1. Understanding customer value: Customer is at the center stage of any exercise done in the organization. The customer is willing to pay only for the value of the product and the one that helps in making the necessary change in the form of product which is considered as value-added (VA) activity.
2. Value stream analysis: Having understood the value for the customers, the next step is to analyze the business processes to determine which ones actually add value.
3. Flow: The focus should be on continuous flow of the material in small quantity rather than moving material in large batches. This approach helps in reducing work-in-process inventory.
4. Pull: The production on any process should be triggered by demand of the process that follows it. No material should be processed unless it is needed by a downstream process.
5. Perfection: The elimination of nonvalue added (NVA) activity is a process of continuous improvement and requires structured framework like Kaizen to be practiced without end.