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Lean Simplified: Part 1
is also known as:
Lean Manufacturing Approach
Lean Manufacturing Benefits
Lean Manufacturing Concept
Processpro Lean Manufacture
Processpro Lean Manufacture Processes
Processpro Lean Production,
Lean Manufacturing Environment,
Lean Manufacturing Experience,
Lean Manufacturing Implementation,
Implementing Lean Manufacturing,
Benefits of Lean Manufacturing,
Defining Lean Manufacturing,
Lean Manufacturing Management,
Lean Production Benefits,
Lean Production Concept,
Lean Manufacturing Package,
Lean Manufacturing Products,
Lean Manufacturing Software,
Implementing Lean Software.
"A systematic approach to identifying and eliminating waste through
continuous improvement by flowing the product at the demand of the customer."
This white paper breaks down the definition of Lean Manufacturing into
easy-to-digest concepts and shares the real-life example of a subject
company working towards the goal of lean.
With all the discussion, books, websites, and other materials on the topic of
lean manufacturing, it's hard to know which resources are credible much less
understand the mounds of information that one has to sift through to find the
basic, most relevant facts. The purpose of this whitepaper is to do just that:
simplify the concepts of lean manufacturing and present them in a manner in
which the manufacturer can determine exactly what is needed in the production
operation and why.
This paper will also take you on a journey of how one
company, a leading global supplier of reference test fuels and
re-manufactured organic solvents, persists along the lean manufacturing path.
What is Lean Manufacturing?
Lean manufacturing is "A systematic approach to
identifying and eliminating waste through continuous improvement by flowing
the product at the demand of the customer."
Let's break the definition into
parts and look at each more closely to understand what it really means.
First, we'll look at identifying and eliminating waste. Various resources have
identified slightly different numbers and specific types of waste, but
generally speaking, they all fall consistently within the following
- D = Defects and Rework
- O = Overproduction
- W = Waiting (Idle Time)
- N = Non-Value Added Procedures
- T = Transportation
- I = Inventory
- M = Motion
- E = Employees Under Utilized
rework is probably one of the most easily identifiable wastes because it's
tangible; it's something people can see or feel. For example, defects and
rework cause companies to spend time correcting mistakes in paperwork or
fixing physical problems with machines, just to name a couple.
Overproduction can point to the obvious waste: turning out more product than
what is needed by the consumer. But it can also mean overproduction of
other items such as running too many reports and too many copies of them,
over engineering by adding more to the process than what is needed, or
having unnecessary order points.
Waiting waste can come from many sources.
In general, waiting waste is time between tasks when no work is being done.
But other areas where employees are potentially waiting are often not
considered, such as: trucks to be unloaded, next production step, searching
for materials, supervisor signatures, poorly configured work centers, or
poor plant layout.
Anything that does not add value to the customer is
considered a non-value added procedure. These are the items that a customer
doesn't pay for such as company reviews, inspections, production
monitoring, and anything else that could be considered counter productive.
Many manufacturers are not only moving products, materials, and other things
throughout the building manually, but they are moving them unnecessarily.
This is considered transportation waste. Another contributor to
transportation waste is the poor location of shipping and receiving
Inventory wastes can come from both shortages and excesses.
Having a shortage of a material can put a batch ticket on hold resulting
in the expiration of the other materials for that batch. Having an excess of
a material simply results in wasted resources. Inventory waste can also
come from having a poor setup for stores and bins.
Motion waste is
different than transportation waste in that motion is the movement within a
work area vs. the company as a whole. Often motion waste comes from poor
organization of a work area, resulting in poor process flow within the
area and poor work flow from one work center to the next.
The value of a
trained employee often goes unnoticed by many upper management officials.
But that is precisely what the "Employees Under Utilized" waste is. Employees
not only need adequate training for what fits their job descriptions, but
they also need to be cross trained in other related areas. Additionally,
applying an employee's skills and creativity where it best fits in the
company is a benefit to both the employee and employer.
waste, manufacturers can do more with less: less time, inventory, people,
space, equipment, labor, and money. To identify wastes in the work
environment, manufacturers need to determine those components of the
process that do not add value to the customer, and it doesn't mean just the
scraps, rework, or other garbage. By looking carefully at each of the
eight identified potential wastes just described, companies can begin the
process of implementing lean.
our subject chemical process company (GPC) accepted the challenge to implement
lean practices, the lead team looked at each of the eight areas of waste. The
waste that was most readily identifiable was the amount of clutter in several
areas, but predominantly in inventory control. There was a significant amount
of excess material in storage that was being saved in case it was ever needed.
Management recognized that the excess had to go in order to make room for
materials that were currently needed in production to make the manufacturing
process more efficient. Inventory control and inventory reduction became
primary goals for reducing waste and improving efficiency.
