Lean Manufacturing Tutorial

For a measure of their shortcomings, one needs only to 
spend some time in an MRP scheduled manufacturing 
facility - especially during the last weeks of the 
final financial quarter. In a typical company, you'll 
find that converting the quarterly financial forecast 
into reality still requires overtime, internal/external 
expediting, last minute "on-the-run" product changes and 
even a little "smoke and mirrors". Results are scrap, 
rework and warrantee costs that negatively impact 
profitability. Then there are quality and shipment 
problems that deliver less than acceptable customer 
satisfaction. Companies have spent many thousands of 
dollars in pursuing MRP and ERP only to see their growth 
and profits decline due to uncontrolled operating costs 
that produced non-competitive pricing. 

So, after introducing MRP/ERP 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 potential? 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 basics of lean manufacturing and then a 
total commitment to the consistent and tenacious 
execution of the 8-basics of lean manufacturing.

Like Vince Lombardi, who achieved success by having 
his team focus on the mastery of football basics - we 
need to have our manufacturing teams focus on the 
mastery of lean manufacturing basics. These basics 
require proactive planning and tenacious execution that 
demands leadership above and beyond just satisfying 
"day-to-day" accountabilities. Some managers can't 
envision the benefits of mastering business 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 lean manufacturing basics, companies will 
seldom achieve their full growth and profit potentials. 
Delineated below are the 8-basics of lean manufacturing:

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.

PERFORMANCE MANAGEMENT: Measurement systems can be 
motivational or de-motivational. The individual goal 
setting of the 80's is a good example of de-
motivational measurement - it tested 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 
scorecards is the choice of manufacturing winners.

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 shop scheduling 
methodology with the simplicity of sequential 
production. Manufacturing leaders have replaced their 
MRP shop order "launch and expedite" methodology with 
continuous production lines that are supported by real-
time, visual material supply chains ... sequential 
production. The assertion that sequential production 
only works in high production, widget-manufacturing 
environments is a myth.

POINT-OF-USE-LOGISTICS: 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. Moving production parts and components 
from the stockroom to their production point of use is 
truly a return to basics and a significant cost reducer.

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."

PRODUCTION LINEARITY: How linear do your production 
departments produce to the company's master schedule? 
As companies struggle to remain competitive, one of 
the strategies by which gains in speed, quality and 
costs can be achieved is to form teams of employees to 
pursue and achieve linear production. 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. 

RESOURCE 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 information.

CUSTOMER SATISFACTION: Customer satisfaction is in 
the eyes of the beholder - the customer. Perceptions 
are what we need to address when it comes to improving 
customer satisfaction. It does us no good to have the 
best products and services if the customer's perception 
of our "as received" quality and service is 
unsatisfactory. We need to plan and implement proactive 
projects that breakdown the communication barriers that 
create invalid customer perceptions. 

While many business gurus have identified one or more 
of these manufacturing basics as important to the 
successful pursuit of business excellence, the 
fundamental importance of these lean manufacturing 
basics has been lost in the proliferation of buzz words 
and the mania of systems sophistication. 

We say it is time for companies to put a hold on 
sophisticated systems development that cause self-
inflicted, day-to-day chaos. In its place, they should 
immediately initiate an action learning program for 
gaining a company-wide understanding and acceptance of 
the importance of the basics of lean 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 
profitable growth. 

If you and/or your company want to learn how to master
the 8-basics of lean manufacturing, click on the below link:

Lean Manufacturing Implementation