I was at a client yesterday whose managers had recently attended a lean seminar that had left them unsatisfied. During our discussion, the production manager asked if lean really helped with the problems that were most impacting his company. In particular, he mentioned the challenges that the company faced with respect to some of its vendors. Given that vendor performance was, for the most part, out of the company’s control and given that vendor performance had a direct and substantial impact on his performance as production manager, how was lean going to help him?
I thought it was a great question and one that’s not really addressed much in lean literature. In fact, most lean literature is written and seminars conducted in a way that leads to the notion that lean doesn’t help much with the really serious problems that companies like his face. By that, I mean that lean literature and seminars too often highlight specific tools and methods and present them as if they solve all the problems companies face. In the production manager’s words, the books and classes assume that everything is perfect (or nearly so) to begin with and the lean tools just make it all even better.
I agree with him on that point. I did a lot of reading about takt time, kanban, and heijunka before figuring out that their success depended on processes that were very well controlled. That doesn’t describe most manufacturing processes pre-lean. Too often, lean is presented as “the medicine” to cure all ills but the patient has to be in pretty good health for it to be effective. There’s no such thing as a pull system that works when equipment and tooling availability is low and changeover times are long and highly variable. Successful implementation of some highly touted lean methods depend on having reduced or eliminated process variances.
But let’s get back to his larger question…does lean offer answers to problems like “My vendors suck.” And the answer is no…at least not in the short run. And what I mean by that is, there’s not a technique or method described in Chapter Four that, when implemented, will get rid of the problem of “vendors that suck” once and for all.
This was emphatically illustrated by another client from a few years back. Seems that client had big problems with one of its vendors. It’s primary raw material was acquired from a vendor near my birth city in the mountains of east Tennessee. The client had a good relationship with the vendor but…it was the only source of the raw material in the US. When my client ordered new material and asked about delivery, they were told, “We’ll do the best we can but we can’t make any promises. Ten or twelve weeks, maybe. We’ll let you know if it runs longer.”
My present client’s circumstance weren’t quite that bad (I don’t think) but similar.
So, sometimes a company is stuck with a difficult situation and has to manage it as best it can. And that “manage it as best it can” is where lean thinking comes in.
The first thing we talked about was measurement of vendor performance. If a particular vendor delivered a component late, that’s a problem. But is that something that happens once a year or once a week? Are some vendors better than others? How much better? How do all vendors perform with respect to on time delivery and delivered quality? Is there a relationship between vendor price and vendor performance, i.e., is a premium price warranted by improved performance for a particular vendor?
The leaders around the table admitted that, though they had a good bit of intuitive information about vendor performance, the fact that they didn’t track and monitor performance regularly and consistently meant that they looked at the issue only when a problem arose.
So, lean may not offer a quick fix to all of your problems but a lean mindset offers a way to manage your processes so that variances are fewer and flow of materials and information is smoother and more consistent.