Lean Manufacturing Principles
A simple Lean Manufacturing definition is 'manufacturing without waste.'
Waste is anything other than the minimum amount of equipment, materials, parts and working time that are essential to production.
Any business interested in reducing waste, increasing production, and streamlining processes can benefit from implementing lean manufacturing principles. To reduce waste, you need an awareness of where and how it occurs. This may require in-depth analysis, communicating with your team or changing the floor plan to improve product ‘flow’.
‘Value’ is a big concept at the heart of Lean Manufacturing. Womack and Jones, who defined modern-day lean manufacturing back in 1996 defined it as follows,
“Precisely specify value by specific product, identify the value stream for each product, make value flow without interruptions, let customer pull value from the producer, and pursue perfection.”
Their model has defined the lean manufacturing principles that have been put in practice by manufacturers over the years:
Value: Recognize the value to your end customer
Value Streams: Identify steps in your manufacturing process that contribute to that value and remove those that do not
Flow: Improve workflow/product flow to deliver value to customer faster
Pull: Drive product demand from customers (by offering high quality and service)
Perfection: Strive for a goal where all parts of the process work to eliminate waste, improve processes, satisfy customers, and reduce costs.
So, what is lean manufacturing?
As the name suggests, it is a ‘skinnier’ version of your current manufacturing process. The principle being ‘if it doesn’t add value – don’t do it’. By removing waste, you will speed up production time and keep up with orders while improving work conditions for your staff. Doing less for more is always a good plan.
The goal of any business carrying inventory is to invest the least amount possible to earn the most money. By applying lean manufacturing principles, a business can reduce waste, lower production costs, reduce inventory, and improve quality and labor productivity quite substantially.
Lean production will lead to waste elimination. Waste elimination begins with a careful examination of inventory and your production process. In this examination, you need to ask some basic questions:
Are you carrying the right amount of inventory?
Are you wasting space? (Can you modify the floor plan to reduce the distance the product travels on its production journey).
What are the production bottlenecks?
Can any part of your processes be automated?
How can all the above be improved?
As is usual in business, if you want to make improvements, the best place to start is by asking the people on the shop floor. They are the people doing much of the work, and they live the processes daily. They will often have some good ideas. But the dialogue needs to be all-encompassing, and a good catalyst for this is the Business Process Review, whereby your team follows an order through your systems, from enquiry to dispatch, and at each stage asks: ‘Is this process really necessary? Can we do it better? Can we automate it? Make a note of all your changes and you will have your ‘go to’ processes defining how you want the new ‘lean’ manufacturing processes to run.
Thinking you know how things work doesn’t mean they are carried out the way you’d expect. Staff will have adjusted to dealing with a problem in the process. Extra steps may have been taken, or shortcuts taken to save time. Knowing what is really going on will allow you to create a plan that fits your business.
A lean management system will probably look different for your current business model, and it will certainly be different than your competitor’s processes because the human element varies from one workplace to another.
Reviewing the steps at each workflow stage will reveal where there’s room for improvement. The goal each time is to move closer to delivering value to the customer and removing those steps/issues that don’t.
Next Steps – Ongoing Improvements Towards a Lean Production System:
Once you and your team identify issues and enact changes to address them, the next goal is to make another improvement. When achieved, you’ll set your sights even higher, with a plan for continuous improvements over time.
Making a list of things to fix or change for each step should help you prioritize. Begin with the changes that are easiest to implement. Getting rid of any bottlenecks should be at the top of your list.
Take note of the impact of any changes. Did they deliver the ‘hoped for’ improvements? Did they reduce waste, save money, or increase productivity? If not, re-evaluate carefully and look for ways to make a bigger impact. If a successful change made in one area stands to improve another, carry it out wherever possible. If that change caused a significant improvement, move it to the top of your next list.
Personnel: The Key to Enacting Lean Manufacturing Principles
Making decisions about changes should consider the motivation of your workers. If they are unhappy, their corner cutting could be cutting your profits. A disgruntled worker is less likely to put in his or her best efforts. When an employee feels valued, he or she becomes a stronger contributor to lean process improvement.
The changes made to eliminate waste should not cause employees to be overworked. If part of the production process currently makes the worker unhappy, consider that person’s daily experience and put it in perspective. Is that person lazy or is it a valid complaint? Fixing the problem to make things easier for the employee could also make that person feel valued and help to improve his or her productivity as a result. If you demonstrate you care about your employees, they will care about your end goal and contribute to your value. Actively listening to your staff at all levels is always to be encouraged.
Assign responsibility for overseeing those changes, and reporting back on the effects of those changes, to managers of the departments.
Lean Manufacturing Tools
One of the significant changes you can make to your business is working with an inventory software that integrates the work tasks of every department. If you are working on spreadsheets, you are certain to be missing important information you could learn from creating a single version of the truth with a centralized system.
Effective inventory and production software will track raw materials and products from arrival to your facility, through your warehouse, production processes and out the door to the customer. All that information should synchronize with the accounting software so costs can be accurately calculated, waste more readily identified, and savings be realized. SOS Inventory was designed to help SME’s reach that goal, at a price point that will allow you to focus your finances on company growth.
SOS Inventory will help your business determine the minimum stock you need to carry to satisfy demand. The right software will set you on a path to practicing best lean manufacturing principles.
Made-to-order products must be produced only when there is demand as the customization means you cannot have safety stock on hand. Finding the right balance to fulfill orders as they come in and optimizing to eliminate waste takes some skill and practice to finesse.
The goal of lean manufacturing principles is to bring the business as close to ‘zero inventory’ as possible while keeping up with demand and achieving the highest level of quality and service levels possible. Lower inventory translates to less money tied up in stock.
Lean manufacturing principles properly implemented can transform your business, giving you a competitive edge and price point that others will want to aspire to.
A Lean Manufacturing Anecdote
Car enthusiasts amongst you may have heard of the family-owned British Morgan sports car. Still to this day, Morgan produces hand-built, British sports cars in their manufacturing plant in Malvern, Wiltshire, U.K.
Morgan’s problem was one of production, not demand. With their antiquated processes and manufacturing plant, they were producing only 9 cars a week, leading to a long order book. If you wanted a new one then, you would have to wait 11 years!
They called in a trouble shooter to help advise them. They were making Morgan cars on that plant since 1919, and were proud that they were still using many of the original production processes. Upon following a car through the production process around the plant, the trouble-shooter commented, “No wonder they put the wheels on the chassis early in the process because the car chassis is pushed up and down this hill for every additional stage to be carried out. That is all money and time that is wasted”. The Morgan family didn’t welcome many of the recommendations valuing their tradition and heritage more than efficiency. But they did slowly adopt some of the suggestions, and by last year, when the business was finally sold out of family hands, sales were up to 700 cars a year.