Practical Lean Accounting. A Proven System for … Errors... · i Why we produced this booklet...

Practical Lean Accounting. A Proven System for Measuring

and Managing the Lean Enterprise Second Edition

Error Corrections and Revisions

Brian Maskell Bruce Baggaley

Larry Grasso

© BMA Inc. Cherry Hill NJ 2012

i

Why we produced this booklet

Since its publication in 2012, a significant number of errors have been found in the printed book: Practical Lean Accounting. A Proven System for Measuring and Managing the Lean Enterprise Second Edition. Regardless of the reason why this occurred, whether during the writing of the book, or during its production, the authors wish to correct these errors, especially where they affect the meaning or usefulness of the text.

This list of corrections, along with the book itself, is intended to provide a better, more accurate and useful book.

How to use the booklet

These entries are arranged as the book is arranged; they follow the book, chapter, page and item. This booklet is meant to be a “companion” for your reading of the book,

In an effort to make this booklet useful, we have provided detailed lists by page number of all known corrections, as well as comprehensive lists of corrected figures and tables. These have been indexed by the page numbers in this booklet and cross referenced to the page numbers in the printed book itself. This booklet will be available and will continue to be updated with any new corrections that are found and verified, until a completely corrected new and revised edition is provided by the publisher, CRC Press.

We welcome reports of any problems you discover with the book; you may email them to our attention at [email protected] We will respond promptly, investigate any issues, and provide revisions as needed.

In doing this work, we have kept closely to the Second Edition numbering and designations. Where something is labeled a “Table” we have kept is so; likewise, if it’s labeled a “Figure.” We have only changed titles to tables or figures when they were clearly incorrect. Changes within the text itself are referenced by page numbers, paragraphs on the page, and lines within the paragraph.

The authors wish to thank you for your patience. Practical Lean Accounting has been, since its first edition, a foundation text for Lean Accounting practitioners everywhere. We are very interested in making sure Practical Lean Accounting remains a valuable and useful resource.

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Table of Contents

Why we produced this booklet ....................................................................................................................... i How to use the booklet ................................................................................................................................... i Index of Figures, Corrected Text, and Tables ............................................................................................... v List of Corrections ......................................................................................................................................... 1

Chapter 1 Page 4, Figure 1.2 ................................................................................................................... 1 Chapter 1, Page 10, Shaded text box ....................................................................................................... 1 Chapter 2 Page 21, Table 2.4. ................................................................................................................ 1 Chapter 2 Page 26, first line, first paragraph. .......................................................................................... 2 Chapter 2 Page 28, Table 2.6 (continued) .............................................................................................. 2 Chapter 3 Page 31, Table 3.1 ................................................................................................................... 3 Chapter 4 Page 64, Table 4.1 ................................................................................................................... 4 Chapter 4 Page 66, Table 4.2 ................................................................................................................... 4 Chapter 4 Page 70, fourth and third line from bottom of page .................................................................. 5 Chapter 4 Page 71, Figure 4.1 .................................................................................................................. 5 Chapter 4 Page 73, Figure 4.2 .................................................................................................................. 7 Chapter 4 Page 74, Table 4.4 ................................................................................................................... 8 Chapter 4 Page 75, end of the first paragraph .......................................................................................... 8 Chapter 4 Page 76, Table 4.5 ................................................................................................................... 9 Chapter 4 Page 77, Table 4.6 ................................................................................................................. 10 Chapter 4 Page 81, Table 4.7 ................................................................................................................. 11 Chapter 4 Page 82, Table 4.8 ................................................................................................................. 12 Chapter 4 Page 83, Last paragraph ........................................................................................................ 13 Chapter 4 Page 85, Table 4.9 ................................................................................................................. 14 Chapter 4 Page 86, second bullet point on the list in the middle of the page ......................................... 15 Chapter 4 Page 86, second-to-last paragraph. ....................................................................................... 15 Chapter 4 Page 87, Table 4.10 ............................................................................................................... 16 Chapter 4 Page 88 Table 4.11 ................................................................................................................ 17 Chapter 4 Page 89 Table 4.12 ................................................................................................................ 18 Chapter 5 Page 96-97, Table 5.3 ............................................................................................................ 19 Chapter 6 Page 113, fourth paragraph, last line ..................................................................................... 21 Chapter 6 Page 119, last sentence in first paragraph below Step Four heading ................................... 21 Chapter 6 Page 121, Figure 6.12 ............................................................................................................ 21 Chapter 6 Page 122 Figure 6.13 ............................................................................................................. 22 Chapter 7 Page 141, last two lines on the page ..................................................................................... 23 Chapter 9 Page 179, Figure 9.2 .............................................................................................................. 24 Chapter 9 Page 179, Figure 9.3 .............................................................................................................. 25 Chapter 9, Page 180 Figure 9.4 .............................................................................................................. 26 Chapter 9 Page 186, Figure 9.6 .............................................................................................................. 27

