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The average or arithmetic mean (commonly just called the mean) is one of the most common measures of central tendency of a set of data. In layman’s terms, a measure of central tendency is simply a way of trying to describe the middle value of a set of data. The Read more…
Facility layouts come in three basic flavors. Unplanned Layouts. Some facilities are not arranged by any master plan. As new machines are needed, they are placed where they will fit. It is fairly uncommon for this method to be used throughout an organization, but many will have a few machines Read more…
In statistical terms, the law of large numbers is a theorem that postulates that as the size of the sample of a random variable increases, its average will approach the theoretical average. In layman’s terms, the law of large numbers simply says that over time, the more times you roll Read more…
Investments trade current resources for future gains. The most common forms of investment include: Financial holdings designed to provide a return on investment (ROI) in the form of appreciation, dividends, or interest. Physical holdings intended to appreciate or generate income, such as real estate Physical items used to create other Read more…
The Hawthorne Effect originated from experiments at the Hawthorne Works, owned by Western Electric, in Cicero, Illinois in the first half of the 1900’s. While there were a variety of experiments, the most commonly referenced study was about illumination. Researchers conducted a series of experiments to identify the optimal lighting Read more…
In his book, Out of the Crisis, W. Edwards Deming lists his 14 points for management. The overall aim of the book is to transform the style of American leadership. At the time the book was first published in 1982, American industry, especially automotive companies, had started to lag behind Read more…
In accounting, last-in, first-out (LIFO) is a method of recording inventory. It is used to manage earnings in inflationary times. A last-in, first-out inventory system records the most recent price of materials as the cost, thereby making earnings reflect current prices. As a result, the older items, purchased earlier when Read more…
Autonomy is the state of being competent and empowered to make decisions on one’s own. Self-directed or self-managed work teams are examples of autonomous groups. In the most effective application of these sorts of teams, workers own the process, rather than having supervisors or leads giving direction. This responsibility may Read more…
Mistake proofing devices, also called poka yokes, are the most effective way to improve quality. In a nutshell, a product (or process) is designed in which a mistake is impossible to make. This problem prevention is targeted at specific errors. In order to mistake proof a process, one must have Read more…
A Design of Experiment (DOE) is the process of determine the interaction of KPIVs (Key Process Input Variables) on the output of a process. It attempts to quantify the relationship of the variables in order to optimize the settings for that process. A key point of the design of experiment Read more…
Agile manufacturing describes a company’s ability to be responsive to the marketplace. A company has to be able to roll out new products and services as the needs and desires of their customers change. It also has to offer increasingly varied product mixes and greater customization when customers require it. Read more…
A water spider or ”mizusumashi” in Japanese (see our listing of Japanese Lean terms), is a person who has a prescribed set of tasks to keep materials in stock at the point of use in production areas. NOTE: The water spider is alternately called a water strider. This differs from Read more…