10-Basics of Best-in-Class Lean Manufacturing
An Executive Summary

By Bill Gaw bg@bbasicsllc.com

Many years ago Vince Lombardi led the Green Bay Packers football  team to unprecedented success by having an obsessive focus on mastering the BASICS. It’s amazing how many individuals and companies have great visions yet fail to achieve their full growth and earning potentials. They're a lot like the Green Bay Packers' football team before the arrival of Vince Lombardi... all the potential in the world but with not enough focus on executing the BASICS of their business and profession.

In today’s competitive manufacturing environment, it takes more than quick fixes, outsourcing and downsizing for companies to consistently achieve their growth and profit objectives. While these options may yield temporary financial relief, they will not lead the way to long-term manufacturing success. For manufacturers to grow and consistently exceed profit expectations, they need to fully understand and effectively execute the 10-Basics of Best-in-Class Manufacturing. While many elements of these basics have been documented and presented in hundreds of management articles, books, video presentations and Seminars/ Webinars, their fundamental relationship and synergistic importance to achieving a best-in-class culture has not been effectively defined and communicated.  

During my 30-year manufacturing career as a supervisor, manager, director and senior executive, I participated in four successful “financial turnarounds”. Throughout these experiences, I continuously researched and tested business ideas, practices, processes and systems relative to  contribution to growth and earnings. As the years passed, it became clear to me that there were a number of manufacturing basics that were crucial to establishing a solid foundation for manufacturing success. Because of their importance, I now write, teach and coach on how to plan and implement a successful Best-in-Class Culture.

The Cart Before the Horse

In their efforts to draw closer to customers, many business management teams have lost focus of the basics of manufacturing. They have pursued Total Quality Management (TQM), Enterprise Resource Planning  (MRP/ERP), Business Process Reengineering (BPR), ISO-9001, and Lean Six Sigma with each respective guru reassuring them that if they followed their program the bottom-line would take care of itself. Well it hasn’t happened! Like most perceived panaceas, each of these programs received a lot of hype, produced a few success stories but in general, contributed little towards helping companies achieve their full potential.

A Measure of Hardware/Software Failure

For a measure of their shortcomings, one needs only to spend some time in a manufacturing facility – especially during the last weeks of a financial quarter. In  many company, you’ll find that converting the quarterly financial forecast into reality still requires internal/external expediting, last minute “on-the-run” product changes and even a little “smoke and mirrors”. Results are overtime, scrap, rework and warrantee costs that negatively impact profitability, quality and shipment problems that deliver less than acceptable customer satisfaction. Companies have spent many thousands of dollars in pursuing MRP/ERP and ISO-9001 certification, only to see their business decline due to uncontrolled operating costs that produced non-competitive pricing. Other companies have won the Malcolm Baldrige Award for Quality and Business Excellence and subsequently fell far short of reaching their full growth and earning potentials

So, after introducing all these computer systems and more, why is it that most businesses are still struggling to sustain profitable growth and are no where close to achieving their full growth and profit potentials?  The first reason is simple – the results achieved by any computer system are only as good as the people at the controls and the integrity of the data they provide. The second is complex – most manufacturing managers facing major day-to-day problems and constraints adopt a totally reactive management style. Consequently, their time is consumed with “band-aiding” and/or finding ways to work around system and process problems – leaving them little or no time to analyze and eliminate the root causes of ineffective systems and processes. How does one turn around such a classic “cart before the horse” syndrome? What’s required is first a company-wide, in-depth understanding of the fundamental importance of manufacturing basics and then a total commitment to the consistent and tenacious execution of 10-Basics of Best-in-Class Manufacturing.  In other words, what's required is a focused effort to establish a Best-in-Class Culture.

The 10-Basics of Best-in-Class Manufacturing

Like Vince Lombardi, who achieved success by having his team focus on and  master football basics – we need to have our manufacturing teams focus on the mastery of the manufacturing basics. Each of the ten basics requires planning and tenacious execution that demands a culture of proactive problem solving. Some managers can’t envision the benefits of of establishing a culture of mastering the basics, other simply can’t find the time. Like practicing blocking and tackling in football, it’s not exciting, and like most football heroes, managers prefer to run with the ball. But without the tenacious and flawless execution of manufacturing basics, companies will seldom achieve their full growth and profit potentials. Delineated below are the 10-Basics of Best-in-Class Manufacturing. 

