What is lean manufacturing?
Lean manufacturing is a business approach that minimizes waste and maximizes efficiency. Also called the Toyota Production System, lean manufacturing has been around since the 1960s, and is used by many Fortune 500 companies today. Lean manufacturing refers to a production approach that uses less of everything compared to traditional manufacturing. While every manufacturer will have their own definition of lean, the common goal is to minimize waste and maximize value-add. This is achieved by eliminating anything that doesn’t add value or make the product or service better.
The history of lean manufacturing
Lean was first developed in Japan at Toyota, in the mid-1940s. It started as a simple goal: ensure that every part produced had value to the customer. At the time, there were many parts being made that never made it into a final product — which resulted in waste. Toyota’s solution was to create more efficient assembly lines that would only produce parts needed for each product. In the following years, Toyota refined this process even further and eventually created what we know today as lean manufacturing. Lean manufacturing is a process to deliver value to customers faster, cheaper, and with better quality. It reduces waste by eliminating unnecessary steps in the production process. Lean manufacturing focuses on creating more value for customers while using fewer resources.
How does lean manufacturing work?
The term lean manufacturing was coined by the Boston Consulting Group to describe Toyota’s approach to reducing waste, increasing customer value, and building quality into each stage of production. The Toyota Production System (TPS) is a system of production that emphasizes small batch sizes and continuous improvement. Although it was originally created for automotive manufacturing, lean manufacturing principles have since been applied to many other industries.
In the TPS, there are seven sources of waste. These are:
Overproduction. This occurs when you produce more than the customer needs or produce more than the next process in the line can consume.
Inventory. Excess inventory hides problems with product quality, production speed, and customer demand.
Motion. Excess motion is any motion that does not add value to the product or process. For example, movement may be required to access materials or equipment or to move parts through the plant.
Waiting time. Waiting wastes time and resources because workers are idle while they wait for materials, machines or processes to complete their tasks. Waiting may also cause defects because workers may forget what they were doing when they returned from waiting periods.
Transportation costs. Transportation costs money and time because products must be moved from one location to another during the production process. For example, transporting parts between suppliers
The lean manufacturing philosophy is highly effective, but it is not a simple “one-size-fits-all” solution. The goal of lean manufacturing is to reduce waste by eliminating unnecessary steps or activities that do not add value to the product. While this seems simple enough, the process for achieving lean manufacturing is highly dependent on the specific applications within your facility and the type of products being manufactured.
Even with a strong understanding of lean principles, manufacturers often struggle with implementing these concepts in their facilities. This is because many manufacturers are too focused on one aspect of production improvement — like reducing inventory or cycle time — when they should be considering all aspects of the production process. This approach can cause them to miss opportunities to improve other areas of their facility.
Running a lean manufacturing operation can be one of the most effective ways to run a successful business. With lean manufacturing, businesses can find ways to cut costs without sacrificing their quality of service.
Understanding how lean manufacturing works can be critical for businesses that are looking to run a more efficient and cost-effective operation.
Benefits of lean manufacturing
Lean manufacturing focuses on removing waste from the manufacturing process while focusing on improving quality and efficiency. Some of the biggest benefits that come from using lean manufacturing include:
Increased productivity – Lean manufacturing processes are designed to increase the productivity of your business, which allows you to get more out of your employees and resources. This increased productivity typically leads to lower costs for your business, which can help improve your bottom line.
Lower inventory costs – By practicing lean manufacturing, you are able to keep your inventory costs low because you only stock what you need and use just-in-time processes to continually replenish your inventory when needed. This essentially allows you to reduce unnecessary spending on inventory while increasing your ability to meet customer demand.
Improved safety – Lean manufacturing processes help improve the safety of your work environment by reducing waste and creating a safer workplace for your employees.
How to get started with lean manufacturing
Lean manufacturing is an intricate process. It requires a lot of work, but it pays off when you start to see positive results. When you’re just getting started with lean manufacturing, you need to understand all the benefits that come from implementing this model. There are a few key steps to take when using lean manufacturing:
Everything in lean manufacturing starts with identifying what your customers value. This is often called “value-add” — anything that adds value to your products or service, as perceived by the customer. Things that don’t add value are waste, and lean manufacturing seeks to eliminate them.
