Is it time to add value?

Is it Lean anymore?  Have we over Leaned?  Is it time for adding more value?

I recommend to everyone that you read the Forbes article titled, “Why Amazon Can’t Make A Kindle In The USA”.  After reading it I do agree that for the sake of accounting and I will add the Westernization of Lean, we are outsourcing to show short term profits.  This outsourcing, as it takes away from our manufacturing, service, and information base, leaves companies with a shell that they can no longer develop in, because the guts were outsourced.  Hence perhaps a new spiral of declining value.

As we outsource we are also educating the companies we are doing business with.  As we outsource more and more, they become more capable of producing a competing product on their own.  So the marketing strategy of the outsource company would be, why pay the mark up when you can buy it direct . . .

As the article suggests this is not always the case.  If you have a tight control on outsourcing, that you are handling the design specifications yourself, you may have control of the process “so far” as the article put it.

This is sort of basic economics.  You must understand the equilibrium point and causes that can make it shift.  There will be times that you should outsource.  Most believe it is when it is outside your expertise.  There are times when even outside your expertise you may need to keep it “in house”.  Understanding what the customer values should determine this.  With reference to the Kano Model, we need to shift “delighting the customer” to “expected performance” to “the basic need” at a quicker pace.  If outsourcing does not conflict with that, then outsource.  Otherwise, keep it “in house”.

How does Lean Manufacturing fall into this?  Is it possible we have reached the end of Lean to where accounting says all we have left is outsourcing for profitability?  Or, is it more likely we have defined Lean Manufacturing incorrectly (Westernized) and that it should have been defined as the strive for continual improvement?