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Lean Business Model:
Lean business model is associated with the minimization of wastes, which results into lower use of resources for satisfying demands of customers. In other words we can say that lean business model focus on the minimization of wastes (costs) and improvement in productivity so that firm can survive in the competitive business environment.
To Explain:
What are the three key principles of lean business model?
Answer to Problem 1DQ
Followings are the three key principles of lean business model;
- Value streams
- Pull production
- Zero waste and zero defects
Explanation of Solution
Followings are the three key principles of lean business model;
Value streams;
As per this principle of lean business model, it is expected from the manufacturers to produce goods & services as per wants of the customers so that needs & wants of the customers can be fulfilled without any delay & wastes. It will result into higher satisfaction for the customers and higher profits for the manufacturers as well.
Pull production;
As per this principle of lean business model, goods & services are made as per orders of the customers so that needs & wants of the customers can be meet out. It will result into higher satisfaction for the customers and higher profits for the manufacturers as well because no inventory of unsold goods will be lying in the firm thus it will minimize the cost of storage as well.
Zero waste and zero defects;
As per this principle of lean business model, manufacturers focus on zero waste and zero defects. Employees of the firm get better training so that any type of defects can be spotted as soon as possible and corrective actions can be made immediately. This will help in zero waste and zero defects.
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