iii

Chapter 9 Page 187, Figure 9.7 .............................................................................................................. 28 Chapter 10 Page 196, Table 10.1 ........................................................................................................... 29 Chapter 10 Page 197, Table 10.2 ........................................................................................................... 30 Chapter 10 Page 199, Table 10.3 ........................................................................................................... 31 Chapter 10 Page 199, Table 10.4 ........................................................................................................... 32 Chapter 10 Page 200, Table 10.5 ........................................................................................................... 33 Chapter 11 Page 209, Table 11.1 ........................................................................................................... 34 Chapter 11 Page 211, Table 11.2 ........................................................................................................... 35 Chapter 11 Page 212, Figure 11.2 .......................................................................................................... 36 Chapter 11 Page 214, Second paragraph under Step 5 ........................................................................ 36 Chapter 11 Page 214, Under the square bullet point preceding Table 11-3 .......................................... 36 Chapter 11 Page 214, Table 11.3 ........................................................................................................... 36 Chapter 11 Page 215, Table 11.4 ........................................................................................................... 38 Chapter 11 Page 215, Under the square bullet point following Table 11-3 ............................................ 38 Chapter 13 Page 243, Figure 13.3 .......................................................................................................... 39 Chapter 13 Page 248, Figure 13.4 .......................................................................................................... 40 Chapter 13 Page 252, Figure 13.5 .......................................................................................................... 41 Chapter 13 Page 257, Figure 13.6 .......................................................................................................... 42 Chapter 13 Page 259, Figure 13.7 .......................................................................................................... 43 Chapter 13 Page 260, Figure 13.8 .......................................................................................................... 44 Chapter 13 Page 264 & 265 Figure 13.9 ................................................................................................ 45 Chapter 14 Page 281, Table 14.1 ........................................................................................................... 47 Chapter 14 Page 282, Table 14.2 ........................................................................................................... 47 Chapter 14 Page 283, Second Paragraph, 11th line ............................................................................... 48 Chapter 14 Page 285, Sixth line from the bottom of the page ................................................................ 48 Chapter 14 Page 289, Table 14.3 ........................................................................................................... 49 Chapter 16 Page 315, Figure 16.6 .......................................................................................................... 50 Chapter 16 Page 321, Figure 16.9 .......................................................................................................... 51 Chapter 16 Page 321, first paragraph below Step 6 heading ................................................................. 51 Chapter 16 Page 326, Table 16.2 ........................................................................................................... 52 Chapter 16 Page 327, Figure 16.11 ........................................................................................................ 53 Chapter 16 Page 334, Figure 16.14 ........................................................................................................ 54 Chapter 16 Page 335, Figure 16.15 ........................................................................................................ 55 Chapter 16 Pages 337 & 338, Figures 16.16 & 16.17 ............................................................................ 55 Chapter 17 Page 345, Table 17.1 ........................................................................................................... 56 Chapter 17 Page 346, Figure 17.5 .......................................................................................................... 57 Chapter 17 Page 349, Figure 17.6 .......................................................................................................... 57 Chapter 17 Page 351, Figure 17.7 .......................................................................................................... 57 Chapter 18 Page 355, Table 18.1 ........................................................................................................... 58

