Introduction
Why is Lean Manufacturing or thinking so prevalent in the modern current economies of scale? To remain competitive, agile and the lowest cost producers, providers and streamlined business, getting rid of waste and being highly, consistently and sustainable is key for survival and thriving in this new economy.
Lean manufacturing or thinking is exactly what the name sounds like – it is about ‘cut to the bone’, fat-trimmed, streamlining operation and organizations.
Authors Womack and Jones define lean thinking as a set or collection of ‘efficiency tools’ that you can unleash in your business to save money, reduce cost and waste and deliver consistent and effective service that is affordable and pleasing to your customers. It is about vision and tools for reducing variability and cutting down on waste, being efficient and running a smooth and competitive, even profitable operation, well.
The thinking was initially championed by pioneers like Toyota and it was eventually adopted by the Japanese automakers as the principle upon which they wanted to build, run and grow their businesses. Only a little later, will the Western world catch onto the value and potential of this approach to their respective organizations and operations.
Some have referred to lean manufacturing as the TOYOTA PRODUCTION SYSTEM, or JIT (just-in-time) manufacturing, paying attention to things like flow productions, line operations, value streams, Kaizen (which we will get to later). In any lean manufacturing process and approach there are a couple of things to pay attention to. There is discipline, planning, rigor, scientific approach and statistically-based tools required and applied to make this business paradigm fit, work and last.
Lean manufacturing will help you in your business take a serious look at visible causes and effects in your business. Aspects that could get some attention could include things like:
- inventory
- movement/motion
- waiting or queues
- broken machines or tools (missing)
- dirt and clutter
- noise
… and many others.
Things that we can see that is obvious waste or inefficiencies attract attention and demand action. This is where lean manufacturing steps in and makes the difference. It deals with the problems that we can actually SEE and do something about.
True to its Japanese origin there are lots of ‘legacy’ terminology here, one of which is MOST appropriate as we start this discussion on lean tools and the implications for your business:
It is referred to as MUDA, essentially meaning WASTE. In any process and business there are EIGHT forms of MUDA/WASTE present:
- Making products, delivering service that no-one wants OR NOT MEETING USER NEEDS (useless)
- DEFECTIVE products or flawed services (mistakes)
- Making too much of something (overproduction)
- Inventory
- Unnecessary processing (non-value added steps)
- Unnecessary movement of people
- Unnecessary movement of things
- Waiting or queuing
There are many reasons people would want to use lean manufacturing in their organization or business
- breakthrough performance
- increased quality
- shorter cycle times
- creating shareholder value
- applying the principles throughout every level of the organization
When you focus on any improvements for production and profit you will have to pay attention to the saying ‘time is money’ and ‘quality matters’. These two principles and fundamental pillars for lean manufacturing will reward you greatly if considered in all aspects and areas of your business.
- Achieve cost reductions on your terms
- Cut lead/wait times within a short period of time, in a planned fashion using lean tools to get you there!
- Cut down on processing time from start to finish, from the moment and order is placed to when it is shipped and delivered, (also called cycle time).
Through using lean manufacturing, you can in effect combine business improvement with business strategy. YOU WILL NEED BOTH TO BE SUCCESSFUL and GET RESULTS THAT LAST.
There are ways that you can decide which specific approach or major projects can have the MOST impact on your bottom line, strategy and overall financial priorities.
Get rid of delays, waiting times, obstacles, bottlenecks and unnecessary waste hindering expedient, reliable, efficient and affordable products and services.
Cutting costs and saving money is at the very heart of lean manufacturing and thinking. It is a philosophy and practical business strategy that will reward greatly and even increase shareholder value significantly.
The tools and approaches we will be discussing and highlighting as part of this process, will be enlightening and inspiration. They are effective and they work. They complement and reinforce efficiency and streamlined operations, with measurable returns to your pocket and bottom line!
The reason we are all in modern-day business at all, is to earn return! It has to pay to do business, otherwise why do it at all?
In a time when businesses have to keep up with all the constant changing and evolving world or exciting, global business, agility and adaptability is key. Everyone is talking about the ‘organic’, collaborative workplace where we all work together well towards mutual goals.
Business, transactional and production efficiencies are an essential part of success, processes and outcomes that will serve and enable all of the above.
- There is the definite potential to significantly cut costs, waste, be more efficient, increase shareholder value and profits.
- Tools, utility and processes are needed to effect these outcomes.
- These approaches and tools can help you leverage and position your business, above mediocre and stand out from the crowd, in that quality matters.
Lean manufacturing has helped the big guns like GE and Toyota lower cost, cut waste and improve how they utilize their resources, quality and time. What are you leveraging to keep your company competitive?
If you are paying close attention to time and quality in your business, then lean manufacturing is for you.
Reducing waiting times, bottlenecks, cycle and lead times all matter to both the business and the customer
Variation in the time it does take to complete any given process (or steps within a process) causes variation and has to be dealt with to ensure customer satisfaction.
