to improve them.
• Cultivate long-term relationships with your customers, suppliers, employees, and business associates.
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1. WHO IS DOING BUSINESS IN AMERICA? |
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STATISTICS ABOUT SMALL BUSINESS IN THE U.S. |
You and your management team should become fully familiar with the lean business engineering method if you really want to improve your chances for a long-term success in business.
According to the U.S. Small Business Administration (SBA), there are about 27.9 million businesses in the United States and they include:
• About 21.7 small businesses* without employees or micro businesses .
• About 6.2 million small to medium-sized businesses with one to 500 paid employees.
• About 20,000 large businesses with over 500 paid employees.
The U.S. Bureau Of Labor Statistics provides the following information related to small business activities during 1994 – 2010 period:
• About 500,000 to 650,000 new business startups per year.
• About 2.5 million to 4.7 million new jobs per year created by new business startups.
You may find additional useful information about Small Businesses In The U.S. online.
*Note: SBA defines small business as any organization with less than 500 employees. |
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THE AMERICAN DREAM |
Whether you plan to start a business or you are a business owner - you pursue the American Dream. You share this dream with millions of entrepreneurs who want nothing less, than to be independent! However, since “there is no free lunch”, independence usually doesn’t come cheap! There is definitely a price to pay! The question is:
Are you prepared to pay this price?
If you are prepared to pay this price, than you should begin your "business knowledge rejuvenation" process by carefully reading this important check point and implementing all relevant guidelines contained herein. Hopefully, you will realize that your effort can "make or break" your business in the future. |
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2. STATISTICS ABOUT SMALL BUSINESS FAILURE IN THE U.S. |
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DO YOU KNOW HOW MANY BUSINESSES FAIL IN THE U.S. EVERY YEAR?
Based on statistics provided by the U.S. Small Business Administration (SBA) and the U.S. Bureau Of Labor Statistics:
About 70% of all small business startups fail after 12 years in business.
According to Small Business Trends, five year survival rates for business startups clearly indicate that thousands of business owners experience serious problems and struggle to survive.
Moreover, according to the American Bankruptcy Institute:
About 43,000 businesses per year filed for bankruptcy during a 1994 - 2012 period.
MAIN REASONS FOR SMALL BUSINESS FAILURE
As you know, nobody is perfect and this certainly includes business owners. Please watch this video and try to avoid:
Top Ten Mistakes New Business Owners Make.
The main Reasons For Small Business Failure usually include:
• Lack of business knowledge and management experience by business owners.
• Loss of customers due to poor value of products and services offered by the organization.
• Insufficient working capital employed by the organization.
• Poor organizational culture adopted by business owners.
• Unprofessional management practices employed by business owners.
• Absence of a cohesive management structure within the organization.
• Excessive waste of human, material, and financial resources within the organization.
• Poor communication between business owners and employees within the organization.
• Low level of morale and motivation by employees within the organization.
• Low level of employee productivity within the organization.
• Health problems experienced by business owners.
• Bad economy.
You may find additional reasons for business failure in articles written by Scott Shane
in
Small Business Trends and
Jay Goltz
in The New Your Times.
THE REAL COST OF BUSINESS FAILURE
The Emotional Cost Of Business Failure obviously can’t be measured in monetary terms, but it is certainly devastating to tens of thousands of small business owners and their families. Just ask any of them…
The Financial Cost Of Business Failure is extremely high. According to
CNBC:
Top ten business bankruptcies alone involved $91.5 Billion in assets in 2011.
These numbers translate into an estimated $100 Billion Business Failure Cost Per Year or:
• Business Failure Cost Per Day: $ 273,972,600/Day.
• Business Failure Cost Per Hour: $11,415,525/Hour.
• Business Failure Cost Per Minute: $190,259/Minute.
One of the prime reasons for this high cost of business failure is the following ironic fact:
The majority of people in business don't have business management education, while the majority of people with business management education are not in business!
Perhaps, it’s time to look into the serious problem of business failure and ask a 100 Billion Dollar Per Year Question:
What can we do to solve the small business failure problem and turn it into a challenging opportunity for the benefit of millions of aspiring entrepreneurs and small business owners?
However, the most important question really is:
Are you willing to accept this challenge to secure your long-term success in business?
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3. WHAT IS REALLY THE PROBLEM? |
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DO YOU THINK THIS MIGHT BE YOU?
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Many entrepreneurs, who manage small or medium-sized business, often overestimate their abilities and are unaware of personal inefficiencies in the area of business management. Are you? |
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Those entrepreneurs who are aware of their inefficiencies still prefer to solve their management problems by themselves either to avoid exposure and possible embarrassment as a result of any mismanagement in the past or to protect their "trading secrets". Are you? |
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Most entrepreneurs who manage small and medium-sized companies are usually skeptical toward any advice about business management given by outsiders, such as management consultants, and they often cannot afford such service. Are you? |
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Many entrepreneurs are usually not overly enthusiastic about business management education or literature and do not really know how to select suitable material. They do not have the time to shop around for needed information nor to absorb it. What about you? |
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Many entrepreneurs consider their accountants as their most important business advisors. Unfortunately, however, most accountants have a very limited knowledge of operational business management. What about you? |
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Many entrepreneurs are not able to delegate functional responsibilities to their employees, and sometimes become the biggest stumbling block within their own organization without even realizing it. What about you? |
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WHAT IS HAPPENING IN THE REAL WORLD?