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Chapter 18 Page 355, Table 18.2 ........................................................................................................... 58 Chapter 18 Page 356, Table 18.3 ........................................................................................................... 58 Chapter 19 Page 362, Figure 19.1 .......................................................................................................... 59 Chapter 19 Page 371, Table 19.1 ........................................................................................................... 59 Chapter 19 Page 374, Table 19.7 ........................................................................................................... 59 Chapter 20 Page 379, Figure 20.1 .......................................................................................................... 60 Chapter 20 Page 380, Figure 20.2 .......................................................................................................... 61 Chapter 20 Page 381, Figure 20.3 ......................................................................................................... 62 Chapter 21 Page 390, Table 21.2. .......................................................................................................... 63 Chapter 21 Page 397, Figure 21.2 .......................................................................................................... 64 Chapter 21, Page 399,Line 2 .................................................................................................................. 65 Chapter 21 Page 407, Table 21.9 ........................................................................................................... 65 Chapter 21 Page 408, Figure 21.4 .......................................................................................................... 66 Chapter 21 Page 406, Third paragraph from the bottom ........................................................................ 67 Chapter 21 Page 409, Figure 21.5 .......................................................................................................... 68 Chapter 21 Page 410, Table 21.10 ......................................................................................................... 68 Chapter 21 Page 411, Table 21.11 ......................................................................................................... 70 Chapter 21 Page 412, Table 21.12 ......................................................................................................... 71 Chapter 22 Page 418, Figure 22.1 ......................................................................................................... 72 Chapter 22 Page 419, Figure 22.2 .......................................................................................................... 74 Endnotes, Page 423 ................................................................................................................................ 76

v

Index of Figures, Corrected Text, and Tables

Figure 1.2 ..................................................................................................................................... 1 Figure 4. 1 .................................................................................................................................... 5 Figure 4. 2 .................................................................................................................................... 7 Figure 6.12 ................................................................................................................................. 21 Figure 6.13 ................................................................................................................................. 22 Figure 9.2 ................................................................................................................................... 24 Figure 9.3 ................................................................................................................................... 25 Figure 9.4 ................................................................................................................................... 26 Figure 9.6 ................................................................................................................................... 27 Figure 9.7 ................................................................................................................................... 28 Figure 11.2 .................................................................................................................................. 36 Figure 13.3 .................................................................................................................................. 39 Figure 13.4 .................................................................................................................................. 40 Figure 13.5 .................................................................................................................................. 41 Figure 13.6 .................................................................................................................................. 42 Figure 13.7 .................................................................................................................................. 43 Figure 13.8 .................................................................................................................................. 44 Figure 13.9 ............................................................................................................................ 45, 46 Figure 16. 6 ................................................................................................................................. 50 Figure 16. 9 ................................................................................................................................. 51 Figure 16.11 ................................................................................................................................ 53 Figure 16.14 ................................................................................................................................ 54 Figure 16.15 ................................................................................................................................ 55 Figure 16.16 & 16.17 .................................................................................................................. 55 Figure 17. 5 ................................................................................................................................. 57 Figure 17.6 .................................................................................................................................. 57 Figure 17.7 .................................................................................................................................. 57 Figure 19.1 .................................................................................................................................. 59 Figure 20.1 .................................................................................................................................. 60 Figure 20.3 .................................................................................................................................. 62 Figure 21.2 .................................................................................................................................. 64 Figure 21.4 .................................................................................................................................. 66 Figure 21.5 .................................................................................................................................. 68 Figure 22.1 .................................................................................................................................. 72 Figure 22.2 .................................................................................................................................. 74 Page 26, first line, first paragraph. ............................................................................................... 2 Page 10, Shaded text box ............................................................................................................. 1 Page 113, fourth paragraph, last line .......................................................................................... 21 Page 119, last sentence in first paragraph below Step Four heading ........................................ 21 Page 141, last two lines on the page .......................................................................................... 23 Page 214 Second paragraph under Step 5 ................................................................................ 36 Page 214 Under the square bullet point preceding Table 11-3 .................................................. 36 Page 215 Under the square bullet point following Table 11-3 .................................................... 38 Page 283 Second Paragraph, 11th line ....................................................................................... 48 Page 285, Sixth line from the bottom of the page ....................................................................... 48 Page 321 first paragraph below Step 6 heading ......................................................................... 51 Page 399 Line 2 .......................................................................................................................... 65 Page 406, Third paragraph from the bottom ............................................................................... 67 Page 423 Endnotes .................................................................................................................... 76

