We often hear the term ‘lean manufacturing’ bandied around. And if we don’t come from a manufacturing background we might be tempted not to reveal our ignorance. Here is a short insight into what lean manufacturing is all about.
The core concept of lean manufacturing is to look at the whole process from the end customer’s point of view. We look at every value-adding step and consider what it adds – or if it adds – to the product that the customer must use. We then remove or minimise the actions that don’t add value to the customer. In this way we institute a lean manufacturing process.
The notion of lean manufacturing goes way back to the Colt firearm manufacturing company before wheeling through Henry Ford and the Ford motor car company. Both these organisations applied the basic principles of lean manufacturing. But lean manufacturing got going at the Toyota Corporation in Japan after the second World War. Toyota wanted to find a consistent, easily replicable, way of dealing economically with low volume production runs.
Once they had refined their thinking and the physical process, Toyota came out with the five principles of lean thinking, the mindset behind the lean manufacturing approach.
- Define value from the way that the customer views value. What steps in the process add the value that the customer requires?
- Review each product family and identify the underlying value stream. A value stream is the set of actions that take place to add value to the customer from the initial request through to the realisation of value by the customer. The value stream begins with the initial concept, moves through various stages of development and on through delivery and support.
- Link the value-creating steps so that the product flows through the system and removes the stops and starts.
- Allow your customers to draw the product they need; rather than the volume of product that you want to supply. This allows your downstream to efficiently configure their processes in a lean manner.
- Refine the process so that every step adds value and remove the steps that don’t add value.
Studies have indicated that very little of the production process contributes directly to the customer’s value. The non-value steps are there because of legacy systems, design errors or poor management.
Waste can typically manifest in several conditions:
- Overproduction can result in unused finished goods sitting idle while waiting for sale and consuming working capital. The savings of a long production run are lost because of this holdup.
- Inventories are the first place to look at. Excess inventory in raw materials. Excess inventory is work in progress. And excess inventory in finished goods. All of these ‘fatten’ the system, tie up storage space and cause working capital to be idle.
- Defective products are another waste of value. Defects must either be reworked or scrapped, thus adding to the costs of production.
- Waiting. This is the bane of factory managers. The production line is waiting because unscheduled maintenance is taking place. Or the production line must be re-set for a different product. This is another form of idle work in process inventory.
- Wasteful logistics can play a part. A delivery truck with half a load is wasteful. Or when two trips are required with a small truck when one trip with one large truck would have sufficed.
- Unnecessary movement of goods. Legacy plant design can mean that products must be moved around the factory floor wasting time and resources. The end of one value step should be at the start of the next value step.
- Excess processing means adding more value than what the customer requires. Unnecessary inspection, as opposed to building in quality adds to cost. Cumbersome paperwork can be frustrating and add little value.
The trick of successful lean manufacturing is to consider the whole manufacturing ecosystem. Tinkering with only one phase of the process can have unintended consequences such as excess downstream inventory or increased waiting times. The entire value system must be optimised and fine-tuned. The goal is to line up the value-creating steps so that the product flows fluently from one step to the other with minimum delay.
Implementing lean manufacturing can be extremely challenging. It requires creativity, determination, and a willingness to learn. But when successful lean manufacturing delivers multiple benefits:
- Customers get defect-free goods on time. You get repeat orders.
- You are better able to manage your suppliers. Raw material remains on their books until it enters your process.
- You cut down wasteful just-in-case inventory through your entire production system, liberating valuable working capital.
- Expensive resources are freed up: staff, storage space, machine operating time.
Lean manufacturing is hard, and it takes time, but it pays remarkable dividends. And it’s never too late to start.
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