ENVIRONMENTAL AND FINANCIAL SYNERGIES ON AFFORESTATION OF DEGRADED LANDS
Financial synergies
2
0 Financial impact of adopting it Significant benefits can be realised, sustained and continuously improved: quality saves money Examples of achieved benefits from Lean Some examples of financial benefits ■ During the period 1996 – 1998 General Electric (GE), the world‟s well-known user of Lean, invested about 1billion dollars in adopting the approach. Their earnings in the same period were 1,75 billion dollars. The ROI-period was 9 months ■ For Motorola, one of the founders of Six Sigma, the ROI took 2.5 year, but the effect was even larger: 2.2 billion dollars ■ The Bank of America stated in 2004: “since launching our Lean efforts less than 3 years ago, we’ve saved hundreds of millions of dollars in expenses, cut cycle times in numerous areas of the company by half or more and improved the percentage of customers who rate their satisfaction at 9 or 10 on a 10-point scale form 41% to more than 50%, an increase of almost 2,5 million customers” ■ Red Cross Hospital Beverwijk saved €310,000 in their first half year of working with Lean (September 2002 – February 2003) ■ Philips Lighting saved more then € 2 billion in Black Belt projects since the start of the program Achieved Short term Long term 85% 185 100 22 13 50 0 50 100 150 200 Potential productivity Better value chain alignment Flexible planning Smarter process Productivity at start pilot Productivity ■ Stork Fokker reported a decrease in work in progress of 80% and a cycle time improvement of 25% at the production of Cessna-airplane tails by using Lean Manufacturing ■ Boeing has implemented a Lean program years ago and gains high savings and higher employee satisfaction ■ Toyota has developed his own Lean derivate, this has made it one of the biggest automobile manufactures in the world, with high quality products
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Transcript of Financial synergies
0
Financial impact of adopting it
Significant benefits can be realised, sustained and continuously improved: quality
saves money
Examples of achieved benefits from LeanSome examples of financial benefits
■ During the period 1996 – 1998 General Electric (GE), the world‟s well-known
user of Lean, invested about 1billion dollars in adopting the approach. Their
earnings in the same period were 1,75 billion
dollars. The ROI-period was 9 months
■ For Motorola, one of the founders of Six Sigma, the ROI took 2.5
year, but the effect was even larger: 2.2 billion
dollars
■ The Bank of America stated in 2004: “since launching our Lean efforts less
than 3 years ago, we’ve saved hundreds of millions of
dollars in expenses, cut cycle times in numerous areas of the
company by half or more and improved the percentage of customers who rate
their satisfaction at 9 or 10 on a 10-point scale form 41% to more than 50%, an
increase of almost 2,5 million customers”
■ Red Cross Hospital Beverwijk saved €310,000 in
their first half year of working with Lean (September 2002 – February
2003)
■ Philips Lighting saved more then € 2 billion in Black
Belt projects since the start of the program
Achieved
Short term
Long term
85%
185
100
22
13
50
0 50 100 150 200
Potential
productivity
Better value chain
alignment
Flexible planning
Smarter process
Productivity at
start pilot
Productivity
■ Stork Fokker reported a decrease in work in progress of 80% and a cycle time
improvement of 25% at the production of Cessna-airplane tails by using Lean
Manufacturing
■ Boeing has implemented a Lean program years ago and gains high savings and
higher employee satisfaction
■ Toyota has developed his own Lean derivate, this has made it one of the biggest
automobile manufactures in the world, with high quality products
1
In practice: financial impact of adopting it
Significant benefits can be realised, sustained and continuously improved: quality
saves money (cnt´d)
Process redesign
■ Measurement and
analyse
■ Definition of „waste‟
■ Design new
process
■ Implement new
process
Continuous
improvement
■ Continuous measurement,
analysis and control
■ Proactive employees
■ Makes use of the
knowledge in the
organisation
Structural EBIT
improvement
through cost
efficient
processes
