"Lean Consumption"
Harvard Business Review
March 2005, pp. 58-68
These well-known authors on the subject of lean production turn their attention in this article to applying lean thinking to the processes of consumption: "By minimizing customers' time and effort and delivering exactly what they want when and where they want it, companies can reap huge benefits."
The article focuses on six principles of lean consumption:
- Solve the customer's problem completely by ensuring that all goods and services work, and work together—Rather than providing patches for recurring problems, the focus should be on diagnosing and changing systemic issues at their source.
- Don't waste the customer's time—By focusing on ways to get rid of non-value-added time for the customer, repeat business is much more likely and provider problems will be solved as well.
- Provide exactly what the customer wants—Instead of large orders based on centralized forecasts, the lean provider has a "rapid replenishment" system that quickly orders exactly what the customer has just pulled from the shelf.
- Provide what is wanted exactly where it is wanted—Most customers buy the same things from a variety of formats (supermarket, warehouse store, convenience store, etc.) at different times. The authors provide an example of a European retailer (Tesco) that provides local convenience stores, midsized stores in town centers, supermarkets in the suburbs, hypermarkets on the periphery, and web-based shopping. The same items from the same suppliers are available at very similar prices.
- Provide what is wanted where it's wanted exactly when it is wanted—"Most of us do plan ahead for large, durable purchases and would be willing to share our plans with the producer in return for getting exactly what we want at a future date with a discount."
- Continually aggregate solutions to reduce the customer's time and hassle—Advances in information technology will provide opportunities to connect bundled goods and services in a cost-effective manner.
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