From the course: Lean Accounting Foundations
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Interpreting results
- [Joshua] Completed box scores may look pretty, but they're of limited value if one can't interpret the results. So let's do it. What you're looking at is a completed box score for a manufacturer, specifically for the large toy cars value stream. It's broken down into three categories, performance indicators, resource capacity, and financial performance. We have raw inputs, that's these figures here in yellow, and also calculations, such as the return on sales. You'll also notice that we have separate columns for each reporting period, tracking the value stream's performance over time. The other thing you'll see is something called our baseline and also a target state. Our baseline is our starting point, and is relatively easy to understand, as it should be based on actuals from the relevant source systems. However, what about target state? What does it mean, and why is it important? Well, given lean is about…
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