Going “Lean” in the Manufacturing Industry
Lean manufacturing is an approach to manufacturing that places an emphasis on eliminating waste, thereby reducing costs and improving efficiency. Although many of the ideas used in lean manufacturing have existed for many years, the development of this methodology is usually credited to Taiichi Ohno, the creator of the Toyota Production System. The Toyota Production System identified seven wastes in the manufacturing process. As this system became accepted in the United States, it became known as simply “lean manufacturing.”
The focus of lean manufacturing is not just to increase profitability. This system is also used to reduce costs in order to deliver greater value to the consumer; reduced costs allow for more competitive pricing. It also seeks to improve employee workflow. Ohno identified seven wastes in the manufacturing process.
Overproduction is often the largest waste a manufacturer must correct. With lean manufacturing, if there are no orders, there is no production. Manufacturing products for which there is no current demand results in excess materials costs, unneeded labor expenses, and excess inventory. Overproduction can range from manufacturing a car that has not been ordered to printing brochures that may change in the near future.
2. Waste of time
Nonproductive time can greatly contribute to inefficiency in manufacturing. Obvious examples of manufacturing downtime are waiting for machine repairs, delivery of product components, and for slower steps of the process to be completed. This waste can occur in offices as well as on factory floors. Slow internet speeds, waiting for project approvals, and having to get clarification of customers’ needs can also waste time.
3. Transportation waste
Every time something is moved, time is used and money may be wasted. Instead of taking delivered materials directly to the usage area, they may be received on a loading dock, placed in a temporary holding area, and then finally moved into warehouse storage. Storing product components away from the production area requires moving them regularly. Repeated emails about the same topic, emails to people who do not need them, and passing paperwork through multiple people can all waste time.
Overprocessing is unnecessary work that adds no value to the end product. This waste can take various forms: constant inspection, rather than eliminating the cause of errors; managing data with multiple systems; polishing an internal part that will function as intended without polishing, and is never seen by the consumer; and generating unused reports.
5. Excess inventory
Excess inventory is a difficult waste to control, as most businesses require some inventory-on-hand to run smoothly. While having a limited number of finished products is necessary to meet immediate demand, any unused product is an expenditure with no profit. Raw materials are often an inventory problem. Routine ordering of materials allows manufacturing to run without stockpiling inventory. In an office setting, avoiding waste can be as simple as not overstocking a supply cabinet with excess boxes of pens, staples, and other supplies.
6. Wasted movement
Wasted movement is a major waste in many businesses. Moving between work stations to complete one task, walking across a room to use a printer, collecting supplies from another room or from a high shelf, retrieving files from a central location–all of these are wasted motion. Eliminating wasted movement improves ergonomics and increases efficiency.
Waste due to defects is the easiest to identify and has the greatest impact on the end user’s perception of value. A defective product is not a profitable product. If the defect is caught in-house, labor and materials have been wasted. If the product makes it into the marketplace, there may be the additional loss of refund processing, potential sales to that customer, and potential sales to anyone else who learns of the defect. Defects must be avoided by ensuring quality throughout the manufacturing process, as defects may occur in design, use of a bad part, data entry errors, or elsewhere.
The principles of lean manufacturing are of beneficial use to any business, but they are of particular importance to the manufacturing industry. By utilizing these principles to eliminate waste, manufacturers can save time and money while delivering greater value to their customers.