Efficiency (lean definition)

Efficiency in lean production means meeting exact customer requirements with the minimum amount of resources. The document separates apparent efficiency, which counts as a gain only if demand rises alongside output, from true efficiency, which comes from producing the same output with less effort and capital. It also separates total efficiency across a whole process or value stream from local efficiency at a single step, and favours the total view.

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Study notes

Ohno's example: 10 people produce 100 units daily; raising output to 120 units is an apparent 20 percent efficiency gain that is real only if demand also increases by 20 percent (Ohno 1988, p. 61).
If demand stays at 100 units, the only way to raise process efficiency is to produce the same number of units with less effort and capital.
Total efficiency covers the performance of an entire production process or value stream; local efficiency covers the performance of one point or step within it, and Toyota emphasises total over local efficiency.
The source cross-references Overproduction and the 7 Wastes.