Everything you need to know about Lean Manufacturing
There are easily more than three dozen books on lean manufacturing concepts. Some of the best ones include those penned by founder of the Lean Enterprise Institute, James Womack, who spent time during his years at MIT studying Japan’s growing automotive industry and learning about the Toyota Production System. A system that has become famous in the manufacturing community by a brand that is still arguably the best manufacturer with regards to quality and reliability. Upon James’ return, he wrote his first book about what he learned and that changed the manufacturing world in America as we know it today.
Let’s take a look at how lean manufacturing has transformed over time and areas of opportunities for companies today.
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How lean manufacturing improves business
Companies that adopt a lean culture believe their sole purpose is to provide the utmost value to the customer through a value creation process that has zero waste. Using lean manufacturing initiatives – such as six sigma or Kaizen – both of which are popular approaches incorporated by many companies today, the notion of lean is to create more productive workplaces and enable ongoing improvements. Both six sigma and Kaizen may be slightly different approaches but the end goal is the same – as they both lead to increases in productivity, quality and profit. They concentrate on creating a constant stream of continuous improvement that enables decreases in waste and inventory and are philosophies that truly drive a customer satisfaction-centric approach.
In order for lean manufacturing practices to work, it must be embedded in your company’s culture for the long term. It’s a way of life for many manufacturers and must be viewed as such by employees. So regardless of what specific approach you use, the idea is to accelerate value by minimizing waste.
One way to drive leaner, more productive workplaces is to create opportunities where employees can be actively engaged in driving improvements on the work floor. Technology exists from companies like Corvex that enables data to be delivered straight from the manufacturing floor to the management team’s dashboard, providing leading indicators vs. lagging ones. This dashboard provides ongoing data on areas of waste within the organization and enables the elimination of burdensome paper processes that create overhead, not improvement. All of this leads to improvements that benefit the customer at the end of the value chain.
A lean organization understands and believes customer value is the most important factor and utilizes processes to continuously increase it. Lean thinking by its very nature is designed to shift an organization’s focus from optimizing separate departments and functions and looking at the operation in silos to correcting the flow of products and services through entire value streams in a more holistic approach.
The cornerstones of lean
Manufacturers have incorporated various initiatives in the workplace that they refer to as lean in an effort to reduce cycle time and scrap and to increase productivity. As customers become more demanding of manufacturers, it will become more critical than ever to find the right tools and systems to sustain growth and provide constant value. Hence the reason lean is so important. Those companies fully committed to this journey and experiencing success are following five specific characteristics that are said to be the cornerstone principles of a lean approach.
1.Defining value: Value represents the starting point in lean thinking, and is defined by the end customer and how they perceive value. This enables companies to understand what a customer is willing to pay for something and what their expectation for a given product is.
2.Identifying the value stream: Taking a look at the entire value/supply chain to see what’s needed from concept to production to marketing and selling a product. The entire process needs to be evaluated to determine what areas add value and which don’t.
3.Ensuring activities flow: This step takes a look at how things progress through production and ensures there is a good flow to the manufacturing process. Any disruption is adversary.
4.Pulling only what the customer needs: A lean business model emphasizes pulling vs. pushing products – which in essence means letting the customer determine when they need product and pulling it in small batches when requested vs. producing too much inventory and creating waste.
5.Pushing for perfection: The ultimate goal is to reduce effort, time, space, cost and mistakes while improving the product, so investing in automated software, equipment and training is key here.
The 5S lean manufacturing method
When it comes to lean, there are several systems and approaches to doing business, but none are quite as simple and effective as the 5S method, which is why it is a foundational approach. It’s designed to eliminate waste, improve cleanliness and enhance quality control at a manufacturers’ most basic levels.
According to the Environmental Protection Agency, when executed correctly this system enhances productivity and minimizes the use of excess material. By following the five-step process, leaders and workers at manufacturing facilities experience a more orderly workplace and improve operational performance. Implemented with the notion that most improvement and competitive success comes from efficiencies created on the factory floor, the five S’s stand for sort, straighten, shine, standardize and sustain.
The Sort step focuses on the process of elimination and removing items that aren’t needed for current production. This means going through tools, supplies and equipment, and keeping out only what is essential.
The Straighten step is all about creating order and arranging daily-use items for easier accessibility and storage. Everything has a place it should go – which makes it easier to find items and minimizes chaos on the factory floor. Labeling systems and designated bins should be incorporated in this stage.
An old adage claims cleanliness is next to godliness and one might argue the same rings true for a company’s manufacturing facility and the Shine step. Cleaning away dirt, debris and keeping the workspace and machinery in top order helps raise the bar of the entire organization. It also helps eliminate downtime.
The Standardize step means systems are needed to create change. Documentation, visuals, designation of roles and responsibilities and regular team meetings help ensure the first three pillars are maintained and followed daily.
