Lean Manufacturing

Lean Enterprise - A business system for organizing and managing product development, operations, suppliers and customer relations. Key principles were pioneered by Henry Ford Toyota Production System (or TPS) - Taiichi Ohno Flow production

As Kiichiro Toyoda, Taiichi Ohno and others at Toyota looked at this situation in the 1930s and more intensely just after World War II, it occurred to them that a series of simple innovations might make it more possible to provide both continuity in process flow and a wide variety in product offerings. They therefore revisited Ford’s original thinking and invented the Toyota Production System.

Principles of Lean In their 1996 book Lean Thinking, James P. Womack and Daniel T. Jones defined a set of five basic principles that characterize a lean enterprise:Lean Thinking, Specify value from the standpoint of the end customer by product family. more... Identify all the steps in the value stream for each product family, eliminating every step and every action and every practice that does not create value. more... more... Make the remaining value-creating steps occur in a tight and integrated sequence so the product will flow smoothly toward the customer. more...more... As flow is introduced, let customers pull value from the next upstream activity. more...more... As these steps lead to greater transparency, enabling managers and teams to eliminate further waste, pursue perfection through continuous improvement.

"The critical starting point for lean thinking is value. Value can only be defined by the ultimate customer. And it's only meaningful when expressed in terms of a specific product (a good or a service, and often both at once), which meets the customer's needs at a specific price at a specific time."

The value stream is the set of all the specific actions required to bring a specific product through the critical management tasks of any business: the problem-solving task running from concept through detailed design and engineering to production launch, the information management task running from order-taking through detailed scheduling to delivery, and the physical transformation task proceeding from raw materials to a finished product in the hands of the customer. Identifying the entire value stream for each product is the next step in lean thinking, a step which firms have rarely attempted but which almost always exposes enormous, indeed staggering, amounts of waste.

Only after specifying value and mapping the stream can lean thinkers implement the third principle of making the remaining, value-creating steps flow. Such a shift often requires a fundamental shift in thinking for everyone involved, as functions and departments that once served as the categories for organizing work must give way to specific products; and a "batch and queue" production mentality must get used to small lots produced in continuous flow. Interesting, "flow" production was an even more valuable innovation of Henry Ford¹s than his better-known "mass" production model.

As a result of the first three principles, lean enterprises can now make a revolutionary shift: instead of scheduling production to operate by a sales forecast, they can now simply make what the customer tells them to make. As Womack and Jones state, "You can let the customer pull the product from you as needed rather than pushing products, often unwanted, onto the customer." In other words, no one upstream function or department should produce a good or service until the customer downstream asks for it.

After having implemented the prior lean principles, it "dawns on those involved that there is no end to the process of reducing effort, time, space, cost and mistakes while offering a product which is ever more nearly what the customer actually wants," write Womack and Jones. "Suddenly perfection, the fifth and final principle, doesn¹t seem like a crazy idea."

“Lean is basically all about getting the right things, to the right place, at the right time, in the right quantity while minimising waste and being flexible and open to change.”

Getting Started As you begin your lean journey, it is important to recognize two critical points: the road ahead is daunting—yet the potential payoff from your effort is enormous.

Getting Started promise of lean “a way to specify value, line up value-creating actions in the best sequence, conduct those activities without interruption whenever someone requests them and perform them more and more effectively. In short, lean thinking is lean because it provides a way to do more and more with less and less— less human effort, less human equipment, less time, and less space—while coming closer and closer to providing customers with exactly what they want.” - Jim Womack and Dan Jones define the promise of lean thinking

THE STEPS TO A LEAN OPERATION 1)ENTERPRISE EVALUATION – You need to know where you are to know where you are going 2) ELIMINATION OF WASTE - Eliminate all activities that do not add value. Eliminate safety nets (just in case manufacturing – inventory building… just in case), maximise use of scarce resources (capital, people and land)

THE STEPS TO A LEAN OPERATION 3) IMPROVE SYSTEMS FLOW - With Value Stream Analysis improve flow and eliminate bottlenecks 4) IMPROVE SYSTEMS QUALITY - The goal is for perfect first-time quality - quest for zero defects, revealing & solving problems at the source 5) PULL SYSTEMS - Products are pulled from the consumer end, not pushed from the production end

THE STEPS TO A LEAN OPERATION 6) AUTOMATED SYSTEMS – Continue to reduce waste, improve flow and open opportunities for automation 7) SYSTEMS PERFECTION – Attainable. It requires management commitment and awareness and training

THE STEPS TO A LEAN OPERATION 1) ENTERPRISE EVALUATION – You need to know where you are to know where you are going. 2) ELIMINATION OF WASTE - Eliminate all activities that do not add value. Eliminate safety nets (just in case manufacturing – inventory building… just in case), maximise use of scarce resources (capital, people and land). 3) IMPROVE SYSTEMS FLOW - With Value Stream Analysis improve flow and eliminate bottlenecks. 4) IMPROVE SYSTEMS QUALITY - The goal is for perfect first-time quality - quest for zero defects, revealing & solving problems at the source. 5) PULL SYSTEMS - Products are pulled from the consumer end, not pushed from the production end. 6) AUTOMATED SYSTEMS – Continue to reduce waste, improve flow and open opportunities for automation. 7) SYSTEMS PERFECTION – Attainable. It requires management commitment and awareness and training.

ENTERPRISE EVALUATION – You need to know where you are to know where you are going

Value Stream Mapping