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Business INSIGHTS e-News for Manufacturers

About the Authors

Robert Loderstedt

President and CEO
New Jersey Manufacturing Extension Program, Inc.

  • President and CEO of NJMEP since 1997
  • Former President and CEO of Raymond Handling Technologies
  • Former Director of Strategic Planning for Bell Atlantic Mobile Systems
  • Accomplished writer and speaker, with works in a variety of industry publications
  • Bachelor of Science in Economics, Rutgers University

Joseph D'Urso

Field Agent (FA)
New Jersey Manufacturing Extension Program, Inc.

  • 30+ year career in engineering, manufacturing and facility operations
  • NJMEP Field Agent and Resource Manager for seven years
  • Certified MEP Lean Facilitator
  • Master of Business Administration, Bachelor of Science in Mechanical Engineering, Rutgers University; training in quality processes, job evaluation and ISO standards

Top-line Growth Through Lean Innovations

by Robert Loderstedt and Joseph D'Urso
New Jersey Manufacturing Extension Program, Inc.

Innovation is a hallmark of the United States. While Henry Ford is recognized for the assembly line and standardization, his real innovation was deciding to build cars, because, as he reportedly said, "If I had listened to my customers, I would have bred faster horses."

While a company can produce (and ideally sell) more by implementing lean production techniques to reduce cycle time, inventory and rejects, top-line growth is more directly achieved through lean innovations off the production floor. Non-production areas such as product development, sales and marketing, and accounting offer great potential.

Product Development: Cross-functional teams and concurrent development bring new, unique products to market faster. Simultaneous development of software, hardware, usage rights, customer interfaces and marketing plans accounted for the rapid, successful introduction of the iPod, for example.

Sales and Marketing: Use of design libraries and one-off quote responses reduces the cycle time for submittals. Almost without exception, purchasing agents will accept a quote delivered in hours and within their acceptance range rather than waiting weeks for other responses.

Accounting: Lean accounting innovations include adjusting cost calculations, inventory valuations and expense approval levels. While traditional standard costing methodology holds cost per unit constant, a lean costing approach recognizes that most costs (labor, space, utilities) are flat over a volume range and should be treated and recovered as fixed costs. (Only costs such as materials vary incrementally with small changes in volume.) This costing structure can lead to profitable new sales. Eliminating redundant approvals is pivotal to efficiency, too, speeding invoice processing and quote responses.

As you put innovative processes into place, remember that the most important step is to recognize talented individuals and free them to do value-adding work. The essence of lean innovation, after all, is identifying and minimizing non-value-adding activity.

New Jersey Manufacturing Extension Program, Inc.
New Jersey Manufacturing Extension Program, Inc. (NJMEP) is part of the National Institute of Standards and Technology (NIST) MEP network. NJMEP works with New Jersey's small to mid-size manufacturers to help them become more efficient, profitable and globally competitive through cost-saving strategies and growth initiatives such as Lean Manufacturing and Business Growth Strategies based on 5S, Kanban, Kaizen and Six Sigma. Located throughout the state, NJMEP field agents partner with clients to assess needs and jointly develop and implement a course of action. For additional information, contact Robert Loderstedt at 973-219-3833 or bloderstedt@njmep.org.

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