Sustaining each pillar will lead to additional skills and knowledge for both leaders and employees, engrain the method into the organization’s culture and result in operational improvements and organizational-wide effectiveness.
How lean removes waste
If your company is struggling with an overly complicated manufacturing process, investigate where waste in your organization might exist. Not only does waste reduction allow you to be more sustainable, but there are production and cost savings as well. Some of the most common types of waste include:
Transport and movement waste – Transferring product or stock from one location should only happen if necessary. Same goes for unneeded travel between workstations or distance that makes the overall production process more inefficient. Check to ensure your manufacturing flows properly and you don’t have workers frequently in wait mode. These are red flags that need to be addressed.
Inventory and overproduction – Software solutions can help better monitor and track inventory so you are better able to manage stock and reduce possible overproduction, because that in turn means excess inventory and overstock.
Defects and over-processing – The absolute last area where you want waste is in defective parts. Whether the root issue is outdated equipment, lack of skills, inadequate training, or the use of low-quality suppliers, this can cost a company excessive amounts of time and money. Fixing these areas of waste are crucial to long-term success.
Eliminating waste along entire value streams, instead of at isolated points, creates processes that need less human effort, less space, less capital, and less time to make products and services at far less costs and with much fewer defects, compared with traditional business systems. Lean approaches do require a complete transformation on how a company conducts business but it’s worth it in the long run.
Lean manufacturing metrics
So, maybe you’ve implemented six sigma or 5S but aren’t sure how effective it’s been to date. There’s some metrics you can use to measure success. Experts say to keep it simple and take advantage of those that are easy to compile like total cost, work in progress, total cycle time, throughput rate, lead time and delivery performance. Analyzing these numbers regularly will help you identify trends and determine if changes to your processes are required.
Some other, more extensive ways to examine and enhance your lean manufacturing include:
Lean manufacturing efforts and their measurement can have a profound impact on your business and provide significant gains.
Let’s take a look at how lean manufacturing has transformed over time and areas of opportunities for companies today.
(INSERT HOTLINKS FOR THE BELOW)
- How lean manufacturing improves business
- The cornerstones of lean
- The 5S lean manufacturing model
- How lean removes waste
- Lean manufacturing metrics
How lean manufacturing improves business
Companies that adopt a lean culture believe their sole purpose is to provide the utmost value to the customer through a value creation process that has zero waste. Using lean manufacturing initiatives – such as six sigma or Kaizen – both of which are popular approaches incorporated by many companies today, the notion of lean is to create more productive workplaces and enable ongoing improvements. Both six sigma and Kaizen may be slightly different approaches but the end goal is the same – as they both lead to increases in productivity, quality and profit. They concentrate on creating a constant stream of continuous improvement that enables decreases in waste and inventory and are philosophies that truly drive a customer satisfaction-centric approach.
In order for lean manufacturing practices to work, it must be embedded in your company’s culture for the long term. It’s a way of life for many manufacturers and must be viewed as such by employees. So regardless of what specific approach you use, the idea is to accelerate value by minimizing waste.
One way to drive leaner, more productive workplaces is to create opportunities where employees can be actively engaged in driving improvements on the work floor. Technology exists from companies like Corvex that enables data to be delivered straight from the manufacturing floor to the management team’s dashboard, providing leading indicators vs. lagging ones. This dashboard provides ongoing data on areas of waste within the organization and enables the elimination of burdensome paper processes that create overhead, not improvement. All of this leads to improvements that benefit the customer at the end of the value chain.
A lean organization understands and believes customer value is the most important factor and utilizes processes to continuously increase it. Lean thinking by its very nature is designed to shift an organization’s focus from optimizing separate departments and functions and looking at the operation in silos to correcting the flow of products and services through entire value streams in a more holistic approach.
The cornerstones of lean
Manufacturers have incorporated various initiatives in the workplace that they refer to as lean in an effort to reduce cycle time and scrap and to increase productivity. As customers become more demanding of manufacturers, it will become more critical than ever to find the right tools and systems to sustain growth and provide constant value. Hence the reason lean is so important. Those companies fully committed to this journey and experiencing success are following five specific characteristics that are said to be the cornerstone principles of a lean approach.
1.Defining value: Value represents the starting point in lean thinking, and is defined by the end customer and how they perceive value. This enables companies to understand what a customer is willing to pay for something and what their expectation for a given product is.
2.Identifying the value stream: Taking a look at the entire value/supply chain to see what’s needed from concept to production to marketing and selling a product. The entire process needs to be evaluated to determine what areas add value and which don’t.
3.Ensuring activities flow: This step takes a look at how things progress through production and ensures there is a good flow to the manufacturing process. Any disruption is adversary.