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Hundreds of thousands of entrepreneurs start, plan, or dream to start a new business every year. |
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All 27.9 million entrepreneurs and business owners in the U.S. will tell you: “I started a business because I wanted to be my own boss, make more money and be financially independent”. Not one of them will tell you: “Because I wanted to go bankrupt!” |
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However, the reality is quite different! The statistics indicate that about 70% of all newly established businesses fail after 12 years in business. Unfortunately, 100% of these businesses did not use the Lean Business 2100 Management Program. |
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Each year many thousands of business people, who often “sign their lives away to the bank”, file for bankruptcy and lose much more than just money in the process. Business failures create untold difficulties for thousands of families, who often sacrifice everything they have to start a business. |
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ASK YOURSELF ONE QUESTION
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Ask yourself one question: |
Do I really know enough about business management to succeed in business in the long-term? |
If you are not sure about your level of Business Management Knowledge - you may be “skating on thin ice...” In this case, you should be prepared to invest in yourself and start improving your knowledge in various areas of business management as soon as you can. It will definitely pay dividends in the future. |
Thousands of small business owners who were not prepared to invest time and money in their own education and, instead, chose to remain ignorant, paid a heavy price and ultimately went out of business. You should not repeat the same mistake. Instead, you should adopt an open-minded attitude toward knowledge self-improvement. Eventually, you will realize that: |
Learning is a never-ending process and you will become its prime beneficiary. |
REMEMBER THREE IMPORTANT FACTS
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If you really want to succeed in business, you should remember these three important facts: |
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The more you will learn today, the more you will realize how much you did not know yesterday. |
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Your business management knowledge will become the cornerstone of your success in business. |
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Time will never come back, money you can make and lose, but knowledge will stay with you forever! |
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THE KEY TO YOUR SUCCESS IN BUSINESS |
To start a business is easy. To keep it open is a completely different story! |
Successful performance of your small or medium-sized business will depend primarily upon your Knowledge and Experience in various areas of business management and your Ability to act as an entrepreneurial manager, your positive Energy, and most importantly - your positive Attitude.
Effective small business management is based on an integrated and multi-disciplinary approach. For this reason you must learn how to "wear several hats at the same time", and apply various elements of business management in a systematic manner. You must, in fact, be able "to engineer" your business for success. In other words, if you want to succeed - you must become a "Business Engineer"!
You will also need a practical business method which will enable you to act as a real business engineer. This method is called:
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THE LEAN BUSINESS ENGINEERING METHOD OR THE LBE METHOD |
TWO COMPONENTS OF THE LEAN BUSINESS ENGINEERING METHOD |
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The Business Engineering Method
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Lean Management |
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| • | The Purpose Of Lean Management.
The prime purpose of lean management is to provide management guidelines designed to enable business people to maximize the value of products and services offered to customers and to improve business performance through Japanese -style business management values, methods, and principles. |
| • | The Origin Of Lean Management.
The term "Lean" was first introduced by John Krafcik in his article "Triumph Of The Lean Production System" in 1988. Lean management has its origin with the Toyota Production System (TPS) and it has evolved gradually over the last sixty years. The TPS includes several Japanese management methods, such as Kaizen, Just-In-Time, Jidoka, and Total Productive Maintenance (TPM). |
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The Lean Business Engineering Method |
| Lean Business Engineering is a cross-functional method of applying traditional Western-style management guidelines and lean management guidelines to operational activities within any organization to maximize the product and service value, operational performance, and profitability. The prime purpose of the lean business engineering method is to provide a Universal Management Tool to business owners, professional managers, management consultants, pro-active CPAs or management accountants, and MBA students, to enable them to maximize business performance through a positive synergy between Western-style management guidelines and lean management guidelines and by utilizing the best information provided by each management style. |
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THE MAIN PURPOSE OF THE LEAN BUSINESS ENGINEERING METHOD |
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The main purpose of the Lean Business Engineering Method is to break the vicious cycle of ignorance, incompetence, mismanagement, and subsequent business failure, and to enable small business owners to acquire essential management knowledge to enhance their chances for a long-term success in business.
The lean business engineering method is based on a simple and time-tested idea:
Whatever you do, learn about it first!
The lean business engineering method prescribes to business owners first to study and understand the basic principles of business management and then, simply, apply those principles in their business in a systematic manner to ensure improved performance and results. This is similar to kids who first have to go to kindergarten to study their ABCs, and then go on through school and to the university to graduate in their chosen profession before they can actually start working.
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THE LEAN BUSINESS ENGINEERING METHOD
PROVIDES A SMALL BUSINESS KNOWLEDGE BASE |
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Western-Style Management Information
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Eastern-Style Management Information |
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THE LEAN BUSINESS ENGINEERING METHOD
REPRESENTS A UNIVERSAL MANAGEMENT TOOL |
The lean business engineering method is at the core of the Lean Business 2100 Management Program and it is supported by a practical Small Business Knowledge Base for small and medium-sized business owners, professional managers, management consultants, pro-active CPAs or management accountants, and MBA students.
This method represents a Universal Management Tool, designed to enable business people to evaluate their potential for business success, to evaluate their personal level of business management knowledge, to complete their cross-functional management training, to evaluate their company's performance, to develop a comprehensive plan of action, and to implement cost-effective management solutions in all major operational areas of business activities. This tool is designed to be used as: |
• A Learning Tool for MBA students.
• A Management Tool for professional managers.
• A Be-Your-Own-Management-Consultant Tool for small and medium-sized business owners.
• A Professional Management Tool for management consultants and pro-active CPAs or management accountants.
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THE LEAN BUSINESS ENGINEERING METHOD
TAKES KNOWLEDGE MANAGEMENT TO THE NEXT LEVEL |
The lean business engineering method is designed to address the challenges presented by two important concepts introduced in the 1990's:
• Knowledge Management (KM)
• Personal Knowledge Management.
These concepts lead to the development of a new type of position in a company known as the Chief Knowledge Officer, who is responsible for maximizing the company's performance through knowledge. |
THE LEAN BUSINESS ENGINEERING METHOD
PROVIDES INTEGRATED KNOWLEDGE MANAGEMENT SOLUTIONS |
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Knowledge Management (KM) is the process aimed at obtaining, storing, distributing, and effectively using knowledge on a cross-functional basis for the benefit of the entire organization.
