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Improving and Innovating Processes

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Supply chains are made up of people, processes, and technologies. All three components need to improve over time for a supply chain to remain competitive. People get better through education, training, and experience. Technology gets better through improvements in hardware and software. Processes get better through innovation and … well, process improvement.

Three approaches to process improvement are particularly useful in supply chain management: Lean, Theory of Constraints, and Six Sigma. These approaches share a goal — process improvement — but achieve it by focusing on different aspects of a process. Table 4-1 highlights the primary focus of each method.

TABLE 4-1 Three Approaches to Process Improvement

Method Focus
Lean Reducing waste
Six Sigma Reducing variability
Theory of Constraints Relieving bottlenecks
Supply Chain Management For Dummies

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