vi

Page 70, fourth and third line from bottom of page ....................................................................... 5 Page 75, end of the first paragraph .............................................................................................. 8 Page 83, last paragraph .............................................................................................................. 13 Page 86, second bullet point on the list in the middle of the page .............................................. 15 Page 86, second to last paragraph ............................................................................................. 15 Table 2.4. ..................................................................................................................................... 1 Table 2.6 (continued) ................................................................................................................... 2 Table 3.1 ...................................................................................................................................... 3 Table 4. 1 ..................................................................................................................................... 4 Table 4. 2 ..................................................................................................................................... 4 Table 4. 4 ..................................................................................................................................... 8 Table 4. 5 ..................................................................................................................................... 9 Table 4. 6 ................................................................................................................................... 10 Table 4. 7 ................................................................................................................................... 11 Table 4. 8 ................................................................................................................................... 12 Table 4. 9 ................................................................................................................................... 14 Table 4.10 .................................................................................................................................. 16 Table 4.11 .................................................................................................................................. 17 Table 4.12 .................................................................................................................................. 18 Table 5.3 .................................................................................................................................... 19 Table 5.3 (Continued) ................................................................................................................ 20 Table 10.1 ................................................................................................................................... 29 Table 10.2 ................................................................................................................................... 30 Table 10.3 ................................................................................................................................... 31 Table 10.4 ................................................................................................................................... 32 Table 10.5 ................................................................................................................................... 33 Table 11.1 ................................................................................................................................... 34 Table 11.2 ................................................................................................................................... 35 Table 11.3 ................................................................................................................................... 36 Table 11.4 ................................................................................................................................... 38 Table 14.1 ................................................................................................................................... 47 Table 14.2 ................................................................................................................................... 47 Table 14.3 ................................................................................................................................... 49 Table 16. 2 .................................................................................................................................. 52 Table 17. 1 ................................................................................................................................. 56 Table 18.1 ................................................................................................................................... 58 Table 18.2 ................................................................................................................................... 58 Table 18.3 ................................................................................................................................... 58 Table 19.1 ................................................................................................................................... 59 Table 19.7 title corrected ............................................................................................................ 59 Table 21.10 ................................................................................................................................. 68 Table 21.11 ................................................................................................................................. 70 Table 21.12 ................................................................................................................................. 71 Table 21.2 ................................................................................................................................... 63 Table 21.9 ................................................................................................................................... 65

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Practical Lean Accounting, 2nd Edition Error Corrections - 1

List of Corrections

Chapter 1 Page 4, Figure 1.2 Error description:

“Drill on CNC Machine” should read “Drill on Drilling Machine”

Corrected Figure 1.2

Chapter 1, Page 10, Shaded text box Error description: Name of BMA Inc. is misspelled.

Corrected text box:

Chapter 2 Page 21, Table 2.4. Error description: The title of this table is mislabeled. It should read as follows: “Table 2.4 Lean Accounting Changes during the Manage by Value Stream Stage of the Lean Maturity Path.”

BMA Inc. recently conducted a detailed study with one manufacturer. The company has a single plant with 150 people. They make about 120 different products and their revenues are approximately $15M per year. They process approximately 4,000,000 transactions per year and this represents 30 people (equivalent heads) within the company. They spend 12.7 percent of their revenues processing wasteful transactions.


Chapter 2 Page 26, first line, first paragraph. Error description: BMA, Inc. is misspelled. It should read “BMA Inc.”

Chapter 2 Page 28, Table 2.6 (continued) Error description: The word “Patht” in the table title is misspelled. It should read “Path”


Chapter 3 Page 31, Table 3.1 Error description:

Sales per person should not appear as a measure in the Cell / Process Measures column.

Corrected Table 3.1


Chapter 4 Page 64, Table 4.1

Error description:

Resource Capacity label box extends too far, encompassing the Inventory value financial measure on the bottom.

Corrected Table 4.1


Error description: Multiple numbers within the table were incorrect. Other inconsistencies with table items and text were found.

Corrected Table 4.2


Chapter 4 Page 70, fourth and third line from bottom of page

Error description: 4th line from bottom, ”ECI ships 2134 boards” should read “ECI ships 2134 controllers.” 3rd line from bottom “processing time is 30.3 min-“ should read “processing time is 46.3 min-“

Chapter 4 Page 71, Figure 4.1

Error description:

Multiple errors in wording on Current State value stream map; multiple errors within data boxes.




Chapter 4 Page 73, Figure 4.2 Error description: Multiple errors in wording on Future State value stream map; multiple errors within data boxes.



Chapter 4 Page 74, Table 4.4 Error description: Formatting problems, and some incorrect numbers within the table.

Corrected Table 4.4

Chapter 4 Page 75, end of the first paragraph

Reduction in gross profit should read $1,055 not $1,053.