Knowledge Management System is designed to promote an integrated approach to identifying, obtaining, evaluating, storing, retrieving, and sharing all information, such as documents, procedures, guidelines, rules, and databases which can be relevant to an effective management of an organization and help to maximize its performance. |
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• An Introduction To Knowledge Management By M.A.C. Impang And Team.
• What Is Knowledge Management? By Chris Collison.
• Why Should You Be Interested In Knowledge Management? By David Griffiths.
• The Difference Between Data, Information And Knowledge? By David Griffiths.
• Knowledge Management: An Organization's Weapon Of Choice By David Griffiths.
• Three Eras Of Knowledge Management By Nancy Dixon.
• The Future Of Knowledge Management By David Griffiths.
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THE LEAN BUSINESS ENGINEERING METHOD
PRESCRIBES CROSS-FUNCTIONAL MANAGEMENT TRAINING |
The lean business engineering method prescribes Cross-Functional Management Training of business owners and senior managers in every organization. Please watch these videos to appreciate the critical importance of cross-functional management training and development of a Cross-Functional Team within your organization: |
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• Cross-Functional Teams By Anat Lechner, NYU School Of Business.
• How To Manage Cross-Functional Teams? By Total Quality Consulting.
• Cross-Functional Process Teams By Henry Shaffer, Insite One.
• Best Practice In Creating Cross-Functional Teams By Donna Howes.
• Cross-Functional Collaboration By Rawn Shah.
• The Innovation Pipeline: Promoting Cross-Functional Collaboration By Diversity Inc.
• Challenges With Cross-Functional Teams By Stanford Advanced Project Management.
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THE LEAN BUSINESS ENGINEERING HOUSE |
| The Lean Business Engineering House, which provides a descriptive representation and outlines the most important elements of the Lean Business Engineering Method, is presented below. |
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5. WHY DOES THE LEAN BUSINESS ENGINEERING METHOD MAKE GOOD BUSINESS SENSE? |
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DO YOU WANT TO MAXIMIZE YOUR BUSINESS PERFORMANCE AND RESULTS?
| | Whether you are a one-person business owner or a president of a large corporation with thousands of employees, you will find that the Lean Business Engineering Method can provide a critical contribution to improving your current business performance and securing your future business success.
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| The main objectives of the lean business engineering method are:
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1. To improve personal business knowledge of each member of your management team.
2. To complete a detailed lean business analysis of your organization.
3. To develop a comprehensive lean business plan for your organization.
4. To implement cost-effective lean management solutions within your organization.
5. To maximize your organization’s business performance and results based on providing the best possible value of products and services to your customers.
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By adhering to lean business engineering guidelines, you and your management team will be able to accomplish the following results outlined below.
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HOW CAN YOU AND YOUR BUSINESS BENEFIT
FROM THE LEAN BUSINESS ENGINEERING METHOD?
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Improved Personal Business Knowledge.
You will discover that business management knowledge is like an iceberg -there is much more to know than meets the eye. Once you start focusing on a specific management area, you will be able to learn and understand what you really need to know to succeed in business and how all this knowledge will fit together into one comprehensive solution.
Remember: “You only know what you know but you don't know what you don't know!”
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Improved Cross-Functional Business Analysis.
You will learn how to look at the “big picture” of your business and evaluate operational and financial performance results in a systematic way. You will also learn that your business, like a chain, consists of many links, or operational activities, and you will need to identify the strength and weakness of each link in a timely manner to ensure the durability of the chain.
Remember: “Every chain is as strong as its weakest link!” |
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Improved Cross-Functional Business Planning.
You will learn how to plan your company’s business activities on a cross-functional basis in all operational areas, including general management, human resources management, financial management, operations management, marketing and sales management.
Remember: “If you fail to plan, you plan to fail!” |
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Improved Cross-Functional Business Solutions.
You will learn how to apply lean management principles and guidelines in implementing your company’s business solutions on a cross-functional basis in all operational areas, including general management, human resources management, financial management, operations management, marketing and sales management.
Remember:” Don’t get mean, get lean!” |
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Improved Level Of Customer Loyalty And Increased Level Of Repeat Business.
You will learn that your customers as the most important part of your business and you must maximize their level of satisfaction with your products and services on a continuous basis. Subsequently, you will convince your customers that it is in their best interests to continue to do business with your company in the long-term.
Remember: “Each customer is a “king” who pays for all your business expenses!” |
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Improved Level Of Employee Morale And Motivation.
You will learn that your employees, business partners, and associates must be treated with genuine respect on a continuous basis. As a result, you will motivate them to provide your company with the most efficient performance within your organization.
Remember: ”What goes around, comes around!” |
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Streamlined Operational Activities.
You will learn how to evaluate your operational activities, identify specific problems in a timely manner, and implement cost-effective improvements on a continuous basis. As a result you will streamline various operational activities within your organization.
Remember: “The shortest distance between two points is a straight line!” |
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Improved Quality Of Your Products And Services.
You will learn how to identify various operational activities within your organization which result in poor quality of products and services. You will also learn how to implement strict quality control at the source throughout your organization on a continuous basis. As a result you will improve the quality of your products and services.
Remember: “The quality of your products will determine the quality of your profits!” |
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Improved Value And Reduced Amount Of Waste.
You will learn how to conduct value-added analysis of your operational activities on a continuous basis. As a result you will improve the value of your products and services and reduce the amount of waste within your organization.
Remember: “Value improvement of your products and services is a never-ending journey!” |
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Reduced Operational Costs.
You will learn how to reduce the amount of waste and wasteful activities during your operational processes on a continuous basis. As a result you will reduce operating costs and increase operational savings within your organization.
Remember: ”Every dollar saved is a dollar earned!” |
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Reduced Inventory Requirements And Associated Costs.
You will learn how to adhere to specific customer requirements on a “just-in-time” basis. As a result you will reduce the level of inventories, including raw materials, work-in-process, and finished goods, and related storage and distribution costs.
Remember: “Less is more!” |
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Improved Productivity And Reduced Turnover Of Employees.
