Lean Manufacturing (Part 1)

I think companies definitely need to find ways to reduce waste and save money in tough economic times. While they may be hesitant to spend money on training and consultants when money is tight, they'll find Lean concepts should pay off in the long run.

Hopefully Lean concepts will become a standard introduced at the collegiate level so that it just becomes a way of thinking, rather than a new concept to learn in the workforce. The intimidation factor is probably a big reason why so many companies shy away from it.

While I definitely agree that that Lean concepts can revolutionize a company, why does it have to happen during tough economic times? Why can't it start as a precautionary measure? Also, it is obvious that in the end, these Lean concepts will pay off, but how soon? Judging by the way the world is, people want results NOW (Think about the bump in plastic surgery). People can't wait long before the interests subsides.

I agree, Terrapin, but the learning curve and perceived expense of implementing Lean are prohibitive. Any suggestions on getting buy-in from stakeholders?

Stakeholders care about the triple bottom line. Lean is all about, producing more with less, increasing profits while reducing production and most importantly, what can you do for me? If you show the cost savings of reducing 5-10% of all scrap from a 1 million dollar company or increasing production by 15%, or reducing inventory levels, they will listen and buy into lean. It isn't very hard to get their attention.

It also depends on the company's and product's life cycle. If it is a fairly new company, less than 10 years, there probably hasn't been much effort put into lean manufacturing. More than likely it was implement, implement, implement. Project Engineers are great at installing equipment and manufacturing processes. They are not good at making them very lean, cost effective, or even efficient.

If the company has been around for a while and the capital investments are no longer necessary to sustain customer demand, then it's the ideal time for lean manufacturing. Large gains can be seen in inventory reduction, travel of product reduction, overproduction, defect reduction, and rework reduction. Much of these can be implemented with little to no capital investment. Stakeholders really love this.

However, with the good must come the bad. Improving equipment and processes requires a different type of person. Project Engineers are not equipped with the right tools to accomplish this. Process Engineers are typically ideal to handle this. They have the right tools and mind set. This means changing resources or at least retraining current resources. This takes time and usually it looks like failure in the middle.

Lean Manufacturing is a double edged sword !

By keeping manufacturing to the bare miniunm and keeping stock in the warehouse low the company does not use much more raw materail than they need to. But on an Economic Scale of competition this actually limits competition. By only filling the oders the company has to maintain their market share plus maybe 5% just incase they get a new customer.

This is becomes a type of price fixing in my book. The only time the company or brand will expand their market is when a new outlet opens. Holding tight to the outlets they have and not seeking to compete with other manufactures of the same type of product puts the consumer out in the cold and give the company something they have sought for years. Total control of the price.

In the past it was very diffucult to raise prices but when your the only mustard on the shelf you get your price if you don't insult people with huge increases.

Depending on the industry buying, shipping and storing large amount of raw materails can have nearly the same cost small amounts. The loss of raw materail to spoilage being the only difference.

Manufacturing has such a thin economic line when talking about economy of scale your damned if you do and your damned if you don't.

Just in time delivery and lean manufacturing protect the manufacturer and hold cost down and use less raw materails so how can it be bad over all ?

The responses here go back and forth, most of which I disagree with.

I see lean as not something a company invests in, it's something a company decides to do. Here's an example of going lean to reduce inventory. First contact the suppler and see what quantities they are shipping and ask them to reduce that to one weeks supply and ship every Thursday or Monday or what ever?

Now you've just reduced your inventory level to a one week supply and where was the capital investment in that? Right... NONE.

Reducing set up. Here's an example. instead of having tools in your CNC machining center pulled after every job and fresh tools put in for the next. (An operation that sometimes can take several hours.) Leave all the tools in the chain, only change out when they are dull. Have the programmer map the tools and use whats in the chain rather then call out new (different) tools for each job.

There you go, set up reduction, (I've taken the average CNC Set up time to less then 15 min.) and where was the capital investment in that savings? Right again... NONE.

