What is Lean Manufacturing?
Lean manufacturing is a methodology to greatly improve manufacturing efficiency. The principles of lean manufacturing focus on reducing waste within manufacturing systems and maximizing productivity. Also popular as Lean Production, the concepts of lean manufacturing are already used in automobile (Toyota), IT (Intel), Sports(Nike), Healthcare, software development, service industries, and various other industries. These principles can even be used in any small-scale business or production process to minimize waste. Basically, waste never adds value and the customers are not willing to pay for it. Studies show that up to 60% of production activities in a typical production facility are waste and there is a tremendous opportunity to improve using lean manufacturing techniques. Some of the other benefits of lean manufacturing are:
- Reduced lead times.
- Increased profits.
- Reduced operating costs.
- Improved product quality.
- Increased employee satisfaction.
- Increased sustainability.
- Improved competitiveness.
Principles of Lean Manufacturing
To eliminate inefficiency and waste, the principles of lean manufacturing were developed by Toyota. The process was so successful that myriads of industries across the world have embraced lean manufacturing. Continuous and incremental improvements on product and process while eliminating redundant activities are the basis of the lean manufacturing concept. The complete principles of lean manufacturing are devised into five key ideas. Those are:
- Identifying value from the customer’s perspective
- Mapping the value stream.
- Creating flow.
- Establishing a pull system.
- Managing towards perfection with continual process improvement.
Lean manufacturing principle 1: Identifying value
The value of a product is defined by a customer as per his needs of that specific product. Every company should understand the value of their products and services from a customer’s point of view as that will finally determine the price the customer is willing to pay. This value is then created by the producer or service provider to meet the optimal price for the customer while maximizing profits. The company should reduce waste and cost to reach the optimum product value.
Lean manufacturing principle 2: Mapping the value stream
The second step in lean manufacturing once the value has been determined is mapping the value stream. This principle is simple and involves identifying and analyzing the flow of information or materials to produce a specific product or service. In each step, waste needs to be identified and the methods should be implemented to reduce those waste. Value stream mapping, also known as process re-engineering is an ongoing activity that encompasses the product’s entire lifecycle, from raw materials through to disposal. Anything that does not add value must be removed.
Lean manufacturing principle 3: Creating flow
After Eliminating the waste from the value stream and identifying ways for improvement, the next step is to ensure that the processes are smooth without any bottlenecks. From the time, an order is received till delivery, everything should flow smoothly. The lean manufacturing concept relies on preventing interruptions in the production process. These enable a harmonized and integrated set of processes in which activities move in a constant stream leading to huge gains in productivity and efficiency.
Lean manufacturing principle 4: Establishing a pull system
Lean manufacturing works on the concept of a pull system which means working only when there is demand for it. It eliminates the creation of huge advance inventory which saves money. In a pull system, everything is flexible and decided based on communication, nothing is bough until there is a demand.
Lean manufacturing principle 5: Managing towards perfection with continual process improvement
The final and most important principle of lean manufacturing is the concept of continually striving for perfection. This entails analysis of the root causes for any issues and improving the process by eliminating waste across the value stream. Always constant efforts need to be put in to become perfect engaging all employees making it a part of the corporate culture.
Lean manufacturing tools
The heart of lean manufacturing is a relentless pursuit of removing anything that does not add value to a product or service. It has an extensive collection of lean manufacturing tools and concepts as mentioned below:
Lean manufacturing tool: Heijunka
The meaning of the Japanese word “Heijunka” is “leveling. Heijunka is a form of production leveling or schedule that produces a continuous flow of production in much smaller batches, releasing work to the plant at the required rate and avoiding interruptions. This process reduces lead times and inventory.
Lean manufacturing tool: 5S
This lean concept focuses on organizing the workspaces to create efficient, effective, and safe areas for workers. These 5s are Sort, Set in order, Shine, Standardize, and Sustain. The 5S principle prevent wasted effort and time by emphasizing organizational cleanliness.
Lean manufacturing tool: Kaizen
The Japanese word “Kaizen” means “continual improvement.” This lean manufacturing tool prepares a strategy to regularly improve every function of a business or manufacturing. Kaizen involves all the employees of the organization collectively to eliminate waste and improve processes. During World War II, Kaizen is first used as a lean manufacturing tool and from then onwards working successfully in several organizations in the world.
Kaizen makes the processes standardized, fix workflow issues, and solve business problems which in turn removes non-value added components. The Kaizen method usually involves the following steps:
- Problem Identification
- Analyzing the problem
- Evaluate and test improvement tactics.
- Incorporate improvements.
- Analyze the output and present it to the management for their feedback and further course of action.
Lean manufacturing tool: KPIs (Key Performance Indicators)
KPI or Key Performance Indicator metrics are designed to track and encourage progress towards critical goals of any organization. This is a very powerful lean manufacturing tool that assesses and analyzes business or manufacturing efficiency. Usually, these matrices are set by the management by careful consideration to drive the desired result. The best KPIs are aligned with top-level strategic goals and are highly effective at exposing and quantifying waste. Some of the typical manufacturing KIPs are:
- Manufacturing Speed
- Product Count
- Rejection Ratio
- Machine Downtime or break time.
Lean manufacturing tool: Bottleneck Analysis
Bottleneck or constraint analysis is the identification of the resources that take the longest operating time. The weakest link of the business or manufacturing process is identified and then improvement is done on that slowest link. Whenever some doubt arises regarding the long time taking for the business or manufacturing process, a bottleneck analysis is performed to increase the efficiency of the process.
Lean tool: Total Productive Maintenance (TPM)
For operating plants, this is the best lean tool to prevent downtime due to machine or equipment failures. The purpose of TPM is to increase productivity by minimising downtime. Total Productive maintenance works on three principles:
- Preventive Maintenance
- Corrective Maintenance and
- Predictive Maintenance
Maintaining machines regularly increases plant production by a great extent.
Lean manufacturing tool: Root Cause Analysis
Root Cause Analysis is a lean problem-solving approach that identifies the actual reason for a problem. By resolving the underlying problem, the true cause for the problem is eliminated so that the same problem does not reappear in the future. Treat the root cause of a problem, larger problems can easily be removed, which in turn increases productivity. However, this a time taking iterative process but provides a very efficient long-term solution.
Lean manufacturing tool: PDCA
PDCA is the acronym for Plan-Do-Check-Act. As the name suggests, it is a four-step cyclic method for bringing improvements in any process. It is a very strong lean manufacturing tool to bring continuous improvement.
There are are many other lean manufacturing tools that are used in various organizations which include
- Continuous Flow
- Right First Time
- Visual Factory
- Just In Time
- Standardized Work
- Overall Equipment Effectiveness (OEE)
- Poka-Yoke (Error Proofing)
- Takt Time
- Value Stream Mapping
- SMART Goals
- Single-Minute Exchange of Dies (SMED)
- 7 wastes
- Six Big Losses
- 5 Whys
- A3 Problem Solving
- Quick Changeover
- Lean Audit
- Total Quality Management
- Cellular Manufacturing
- Demand Management
- One-Piece Flow