Chapter 4 Page 76, Table 4.5 Error description: Some figures were not correct. Format of table was improved for clearer understanding of how the figures were computed. Corrected Table 4.5


Chapter 4 Page 77, Table 4.6 Error description: Minor formatting issue; corrected multiple figures to correct the box score.

Corrected Table 4.6:


Chapter 4 Page 81, Table 4.7 Error description: Numerous errors among figures. All figures should be expressed in the same number of decimal places to avoid confusion. Table needs to fit on one page.

Corrected Table 4.7


Chapter 4 Page 82, Table 4.8 Error description: Missing text from table headings and row headings. Some figures were incorrect. Corrected Table 4.8


Chapter 4 Page 83, Last paragraph Error description: A number figures within this paragraph were incorrect. Corrected paragraph should read: “Note that value stream profits have been increased by $36,295; sales per employee increased by a whopping $11,518 as a result of reducing payroll by 17 people -- $36,295; average cost per unit will have decreased by only $17.01 as a result of applying this alternative. Material costs will have been reduced by $35,000 due to inventory reduction.”


Chapter 4 Page 85, Table 4.9 Error description: Some numbers within the table were not correct.

Corrected Table 4.9


Chapter 4 Page 86, second bullet point on the list in the middle of the page Bullet point should read: “Sublease the 17,000 square feet to a subcontractor at $1.50 per square foot … “

Chapter 4 Page 86, second-to-last paragraph. “Under alternative 2, the growth scenario, Value Stream Profit increased by $284,655, a 45 percent increase …”


Chapter 4 Page 87, Table 4.10 Error description: Some confusing formatting in the box score. There were numerous errors and inconsistencies in the numbers on the box score. Corrected Table 4.10


Chapter 4 Page 88 Table 4.11 Error description: Various figures within the table were not correct. Corrected Table 4.11


Chapter 4 Page 89 Table 4.12 Error description: Numbers and percentages within the Table were not correct Corrected Table 4.12


Chapter 5 Page 96-97, Table 5.3 Error description: The “Dimension” column was reformatted to improve clarity. Some items were misplaced; these were moved to the correct locations within the table.

Corrected Table 5.3 Page 96:


Corrected Table 5.3 (Continued) Page 97:


Chapter 6 Page 113, fourth paragraph, last line Last sentence should read: “On average, the shared services team processes 36,000 invoices 36,000 invoices per month and send out a check for each of these.”

Chapter 6 Page 119, last sentence in first paragraph below Step Four heading Sentence should read: “This change required the team to make improvements in the purchase order process to permit payment from the amount in the purchase order rather than the invoice and to prevent mismatches.”

Chapter 6 Page 121, Figure 6.12 Error description: Title of Figure 6.12 was misleading. Some figures on the process map were not correct. Figure 6.13 was relabeled for consistency and understanding.



Chapter 6 Page 122 Figure 6.13 Error description: Figure title and content were inconsistent.



Chapter 7 Page 141, last two lines on the page The last two lines at the bottom of the page should read, “ …structures. The management team then assigned scores for each criterion – 5 for the structure that most supported the criteria, 3 for the next, and 1 for …”


Chapter 9 Page 179, Figure 9.2 Error description: There were many incorrect amounts in this figure. These have all been corrected.



Chapter 9 Page 179, Figure 9.3 Error description: Conversion cost figure was not correct.



Chapter 9, Page 180 Figure 9.4 Error description:

A number of figures were incorrect within the box score. The layout of the box score was truncated.




Conversion cost, profit and ROS were misstated in the figure.



Chapter 9 Page 187, Figure 9.7 Error description: Some figures were not correct. Decimal point for ROS was formatted to no decimal places. Over all format made uniform.

Corrected Figure 9.7:


Chapter 10 Page 196, Table 10.1 Error description: Capacity category label box extends down too far. The Revenue row belongs in the financial category.



Chapter 10 Page 197, Table 10.2 Error description: Capacity category label is formatted incorrectly. Productive and non-productive percentages not correct. Corrected Table 10.2


Chapter 10 Page 199, Table 10.3 Error description: Cash flow figures were revised to be more realistic. Corrected minor formatting problems. Corrected Figure 10.3


Chapter 10 Page 199, Table 10.4 Error Description: Cash flow figures were revised to be more realistic. Corrected minor formatting problems. Corrected Figure 10.4:



Error description: Cash flow figures were revised to be more realistic. Corrected minor formatting problems.