These are examples of lean that I have used and given my company cash in the pocket the day there were implemented.... didn't need to wait for a payback.

I think the reason US manufacturer are delaying in using lean is they don't understand it.

I have many more lean ideas if anyone want to here them, contact me. The implementation cost for you will be ZERO DOLLARS... results PRICELESS.

Labyguy

is it only for production or i can implement it in maintenance also.

Lean thinking can be used for more than just manufacturing. The principles can be applied to most processes and value streams. Accounting, health care, maintenance operations, government, education and service industries are all examples of areas and industries where Lean thinking is being applied.

It starts with enabling people and giving them the means to be responsible for the job they are performing. The people doing the work will best equipped to solve the problems associated with their job and offer assistance to continually improve the process.

Lean can be utilized in manufacturing, maintenance, office work and your personal life. It is, however, not a one size fits all concept.

I think you have a rather utopian view there.

Reducing inventory is something we would all like to do but called the supplier and changing shipping cannot but done that easily. The main companies that can do that either have very few suppliers or are very very large and can influence there suppliers with buying power.

Within a compnay it is not as easy as one person picking up a phone unless that person performs a number of different roles!

Most of us are not in that situation!

I do totally agree with you about machine setup tho. But persuading operators is usually the difficult thing to do!

What I found in dealing with suppliers is the assignment of risk. If I tell the suppler to make 100, but only to ship me 50, you have to put agreements in place with the supplier that your going to take the other 50.

Lean means increase the value added today and in the future, increase the happiness ot the customers , employees and suppliers. In this sense can help a lot, USA Manufacturers to compete better with lower labor costs countries and avoid to transfer companies to overseas.

But for doing that , the company need to change the way of thinking . We are trying to do this at our company, because we also are loosing market , and we need to increase our profit.

Instead of basing the company actions in waste of resources (raw-materials, stocks, etc) , company need to base their actions in labor waste (inefficiencies of the way of producing)

.This is not easy to understand when written, but as soon an engineer or manager, make his first Value Added Production Map ,all losses based in Shingo and Ohno (super production, transport, processing, cost of producing bad quality products, product waiting for processing, stock and motion ) are so clear to see, that improvements are almost immediate, because for the first time he can really see what is happening at his production line.

With the use of our old way of thinking , only looking for the indicators individually, sometimes we can´t see the root causes of the quality or stock or other cost problems we have . We know the costs, but we don´t really understand what is happening at the production lines. At least this is our experience.

That means company can start to make money very fast and this is a system that never ends, because the unique concern is to increase the economic productivity instead of production productivity of the company .Most of the improvements has not big investments. We started this year with this system in our company and we are foreseeing a economy of 10 times higher than our costs in the next 2 years. That means, in the fist year our company will pay for the investments.

Steps important to start with Lean

1) Get a consultant company with more than 5 years experience in Lean

2) Teaching of the key personal of the company (production and process engineers, managers, etc)

3) Teaching with practical cases in production lines, oriented by the consultant company

4) Selection of a Dedicated Lean Manufacturing Group (2 to 3 persons ) in the company that will constantly coordinate the activities of Lean at the Company

What size company is this best for?

examples

small manufacturing company 20 - 30 people?

small service company 20-30 people?

Mid size manufacturing company 200 - 300

Large service organizations say a state government or a nations government?

Should small companies start out with this philosophy?

The Lean Manufacturing Program normally ,when well executed , start simultaneously in all production lines, because the idea is to spread the new concept in all departments.

As Bigger the company is, normally the scope to implement the new Lean Concept is more complex, than a smaller company, due several production lines, several different products, and probably will require more resources and more time to implement , that a smaller company with few production lines .