Moving on, let's
look at the next two key words in our lean definition: continuous
improvement. Lean principles aren't concepts companies can apply once and
consider themselves done; lean principles are ongoing. It involves a cycle of
constant evaluation through each stage of the manufacturing process to find
gaps between what is happening in the process and what should be happening
based on the demand of the customer.
One of the challenges at GPC in
implementing lean practices was helping the network of employees
understand that after a goal has been accomplished, there is yet the next
step toward improvement beyond that to strive for. Often in traditional
working environments, once a target has been reached, employees relax and
feel as though their work is done. Lean practices demand that GPC workers
stay focused on continuous improvement and continue to maintain momentum
in finding and implementing waste reduction projects.
We have repeatedly
pointed out customer focus throughout this paper, so let's look at the last
part of the definition: by flowing the product at the demand of the
customer. This is where we need to look at the five basic principles of lean:
- Specify Value
- Identify the Value Stream
- Customer Pull
- Pursue Perfection
Specifying value is the most critical point of all
the principles. If you're asking yourself, "But, which value?" you're asking
the right question. The same lean process, identifying wastes and other
aspects we have yet to cover, applies to all the different values. For the
sake of simplicity, we will only address the customer value. What this
means is that if a product has features that add cost but not value, the
customer will not likely purchase the product. For instance, if a customer
wants a basic shirt, but the manufacturer adds a pretty logo, the cost will
go up but the shirt will not have improved in overall quality, thus creating
waste, and ultimately, not meeting the demand of the customer.
stream is the set of all the specific actions required to bring a product
through the critical business tasks from raw material to finished product.
The development process stream runs from the design concepts to addressing
any challenges faced in engineering the product and finally to the production
launch. The fulfillment process stream involves the management of the
product from order-taking to scheduling delivery to getting the finished
product to the customer.
The flow of a system is identifying each of
the steps of production and lining them up in a continuous format.
Eliminating waste and processes between steps will improve development and
response times. This can be more easily visualized when we think about how we
bake cookies at home. A typical consumer response might be something
like: "We get all of the ingredients out of the cupboards, put them on the
counter, and begin adding and mixing them as the recipe calls for them." On
the other hand, a lean description might look something like this:
- Determine how long the process will
- Locate the recipe and determine whether ingredients are on-hand
- Create or clean a work surface for preparation
- Gather all the
ingredients and position them for use on the work surface
- Gather the
necessary tools for preparation
Following the steps of this process has saved the cookie maker a bundle of
time because everything that was necessary, both ingredients and tools,
for putting the product together was located in advance. The lean process
also ensured a clean work surface in advance and ensured ample time to do
the job correctly.
Customer pull is just the opposite of customer push.
Often customer push methods create long response times in which companies try
to convince customers that they want the item that was already designed
and produced. Production scheduling is based on sales forecasts rather than
actual requests. Customer pull production, on the other hand, is dictated by
what the customer requests the manufacturer to make. This is also known in
the manufacturing industry as just in time (JIT)
pursuing perfection is a perpetual review from beginning to end of the
manufacturing process, always with the goal of reaching zero waste. In
reality, perfection is never really reached because no matter the outcome of
each review, there is always room for improvement in reducing cost,
effort, time, space, and mistakes.
GPC has embraced value stream mapping as a
tool in identifying those steps in their manufacturing processes which are
truly valuable to their customers and those which aren't. By quantifying
the value of the various steps in any process, the company has been able to
‘lean out', or recreate their operating practices so that they deliver the
value that their customers need while eliminating the steps that truly do not
add value to the customer.
What Lean Manufacturing Is NOT
manufacturing's primary focus is on speed and inventory reduction, while
delivering product quality that meets clearly defined customer
specifications. Again, looking at the value to the customer (both internal
and external), manufacturers must be careful to balance the cost and time
invested into a product with the quality demanded by the consumer. It is
much like a three legged stool: speed, cost, and quality representing
the three legs. Each leg must raise or lower in proportion to the
other legs, or the stool is out of balance. Since the primary focus
of lean manufacturing is to improve speed, this leg becomes the
pivotal leg upon which the other two must balance. Keep in mind, however,
that just because lean focuses on speed, it does not mean quality is
compromised. The very nature of the principles of lean manufacturing
improves the quality of the product.
The Benefits of Lean
The benefits of lean manufacturing are so numerous that they
are quite difficult to simplify. For all practical purposes, let's say there
are 5 basic benefits, with all the additional benefits falling into one of
the following categories:
- Material Handling - Utilizing lean principles
means that materials move fewer times, with shorter distances, and with
simpler routes. These add up to a significant savings for the manufacturer
due to fewer delays, less tracking efforts, and less confusion. In other
words, material handling becomes more efficient.