Chapter 11 Page 209, Table 11.1 Error description: Multiple numbers within the table were incorrect. Other inconsistencies with table items and text were found.

Corrected Table 11.1


Chapter 11 Page 211, Table 11.2 Error description: Other costs should be $28,000, not $20,000 in the table footnote.



Chapter 11 Page 212, Figure 11.2 Error description: numerous errors and misleading information on chart.


Chapter 11 Page 214, Second paragraph under Step 5 First sentence of second paragraph should read: “Note that for the average component having 200-700 dots and 5-10 nondedicated components per board, the cost per unit is equal to the total conversion costs for the period ($189,866) divided by the number of finished units made during the period (2,134) or $88.97.”

Chapter 11 Page 214, Under the square bullet point preceding Table 11-3 The two bullets should read:

“ – At over 700, cost equals $95.84. – At less than 200, cost equals $71.76”

Chapter 11 Page 214, Table 11.3 Error description: Conversion cost figures were not correct.




Chapter 11 Page 215, Table 11.4 Error description: Incorrect assumptions and figures were present in the table.


Chapter 11 Page 215, Under the square bullet point following Table 11-3 “ – At over 10, cost equals $108.25

– At less than 5, cost equals $56.63


Chapter 13 Page 243, Figure 13.3 Error description: Corrected minor formatting problems and some figures that were not correct.



Chapter 13 Page 248, Figure 13.4 Error description: Formatting inconsistencies and some incorrect figures.



Chapter 13 Page 252, Figure 13.5 Error description: Formatting inconsistencies and some incorrect figures.



Chapter 13 Page 257, Figure 13.6 Error description: Formatting and values in some cells incorrect. Corrected Figure 13.6


Chapter 13 Page 259, Figure 13.7 Error description: Cell formatting not consistent. Figure sub-headings mislabeled.



Chapter 13 Page 260, Figure 13.8 Error description: Rounding errors found in table figures. Formatting not consistent.



Chapter 13 Page 264 & 265 Figure 13.9 Error description: Various errors in Figure labels and figures.

Corrected Figure 13.9 Page 264:


Corrected Figure 13.9 Page 265:


Chapter 14 Page 281, Table 14.1 Error description: Numerous errors among values. Dollar values formatted with $ signs.


Chapter 14 Page 282, Table 14.2 Error description: Numerous figures within the table were not correct.

Corrected Table 4.2 (next page)


.

Chapter 14 Page 283, Second Paragraph, 11th line Sentence should read “The statement shows that during the period inventories declined by $536,117. So an adjustment was made in this amount to reduce the cash-basis profit to an accrual-basis profit of $411,462.

Chapter 14 Page 285, Sixth line from the bottom of the page

Error description: The word “clean” is misspelled. The entire line should read: “ Lean approach to this problem, known as the 5S’s, is to clean the spaces”


Chapter 14 Page 289, Table 14.3 Error description: Items in the System/Issue column were unnecessarily bulleted.



Chapter 16 Page 315, Figure 16.6 Error description: Some boxes mislabeled.



Chapter 16 Page 321, Figure 16.9 Error description: Title of Figure was corrected. Column labels and formatting corrected.


Chapter 16 Page 321, first paragraph below Step 6 heading First two sentences should read, “A matrix (Figure 6.9) is now used to show the correlation between the product features and the value stream business processes. The y-axis shows the product features.”


Chapter 16 Page 326, Table 16.2 Error description: Employee resource constraint was mislabeled. Capacity percentages for Employees were wrong.



Chapter 16 Page 327, Figure 16.11 Error description: Figures given were inconsistent with corrected Table 16.2. For this set of exhibits to work, they must show the same values. Corrected Figure 16.11


Chapter 16 Page 334, Figure 16.14 Error description: Figures given were inconsistent with corrected Table 16.11. For this set of exhibits to work, they must show the same values. Corrected Figure 16.14


Chapter 16 Page 335, Figure 16.15 Error description: Format was changed for clarity and consistency with other exhibits in the book showing similar information. There were some incorrect figures.


Chapter 16 Pages 337 & 338, Figures 16.16 & 16.17 Error description: Neither figure is described in the narrative; they appear parenthetically after the Summary. They are not necessary.

These two figures are eliminated.


Chapter 17 Page 345, Table 17.1 Error description: Formatting and typos need to be corrected. Some percentages and ranking figures not correct.



