Kodak: Lean Start-Up Management
Kodak: Lean Start-Up Management
Kodak: Lean Start-Up Management
KODAK
Close collaboration will usually be necessary between Production and various other functions
within the organisation, for example:
Research and Development, concerning the implications of product design for production
methods and cost
Marketing, concerning desired product functionality, appearance, quality, durability and so on
Finance, concerning the availability of funds for purchase of new equipment and the
acceptability of inventory levels.
Human Resource Management, concerning staff motivation implications of job design and
production methods.
Service Organisations
Although many of the principles of good management in a manufacturing environment also
apply in organisations that provide services (rather than manufacture products), service
businesses, such as banking and professional firms of accountants and solicitors, do have a
number of distinctive features which have implications for how they are managed.
1. Services are less easily standardized than manufactured products and so service quality
tends to be more variable. This makes human resource management and motivation more
critical.
2. Services are often ‘intangible’ (i.e., something that cannot be precisely measured or
assessed) and multi-dimensional – what exactly is the ‘service’ being offered by a bank, a
private hospital or educational establishment? This can make attracting customers more
difficult as it often depends on promoting an intangible item.
3. Unlike manufactured products, services cannot be stored, but must be consumed as they
are produced or they are wasted. This creates additional problems matching productive
capacity with customer demand. This is reflected in, for example, the common practice of
commercial airlines offering very cheap flights based on marginal cost to fill empty seats –
a plane flying empty to New York is a service provided but wasted!
4. Ascertaining the cost of individual services is often also problematic, as the cost structure
of many service businesses is such that costs are often shared among different services.
This makes, among other things, pricing and the analysis of profitability of different
services more difficult than with most manufactured goods.