Integrating VSM and Waste Identification with Cost Deployment into Leathergoods Production

The luxury industry serves as a vital economic pillar for various countries. Companies within this sector encounter several challenges, including high variability, low predictability, short product life cycles, and high product customization. These factors contribute to a significant level of uncertainty, frequently resulting in challenges to meet customer needs promptly. As a response, there is a growing imperative to streamline operations and enhance effectiveness to successfully navigate the dynamic shifts in the market. While the adoption of lean principles could address these challenges, implementing lean practices in a luxury enterprise proves challenging due to the high variability of products. Consequently, the transition to a lean factory is not a straightforward process. This paper aims to present a feasible approach for integrating lean principles into a luxury company to minimize potential waste. In this context, the Value Stream Map (VSM) is combined with Waste Identification (WID) to comprehend the distribution of wastes within various processes. Additionally, Cost Deployment (CD) is adopted to connect activities for waste reduction with cost reduction objectives. This final phase contributes to a deeper understanding of the company's financial landscape. The proposed framework is applied to a case study of a luxury company operating in the leather field. The framework could be adopted to identify and quantify wastes, leading to the detection of the most impactful ones. Accordingly, it could guide the prioritization of appropriate countermeasures, enhancing operational excellence and continuous improvement in companies.