In a smaller and middle manufacturing company, there are several advantages:

- reduced number of key personal to teach new concept

- reduced complexity of the scope

- reduced cost of consulting

- reduced cost of dedicated lean manufacturing coordination (suggestion below can varies depending in the scope)

1 person for a company of size 20-30

2-3 persons for a company of size 200-500

4 -6 persons for a company of size 900-1000

Our company with 500 persons will probably use 2 persons

Sorry , I forgot to mention my username FE in the previous answer #11 (Guest)

we are discussing the advantages of lean

but exactly lean is

anybody can explain with example

TPS (Toyota Production System ) also called Lean Manufacturing emerge in Japan, in Toyota automotive after Second War. At this period of time productivity of Japanese industry was small and there was a huge lack of resources, that obviously prevent the them to use the model of mass production

The creation of the system was due 3 persons from Toyota : The owner Toyoda Sakichi , his sun Toyoda Kiichiro e the first executive engineer Taiichi Ohno

Lean Manufacturing is based in 3 important principles : JIT , Stability of Process and Intelligent Automation.

Characteristics of JIT (Just in Time)

- Small lots of production

- Reduced stocks

- Reduced Lead Times

- Cellular layout

- Planning and controlling not centralized and located in the production line

- Labor multi-functional (meaning same worker able to work in several machines)

- Obsessive goal to obtain Zero Defect in production lines

- Pull production instead of Push production

Stability of Process

Reduce variation of the variables of the process to a minimum (CEP, 6-Sigma projects, etc)

Intelligent Automation

When an abnormal situation happens in production (an issue), and machine stop the workers will decide to stop the production line and solve the problem, to avoid the production of defective parts.The Intelligent Automation prevent the occurrence of defective products , remove the super production and concentrate the comprehension in the problem assuring that it never happens again.

Lean can be used by any size company from 1 person to 100000. It is a mindset of doing more with less.

The danger is that many companies treat it like the dozens of other programs they've instituted and never get buy-in from employees or management. Just because you say that you support Lean does not make it so.

Immediately following WWII, during very tough economic times for their own economy (rebuilding from scratch), the Japanese adopted American quality principles terrapin writes about, improved on them, and have been reaping rewards ever since.

Seems to me like most American companies (and maybe government agencies, too?) could now learn from the profitable Japanese/Toyota experience with the LEAN quality system, the way the Beatles borrowed from Chuck Berry and the American music scene of the 50's.

If international competition from Sputnik could drive the U.S. to the Apollo program, maybe Toyota's success could inspire American companies to greatness in a similar way?

LEAN (and ISO and similar quality systems) aren't global conspiracies (I've amazingly worked with folks over the years who felt this way), but smart ways to do profitable business, from my experience.

- Larry

I think Lean has to be taken with a grain of salt. In my experience, there is "Lean" and just the right thing to do. I should back up, Lean has to be a big picture item. Example, we're going to run JIT. Great, first couple of weeks everybody hurts their shoulders patting themselves on the back. THEN, customer calls, I need a triple order because we're running a huge campaign at Lowe's. Oops, machine goes down because we didn't take care of it. Customer doesn't care, they want parts and the guy down the street is carrying inventory. I was actually asked why we can't call up the customer and tell them what they're getting and when. Clarification of example: small $45 million rubber company selling to huge Fortune 500 customer - guess what, the customer doesn't care, they want their parts when they want them.... Everyone says Toyota does it, Lantech does it, Wiremold does it, etc.... Everybody fails to realize that somewhere down the chain someone isn't practicing the TPS system because if one thing goes wrong, you're SOL. We should mention leverage, what I mean is that because you supply to us (us being large company - GE, Ford, GM) you will give us this price and timing or we'll go somewhere else. You should be happy to just have us as a customer.....

So just take care of your equipment right? Reality is that's easier said than done, especially when traditional manufacturing is run until it breaks.

I guess what I'm saying is that I don't need lean to tell me that I should carry minimum inventory, order what I need, don't take 5 steps when 2 will do. If we all start working together, I know that lean promotes that which is good, we'll be just fine. Accept the fact that everybody in the chain needs to make money to stay in business. Example - Ford: 5% reduction in cost per year - what do you think is going to happen to the initial price??? Jack it up so you can take it out later. The Japanese and most other countries have it right when they establish long term contracts based on handshakes and interpersonal skills more so than a long contractual agreement.

