Welcome!
The time: 2001.
The place: Boston, Massachusetts, a food processing company.
This company had just been spun off by its conglomerate parent because it could not contribute to the overall profit margin goals of the parent company. Determined to show the parent company what they really were worth, they formed their own privately-held corporate entity. Then they established cross-functional teams to map the Value Streams, from the time material hit the receiving dock to the time the finished product was shipped to the customer. After mapping the current state, they went to work eliminating Waste (miles of conveyor belts, waiting time, queue time, mountains of inventory, handling waste, defects), reducing lead time from 114 days to 10 days, and taking $3 million to the bottom line with only an $80k investment (that�s an IRR of 3,650%.) Who led this team? A LEAN CONTROLLER!
Whether you are a controller in a Lean enterprise in Boston, London, Tokyo, or Sao Paulo, we all speak the same language -- the language of the Lean philosophy of business and Lean Accounting. Lean, based on Henry Ford's "common sense" approach to manufacturing and the much admired Toyota Production System, has proven to be an unbeatable operating philosophy and business strategy to reorganize and revitalize a business. Its focus is on eliminating waste to "create" cash, not just cutting costs to "save" cash. It focuses on costing processes in Value Streams in Product Families_ not costing individual products. And it integrates financial data with operational data, ensuring responsibility and accountability throughout our businesses.
New paradigms are emerging! Some of these new paradigms are:
~ 'Bean counter' to Business partner!
~ Financial Statements in a language that ALL associates can understand.
~ NOT Cost Accounting, but rather Cost Management.
~ Mind what you measure. Measure those things you want to change!
~ MBV (Management by Value), and not MBO for "how" we achieve success is important.
~ Horizontal, not vertical, organizations, and integrated Teams.
~ NOT "variance analysis/paralysis," but rather trend analysis.
~ NOT valuing inventory, but eliminating inventory.
~ NOT a standard absorption cost system, but a cost system that drives the correct behavior in people.
New paradigms are emerging! Dramatic changes are taking place! And you, the LEAN CONTROLLER, are the leader, the Change Agent, the Catalyst to adding Value to the business. You, the LEAN CONTROLLER, are the Strategist, a Team player, leading cultural change and defining the new Lean management system.
You may read more about Lean Accounting on our website www.leanbeans.net. Here, in this website, we are promoting a LEAN CONTROLLERS CONFERENCE to be held in Fall 2012 in Orlando, Florida. Please do check back frequently for more details and an expanded Agenda! Enjoy the articles posted here for the LEAN CONTROLLER. We look forward to having you join the network in Orlando in late 2012!
Questions? Email us at info@leancontroller.com
