Explain one benefit of lean production for ABC.

• A. Increases cycle time
• B. Lower costs and improved efficiency by reducing waste
• C. Requires more inventory
• D. Increases setup times

Answer: (B)

Lean production aims to remove waste from operations so processes flow smoothly with minimal use of resources. A clear benefit for ABC is lower costs and improved efficiency by reducing waste. By cutting waste—such as making more than is needed, waiting time, unnecessary movement, excess inventory, defects, and wasted talent—the company spends less on materials, storage, and rework, while work moves faster from start to finish. This typically leads to shorter lead times, better use of capacity, and higher quality, all of which shave costs and boost overall efficiency. Tools like just-in-time, Kanban, 5S, and kaizen help identify and eliminate waste and streamline processes.

Options that suggest higher cycle times, more inventory, or longer setup times run counter to lean principles, which strive to shorten cycle times, reduce inventory, and minimize setup times.