What is Lean Manufacturing?
If you have looked at hiring a manufacturing consulting firm to help increase profit, help with global project management, or design a new factory layout, you have probably heard the term "lean manufacturing" thrown around. Lean manufacturing (often just referred to as "lean") is a method of minimizing waste within the manufacturing system and process without sacrificing quality and productivity.
When transitioning into lean manufacturing, the first step is to clearly delineate what actually adds value to someone purchasing your products. In other words, what actually matters to the customer? What are they willing to pay for? If there are parts of your manufacturing process that customers don't care for, you might consider reducing or removing them completely, and cutting out those costs. It's also important to remember that over half of manufacturers use a combination of project management methodologies.
Lean Manufacturing was borrowed from Japanese manufacturing, where the idea of continuously reducing waste over time was started. As you get started in creating a lean team, it is important to pace the rate at which you "lean up". A lean project consulting team can help manage this.
Advantages of Going Lean
There are five main benefits of leaning up manufacturing processes: Added Value, Value Streams, Increased Flow, Better Pull, and Perfection (yes, perfection doesn't seem as far fetched with lean).
Added Value: The only reason manufacturers stay in business is that they add value. One of the most important things is how your customers perceive the value of what you produce, and what they are and aren't willing to pay for. Once you understand your customer base and their desires, you can lean out things that aren't important to them, bringing your costs and their costs down.
Value Streams: The stream of manufacturing from raw material, shipping, equipment, labor, and processes, all need to be evaluated. These individual parts all add up to the value stream you produce for a customer. If there are parts of the stream that don't add value, eliminate or reduce them.
Increased Flow: Flow in manufacturing refers to the progress of work throughout production. When a system for production is tuned finely, it progresses steadily and efficiently and has good flow. If there is a breakdown in flow, it causes a bottle neck and waste is created (usually in labor). Dependable flow leads to consistent delivery.
Pull: Pull is the process of getting inventory manufactured "just in time," or as close as possible to when the product is needed by a buyer. Having product produced too early leads to wasted space because product is sitting around. Having it produced too late is a nuisance to buyers and decreases customer satisfaction. Lean manufacturing tries to get pull to be as close as possible to when a customer needs the inventory. This deals with issues such as transportation and movement of inventory and other motion related waste issues.
Perfection of the Process: While some people consider perfection an unattainable goal, the goal of lean manufacturing is to steadily more closer and closer to the perfect production model. Analyzing and changing the process of reducing effort, time, cost, space, and mistakes brings everything into line.
The benefits of going lean are many. In addition to having better quality product and faster lead times (which makes buyers very happy), going lean can also increase your profit margins and improve the bottom line. Engineering your manufacturing around lean principles will be key to asserting yourself as a top manufacturer in the ever growing world of super connected eCommerce.
Additionally, manufacturers who go lean report a more sustainable and eco friendly process because they reduce their carbon footprint. Employees also have a higher satisfaction rate at lean plants because they feel their time is actually being used in a valuable way, rather than wasted on inefficient processes.
The Globalization of Commerce
Embrace the globalization of manufacturing and commerce. Commerce has significantly changed over the last 20 years, and will continue to do so. It is now easier than every to purchase product from any country in the world, and get it shipped to any other company. Embrace this change. Make sure that you are set up to accept orders from a global market, and watch your profits grow.