4.Pulling only what the customer needs: A lean business model emphasizes pulling vs. pushing products – which in essence means letting the customer determine when they need product and pulling it in small batches when requested vs. producing too much inventory and creating waste.
5.Pushing for perfection: The ultimate goal is to reduce effort, time, space, cost and mistakes while improving the product, so investing in automated software, equipment and training is key here.
The 5S lean manufacturing method
When it comes to lean, there are several systems and approaches to doing business, but none are quite as simple and effective as the 5S method, which is why it is a foundational approach. It’s designed to eliminate waste, improve cleanliness and enhance quality control at a manufacturers’ most basic levels.
According to the Environmental Protection Agency, when executed correctly this system enhances productivity and minimizes the use of excess material. By following the five-step process, leaders and workers at manufacturing facilities experience a more orderly workplace and improve operational performance. Implemented with the notion that most improvement and competitive success comes from efficiencies created on the factory floor, the five S’s stand for sort, straighten, shine, standardize and sustain.
The Sort step focuses on the process of elimination and removing items that aren’t needed for current production. This means going through tools, supplies and equipment, and keeping out only what is essential.
The Straighten step is all about creating order and arranging daily-use items for easier accessibility and storage. Everything has a place it should go – which makes it easier to find items and minimizes chaos on the factory floor. Labeling systems and designated bins should be incorporated in this stage.
An old adage claims cleanliness is next to godliness and one might argue the same rings true for a company’s manufacturing facility and the Shine step. Cleaning away dirt, debris and keeping the workspace and machinery in top order helps raise the bar of the entire organization. It also helps eliminate downtime.
The Standardize step means systems are needed to create change. Documentation, visuals, designation of roles and responsibilities and regular team meetings help ensure the first three pillars are maintained and followed daily.
Sustaining each pillar will lead to additional skills and knowledge for both leaders and employees, engrain the method into the organization’s culture and result in operational improvements and organizational-wide effectiveness.
How lean removes waste
If your company is struggling with an overly complicated manufacturing process, investigate where waste in your organization might exist. Not only does waste reduction allow you to be more sustainable, but there are production and cost savings as well. Some of the most common types of waste include:
Transport and movement waste – Transferring product or stock from one location should only happen if necessary. Same goes for unneeded travel between workstations or distance that makes the overall production process more inefficient. Check to ensure your manufacturing flows properly and you don’t have workers frequently in wait mode. These are red flags that need to be addressed.
Inventory and overproduction – Software solutions can help better monitor and track inventory so you are better able to manage stock and reduce possible overproduction, because that in turn means excess inventory and overstock.
Defects and over-processing – The absolute last area where you want waste is in defective parts. Whether the root issue is outdated equipment, lack of skills, inadequate training, or the use of low-quality suppliers, this can cost a company excessive amounts of time and money. Fixing these areas of waste are crucial to long-term success.
Eliminating waste along entire value streams, instead of at isolated points, creates processes that need less human effort, less space, less capital, and less time to make products and services at far less costs and with much fewer defects, compared with traditional business systems. Lean approaches do require a complete transformation on how a company conducts business but it’s worth it in the long run.
Lean manufacturing metrics
So, maybe you’ve implemented six sigma or 5S but aren’t sure how effective it’s been to date. There’s some metrics you can use to measure success. Experts say to keep it simple and take advantage of those that are easy to compile like total cost, work in progress, total cycle time, throughput rate, lead time and delivery performance. Analyzing these numbers regularly will help you identify trends and determine if changes to your processes are required.
Some other, more extensive ways to examine and enhance your lean manufacturing include:
- Determining how well you incorporate Just in Time (JIT) – This Toyota-created philosophy has a number of benefits. The premise of JIT is to produce only what is needed when it is needed therefore removing excess material from the supply chain. It takes out the waste associated with overproducing excessive stock. Instead of forecasting, companies create a simplified system that uses tools to pull production through a process based on orders received. It is meant to reduce stock and lead times, helping save money in scrapping, handling, obsolete parts and more. Sounds simple enough but it’s quite difficult to achieve. That’s why it must be part of a broader lean manufacturing initiative that also addresses standardized operations, proper flow and layout, quality and more.
- Conducting lean audits – To determine how lean your organization is, a third-party audit can analyze the amount of waste that exists in your organization. Look closely at inventory, supply chain management and operational procedures and make sure you have a scoring system that works for your management team. Address all relevant areas where waste is a concern.
- Incorporating incentive programs – Employees can play a role in creating a lean operating environment. Consider an incentive program that allows for the real-time reporting of issues. Corvex believes the worker is the greatest source of information and continuous improvement. It has a platform that offers real-time feedback so leadership can quickly review areas of concern, detect any patterns and identify solutions. This helps cut waste quickly from the process and leads to a more effective work environment.
Lean manufacturing efforts and their measurement can have a profound impact on your business and provide significant gains.