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What is Lean Manufacturing?

Lean manufacturing is a production strategy that seeks to produce a high level of throughput with a minimum of inventory. This method was originally a Japanese methodology. It was known as the Toyota Production System designed by Sakichi Toyoda. Unlike the American automotive industry Toyota encouraged employees to be a part of the production process, which was vastly different from the American automotive industry.The company was considered innovative in introducing quality circles which were a group of workers, who would meet to discuss workplace improvement. Quality circle members would also make presentations to management with regarding the quality of production. It is interesting to note that the developments made by Toyota were adopted by other Japanese manufacturers but none were as successful. In the 1980's American companies began to adopt some of the processes developed by Toyota, and gave these names such as Continuous Flow Manufacturing (CFM), World Class Manufacturing (WCM) and Stockless Production.

Lean manufacturing is structured around placing small stockpiles of inventory, in strategic locations around the assembly line, instead of in centralized warehouses. These small stockpiles are referred to as kanban, and the use of it significantly lowers waste and enhances productivity on the factory floor.

The ultimate goal for any business that adopts lean manufacturing processes is to reduce waste. An average company will waste a significant amount of resources. Studies have shown that in cases where the manufacturing process is outdated, the level of waste can be close to 90%. By adopting lean manufacturing processes the waste can be reduced to around 25-35%. Lean Manufacturing processes can improve -

  • Material Handling- This includes fewer moves of material, shorter travel distances in the warehouse, and simpler picking routes in the warehouse.

  • Inventory- Lean manufacturing reduces the inventory required to be in the queue, and therefore the inventory level overall.

  • Quality- Smaller lots mean that any quality issues that arise can be dealt with at the time of manufacture.

  • Customer Satisfaction- Higher customer satisfaction will reduce the incidence of repairs, returns and customer complaints.

Lean manufacturing also seeks to provide optimum quality. This is done by building in a method, where each part is examined immediately after manufacture, and if there is a defect, the production line stops, so that the problem can be detected at the earliest possible time. The Lean Manufacturing method has much in common with the Total Quality Management (TQM) strategy. Both of these manufacturing strategies empowerthe workers on the assembly line, in the belief that those closest to production have the greatest knowledge of how the production system should work.

Another important factor in Lean Manufacturing is that suppliers deliver small lots on a daily basis, and machines are not necessarily run at full capacity. One of the primary emphases of Lean Manufacturing is to eliminate waste. In other words the manufacturing process should get rid of anything that does not add value, to the final product. Because of this, large inventories are seen as a type of waste that carries with it a high cost. A second major emphasis is to empower workers in order to make production decisions at the lowest level possible.

It is important to realize that supply chain management, factors heavily into Lean manufacturing. Because of this a tight partnership with suppliers is necessary; as this facilitates the rapid flow of product and parts to the shop floor.

The bottom line is that Lean Manufacturing strategies can save millions of dollars and produce excellent results. Some of the major advantages include:lower lead times, reduced set-up times, lower equipment expense, and increased profits. Using Lean Manufacturinggives the manufacturer a competitive edge, by reducing costs and increasing quality, and by allowing the manufacturer to be more responsive to customer demands.

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