You will discover that your employees must be treated with genuine respect and provided with opportunities to learn, improve, and grow within your organization on a continuous basis. As result you will increase employee motivation and productivity, reduce employee turnover rate and associated employee turnover costs.
Remember: ”Training costs, but it also pays!” |
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Improved Utilization Of Plant And Machinery.
You will learn how to implement preventive maintenance methods on a continuous basis instead of maintaining your plant and machinery when breakdowns occur. As a result you will improve plant and machinery utilization level and reduce plant maintenance and replacement costs.
Remember: ”One ounce of prevention is worth a pound of cure!” |
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Improved Liaison With Your Suppliers.
You will learn how develop solid relationships and maintain effective communication with your suppliers on a continuous basis. As a result you will streamline your supply chain performance and reduce the cost of products and services purchased by your organization during your specific business process.
Remember: ”Your business is as good as your suppliers!” |
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Improved Communication.
You will learn how to improve communication between partners, associates, and employees within your organization on a continuous basis. As a result you will reduce wasteful activities and maximize overall employee efficiency.
Remember: ”The key is to hear what has not been said!” |
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Increased Safety Level.
You will learn how to evaluate your operational processes, identify specific safety problems in a timely manner, and implement safety improvements on a continuous basis. As a result you will maximize the safety level within your organization and increase morale of your employees.
Remember: “Safety does not happen by accident!” |
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Increased Productivity And Profitability.
You will learn how to implement and maintain various elements of traditional Western-style business management and lean management within your organization on a continuous basis. As a result you will maximize the value of your products and services to customers, and increase your overall productivity and profitability.
Remember: “Do your homework and better grades will follow!” |
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6. BASIC TASKS OF THE LEAN BUSINESS ENGINEERING METHOD |
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THE LEAN BUSINESS ENGINEERING METHOD IS VERY USER-FRIENDLY
The Lean Business Engineering Method, or the LBE Method, is designed in a very user-friendly manner, based on KISS Principles (keep it simple, Sir!). Once you start using this method, you will be pleasantly surprised, how simple it really is.
The LBE method will enable you and each member of your management team (if you have a team) to accomplish eight important tasks outlined below: |
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Tasks 1 - 4
These tasks entail evaluation of your potential for business success, evaluation of your personal business management knowledge, development a plan of action to improve your personal business management knowledge, and implementation of your plan of action. |
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Tasks 5 - 8
These tasks entail evaluation of your company's business performance, development of a plan of action to improve your company's business performance, and implementation of your plan of action. |
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EIGHT BASIC TASKS OF THE LEAN BUSINESS ENGINEERING METHOD |
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Evaluate Your Personal Potential For Business Success.
Evaluate your personal preferences which may affect your chances for success in business. |
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Evaluate Your Personal Business Management Knowledge.
Evaluate your personal strengths and weaknesses in various areas of business management relevant to you and your business. |
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Develop A Plan Of Action To Improve Your Personal Business Management Knowledge.
Develop a plan of action to improve your personal knowledge in various areas of business management relevant to you and your business. |
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Improve Your Personal Business Management Knowledge.
Study operational management guidelines in various areas of business management relevant to you and your business. |
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Complete Your Company’s Lean Business Analysis.
Complete detailed management and financial analysis of your company’s performance covering all relevant areas of operational activities. |
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Develop Your Company’s Lean Business Plan.
Develop a comprehensive plan of action for your company in all relevant areas of operational activities. |
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Implement Your Company’s Lean Business Solutions.
Implement cost-effective management solutions within your company in all relevant areas of operational areas activities. |
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Repeat The Above Process Annually.
Repeat all steps in the above process on an annual basis to ensure your company’s continued success in the future. |
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7. IMPLEMENTATION OF THE LEAN BUSINESS ENGINERING METHOD |
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THE LEAN BUSINESS ENGINEERING PROCESS
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The lean business engineering method, which is at the core of the Lean Business 2100 Management Program, must be implemented in accordance with your Management Level and your specific business needs. The process of implementing the lean business engineering method is called:
THE LEAN BUSINESS ENGINEERING PROCESS
The lean business engineering process entails two stages as described below.
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TWO STAGES IN THE LEAN BUSINESS ENGINEERING PROCESS |
Stage 1: Accomplish Your Personal Objectives In Business. |
Stage 2: Accomplish Your Business Objectives (For Business Owners Only). |
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Each stage of the lean business engineering process entails a number of steps,
depending upon your specific management level and it is discussed in detail next.
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Note: SBA defines small business as any organization with less than 500 employees |
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8. THE FIRST STAGE IN THE LEAN BUSINESS ENGINEERING PROCESS |
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ACCOMPLISH YOUR PERSONAL OBJECTIVES IN BUSINESS
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The first stage in the Lean Business Engineering Process entails evaluation of your personal potential for business success and your personal business management knowledge, development of a plan of action to improve your business management knowledge, and implementation of your plan in all areas relevant to your personal business activities.
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FOUR STEPS IN ACHIEVING YOUR PERSONAL OBJECTIVES IN BUSINESS |
1. Evaluate Your Personal Potential For Business Success. |
2. Evaluate Your Personal Business Management Knowledge. |
3. Develop A Plan Of Action To Improve Your Personal Business Management Knowledge. |
4. Improve Your Personal Business Management Knowledge On A Continuous Basis. |
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FIVE TUTORIALS IN THE LEAN BUSINESS 2100 MANAGEMENT PROGRAM |
The Lean Business 2100 Management Program provides the knowledge-based foundation for the lean business engineering method and contains Five Tutorials covering five major operational management areas. Each tutorial, in turn, contains 20 Check Points described below.
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EACH OF THE FIVE TUTORIALS CONTAINS 20 CHECK POINTS |
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20
Check Points
(1-20)
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20
Check Points
(21-40)
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20
Check Points
(41-60)
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20
Check Points
(61-80)
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20
Check Points
(81-100)
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Each check point includes a broad range of topics related to the specific tutorial. Thus, the entire Lean Business 2100 Management Program contains:
5 Tutorials x 20 Check Points = 100 Check Points.
You are advised to study all 100 check points in the Lean Business 2100 Management Program to enhance your business management knowledge and professional competency.
