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Lean Manufacturing, Basics, Principles, Techniques

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There is an ancient proverb that states, "When you chase two rabbits, both will escape." If you were to observe a bird of prey in action, the validity of this would be obvious. Envision a mighty eagle sitting on its mountain perch. To be successful the eagle must focus on one and only one rabbit. To do otherwise would result in starvation and death. Having clearly identified the target rabbit, the majestic eagle makes its attack and savors the results of its pursuit.
As  practitioners in today's global marketplace, each of us must be committed to our company's success. What is true for the eagle must be true for us. We must focus on the "one rabbit" that will ensure our corporate and personal success.


Attend many seminars, visit booths at trade shows, read industry pub­lications or newspapers, or listen to public, political, and scholarly rheto­ric and you hear numerous philosophies of what the main purpose of a company should be. Observe the actions of many corporate leaders and you may receive a similar mixed message.

While there may be an element of truth in all these pronouncements and actions, the leader who is not careful may have his or her focus blurred. The simple hypothesis of this paper is that there is one funda­mental target. There is one and only one rabbit to hunt. For a company entering the next millennium with the vision of surviving the unknown, the only valid target is profit.

This focused pursuit of profit needs to be built upon a number of fundamental and guiding principles. When this occurs, the company is able to prosper in the good times. It is also able to withstand the eco­nomic storms that are inevitable in today's global marketplace. The earning of a profit becomes a sustainable and honorable calling.

This importance of profits can be very simply illustrated. Manufac­turing is a process whereby a company purchases what are categorized as raw materials. Each of a series of steps adds value to this raw mate­rial, and ultimately a finished product is created. It is through the proper mix of human and machine resources that this transformation occurs. There is an associated overhead that supports the process. There is also an underlying need for capital to place these various resources in place.

However, the process does not stop here. This manufactured product must be put to use. It must have a value to someone we call the customer. If no one buys the output, the process comes to a screeching halt. The availability of money ceases. This eliminates the development of new products, the purchasing of additional materials, the paying of wages and benefits, and the acquiring of needed overhead services.

A multiplication effect occurs throughout the community, the na­tional economy, and the world economy. Suppliers are negatively im­pacted. Employees lose their jobs and their earning power. Disposable income is reduced. Ancillary businesses that provide goods and ser­vices lose sales. The failure of one company to sell its product at a profit has a far-reaching impact.


The immediate response that one might have is, "You have got to be kidding. You are making the dollar the almighty king. This will result in rampant abuses of power. Employees will be exploited. Consumers will be fleeced. Pollution will be rampant. Only the fat cats will pros­per. This is the age of enlightenment and social consciousness."

The eagle is constrained by the laws of nature. It is gifted with certain skills and attributes. The eagle has certain physical requirements for food.

There are natural enemies to avoid. There are certain places and times to locate food. As long as the eagle operates within these constraints, it is able to enjoy its freedom to soar as a majestic bird.

It is no different for our top corporate leaders. There are fundamen­tal principles that must guide their focused pursuit of profits. Eight of these guidepost principles that our leaders and we, as their followers, must operate within are these:

1. The customer is king. We must provide all customers with what they want, when they want it, or when it has been promised to them, with the quality that they demand, at the price that they can justify, and with the ongoing support and service that they require. In fact, wise leaders view profit and customer service as two sides of one coin. You cannot achieve one without the other. Therefore, prin­ciples two through eight must be focused upon decisions and ac­tions that meet our customers' needs and generate a profit.

2. Our employees are our number-one asset. As such, we must have regard for their needs that include a just wage, adequate benefits, appropriate working conditions and hours, growth opportunities, personal recognition, and security.

3. Maximizing profits is best accomplished when we focus on those products and within those markets that match our current or emerg­ing expertise and capabilities.

4. Our vendors are invaluable partners and must be treated as assets and not adversaries. Their ability to earn a profit is important to our earning a profit. They are more than a turnip from which to squeeze the last ounce of blood.

5. Our business strategy in the immediate as well as the long term must be combined with character in order to earn a profit. If we must be without either the strategies or character, we will always choose to retain character.

6. Government laws and regulations will constrain our actions. We will strive to adhere to the spirit of these laws and regulations. We will view them and the authorities that enforce them as our friends. This will ensure that we get to enjoy the lasting rewards of having made an honest profit.

7. Our good name will ultimately be worth more than our profits. Our decisions and actions will be directed toward the enhancement or maintenance of our good name with our customers, employees, ven­dors, regulatory officials, and the general public.

8. Our ability to profitably weather the economic storms will be di­rectly related to our willingness to operate within our income dur­ing the good times. Monies will be set aside for the difficult times, and leveraged operations and large debt will be avoided.

To Be Continued


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