Basic No. 1: Strategic Planning: Strategic planning is a business process that Best-in-Class companies employ to identify their critical success targets that set the course for future growth and profits. Lewis Carroll in “Alice in Wonderland” makes a good case for it: “Would you tell me, please, which way I ought to go from here?” said Alice. “That depends a good deal on where you want to get to,” said the Cat. “I don’t much care where…,” said Alice. “Then it doesn’t matter which way you go,” said the cat.

Basic No. 2: Sales and Operation Planning: One of the major challenges in industry today is the timely right sizing of operations. Profit margins can be eroded by not taking timely downsizing actions and market windows can be missed and customers lost by not upsizing the direct labor force in a timely manner. These actions demand timely, tough decisions that require accurate, well-timed and reliable resource planning and sales bookings. 

Basic No. 3: Point-Of-Use-Supply Chain: Material handling and storage are two of manufacturing’s high cost, non-value added activities. The elimination of the stock room, as it is known today, should be a strategic objective of all manufacturers. It’s time to realize that there is much more to increasing supplier contribution to a company’s growth and profitability than simply placing purchase orders with the lowest price bidder.

Basic No. 4: Information Integrity:  It is not uncommon for front office management to become disenchanted with computerized systems results when time schedules and promised paybacks are not achieved. Truism: acceptable systems results cannot be achieved when systems are driven by inaccurate data and untimely, uncontrolled documentation.

Basic No. 5: Value Stream Mapping: Analysis of the processes which the maps represent can help you increase customer satisfaction by identifying actions to reduce process cycle time, decrease defects, reduce costs, establish customer-driven process performance measures, reduce non-value-added steps, and increase productivity are a few.

Basic No. 6: Continuous Improvement: Price Pritchett puts it this way, “Without Kaizen, you and your employer will gradually lose ground. Eventually, you’ll be “out of business,” because the competition never stands still.

Basic No. 7: Performance Management: Measurement systems can be motivational or de-motivational. The individual goal setting is a good example of de-motivational measurement - it tests one individual or group against the other and while satisfying some individual egos, it provided little contribution to overall company growth and profit. Today, balanced, performance scorecards are the choice of manufacturing winners.

Basic No. 8: Cycle Time Management: Long cycle times are symptoms of poor manufacturing performance and high non-value added costs. Manufacturers need to focus on the continuous reduction of all cycle times. Achieving success requires a specific management style that focuses on “root cause” proactive problem solving, rather than “fire-fighting.” 

Basic No. 9: Sequential Production:  It takes more than systems sophistication for manufacturing companies to gain control of factory operations. To achieve on-time shipments at healthy profit margins, companies need to replace obsolete MRPII/ERP “order launch and expedite” methodology with the simplicity of sequential production. The assertion that sequential production only works in high production, widget-manufacturing environments is a myth.

Basic No. 10: Production Linearity: Companies will never achieve their full profit potential if they produce more than 25% of their monthly shipment plan in the last week of the month or more than 33% of their quarterly shipment plan in the last month of the quarter. As companies struggle to remain competitive, one of the strategies by which gains in speed, quality and costs can be achieved is to train and empower a multi-function, work team to pursue and achieve linear production.

Let's Put the Horse Before the Cart

While many business gurus have identified one or more of these manufacturing basics as important to the successful pursuit of operation excellence, the fundamental importance of the 10-Basics of Best-in-Class Manufacturing has been lost in the proliferation of buzz words and  systems sophistication. I say it is time for companies to put a hold on sophisticated systems development that can cause self-inflicted, day-to-day chaos. They should plan and implement  a Best-in-Class Culture for gaining a company-wide understanding and acceptance of the importance of the 10-Basics of Best-in-Class Manufacturing. Once buy-in and commitment have been achieved, aggressive planning and tenacious implementation must follow. In short, let’s put the “horse before the cart” – such a program will build a solid foundation for redefining and revitalizing a company’s pursuit of growth and profits.

Simon says, "Take a giant step forward."

If your manufacturing leader could use some help in developing and implementing  a best-in-class manufacturing transformation, have him/her check out my Best-in-Class Manufacturing e-Library" or my "Best-in-Class Manufacturing Champion Certification Program." They both have the knowledge and implementation tools needed to successfully carry out a best-in-class manufacturing transformation:

The Best-in-Class Manufacturing e-Library

The Best-in-Class Manufacturing Champion Certification Program

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