Chapter 17 Page 346, Figure 17.5 Error description: Some functions incorrectly positioned.


Chapter 17 Page 349, Figure 17.6 Error description: Minor formatting issues as listed below

• No arrowhead on information (weekly) from Distributors to Production control. • No arrow heads on information from Production control to Procurement, Dashboard Assembly,

Interior Assembly, and Warehouse.

Chapter 17 Page 351, Figure 17.7 Error description: Minor formatting issues as listed below

• No arrowhead on information (weekly) from Distributors to Customer service. • No arrow heads on information from Customer service to finished goods.


Chapter 18 Page 355, Table 18.1 Error description: Table contained misleading format information


Chapter 18 Page 355, Table 18.2 First bullet point in the tale should read “Performance measurements at value streams integrated with corporate level strategy.” Fifth bullet point should read, “Assess and track performance and cost improvements for lean projects.”

Chapter 18 Page 356, Table 18.3 Table title should read: “Stage 4: Changes to Implement Once Lean Value Streams are in Place”


Chapter 19 Page 362, Figure 19.1 Error description: Figure title was not correct. Some items were misaligned. Corrected Figure 19.1

Chapter 19 Page 371, Table 19.1 Error description: Steps in body of Table were confusing.


Chapter 19 Page 374, Table 19.7 Error description: Table title should read: “Develop non-production process measures.”



Table format was incorrect. Original table from Edition 1 was correct.

Replaced Figure 20.1.




Replaced Figure 20.2




Replaced Figure 20.3


Chapter 21 Page 390, Table 21.2. Error description: Some of the figures displayed in the Current State and Future State columns were incorrect. Corrected Table 21.2


Chapter 21 Page 397, Figure 21.2 Error description: Multiple errors in process boxes and on time line.

Generated new Value Stream map for Figure 21.2


Chapter 21, Page 399,Line 2 This line should read: “1.75 circuit boards per controller.) Approximately 5 percent of the total” ”

Chapter 21 Page 407, Table 21.9 Error description: Some figures in the table were incorrect.



Chapter 21 Page 408, Figure 21.4 Error description: Multiple errors in wording on Future State value stream map; multiple errors within data boxes.



Chapter 21 Page 406, Third paragraph from the bottom First line of this paragraph should read: “Note that the changes planned for the future state will eliminate 329 …”


Chapter 21 Page 409, Figure 21.5 Error description: This work sheet sample misstates the change-over (C/O) time for the Hand Load and Wave Post data box. In order to be consistent with Figure 21.4 Future state C/O should be 0 minutes, not 30 minutes.

Chapter 21 Page 410, Table 21.10 Error description: Numerous errors in number values and placement. Formats for numbers were not adequate; not enough decimal places.

Corrected Table 21.10 (next page)




Error description: Some numbers within the table were not correct.



Chapter 21 Page 412, Table 21.12 Error description: Numerous errors among figures. All figures should be expressed in the same number of decimal places to avoid confusion. Table needs to fit on one page.



Chapter 22 Page 418, Figure 22.1 Error description: Many data boxes were not correct. Time line was not correct. Staffing level for A/R was missing.


See next page.



Chapter 22 Page 419, Figure 22.2 Error description: Many data boxes were not correct. Time line was not correct. Added staffing level to A/R.


See next page.



Endnotes, Page 423

Error description:

Endnotes for the Introduction chapter are missing.

Corrected Endnotes:

1. For a readable understanding of the use of “Design of Experiments” methods, we recommend the excellent book by Mark J. Anderson and Patrick J. Whitcomb, DOE Simplified, Practical Tools for Effective Experimentation. Productivity, Inc., Portland, Oregon, 2000

2. The subject of statistical variation is beyond the scope of this book. We encourage readers to refer to one of the many excellent texts on the subject.

One of the most readable that we have seen is written by Stephen R. Schmidt, Mark J. Kiemele and Ronald J. Berdine, Knowledge Based Management, Unleashng the Power of Quality Improvement. Air Academy Pres & Associates, Colorado Springs, CO, 1998

Another very fine book, slightly more technical but very readable nonetheless, is by Donald J. Wheeler, Understanding Variation, the Key to Managing Chaos. SPC Press, Knoxville, Tennessee, 1993.

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Practical Lean Accounting. A Proven System for … Errors... · i Why we produced this booklet...

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