Lean Manufacturing Overview

What is "Lean Manufacturing" and why should I care?

Lean Manufacturing is a modern approach to manufacturing which attempts to identify and eliminate "waste". Don't let the fancy vocabulary intimidate you. Lean has its origins in ancient Industrial Engineering principles popularized by Henry Ford. In its modern form it was developed by Toyota (think "JIT") and is now used by many manufacturing companies throughout the world (at least, those companies that have a future!). Toyota cleverly called their system "The Toyota Production System" or TPS. Most large manufacturing companies have adopted and adapted TPS, given it some new vocabulary words, and now call it "Lean Manufacturing".

The term "Lean" is very appropriate because Lean Manufacturing focuses on eliminating the "fat" or waste in the manufacturing process. The word "Waste" is defined strictly from the customer's viewpoint as anything that does not add value to the product. In our customer-centric universe, the customer is the sole arbiter of value and non-value; He will only pay for value, and if we offer him non-value, he'll take it for free, or go somewhere else.

Exquisitely Simple:	The basic ideas in Lean Mfg are old, having been well thought out by industrial engineers for almost a century. Don't get hung up trying to follow the orthodoxy; Focus on doing it fast, doing it cheaply, and doing it right the first time. If you apply common sense (which most manufacturing guys have in abundance), you'll be doing Lean.

Maddenly Complex:	Lean forces you to do your homework. You can't simply tell the guy on the floor to go "do something". You have to: 1) plan how you want him to do it, 2) understand the flow of materials, 3) balance the different operations, 4) write the work instructions, 5) train him in the process, 6) continually tell him how he's doing, 7) satisfy the accountants, and 8) get your product delivered to the customer when he wants it. If you screw up any of these things, the whole system falls apart. Remember, If it were easy, we'd all be doing it already!

Essential for Survival:	We Americans used to have to compete against 300 million Americans. Like it or not, we're now in a global economy and competing against 8 billion other people. And most of those people are thrilled to work for less than 10% of what we make. Lean is our only hope to beat them.

The Lean Fad

Why is "Lean" still here? Goldratt published "The Goal" in 1984. Womack & Jones published "Lean Thinking" in 1996. Lots of other business fads have come and gone. (Remember "Total Quality Management" or JIT?) Lean by now is the grand old man of business fads. Why is it still here?

Lean is still here because it has been successful, and it has the mixed blessing of being simple enough that most people think they understand it. In fact, almost everybody says they understand Lean. (There probably isn't an engineer in the country who doesn't have "Lean" somewhere on their resume.) It's taught in engineering schools. But unfortunately, this simplicity also means that many people who think they understand Lean, actually understand "Industrial Engineering". Lean is much, much more than Industrial Engineering, although IE principles are integral to Lean.

So what is "Lean"?

Lean is...

...a tool	Lean is a series of tools that can be used to improve almost any business process. Those tools are things like 5S, Kaizens, Kan Bans, and Visual Metrics.

...a great way to increase capacity	Lean is best used to increase capacity. By eliminating wasteful activities, we free up resources that can be used to make more products and services that we can sell. We make more money by selling more stuff. Lean helps us make more stuff with the same people and equipment we already own.

...a buzzword	There's no escaping that "Lean" is the most widely used buzzword in manufacturing today. (Yeah, this makes me a little unhappy and a little uncomfortable, but I think I can get over it.) Don't let other peoples' misunderstanding of Lean make you think that Lean is not one of the most valuable business concepts you are likely to ever learn.

...old ideas	Henry Ford applied many Lean principles to his assembly line. We've been doing Lean for hundreds of years. But we do have a few twists on these old ideas. Please keep reading.

...a philosophy	Lean is a philosophy, a set of values, a paradigm, and almost like a religion. Often the benefits of individual Lean activities are very difficult to quantify. Lean works best when it becomes the basis for how you do business. For example: What is the value of your company's business ethics policy? In any one situation, following a code of ethics may hurt your ability to make money. Still, we follow them because they allow us to make the most money in the long run, since no one will routinely deal with an unethical organization. Lean too, pays in the long run, but can actually hurt in the short term.

...a systematic way of eliminating "Waste"	We spend a horrifyingly large amount of time doing wasteful things. Lean helps us to see this waste (which we spent our lifetimes working to hide!), and this lets us get rid of it. Also please notice that "Waste" is in quotations because we have our own, very specific definition of waste which is probably different from your current definition.

...very concerned with the "velocity" and "flow" of materials	We should be able to easily visualize the flow of products and information in our organization. We want this flow to move steadily (and rapidly) through our organization. In a Lean world, we try to reduce the amount of time our materials sit in our factories. We have found that the quicker things move, the easier it is to solve problems and make our processes more efficient. We also crave the ability to immediately see disruptions to this flow, so that we can just as immediately correct those disruptions.

...a better way to utilize scarce resources	We will never have all the resources we want. Lean helps us free them up from doing non-productive things and lets us redirect them to productive work.

...complimentary to 6-Sigma	Lean and 6-Sigma go together like peanut butter & jelly. They are very different disciplines, but they dovetail together very well. You will often hear Lean & 6-Sigma described as "Lean Six Sigma" or LSS.

...common sense	Above all, Lean is simply common sense. Once you've adopted the viewpoint of your customer, all the other Lean concepts are actually pretty simple. If the Lean orthodoxy says you should be doing something one way, but your common sense says you should do it another, follow your common sense. Lean is a tool, and not all tools are usable in all situations. Use your common sense!

Lean Manufacturing Overview

Contents

What is "Lean Manufacturing" and why should I care?

The Lean Fad

Lean is...