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STEP 1: EVALUATE YOUR PERSONAL POTENTIAL FOR BUSINESS SUCCESS |
As a small business owner, you personify your company and everything that it represents. It is critical, therefore, that you evaluate your personal preferences to identify your chances for success in business. This will help you ensure that you are on the right track. For this reason, it you must complete the Entrepreneurship Test online and identify your personal potential for business success. Upon completion you may need to make adjustments in your current set of preferences, if necessary, to maximize your long-term chances for successful business performance.
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STEP 2: EVALUATE YOUR PERSONAL BUSINESS MANAGEMENT KNOWLEDGE |
You and each member of your management team must independently complete the Personal Evaluation Worksheet online. Each check point in this worksheet is linked to the Lean Business 2100 Management Program online and supported by detailed information. You must only decide which check point is relevant to you and your business and ask yourself two simple questions: |
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Is this check point relevant to my company’s operational activities?
If your answer is "Yes" – ask the second question, if your answer is "No" - mark as N/A (not applicable) and proceed to the next check point. |
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How would I rate my business management knowledge related to this check point? |
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Click on any check point in the Personal Evaluation Worksheet and use the traditional Western-style management guidelines and lean management guidelines provided in this program online as a benchmark for your evaluation. |
STEP 3: DEVELOP A PLAN OF ACTION TO IMPROVE
YOUR PERSONAL BUSINESS MANAGEMENT KNOWLEDGE |
Upon self-evaluation of your personal business management knowledge, the Personal Evaluation Worksheet will automatically develop for you a Plan Of Action related to each relevant check point as follows:
• Plan A – Improve your business management knowledge related to this check point.
• Plan B – Keep your business management knowledge related to this check point as is.
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STEP 4: IMPROVE YOUR PERSONAL BUSINESS MANAGEMENT KNOWLEDGE |
Upon completion of your plan of action to improve your business management knowledge, you must make a total commitment to the knowledge-improvement process on a continuous basis. This process, based on kaizen guidelines, will undoubtedly make the most important positive difference in your business and in your life. Kaizen represents an integral part of Lean Management which is discussed in detail in this program.
So, all you really need to do is to diligently follow the Plan A summarized in your Personal Evaluation Worksheet.
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CROSS-FUNCTIONAL MANAGEMENT SELF-TRAINING |
The concept of cross-functional training of managers in various areas of operational business management was initially introduced in kaizen-driven companies. However, the lean business engineering method takes this approach one step further and, in addition, prescribes cross-functional management self-training of small and medium-sized businesses owners, professional managers, management consultants, pro-active CPAs or management accountants, and MBA students.
So, if you really want to succeed in your business in a long run – you must be prepared to learn whatever you need to do before you actually do it. Always remember:
• “Aim before you shoot”.
• “Measure seven times before you cut once”.
Hopefully, from now on, your motto in business and in life will be:
Whatever I do, I will learn about it first! |
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9. THE SECOND STAGE IN THE LEAN BUSINESS ENGINEERING PROCESS |
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ACCOMPLISH YOUR BUSINESS OBJECTIVES |
The second stage in the Lean Business Engineering Process will apply to you only if you have a business. This stage entails completion of your company’s Lean Business Analysis, development of your company’s Lean Business Plan and implementation of your company’s Lean Business Solutions in all areas relevant to your company’s operational activities.
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THREE STEPS IN ACHIEVING YOUR BUSINESS OBJECTIVES |
1. Complete Your Company’s Lean Business Analysis. |
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| The main purpose of lean business analysis is to evaluate your company's current operational performance using traditional Western-style management guidelines and lean management guidelines as performance evaluation benchmarks. Lean business analysis also includes your company's current and comparative financial performance results. |
2. Develop Your Company’s Lean Business Plan. |
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The main purpose of the lean business plan is to develop a comprehensive plan of action for your company in all relevant operational areas in accordance with traditional Western-style management guidelines and lean management guidelines. The lean business plan also entails preparation of a master budget, including an operational budget and a cash flow projection for the remaining portion of the current and next fiscal years.* |
3. Implement Your Company’s Lean Business Solutions. |
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The main purpose of lean business solutions is to implement your company's operational plan of action in accordance with traditional Western-style management guidelines and lean management guidelines to ensure the achievement of objectives in all operational areas in the most cost effective and professional manner. |
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* Note:
If the timing of this task falls toward the end of your company’s current fiscal year, then you should prepare the operational budget and cash flow projection only for the next fiscal year.
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THE SECOND STAGE IN THE LEAN BUSINESS ENGINEERING PROCESS
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PART 1: LEAN BUSINESS ANALYSIS |
1.1
Lean Operational Management
Analysis |
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1.2
Financial Performance
Analysis |
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Repeat The Above Process On An Annual Basis. |
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Note:
You and your financial management team should use your existing accounting package, such as QuickBooks®, to complete the financial performance analysis, to prepare financial performance plans, and to implement financial solutions for your company. Alternatively, you may request your accountant or CPA for additional assistance.
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10. LEAN BUSINESS ANALYSIS |
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PART 1: LEAN BUSINESS ANALYSIS
Lean Business Analysis is designed to enable you and your management team in completing your company’s lean operational management analysis and financial performance analysis. |
TWO ELEMENTS OF LEAN BUSINESS ANALYSIS
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1.1
Lean Operational Management
Analysis |
1.2
Financial Performance
Analysis |
| Lean operational management analysis entails completing a detailed performance evaluation of your company's current activities in all operational areas, using traditional Western-style management guidelines and lean management guidelines as performance evaluation benchmarks. |
The financial performance analysis entails completing a detailed evaluation of your company’s current financial performance and comparative financial results during the last three fiscal years, provided that financial statements are available. |
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11. LEAN OPERATIONAL MANAGEMENT ANALYSIS |
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1.1: LEAN OPERATIONAL MANAGEMENT ANALYSIS
Lean Operational Management Analysis is designed to enable you and each member of your management team to complete a detailed evaluation of your company's current activities in all operational areas and identifying strengths and weaknesses in each area, using traditional Western-style management guidelines and lean management guidelines as performance evaluation benchmarks.
