What is the ROI for implementing lean production?
To calculate ROI (short for “return on investment”) you divide the profit (after tax) by the total cost of the investment. Then you will get a number that shows the return in percent, i.e. the ROI.
The same calculation model can of course be used to calculate your ROI of implementing lean. By digitizing, quality assuring and streamlining your production, you make profits through increased productivity, reduced waste and increased profitability. Therefore, the easiet way is often to divide the implementation into individual projects where you simply look at the improved economy and subtract the costs of the project. That way, you get a number that indicates the return on your investment.
Our experience, after almost 40 years in the industry, is that the companies that make these investments quickly reach an ROI of hundreds or thousands of percent. This even tough ROI is a simplified measure that only takes into account short-term measurable values. Lean production also leads to higher health among employees, more satisfied customers and a reduced climate footprint.
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