Pretty cynical I know, but I've been with 6 different companies and the customer base has never been kind to the supplier base. (automotive and industrial goods)

anybody can tell me any website for lean

more practical examples and format which i can follow in process industry.

please guide me.

www.lean.org

I agree with mvida450 that there are problems with TPS and lean. Just look at the Prius. Toyota is failing to produce them "in time". VW and Honda are getting plenty of new customers because Toyota can't provide Prius cars fast enough. Toyota dealers in the US certainly don't follow the TPS system. I see plenty of inventory on their car lots all the time. Most American car buyers are impatient and can't be bothered to wait for their car to arrive. They'll just go to the other manufacturer's dealer next door.

I'm getting down sized next week since there is currently little work for my department. However, in six months there will be more work that the one guy remaining in my department can handle on his own, but it will take another six months to hire additional staff. Consequently, the project will just fall further behind.

If you really want to get crazy about this, the mathematical equations that model queueing can produce oscillatory results in your parts supply chain if you don't have sufficient controls in place. I'm sure starting and stopping production repeatedly is less efficient than just shooting for a little above mean.

Running a "Lean" shop also has to focus on a wasted time element - harnessing wasted slack time for the betterment of the system - how? Set up the environment for success rather than failure - I don't know how many shops I have been in where while 'trained employees' have to accomplish herculean change overs, the 'newbies' are relegated to 'sweeping up' -

Example -

a) design equipment and tooling that must be accumulated from wait stores (which ideally are close to the action of course), transported to the work center and assembled with as few common connections/connectors possible; providing the tools to dissassemble to all.

b) implement an apprenticeship training program that allows for items to be dissassembled safely at changeover by the least tenured employees quickly and moved to a sort area nearby

c) have employees previously taught to disassemble these pieces now taught to properly sort, classify, and possibly clean/restore any retrieveable supplies discarding spent supplies then move them to a transport area to be restocked into wait storage

d) have employees put items into clearly labelled wait storage areas and pull items from wait storage for next set up using a standarized equipment listing and deliver to staging area for pre assembly.

e) assemble waiting tooling prior to next change over to minimize assembly time

The trick is to have employees with the fewest skills start learning at the beginning with the easiest activity and become both effective and efficient at it, taking short lessons on how to implement each step, then moving them on to the next. Once employees are trained, teach them how to use their slack time to keep each element moving from station to station.

Oh yes, and when you measure and confirm the savings - give a taste back to the people that are making it happen and watch the program gain speed!

Just my take -

Jim

These answers could benefit with some perspective.

LEan is really about the elimination of wastes.

Only deluded people would believe that the High volume low mix Lean of Toyota Fame would be appropriate for a smaller Low volume High mix manufacturer.

Only if americas economic woes can be tied to manufacturing inefficienecy would "lean" become the prescribed medicine.

Critical reading of the news would indicate that it is not necessarily manufacturing inefficiency that Is the cause of our Manufacturing woes. Shoddy designs, Legacy workrules, and a host of other management and market inflicted pains are part and parcel of our current manufacturing malaise.

Lean does not deal with many of these prime causes directly.

But its a safer cult to join than say Jonestown.

milo

I agree completely, but my experience has proven otherwise. The essence of lean is truly to eliminate waste which most engineers in manufacturing currently do. Lean does push it further to include the entire value chain which only makes sense, most operators know more about their machines than the engineering or maintenance crew. What I've run into though is lean robots that regurgitate what they read in the book and when the forms and procedures pulled verbatim from their books don't work, they can't understand why. No doubt, lean can only help the woes of the American manufacturing workforce. We have a long way to go though, someone please correct me if I'm wrong, but in 2007 or 2008, the Wall Street Journal quoted the average wage of a UAW employee as $36/hr with entry level wages starting at $28. I digress though... As with everything, liberal arts, engineering, lean, whatever - when we focus on the essence and less on the procedure, we will attain success.