The favorite example is delivery ‘windows’ and managing expectations around that. Lean manufacturing is about MORE than identifying and dealing with defects. It goes beyond cause and effect and gets rid of the little jackals in the vineyard, with the potential for causing the most damage.
To make your operation and business reliable to your customers is a top priority and lean manufacturing, thinking, approaches and tools can help.
In our modern economy BOTH speed and reliability makes the difference. What was the gold standard yesterday, quickly becomes the entry-level requirement and prerequisite, in a highly competitive market. To stay on top, you need to be able to adjust and deliver consistently.
Reducing overhead cost and inventory is at the heart of lean manufacturing.
Some business metrics that are oftentimes used to gage a business’ performance is on time delivery and reduction in lead time. Scrap and rework, other forms of waste are good indicators too. Speed and quality often suffer in our fast-paced business, yet the consumer of the present and the future will be increasingly demanding and insisting on both as BASIC service!
Companies typically improve at a slow pace. Change takes time. Lean turbo-charges these improvement efforts and underpins with some muscle, the processes and outcomes undertaken.
High quality, high speed and low cost is what you are after with lean tools, thinking and manufacturing.
If you are after sustained value creation in your business then lean manufacturing is the answer and solution for you. Oftentimes combined with process and business improvement tools like Six Sigma.
You will find as you start out on this path, that lean thinking is sometimes really quite counterintuitive and brilliant, yielding great results, applying simplistic method and wisdom to process and outcome.
Lean manufacturing requires a strong sense of leadership and leading by example will be required. If you are in fact looking for a niche and competitive edge in your business, THIS IS IT!
Optimizing opportunity is the name of the game with lean. Moving faster and with quality in mind, lowering cost and waste in the process, will have you reaping rewards in no time. Make the most of the fact that some of your competitors are rather ‘slow pokes’
- You might be having all sorts of questions at this point, like: What does Lean manufacturing bring to business? What is the value propositions really? Why do it?
Many have defines lean manufacturing as the streamlining of manufacturing processes to get the most out of equipment, inventory, and people.
To keep things really simple, lean manufacturing (or LM), has a base premise and overall goal ‘to get more done with less’ This is effectively done, by
- minimizing inventory
- at and through all stages of production
- eliminating waste,
- reducing wait times, queues
- shortening product cycle times from raw materials to finished goods.
LM processes involves some real positive, productive changes in businesses that will have a measurable impact on the bottom line.
- Benefits of LM could include
- Reduced lead time, wait time and cycle time
- Liberated capital
- Increased profit margins
- Increased productivity
- Improved product quality
- Just-in-time, affordable, streamlined, cost-efficient processes, products and services
- Improved on-time shipments
- Customer satisfaction and loyalty
- Employee retention
As a business, regardless of the scope, range, condition, small, large, start-up, growing or expanding, improvement, quality and time, cost and waste all matter. LM affords you the opportunity to ensure your business grows stronger, quicker, consistently, getting higher value and improving competitiveness. Effectively positioning yourself above the masses and mediocrity.
- What is lean manufacturing and which tools can I use in my business?
LM is an on-going process. This approach and paradigm focusing on time and quality, cost and waste reduction, streamlining operations can assist you in reducing inventories, work-in-process (often referred to as WIP), required floor space, cycle times and lead times.
LM (even when combined with business improvement efforts such as Six Sigma methods and discipline), can lead to meaningful and measurable improvements, quality. Most of the tools focus on really simple concepts and are easy to use and implement. It focuses on the visible, what you can see, change and control. It does connect steps, processes and people. It spots waste, problems and allows us all to identify, spot and deal with errors quicker and more effectively, saving more money in the process!
There is nothing really complex or mysterious about it. Everyone can apply it to your business, no matter what industry you are in. It does not have to be intricate and only set aside for a chosen few. It can be a great tool to mobilize your organization.
The basic toolkit of LM has basic tools (which we will get to), that will consistently and constantly enable you to change ineffective processes to smoothly operating and flowing production lines. It provides everyone the opportunity to ‘take control’ and pride in the work that they do. It is a hands-on enabler. When people understand how and what affects process and outcome and take a cause-effect, analytical approach to things around them, like work-processes for example, a whole new world of understanding, accountability and change erupts! It reenergizes your business and when the rewards start trickling in, everyone partakes and shares in the success and results.
On myth that needs dispelling right off the bat is that LM is ONLY for high-volume or standardized processes. This is simply misleading and far from the truth. LM is versatile and robust enough to be applied in any context on any process in numerous forms. Batch operations, mixed model production systems, shift-by-shift changes, switching of dyes etc. all qualify! Whether you are making appliances, light bulbs, providing a service or niche product, LM can help you in all aspects of your business, even financial, transactional, ordering, inventory and HR processes (payroll, hiring etc.)
You pick your priority, streamlining operations, improving productivity, eliminating waste, LM has a tool for that!
