Framework for a Cost-Benefit Analysis of Lean Production Systems

Abstract

Although lean production and its advantages are discussed for over 20 years, the detailed identification of the contribution of individual lean methods is still hardly possible. Due to the lack of efficiency analysis frameworks the benefits and costs of a lean production system remain vague in literature. This paper presents a framework to analyze the benefits and costs of the implementation of lean methods. A specific decomposition methodology is used which starts with a high-level performance indicator to break it down to operational indicators which individual lean methods can be assigned. The framework assists companies to track the contribution of individual lean methods to a key performance indicator.