Practical lean accounting: a proven system for measuring and managing the lean enterprise

Abstract

Why Is Lean Accounting Important? How Standard Costing Can Drive Wrong Behavior We Need to Show the Financial Impact of Lean Improvements We Need a Better Way to Understand Product Costs We Need New Kinds of Lean Performance Measurements We Need to Eliminate Waste from Accounting Processes and Systems We Need Better Ways of Making Decisions We Need to Focus Our Business around Customer Value Summary Exercises and Discussion Questions Maturity Path to Lean Accounting The Maturity Path Getting Started with Lean Accounting Summary Exercises and Discussion Questions Cell Performance Measurements What's Wrong with Traditional Measurements? What's Right with Lean Cell Measurements? BMA, Inc. Performance Measurement Starter Set Day-by-the-Hour Report First-Time-Through Report WIP-to-SWIP Report Operational Equipment Effectiveness Other Support Measurements in the Cell Presenting the Information Making the Cell Performance Measurements Work Nonproduction Cells and Departments Summary Exercises and Discussion Questions Financial Benefits of Lean Manufacturing The Problem Creating the Box Score Managing Capacity Making Money from Lean Manufacturing Eliminating Wasteful Transactions What Must Be in Place? Cell Transactions Labor Tracking Material Costs Inventory Tracking Summary Lean Financial Accounting A New Perspective on Internal Accounting Control Eliminating Waste from the Financial Accounting Processes Using Lean Tools to Create Change Managing by Value Stream What Is a Value Stream? Different Kinds of Value Streams Why Do We Focus on Value Streams? Why Should We Manage the Business through the Value Streams? Continuous Improvement The Maturity Path to Lean Value Stream Organization Problems and Issues How Do We Identify the Value Streams? Do We Need to Change Our Organization Chart? Develop a Plan Summary Value Stream Performance Measurements What Is the Purpose of Value Stream Performance Measurements? Value Stream Continuous Improvement Teams Value Stream Measurements and Process Control How Do Value Stream Measurements Differ from Traditional Metrics? Box Scores Sales per Person Alternative Measurements On-Time Shipment Dock-to-Dock Time First Time Through Average Cost per Unit Accounts Receivable Days Outstanding Supporting Measurements Presenting the Information Making the Value Stream Performance Measurements Work Summary Value Stream Costing What Is Wrong with Traditional Standard Costing? How Does Value Stream Costing Work? Why Is Value Stream Costing Simple? How Can We Implement Value Stream Costing? How Do We Handle Costs Outside the Value Stream? How Do We Know the Cost of a Product? Value Stream and Plant Profit and Loss Statements Calculating the Cost of Inventory Special Problems Involving Inventory Getting Started with Simpler Methods Summary Using the Box Score Reporting Value Stream Performance Showing the Effects of Lean Improvements Showing the Effects of Strategies and Plans Summary Calculating Product Costs-Features and Characteristics What Drives Cost in a Lean Value Stream? How to Use Features and Characteristics Uses of Features and Characteristics Costing Summary Eliminating More Wasteful Transactions Labor Tracking Material Costs Inventory Tracking The Internal Control System Sales, Operational, and Financial Planning (SOFP) Purpose of Lean Sales, Operations, and Financial Planning Lean Financial Planning Lean Sales, Operations, and Financial Planning Value Stream Demand Planning Value Stream Operations Planning SOFP Planning Meeting Executive SOFP Meeting Variations on a Theme Making It Happen Summary Lean Financial Accounting II Further Advances in Lean Accounting Summary The Lean Enterprise What Is a Lean Enterprise? What Lean Methods Support the Wider Lean Enterprise? Why Are Lean Enterprises So Hard on Themselves? Summary Target Costing How Does Target Costing Work? Where Is Target Costing Used? What Are the Steps We Take? After Step 3 Target Costing at ECI, Inc.: Steps 1 through 3 Understanding Customer Value Example of Target Costing at ECI: Steps 4 through 6 Calculating the Target Costs Example of Target Costing at ECI: Steps 7 through 9 Driving to Customer Value Example of Target Costing at ECI: Steps 10 through 12 Summary Expanding Value Streams Outside Our Four Walls The Lean Value Stream Revisited A Vision of the Expanded Value Stream Examining Value and Cost within Our Own Company Example of Effective Value Stream Expansion Summary The Lean Accounting Diagnostic The Maturity Path Revisited Overview of the Diagnostic Tool Working with the Diagnostic Tool Summary Performance Measurement Linkage Chart The Performance Measurement Framework Creating the Performance Measurement Starter Set Steps for Developing Performance Measures in Your Company Summary Transaction Elimination Maturity Path Table How to Use the Maturity Path Table Transaction Elimination Process Maps Summary Value Stream Cost Analysis What Is Value Stream Cost Analysis Performing the VSCA Calculations Step 1: Define the Value Stream Step 2: Analyze Capacity Future State Step 3: Simulate Uses of Capacity Summary Value Stream Mapping Value Stream Maps and Lean Accounting More Value Stream Steps on the Value Stream Map Data Box Information Summary