Maskell, B. H. and B. L. Baggaley. 2006. Lean accounting: What's it all about? Target Magazine 22(1): 35-43.
Note by James R. Martin
Lean Accounting Main Page | JIT & Lean Enterprise Main Page
The purpose of this paper is to document the principles, practices, and tools of lean accounting that were developed by a group of lean advocates at the 2005 Lean Accounting Summit. The following provides a brief outline of the lean accounting concept as described by Maskell and Baggaley.
1. Lean and simple business accounting. Eliminate waste in transactions, processes, reports etc.
2. Accounting processes that support lean transformation.
a. Visual performance measures.
b. Continuous improvement - value stream boards.
c. Value stream costing.
d. Target costing.3. Clear and timely communication of information.
a. Visual management - both financial and non-financial performance measures.
b. Decision making and box scores - See the table below and many other JIT measurements in Chapter 8.
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Box Score Example Format |
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| Operational measures: | Period 1 | Period 2 | Period 3 | Period 4 | Goal |
| Units per person | Number | Number | Number | Number | Number |
| On time shipments | % | % | % | % | % |
| Dock to dock days | Number | Number | Number | Number | Number |
| First time through | % | % | % | % | % |
| Average cost | $ Amount | $ Amount | $ Amount | $ Amount | $ Amount |
| Capacity measures: | Period 1 | Period 2 | Period 3 | Period 4 | Goal |
| Productive | % | % | % | % | % |
| Unproductive | % | % | % | % | % |
| Available | % | % | % | % | % |
| Financial measures: | Period 1 | Period 2 | Period 3 | Period 4 | Goal |
| Sales, Costs etc... | $ | $ | $ | $ | $ |
4. Lean planning and budgeting.
a. Hoshin policy deployment.
b. Sales operations, and financial planning.
c. Capital planning - 3P.
d. Investment in people.5. Strengthen internal controls.