Some of the main questions in operational management analysis are:
• How strong is our company's performance in various areas of operational activities using traditional Western-style management guidelines as performance evaluation benchmark?
• How strong is our company's performance in various areas of operational activities using lean management guidelines as performance evaluation benchmark?
FIVE ELEMENTS OF LEAN OPERATIONAL MANAGEMENT ANALYSIS |
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1.1.1
Lean General
Management
Analysis |
1.1.2
Lean Human
Resources
Management
Analysis |
1.1.3
Lean Financial
Management
Analysis |
1.1.4
Lean Operations
Management
Analysis |
1.1.5
Lean Marketing
And
Sales
Management
Analysis |
HOW DOES YOUR COMPANY’S LEAN OPERATIONAL MANAGEMENT ANALYSIS WORK?
You and each member of your management team must independently complete the Company Evaluation
Worksheet online. Each check point in this worksheet is linked to the Lean Business 2100 Management Program online and supported by detailed information. You and each team member must only decide which check point is relevant to your company’s operational
activities during the current fiscal year and ask two simple questions:
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1. |
Is this check point relevant to my company’s operational activities?
If your answer is “Yes” – ask the second question, if your answer is “No” – mark as N/A (not applicable) and proceed to the next check point. |
2. |
How would I rate my company’s operational performance related to this check point?
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Click on any check point in the Company Evaluation Worksheet and use the traditional Western-style management guidelines and lean management guidelines provided in this program online as a benchmark for your evaluation. |
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THE LEAN BUSINESS 2100 MANAGEMENT PROGRAM
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WHO SHOULD COMPLETE YOUR COMPANY’S
LEAN OPERATIONAL MANAGEMENT ANALYSIS?
You and each member of your management team must use the Company Evaluation Worksheet
to independently select each relevant check point and evaluate your company’s operational
performance related to that check point.
Upon completion, you must conduct a Management Meeting* and use a Final Company Evaluation Worksheet to determine the final evaluation level for each relevant check point
by mutual consent among all members of your management team.
The Final Company Evaluation Worksheet will enable you and your management team to identify your
company’s strengths and weaknesses in various operational areas and prepare you for the next stage
in the lean business engineering method - development of your company’s business plan.
* Note: This is applicable only to business owners who have a management team.
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12. FINANCIAL PERFORMANCE ANALYSIS |
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1.2: FINANCIAL PERFORMANCE ANALYSIS
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13. LEAN BUSINESS PLAN |
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PART 2: LEAN BUSINESS PLAN
Lean Business Plan is designed to enable you and your management team in formulating a sound lean operational management plan based on the previously concluded lean business analysis and developing an effective financial performance plan in accordance with your company’s overall business objectives.
TWO MAIN ELEMENTS OF A LEAN BUSINESS PLAN |
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2.1
Lean Operational Management Plan |
2.2
Financial Performance Plan |
The lean operational management plan entails completing a detailed plan of action related to your company's operational activities in accordance with traditional Western-style management guidelines and lean management guidelines. This also entails assigning responsibility for plan implementation to each member of your management team in accordance with your company's organizational structure and specific objectives. |
The financial performance plan entails completing operating and financial budgets for the remaining portion of the current and next fiscal years* in accordance with your company’s specific needs.
* Note: If the timing of this task falls toward the end of your company’s current fiscal year, then you should prepare operating and financial budgets only for the next fiscal year.
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14. LEAN OPERATIONAL MANAGEMENT PLAN |
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2.1: LEAN OPERATIONAL MANAGEMENT PLAN
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DIRECT CONNECTION BETWEEN
LEAN BUSINESS ENGINEERING METHOD AND LEAN MANAGEMENT
According to the Lean Business Engineering Method, you and your management team must develop a comprehensive operational management plan in accordance with traditional Western-style management guidelines and lean management guidelines, provided in this program.
This plan must cover all areas of your organization's activities and include the following:
• General Management.
• Human Resources Management.
• Financial Management.
• Operations Management.
• Marketing And Sales Management.
It is essential that each member of your management team becomes familiar with all relevant management guidelines contained in this program to ensure successful development and implementation of your company's lean operational plan.
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HOW DOES THE LEAN OPERATIONAL MANAGEMENT PLAN WORK?
You and each member of your management team must independently complete the Company Evaluation Worksheet which will automatically generate a detailed Plan Of Action for each relevant check point as follows:
• Plan A – Improve your company’s operational performance related to this check point.
• Plan B – Keep your company’s operational performance related to this check point as is.
If you are a one-person business owner, you must review the Plan A, specified in your Company Evaluation Worksheet, study each relevant check point, contained in the Lean Business 2100 Management Program, and determine all operational tasks which should be implemented to improve your company’s performance. Subsequently, you will need to summarize all tasks in a Company Plan Of Action Worksheet and specify planned completion dates.
If you are a business owner and you have a management team, you must conduct a Management Meeting, complete the Final Company Evaluation Worksheet by mutual consent, and assign responsibility for Plan A implementation regarding each relevant check point to a specific member of your management team. This is based on the Management By Objectives (MBO) Process guidelines discussed in detail in Tutorial 1.
Finally, you and each member of your management team must independently complete the Company
Plan Of Action Worksheet, summarize all necessary tasks related to each assigned check point, and specify planned completion dates. The information provided in the Lean Business 2100 Management Program online regarding each check point will help you and your management team members to complete each task.
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BENEFITS OF THE LEAN OPERATIONAL MANAGEMENT PLAN |
1. |
Comprehensive Operational Road Map For Your Company.