#2 Value stream
The value stream is lean terminology for everything that goes into getting a product manufactured and delivered to a customer. This includes both direct activities — assembling components, for example — and indirect ones such as managing inventory or waiting for materials to arrive from suppliers. The goal of lean manufacturing is to identify non-value-adding activities so they can be eliminated or minimized.
Create a value stream map of the current state and the future state of the value stream. Identify and categorize waste in its current state, and eliminate it!
Map all of the steps that bring a product or service to the customer. Include:
- Value-added– activities that are of value to the customer.
- Value enabling– Not valued by the customer, but required for the process.
- Non-value added– Create no value and are avoidable.
- Remove waste from your VSM.
Create flow to bring value to the customer as quickly as possible. Flow refers to the degree to which products move through production without interruption or delay. The purpose is to provide products when customers want them in the quantities they want at minimum cost with no defects and no delays. The goal is to design a production process that never stops moving and always meets demand exactly as it occurs.
Let the customer pull products as needed, eliminating the need for a sales forecast. After developing core product features, use a systematic approach for obtaining input from customers. The system should be designed to adapt to changes over its lifespan. Taking this step can enable you to satisfy customer needs within your basic framework
Establish a Pull System: A pull system works by only commencing work when there is a demand. This is the opposite of push systems, which are used in manufacturing resource planning (MRP) systems. Push systems determine inventories in advance with production set to meet these sales or production forecasts. However, due to the inaccuracy of many forecasts, this can result in either too much or not enough of a product being produced to meet demand. This can lead to additional warehousing costs, disrupted schedules or poor customer satisfaction. A pull system only acts when there is demand and relies on flexibility, communication and efficient processes to be successfully achieved.
The pull system can involve teams only moving onto new tasks as the previous steps have been completed, allowing the team to adapt to challenges as they arise in the knowledge that the prior work is mostly still applicable to delivering the product or service.
There is no end to the process of reducing effort, time, space, cost, and mistakes. Also, return to the first step and begin the next lean transformation, offering a product that is ever more nearly what the customer wants. In lean management, continuous improvement is also known as Kaizen.
#5 Perfection and keep improving
Eliminate waste constantly so that every step contributes directly to creating value for customers. The pursuit of perfection via continued process improvements is also known as ‘Kaizen’ as created by Toyota Motor Corporation founder Kiichiro Toyoda. Lean manufacturing requires ongoing assessment and improvement of processes and procedures to continually eliminate waste in an effort to find the perfect system for the value stream. To make a meaningful and lasting difference, the notion of continuous improvement should be integrated into the culture of an organization and requires the measurement of metrics such as lead times, production cycles, throughput, and cumulative flow.
Tips for continuous improvement
It is important for the culture of continuous improvement to filter through all levels of an organization, from team members and project managers right up to the executive level, to create a collective responsibility for improvement and value creation.
#1. Design a Simple Manufacturing System
The more you break down your systems into their simple, composite parts, the easier each will be to monitor and improve through eliminating waste.
#2. Keep Searching for Ways to Improve
Staff at all levels should be encouraged and supported in finding ways to improve processes and procedures. It is important to have an honest overview of procedures in order to find areas for improvement. The more specific these improvements are to your particular company and processes, the more effective they will be.
#3. Continuously Implement Design Improvements
It is not enough to seek out improvements. These need to be implemented through your designs, procedures, and processes. It is not enough to just seek improvements, they need to be put into practice on a practical level too. Any improvements should also be backed up by improvement metrics, and it is often best to make small incremental changes rather than large sweeping ones.
#4. Seek the support of your staff
In order to effectively achieve the first three steps, you need to gain the support of your staff. The whole methodology can suffer if management decides to implement it without gaining the buy-in of employees. Since waste, and therefore lean, is an overall concept across the entire business, it requires management to identify and understand the true problems that need to be solved.
If you’re interested in learning more about quality management and lean manufacturing guidelines, here are some of the links that may be helpful: