What is Lean Manufacturing?
Lots of books have been written on this and there are as many definitions as their are practitioners of lean manufacturing. In my own view, the very term “lean” is something of a misnomer. It connotes cutting away, reducing, making smaller. It prompts lots of discussions of removing waste, cutting costs, improving efficiency. And, yes, there is an element of all that in lean manufacturing practice.
Lean manufacturing principles and tools are all about building capabilities and competencies. They are all about increasing capacity. They are all about creating the ability to do things the organization couldn’t do in the past. Lean achieves this by simplifying processes so that they consistently provide value to the customer. Lean achieves this with tools and methods that, when effectively implemented, provide for smooth, consistent flow of materials and information through the process.
Here’s my definition of lean manufacturing, then:
Lean manufacturing is the ability to smoothly and consistently move materials and information through manufacturing processes so that value to the customer is optimized.
Getting from where you are to the Lean Promised Land is hard to do and it takes a long time. Mostly because it requires substantial culture change. The tools and methods are straightforward. Consistent, sustained application of those tools and methods is difficult.
Where do I start if I want to implement lean manufacturing?
Start by gathering information about your current state. Then talk about your desired future state. Then organize your workplace and implement visual factory. While you’re doing that, establish teams to map your important manufacturing and administrative processes. Sustain it all with a lean management system.
Want more detail? Read the blog!
What is Lean Six Sigma?
Manufacturing processes are rife with variation. Variation is a fancy name for stuff that goes wrong…delays, errors, scrap, missing material, downtime. Lean tools and methods address the largest, most obvious sources of variation. Six Sigma tools and methods address more complex or more subtle sources of variation. So Lean Six Sigma is an integration of those methods to address all sources of variation.
Further, in my view, Six Sigma tools are best used in collaboration wit others, that is to say, best used by a team. Many Six Sigma tools, then, (e.g., structured problem solving) help teams manage agreement as they work their way through a particular opportunity or problem.
What are the benefits of Lean Manufacturing?
Well, Lean Manufacturing entails the reduction or elimination of unwanted variability in manufacturing processes. Some examples of that unwanted variability is scrap, machine unavailability, tooling unavailability, material handling problems, scheduling problems. Just about anything you can think of can be a source of variability in the manufacturing process, including changes in temperature and humidity. (If you’re extruding PVC pipe in January and somebody opens an outside door, you just created several minutes, at least, worth of scrap.) All this variability has costs: overtime, rework, lost material, lost direct labor, decreased throughput, expedited shipping, excess inventory, increased cost of quality. Lean Manufacturing reduces all these costs.
More importantly, though, Lean Manufacturing creates capacity and capability that didn’t exist before. Companies that seek to implement Lean Manufacturing tools should be asking themselves, “If I can design, make, and deliver a better product in less time than my competitor can, will that provide me a sustainable competitive advantage?” If the answer is no…don’t bother with Lean Manufacturing. Sure, it will save money but implementing the tools isn’t easy and you won’t stick with it. If the answer is yes…Lean Manufacturing concepts and tools will provide the surest, most cost effective path to achieving that competitive advantage.
What are the most common mistakes in implementing Lean Manufacturing?
They are as follows:
- Implementing Lean Manufacturing strictly as a cost cutting tactic,
- Underestimating the difficulty of the culture change that will be needed.
Implementing Lean Manufacturing as Cost Cutting
I tell all my clients, “Lean will lead to lower manufacturing costs but if you implement lean with a single focus on lowering your manufacturing costs…you’ll fail!” I tell them that, if lowering costs is their only interest, go find all the water, air, oil, steam, and fluid leaks and fix them. You’ll save a bundle.
Here’s the thing: Lean Manufacturing is all about continual, on-going, perpetual process improvement. It’s all about getting the folks who manage and carry out those processes involved in that on-going improvement. If the focus is seen to be solely on cost-cutting, those managers and employees will come to see Lean as simply an acronym for “Less Employees Are Needed”. Continual focus and talk about “improving efficiency” and “increased productivity” are heard as “work harder, faster with less”. It’s also heard as (and trust me on this), “Costs are higher than they need to be and it’s YOUR fault.” As you might imagine, none of this does much by way of getting managers and workers excited about the prospect of participating in the lean initiative.
Too much focus on cost cutting leads to the likelihood that Lean Manufacturing is seen as simply a set of tools and the view that implementation is simply a matter of picking the tool that will provide immediate savings. In the meantime, methods and approaches that build a true Lean Manufacturing strategy are shortchanged if not ignored outright.
Workplace organization and visual factory? Can’t see the immediate return.
Daily morning meetings? Paying direct labor to stand around to talk about their problems? Are you kidding?
And are you really sure we need all this training?
All this is apart from the fact that many (maybe most) manufacturers don’t do a good job of measuring or even thinking about their costs in any case. They tend to think of their costs as residing in a few big buckets: material, labor, and overhead. And that overhead bucket, they can’t do much about. So, if they aren’t measurably reducing labor or material, they can’t see that they are reducing costs.
So…focus too strongly on cost cutting and a company will sabotage its Lean Manufacturing implementation.
Underestimating the Difficulty of Culture Change
Volumes have been written about this issue. I’ve written a good bit about it myself. It’s a broad and complex topic, too much so to cover in a few words here. I’ll just tell you what I tell all my clients, “The tools are straightforward. It’s the culture change needed to sustain the application of the tools that’s the challenge.”
All of us rely on patterns in our environment to get through the day. For example, when you drive to work, you’re not deliberating at each stop light and turn as to what to do next. You can be listening to the radio, getting the interior temperature just the way you like it, adjusting your seat, and keeping a sharp eye out for motorcycles and you’ll still get to work just fine with no mistakes…because you rely on patterns that you’ve created (turn at the BP station) and that others have created for you (red means stop, green means go).
Any initiative means that those patterns at work are going to change. As such, change is always difficult, always disruptive. When managers underestimate the extent of the disruption change promulgates, they tend not to take the needed steps to assure that change will be sustained. They tend to think that an announcement will be enough to get folks to do things they’ve never done before and quit doing things they’ve done for (perhaps) decades. It just doesn’t work.
What is “Lean Leadership”?
That’s a difficult question and one without a tidy answer. Essentially, it’s leadership that is conducive to implementing and sustaining an effective lean initiative…and I know that definition is a bit circular and doesn’t help much.
Let’s start with what Lean Leadership is NOT. “Lean Leadership” has nothing to do with any sort of “cost cutting” focus. And you’ll never hear a real Lean Leader say anything like “We’re lean and mean.”.