This plan will provide you and your management team with a comprehensive road map for ensuring your company’s successful performance. |
2. |
Effective Assignment Of Managerial Responsibility Within Your Company.
This plan will enable you to assign managerial responsibility to each member of your management team by mutual consent. |
3. |
Introduction Of The Management By Objectives Process Within Your Company.
This plan will enable you to introduce the management by objectives (MBO) process within your company to ensure maximum commitment and accountability by each partner and employee. |
4. |
Increased Employee Motivation Level Within Your Company.
This plan will increase motivation among all members of your management team and promote a feeling of “functional ownership” and increased accountability for meeting your company’s objectives. |
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15. FINANCIAL PERFORMANCE PLAN |
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2.2: FINANCIAL PERFORMANCE PLAN
USE QUICKBOOKS AND WORK WITH YOUR ACCOUNTANT
You and your financial management team should use your existing accounting package, such as QuickBooks®, to prepare operating and financial budgets for your company. Alternatively, you may request your accountant or CPA to assist you in completing these tasks.
Upon completion of your company’s business plan, you and your management team will be ready for the final stage in the lean business engineering method – cost-effective implementation of your business plan within your organization.
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16. LEAN BUSINESS SOLUTIONS |
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PART 3: LEAN BUSINESS SOLUTIONS |
Your ultimate objective is to ensure cost-effective implementation of your lean business plan by each member of your management team and to maximize your company’s performance and results. You can achieve this by introducing Lean Business Solutions in all areas of your company’s operational activities. The main objectives of this process are:
To maximize the value of your company’s products and services offered to customers, to streamline all operational activities, to minimize waste, to improve overall performance efficiency, and to reduce operational costs on a continuous basis.
Lean business solutions are based on traditional Western-style management guidelines and lean management guidelines, presented in this program. You and each member of your management team should become familiar with these guidelines, adopt kaizen principles of continuous improvement, and implement lean business solutions within your organization in a planned manner.
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BEGIN THE IMPLEMENTATION OF LEAN BUSINESS SOLUTIONS
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If you are a one-person business owner, or you have several employees, you must become a Cross-Functional Business Manager by wearing several “management hats” at the same time to ensure your business success. You are, in fact, the “Chef and the chief-bottle-washer” in your business. This means that you must study Lean Management presented in this program and apply lean management guidelines to all operational activities within your organization, namely: administration, finance and accounting, operations, marketing and sales.
If you own a small or medium-sized company, you must develop a Cross-Functional Management Team and motivate each member of your team to study Lean Management presented in this program. Subsequently, you and your team will be able to apply lean management guidelines to all operational activities within your organization to ensure successful business performance. This includes five operational management functions presented below.
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APPLY LEAN MANAGEMENT GUIDELINES
TO ALL OPERATIONAL ACTIVITIES WITHIN YOUR COMPANY |
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MANAGE THE IMPLEMENTATION OF LEAN BUSINESS SOLUTIONS |
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You will need to schedule a Management Meeting* with all members of your management team and proceed with the implementation of lean business solutions in a systematic manner.
You and each member of your management team should review all operational tasks summarized in your respective Company Plan Of Action Worksheets. Each member of your management team should be encouraged to use operational guidelines, contained in this program, which relate to the implementation of specific tasks. The ultimate efficiency of the Plan A implementation will depend upon the specific skills and knowledge acquired by each member of your management team throughout this entire process.
You should also plan to conduct future meetings with your management team on a regular basis to
ensure effective implementation of all operational solutions and steady Management Control within
your company. This must include a frequent Progress Review related to the implementation of
various tasks by each member of your management team to ensure a continuous progress toward
meeting your company’s objectives. Upon successful completion of each task, the task completion date
must be entered in the Company Plan Of Action Worksheet.
Ultimately, lean business solutions will enable you to improve the value of your company’s products and services offered to customers, increase your company’s level of competitiveness in the marketplace, improve operational profitability, and maximize the return on shareholders' investment.
* Note: This is applicable only to business owners who have a management team.
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17. ADVANTAGES OF THE LEAN BUSINESS ENGINEERING METHOD |
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WHAT CAN YOU EXPECT FROM USING
THE LEAN BUSINESS ENGINEERING METHOD? |
Hopefully, you and your management team will consistently apply all relevant guidelines prescribed by the lean business engineering method to your company’s operational activities, namely:
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• General Management
• Human Resources Management
• Financial Management
• Operations Management
• Marketing And Sales Management
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As a result of using the lean business engineering method, you can expect a more effective implementation of General Management Solutions within your company, as outlined below.
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THE LEAN BUSINESS ENGINEERING METHOD
CONTRIBUTION TO GENERAL MANAGEMENT |
1. |
Meaningful direction in developing strategic plans. |
2. |
Effective implementation of strategic plans. |
3. |
Comprehensive management by objectives (MBO) process. |
4. |
Improved method in developing operational plans. |
5. |
Effective implementation of operational plans. |
6. |
Comprehensive plan of management. |
7. |
Sound organizing process. |
8. |
Effective organizational structure. |
9. |
Improved communication process. |
10. |
Strong management control. |
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As a result of using the lean business engineering method, you can expect a more effective implementation of Human Resources Management Solutions within your business, as outlined below.
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THE LEAN BUSINESS ENGINEERING METHOD
CONTRIBUTION TO HUMAN RESOURCES MANAGEMENT |
1. |
A better way of treating employees. |
2. |
Effective job analysis. |
3. |
Concise job descriptions and job specifications. |
4. |
Cost-effective employee training and development. |
5. |
Improved employee motivation. |
6. |
Effective employee performance appraisal. |
7. |
Sound employee career management. |
8. |
Improved labor-management relationship. |
9. |
Improved employee safety and health. |
10. |
Effective conflict management and resolution. |
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As a result of using the lean business engineering method, you can expect a more effective implementation of Finance Management Solutions within your business, as outlined below.
