Administrative processes substantially contribute to a company’s costs. Obviously, it depends on the company, but estimates commonly attribute 60-80% of expenses to administrative processes.
Administrative processes are the office tasks that are required to keep a company humming along. Administrative processes include human resources, marketing, and accounting. Basically anything that entails managing the information that supports a business is an administrative process.
On occasion, the administrative process is actually the service for the customer, and thus is production work. Processing loan applications or managing rental properties are examples.
It makes sense, given the high level of costs associated with administrative processes, that Lean would leap from the shop floor to the office—often called, not surprisingly, the Lean office. While this transition has been happening for some time, it picked up significant steam around the turn of the century.