Results of application
of Lean Manufacturing (published data): |
The data contained in the table below is obtained
from several sources listed subsequently. Each organization’s
performance will vary depending on where they stand
at the beginning of the project. |
Item |
Lean Manufacturing |
Theory of Constraints |
Just-in-time |
Inventory Reduction |
50 to 90% |
45 to 50% |
50 to 90% |
Throughput Increase |
100 to 200% |
63 to 82% |
100 to 200% |
Lead Time Reduction |
80 to 90% |
66 to 70% |
Data Not Available |
Capacity Increase |
30 to 40% |
Data Not Available |
Data Not Available |
Scrap/Rework Reduction |
40 to 50% |
Data Not Available |
60 to 80% |
Floor Space Reduction |
30 to 40% |
Data Not Available |
30 to 60% |
Setup Time Reduction |
Data Not Available |
Data Not Available |
50 to 90% |
On-time Shipping Performance |
Data Not Available |
60 to 70% |
Data Not Available |
|
(Sources: Victoria J. Mabin and Steve J. Balderstone
– Review of 400 published articles (1999); Bill Baron
– Georgia Tech (2003); Tim Israel, Lean Success Stories,
Georgia Tech Economic Development Institute; W. A.
Sandras, Jr. Just-in-Time: Making It Happen - Unleashing
the Power of Continuous Improvement, John Wiley and
Sons, 1989; Robert W. Hall, Attaining Manufacturing
Excellence, Dow Jones-Irwin, 1987; APICS, Just-in-Time:
Lean Operating Principles and Techniques; and others
cross referenced by these references) |
What is Lean Manufacturing / Lean Enterprise?
Lean manufacturing is a package of management philosophy,
methodologies, and tools to systematically identify
and minimize or eliminate waste that is created
due to non-value added activities. It addition
to its own tools, Lean Manufacturing also encompasses
other proven techniques such as Just-In-Time and
Six Sigma. Although the term “Lean Manufacturing”
alludes to manufacturing enterprises, it can also
be applied to other enterprises such as Distribution
and Service. |
|
What are some of the similar philosophies
and methodologies? Where and how does Lean Manufacturing
fit in or compare?
There are quite a few methodologies that compliment Lean Manufacturing. For example,
Just-In-Time (JIT), Theory of Constraints (TOC), Six Sigma (6s), Synchronous
Manufacturing, Kaizen, Total Quality Management (TQM) and so on. While implementing
Lean Manufacturing, one should not get tangled up in semantics, but should employ
whichever technique best serves the purpose of minimizing/eliminating waste. |
|
ISO 9001:2000 requires continual improvement
too. What is the difference between continual improvement
as part of the ISO Quality Management System (QMS)
and continual improvement as a result of Lean Manufacturing?
Theoretically, they are one and the
same. However, in reality, when managers think
about continual improvement as a part of the
QMS, they think about Quality related problems
and associated root cause analysis. For the most
part, the QMS rarely addresses set-up time, inventory
levels, lead-time and similar issues. In Lean
Manufacturing, we look at existing business processes,
identify opportunities for waste and then work
at minimizing waste. |
|
Is Lean Manufacturing complicated?
No. From the viewpoint of concepts,
methods and tools, Lean Manufacturing is just
common sense. However, there will be a definite
need for training, buy-in from top management,
provision of resources and disciplined leadership. |
|
Why should we consider and apply Lean Manufacturing
in our company?
According to published data, in more
than 90% of the companies, the value-added activities
are 10-20%, and non-value added activities (waste)
are more than 80%. This provides potential for
significant opportunities for improvement. The
results of application of Lean Manufacturing
principles to your enterprise will depend on
where you are in value added and non-value added
activities, your value stream, and the amount
of efforts expended on the continual improvement
process. . |
|
What kind of improvements can we expect by applying
Lean Manufacturing philosophy?
You should expect to see improvements in
net profit, return on investments and cash flow;
increases in throughput, capacity, output, inventory
turnover and productivity; and reductions in inventory,
space requirements, and manufacturing lead time.
At ITTI, we guarantee a net Return On Investment
of $5 to $15 for every dollar you invest in our
services: “Satisfaction Guaranteed or Your Money
Back”. |
|
What is required or the starting point for application
of Lean Manufacturing philosophy in my company?
There are five steps: (a) recognition
of need for “change” by the top management; (b)
total buy-in, full commitment, and leadership
by top management; (c) identify what to “change”;
(c) identify the target; (d) identify the methodology,
and (e) implement the change. The client will
bring items (a) and (b) to the table; ITTI will
supply items (c) and (d) and we will jointly
accomplish (e). |
|
How long will it take for us to see improvements?
Lean Manufacturing is a continuous and
incremental approach using concepts of Six Sigma
and Kaizen Event/Blitz. It is highly recommended
that the improvements be made incrementally. If
too many improvements are planned at the same time,
the process will get bogged down due to lack of
resources. A typical Kaizen event/blitz may be
of one to two weeks long, with about 40% of the
time for project planning and development, 20%
of time for implementation of the project, and
40% of the time monitoring and tracking results.
Once this event/blitz provides the desired result,
sustain it, and identify and implement and monitor
the next project along with the previous
project. |
|
Once we apply Lean Manufacturing principles,
do we need to do anything else?
Lean Manufacturing is a continuous and
relentless pursuit of perfection in eliminating/minimizing
waste. Sustainability is an important issue with
Lean Manufacturing and other philosophies. As
it is, change is always difficult. If complacency
sets in due to internal resistance to change,
there will be tendency to go to the old way of
doing things. Thus, ongoing and never-ending
continuous improvement has to be a part of the
management philosophy and strategy. |
|