- Inventory, Scheduling,
and Production Control - With a customer demand flow to production,
companies are able to reduce the amount of on-hand inventory, thus decreasing
the amount of potential waste in both expired materials and in reduced
floor space for storage and manufacturing. Fundamentally, excess inventory
hides problems. By reducing inventory levels, manufacturers discover a wide
variety of process improvement opportunities that, once corrected, help
them to become much more effective competitors in today's marketplace. By
reducing inventory levels, they are also able to increase inventory turns
which means the inventory will be more in balance with current demands.
This, in turn, creates better supplier relationships as manufacturers
regularly re-order products needed for manufacturing. From a scheduling
perspective, creating more batches in smaller lot sizes enhances the overall
manufacturing flexibility. The less inventory a company has in its value
stream, the less the lead time will be from customer order to delivery.
- Quality - In traditional manufacturing, quality becomes compromised when a
product is discovered to be defective. A product must move many times,
often between several departments, making it very difficult to pinpoint
where the defect occurred. With a single piece flow, the defect affects only
1 single part thus eliminating long hours of isolating and investigating
different parts of the process to find the problem. Forming an effective
problem solving group also becomes a challenge across departments as
nobody wants to take responsibility. With single piece flow, each team is
focused on its responsibilities and is motivated to avoid future defects.
- Employee - As mentioned above, in a lean manufacturing environment, each
team is focused on its goals and work results. Problems are typically
identified right away, and team members receive immediate feedback on
their work. Team success builds employee morale. With team problem
solving, the focus is directed to the processes and not the individuals. In
addition to a boost in morale, employees will also benefit from a safer
work environment. Less inventory means less clutter; fewer people and
machines means more light and space with which to work and move; and a
better layout of machines makes the physical work for employees easier.
- Customer - Improved quality along with shorter and reliable response times
is a recipe for happy customers. Having happy customers ultimately impacts
the bottom line for the manufacturer as each customer becomes a repeat
customer. It's a win-win for each party.
The team at GPC is realizing many
of these benefits, and continues to explore opportunities for creating and
continues to explore opportunities for creating efficiencies. GPC management
remains firm in their commitment to continue down the Lean Manufacturing
journey. The rewards, as we will read more about in Part 2, are measurable
Summing it Up
No matter the type of manufacturing you
are in, these basic lean principles, applied and adhered to, serve to improve
all aspects of the company operations. If your company is not already engaged in
a lean process, it's clearly time to think about it and look closer at lean
practices—Charles Theisen, CPIM, CIRM
About the Author
(Chuck) Theisen is a Supply Chain Industry Specialist with over 30 years
experience in Supply Chain operations and business systems. His operations
experience includes production scheduling, materials management,
transportation management, business system support, and business systems
management. Chuck has many years of experience in Supply Chain operations and
consulting including warehousing, shop floor control, and related information
systems. His consulting experience includes systems selection, implementation
and usage, and operations and process improvement. He is a seasoned professional
with strong communication skills, experienced in working with all levels in
Currently, Chuck is the Director of Implementation Services
for ProcessPro, developers of ProcessPro® Premier ERP software. He works
extensively with clients of ProcessPro to improve their Supply Chain
effectiveness, with the primary focus being on Materials Management and
ProcessPro is the developer
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real-time solution. This ERP rises above other industry software in
production capabilities, financial integration, user interface, system
functionality, flexibility, and more. ProcessPro® Premier is available with
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business needs. For more information, visit
GPC is a leading global supplier of paint solvents, test fuels, and paint-system
recycling technology for the automotive industry. Their customers include
automotive manufacturers and suppliers, as well as chemical and
pharmaceutical companies, in the United States, Canada, Mexico, Europe, and
South America. The company has supplied custom-blended solvents, test fuels,
calibration fluids, and refined products to the automotive industry for over
70 years. Its products are used in OEM assembly, engine, and component plants,
and throughout the industry's supply chain.
GPC manufactures paint-related
products and cleaners for a wide variety of industrial uses, as well as
calibration testing fuels for use in the automotive industry. Paint-related
products include paint-line and booth cleaners, purge solvents, and thinners.
The Benefits of Lean Manufacturing: Single Piece Flow.
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Lean Manufacturing Principles. Strategos Consultants, Engineers, and
Strategists. 16 February 2009. www.strategosinc.com/lean_benefits.html
McCabe, Dr. P. "Defining Lean Manufacturing." Lean Manufacturing Guide. October
2001. 16 February 2009. www.leanmanufacturingguide.com
Womack, James P.
and Daniel T. Jones. Lean Solutions: How Companies and Customers Can Create
Value and Wealth Together. New York: New York, 2005.
Womack, James P. and
Daniel T. Jones. "Principles of Lean." Lean Enterprise Institute. 2008. 16
February 2009. www.lean.org