Summit Group Partners Blog

Lean Manufacturing: What Is It, It's Value, and Requirements For Success

 

 

What is Lean?

 

When asked, many people will respond that Lean Manufacturing is making more with less. Many leaders think that Lean involves getting rid of people and spreading the work across those that remain.

Lean Manufacturing does involve the word “less” but it focuses on less waste and less time to process goods and services. Lean Manufacturing simply is reducing the waste that cost companies money. Lean focuses on the reduction of throughput time in each and every process and can be applied by any type of organization. Lean Manufacturing is a way of thinking more than anything. Lean addresses the culture of the company, the way the organization thinks about improvements, and the complete dedication to reducing waste and driving extreme results.

 

Its Value

 

Lean does not require a large capital investment and the return on investment is very quick. As a company implements lean, each and every process that takes place within the organization is studied and analyzed to reduce waste. Lean attacks 7 types of waste that eat profits. These 7 forms of waste are:

 

1. Overproduction – only producing what is needed. Forces you to address the process.
2. Waiting – due to poor flow of products. Leads to longer lead times and cost.
3. Transporting – moving things around. Can cause damage and time and money to move.
4. Inappropriate Processing – using equipment that has high cost and requires long runs to be efficient.
5. Inventory – requires space, ties up money and hides problems in process.
6. Unnecessary / Excess motion – can cause safety hazards and injuries.
7. Defects / Scrap – cause replacing or rework. Do it right the first time.

 

Key Lean measures are set up to evaluate the changes that add value. Traditional measures like efficiency and units per hour are replaced by Throughput time and OEE (Overall Equipment Effectiveness). OEE is a measure of Availability, Performance, and Quality.

 

How do you know where to start? Lean Manufacturing studies the overall process to determine a constraint. Each of the current processes is evaluated to determine where the constraint lives so that it can be attacked. The identified process is the first to be evaluated. As that process improves the constraint will move to a different process. The Lean Manager uses a tool belt of lean resources to correct constraints as they are identified. As each process improves, so does the overall process as waste is removed and performance increases. On the Lean Enterprise Institute web site (http://www.lean.org/common/display/?o=1385 ) Jim Womack does a great job of explaining why to institute lean into your organization.

 

Implementation Success:

 

For Lean to succeed within an organization, three main aspects have to be present. First and foremost, the senior management team must fully support the organizational change. Most lean implementation effort fail due to the lack of upper management support. The CEO hires the Lean expert and sends them into the organization but fails to perform the critical key to success. If upper level management does not take an active role in the transformation and fails to support the activities, the efforts will fail. Upper management must introduce the transformation and then fully support the entire process.

 

The second aspect needed is a culture that supports doing things differently. If the culture of the company is not strong enough to support the activities and drive the changes, the transformation will not work. Apathetic employees can disrupt the transformation from within. Upper management support again is the key to driving the culture that can sustain the changes and drive results. From my experience there are 3 types of individuals present within the lean transformation. Type A is an individual that fully understands lean and fully supports the transformation. Type B is an individual that does not understand lean but fully wants to learn and is willing to change with the transformation. Type C is an individual that does not want to change and will do everything within their power to derail the transformation. Type C individuals need to be address if the transformation is to be successful.

 

The third aspect is a skilled and dedicated leader for the lean transformation. The leader needs to have a proven track record of hands-on experience with design, implementation, and continuous improvement through the lean process. Learning about lean in the classroom is completely different from learning about lean hands-on. A successful Lean transformation is unique to the situation as each and every organization is different and has different needs.

 

Tom Fidler is part of the network of advisors for Summit Group Partners and is a leading expert in Lean Manufacturing and has successfully implemented lean systems into companies in multiple industries. He has successfully led four turn around initiatives over the past 11 years. Tom has also worked for companies of varying sizes in the automotive, print, financial services, direct mail, stamping, and fastener industries. Tom’s consulting business specializes in Lean transformations and he can be reached through This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

 

About the author

Kevin Lombardo
Kevin P. Lombardo, Founder and CEO

Kevin founded Summit Group Partners to support businesses throughout the United States in their quest to accelerate a transformation and achieve sustainable change through strategies of growth, expansion and operational excellence. His passion is to help businesses and executives maximize their potential. Throughout his consulting career, Kevin has formally coached over 25 CEOs and business owners representing 10,000 employees’ globally and nearly $2 billion in revenues and helped them to unlock human potential and shareholder value. With 14 years of direct P&L leadership and over two decades of management and consulting experience in multiple industries Kevin can quickly bring the resources together to make an immediate impact on any organization. Kevin participates on various industry panels and has spoken at corporate and industry events throughout the country on the topic of accelerated sustainable change. Furthermore, he has authored numerous articles on corresponding subjects and has been interviewed by media outlets throughout the country.

Kevin directs all engagements for Summit Group Partners from inception and guides their progress throughout in order to ensure consistency and efficiency in all services delivered. He also manages client relationships and develops optimum solutions tailored for each client’s specific need. He has extensive experience assisting both healthy and distressed companies with M&A transaction leadership, revenue growth, operational improvements, restructuring debt, negotiating with creditors and unions along with locating financing.

Prior to forming Summit Group Partners, Kevin built two nationally renowned consulting practices from 2004 through 2010. Kevin has held numerous senior executive positions including CEO, President, CRO, EVP and CFO of publicly traded, privately held, Fortune 500 and private equity led businesses. Kevin has an extensive background in business leadership, strategic planning, growing revenue, profits and shareholder value of numerous businesses, executive development, entrepreneurship and turnaround management. As CEO of a $300 million dollar supplier of print services, Kevin led the transformation from a stale business model to a growth engine for the parent company, achieving revenue growth of 7% after multiple years of decline, reaching and sustaining the number one market share position and supporting the stock price increase of 300% within 15 months of taking the leadership role. He has held the position of CRO multiple times and has three times led businesses through the Chapter 11 bankruptcy process with each company successfully emerging with a confirmed plan of reorganization. He has led and executed the management of the merger, acquisition, divestiture and integration of over two dozen businesses with total transaction value in excess of $1.5 billion. Kevin received both his BS and MBA from the State University of New York at Buffalo. In addition, he holds a graduate certificate from Cornell University in Human Resource Management.

Comments

Mrs

Words tend to take on specific meanings. Lean means without fat and why are people thought to be the fat - could be the layers as well as the waste of time and energy

Wednesday, 08 June 2011
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