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THE LEAN BUSINESS ENGINEERING METHOD
CONTRIBUTION TO FINANCIAL MANAGEMENT |
1. |
Improved financial management process. |
2. |
Accurate financial information. |
3. |
Effective bookkeeping process. |
4. |
Accurate financial statements. |
5. |
Effective financial performance evaluation. |
6. |
Improved budgeting process. |
7. |
Effective internal control and cash management. |
8. |
Improved control of purchases and disbursements. |
9. |
Improved inventory management. |
10. |
Accurate cost accounting. |
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As a result of using the lean business engineering method, you can expect a more effective implementation of Operations Management Solutions within your business, as outlined below.
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THE LEAN BUSINESS ENGINEERING METHOD
CONTRIBUTION TO OPERATIONS MANAGEMENT |
1. |
Improved facility design, location, and organization. |
2. |
Effective product, service, and process design and standardization. |
3. |
Effective equipment evaluation and selection. |
4. |
Improved plant layout. |
5. |
Cost-effective equipment maintenance and replacement. |
6. |
Improved operations planning. |
7. |
Improved material requirements planning. |
8. |
Effective operations control. |
9. |
Improved supply chain and material management. |
10. |
Improved total quality management. |
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As a result of using the lean business engineering method, you can expect a more effective implementation of Marketing And Sales Management Solutions within your business, as outlined below.
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THE LEAN BUSINESS ENGINEERING METHOD
CONTRIBUTION TO MARKETING AND SALES MANAGEMENT |
1. |
Comprehensive target marketing. |
2. |
Effective marketing strategies. |
3. |
Effective product and pricing strategies. |
4. |
Effective promotional and distribution strategies. |
5. |
Improved direct marketing. |
6. |
Sound marketing and sales planning and budgeting process. |
7. |
Improved sales force recruitment, selection, and training. |
8. |
Effective sales organization. |
9. |
Improved sales force management and motivation. |
10. |
Effective sales performance evaluation and control. |
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Finally, as a result of using the lean business engineering method, you can expect important improvements within your organization, as outlined below.
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THE LEAN BUSINESS ENGINEERING METHOD
CONTRIBUTION TO YOUR ORGANIZATION |
1. |
Improved business knowledge by your management team. |
2. |
Better understanding of business activities by your management team. |
3. |
Detailed business analysis of your company’s performance. |
4. |
Comprehensive business plan for your company’s operations. |
5. |
Cost-effective lean business solutions for your company’s operations. |
6. |
Improved value of products and services offered by your company. |
7. |
Improved level of customer satisfaction with your products and services. |
8. |
Improved level of long-term customer loyalty toward your company. |
9. |
Improved operational value stream within your company. |
10. |
Reduced non-value added activities and waste within your company. |
11. |
Improved process of selecting the most qualified managers and employees. |
12. |
Improved level of management control within your company. |
13. |
Improved communication, morale, and employee motivation within your company. |
14. |
Improved efficiency and productivity of employees within your company. |
15. |
Improved profitability of your company and higher return on shareholders’ investment. |
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18. WHAT SHOULD YOU DO NEXT? |
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THE LEAN BUSINESS ENGINEERING PROCESS CYCLE
Once you complete the implementation of cost-effective management solutions within your company, you should never “rest on your laurels”. You must ensure that your company stays on the road to success and adheres to the Lean Business Engineering Process Cycle. To accomplish this, you and all members of your management team must “always keep your eyes on the ball” and repeat the lean business engineering process cycle on an annual basis.
REPEAT THE LEAN BUSINESS ENGINEERING PROCESS CYCLE ON AN ANNUAL BASIS
Note:
As a Lean Business Club Member, you are invited to Subscribe to the Lean Business 2100 Management Program online, save up to 75% off the regular subscription rate and obtain full access to a wide range of information related to various operational management activities.
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19. WHAT DO YOU NEED FOR A LONG-TERM SUCCESS IN BUSINESS? |
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DEFINITION OF INSANITY
Can you imagine sending your children to university after kindergarten and expecting them to succeed, or building a five-story structure without foundation and expecting it to remain intact? The answer to both questions is obviously “No”.
However, this is exactly what happens to the majority of entrepreneurs and small business owners, who often start a business with very limited knowledge and experience in business management. As you know:
About 70% of all business startups fail after 12 years in business at a staggering loss of approximately $100 Billion per year.
You should remember wise words of Albert Einstein:
“The definition of “Insanity” is doing the same thing over and over again and expecting different results...”
THERE ARE NO SHORTCUTS FOR A LONG-TERM SUCCESS IN BUSINESS
The definition of insanity also applies to running a business. It means that if you are a small business owner, or you plan to start a business without proper business knowledge, you risk of becoming a part of the next 70% of failed businesses. For this reason, there is only one conclusion:
There are no shortcuts for a long-term success in business. It may be relatively easy to start a new business, but to keep it open - it’s a totally different story. Therefore, if you really want to succeed in your business, you must have solid knowledge of business management... and no more excuses.
That’s what the Lean Business 2100 Management Program and the lean business engineering method at its core are all about. This method does not provide a 100% guarantee for your success in business. However, it is designed to enhance your chances for a long-term success in your business. The rest is really up to you!
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20. FOR SERIOUS BUSINESS OWNERS ONLY |
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ARE YOU SERIOUS ABOUT YOUR BUSINESS TODAY? |
Reprinted with permission. |
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21. THE LATEST INFORMATION ONLINE |
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WOULD YOU LIKE TO LEARN MORE? |
Would you like to learn how to improve your personal business management knowledge and maximize your business performance through Lean Business Club?
When you are ready: |
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If you are U.S. Veteran, your membership in Lean Business Club and complete access to the Lean Business 2100 Management Program online will be available to you free of charge for an unlimited period. |
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LESSON FOR TODAY:
Your Business Is An Orchestra And You, As The Conductor, Must Know
What And When Your Musicians Must Play To Create A Symphony! |
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