The purpose of lean manufacturing is to minimize waste, which in turn reduces costs and maximizes productivity. Waste in this context is any action or process step that adds to costs but doesn’t add value for the customer.
Henry Ford laid the foundations of lean in the Ford manufacturing plant in Highland Park, Michigan, back in 1913. The focus was on flow – what he called “logical arrangement”, which by its very nature worked towards the elimination of waste.
Japanese automobile manufacturer Toyota picked up the baton and developed Ford’s system into what we now recognize as lean manufacturing. The Toyota Production System (TPS) developed machines to improve flow and also allow for variation of products – something Ford’s system failed to do. Toyota also identified three barriers: muda, which relates to the eight types of waste that impact lean manufacturing; muri, which relates to proactive changes aimed at eliminating waste; and mura, which relates to actions taken retroactively following the discovery of waste in an action or process step.
The eight types of waste that impact lean manufacturing
Originally, seven wastes – transportation, inventory, motion, waiting, overproduction, over-processing and defects – were identified, with the eighth, staff, being introduced in the 1990s. They can be easily remembered with the acronym TIMWOODS.
- Transportation: relates to the movement of materials from one place to another throughout the manufacturing process. This can be anything from movement of parts within a factory to procurement of raw materials and goods from external suppliers. Good workflow design and shorter supply chains help control waste.
- Inventory: relates to, for example, raw materials, work in progress and finished goods. Inventory ties up working capital, takes up space and is capable of being damaged or stolen, resulting in loss of money. Lean just-in-time ordering practices limit costs and increase profitability.
- Motion: relates to any unnecessary movement, whether of people, equipment or machinery. Motion waste suggests poorly designed workstations and processes, corrective actions include reorganizing workspaces with an eye on ergonomic design, implementing continuous workflow, and ensuring equipment is positioned at or near the place it will be used.
- Waiting: relates to wasted time and opportunity. The wait could be for instructions, deliveries, supply of equipment, maintenance or repair of machinery, or for personnel to turn up. It can be mitigated by taking steps such as having standard operating procedures and work instructions.
- Overproduction: relates to the production of too much inventory, or producing inventory earlier than needed. While the driver might be simply to utilize machine time it is a costly practice, tying up working capital and storage space. Pacing production, small-batch manufacturing, and using “pull” practices can combat this.
- Over-processing: relates to poor process design which results in more than is necessary being done, whether that be more work, more steps in a process, or more functionality in a product. This can be reduced or eliminated by understanding customer expectations and requirements, and designing manufacturing processes to meet those.
- Defects: relates to when a product is manufactured that is not fit for use. Such products need to be either reworked or scrapped, and both processes are wasteful. Countermeasures include conducting root cause analysis to understand the issue, introducing standard operating procedures, and empowering machine operators to act when a problem occurs.
- Staff: relates to the failure to fully realize human potential, talent, and ingenuity. This could be due to, for example, a lack of training or a failure on the part of management to communicate fully with workers, meaning they don’t benefit from the knowledge and expertise of the workforce.
The benefits of lean manufacturing
The benefits of lean manufacturing are manifold. While their importance may differ between organizations, here are five that are key to all that implement lean.
- Improved quality: implementing lean manufacturing inevitably leads to quality improvement, as workers freed from the demands of the eight wastes have time to focus on quality. As problems are identified, root cause analysis and innovative problem-solving resolve and eliminate issues.
- Improved lead time: with lean, a company doesn’t horde excessive inventory or carry out unnecessary steps or processes. It is relatively easy to switch production from one product to another. This all helps to speed up the production process, resulting in improved lead times.
- Improved customer service: customers are at the heart of lean manufacturing practices; their feedback about how they use and benefit from the product (or otherwise) help drive the elimination of waste. With time and effort focused on those things that add value for a customer, customer service inevitably improves.
- Increased employee morale: lean facilitates improved communication between management and workforce, and encourages discussion about work and processes. Workers know their experience and opinion are valued, and they will be listened to. This involvement, and empowerment to contribute to progress and decision-making, helps build the team and boost morale.
- Decreased inventory costs: lean manufacturing practices help to reduce costs and boost productivity by eliminating waste. Unnecessary processes are eradicated and the focus is firmly on those things that will add value to the customer. This, in turn, maximizes profit.
How to implement lean manufacturing
There are specific steps you can take when you are looking to implement lean manufacturing practices in your organization. It arguably starts with the process of designing a simple system of manufacturing based around the eight wastes, so that you are eliminating the unnecessary, cutting costs, and boosting productivity, but it doesn’t end there.
Experiment and innovate
Lean manufacturing is a dynamic system. It seeks to act proactively to improve and innovate, and it also acts retroactively if problems are identified that cause adverse outcomes.
Lean avoids complacency with regard to the status quo, instead seeking to look critically at processes and procedures and implement improvements – large or small – that will benefit the profitability of the organization.
Lean thrives on continuous improvement and innovation.
Apply the principles of kaizen
The principle of kaizen – the philosophy of continuous improvement – is central to lean manufacturing. Kaizen is founded on the concept that major improvements can be brought about as a result of the application of small, continuous changes. It seeks to aggregate the combined talents of all the employees of an organization, encouraging people at all levels to collaborate to eliminate waste, boost productivity and innovation, and encourage employee accountability.
Map your value stream
A value stream incorporates all the activities necessary for the generation of a product or service. Value stream mapping provides a method of showing and analyzing the current situation with regard to that process. It illustrates the linkage between the flow of information and the physical flow of inventory, and reveals waste that you might not otherwise become aware of. This aids understanding, which facilitates improvement of the process. Ultimately, it is the blueprint for lean implementation.
Despite the advantages of lean, there will be challenges and obstacles along the road to implementation. The key to overcoming them is visible management support from the top down.
There will undoubtedly be a cost attached to implementing lean manufacturing practices. However, it is better to think of this in terms of an investment – something that will confer a range of benefits, including competitive advantage, and that will ultimately positively impact the bottom line.
Lack of understanding or training
The people who will be affected by lean need to fully understand the concept, why change is happening, and how they and the organization will benefit. Lean isn’t a quick fix, it’s a culture change. Helping people to understand this and embrace the principles is essential. Failure will result in resistance.
People generally don’t like change, not least because it pushes them out of their comfort zone. If they can’t understand the benefits – including what’s in it for them – they will resist. The new culture should be disseminated from the top down, to show it has backing from the highest levels.
For more information on lean manufacturing and how Juran can help you leverage it to improve business quality and productivity, please get in touch with the team or visit one of our dedicated program pages.