I fully agree that mechanics and operators are always the key people, to reveal the symptoms of the process (or machines) issues that generate the wastes, because they are dealing with the machines constantly. The problem is that sometimes the engineers are so busy, in so many different tasks, that don't have time to analyze deeply the root causes of the manufacturing wastes .In fact is very easy to invest in control and very time consuming to eliminate the hard problems in our process and sometimes our engineers prefers the easy way of controlling instead of solving problems. Lean is in fact a very easy concept and can be used in any size of industry and I don't agree with those people that think that lean is dependable of size or mix of products. The best use for me of lean is when is integrated with 6-Sigma. Lean helps to map the waste in the process and 6-Sigma to analyze deeply complex failures that could exists in process steps. Without a structured way of thinking the success is by chance.

"I don't agree with those people that think that lean is dependable of size or mix of products."

What works for Low mix and High volume is not what will save a shop with much different demands due totheir higher Mix (# of) of parts and lower volumes.

We can agree that eight kinds of waste are 8 kinds of waste, and waste is waste but techniques that work in a limited mix environment may not (are not ) robust enough nor appropriate for a high mix environment.

Suggest that you google "Job Shop Lean" to see the differences between what works for the apex shops at the top of the line with fewer degrees of freedom and those of us further down the supply chain who are drowning in permutations and combinations every day. It really is different.

I would not go to a doctor that uses "only one medicine at one dose" for all his patients, and the idea that there is only "one Lean and it is one size fits all" is probably the reason that so many shops have tried it only to say "it doesn't work for me" and drop it in frustration.

What you mean by "six sigma" and what those of us on this board have had inflicted upon us under the guise of "six sigma" are probably two very different ideas. If you look up some of the existing six sigma threads, you'll probably see stark differences from what you mean and what most of us have experienced.

Your comment about the engineers being too busy is a good point. Since no firm wants to over pay for engineering talent, most of us are already responsible for processes that are worth several times the budgetary responsibility of any single department manager. So our limited time by necessity gets deployed only on the A- list items. Thats why we are fans of control plans, they help reduce risk and variability. If the operators are experts in their processes, then problem solving is rightly in their purview. If not, well, I guess more engineering is in order...

Cheers.

milo

I think we have the same way of thinking , only I have my limitations in English and can´t express myself as good as I wish.

For each process could be different solutions. But each process can use the Lean methodology, because the time of the operations that add value to the process is calculated based in lot of 1 piece only.

For instance:

If I have a process with 18 steps in which only 2 steps add value to my process

Time Not Added Value = 3300 minutes

Time Added Value = 0,40 minutes ( 0,15min / 1 piece +0,25 min/1 piece)

That means my process waste more than 3299,6 minutes in operations that don't add value to my product. These waste can be due excess of quality control, missing operator, transportation, stock,etc. Finding these wastes is possible in any kind of process.

I am a 6-Sigma black belt engineer working 100% of my time in the last 4 years in 6-Sigma Projects that use the methodology DMAIC, mostly working in quality and productivity issues, because the segment we sell is for Automotive customers which quality target is 0 PPM. The normal approach for solving problems don´t work, because is hard to find failures below 10 ppm and our process and product engineers has no time for deep analysis.

Regards

Fernando

Been there. Your approach to wasted (non value time) in process queue we agree.

I have spent my career being abused by automotive oem and tier 1 &2 companies who couldn't even control their processes, I was documented at below 30PPM, and these idiots kept trying to raise my costs when they couldnt understand the cost impacts of their proposals.

at 20 ppm, and 10 poundser part,how are you going to measre the effects of a process change in a "5000 pound" trial?

They were the ultimate hypocrites.

I am sad to say that part of me is enjoying their demise; they deserved it with their smug superiority and arrogance. And to see their true character revealed as they grovel for government handouts .

They dissipated many years to improve their processes- and products.

Thanks for your response. The math speaks for itself across all barriers.

milo