February 19, 2001
All manufacturing operations need to reinvent themselves to compete in today's marketplace. What can you do to change? Try going lean.
While some people have caught on to the need to get lean in their manufacturing operations, others still are waiting for the so-called fad of the Toyota Production System to go away. Surprise—it's here to stay. All manufacturing organizations have to reinvent themselves if they hope to compete in the global market.
What are the steps to reinvention, though? At what point do you begin to become lean? And, by the way, when and where did you become, ahem, unlean?
Just like personal weight gain, becoming un-lean is a subtle, gradual, even indiscernible phenomenon - - unless you watch the scale every day, it will sneak up on you.
Once the situation is discovered, the return to a lean state of operation (returning to lean) is possible, but hard work often is involved. Many similarities exist between staying in good physical shape and returning to lean in a manufacturing sense.
Getting a grip on the situation requires answering several key questions:
How do companies go from running like nimble gazelles to plodding along like bloated corporate water buffalo? The answer is simple—growth. Small companies evolve into large companies.
Small companies usually are lean by definition. For example, certain people spin off larger companies to start their own little shops. They manufacture materials only when ordered and in the quantity ordered, and rarely does the material languish, waiting for someone to add value to it. Because of their responsiveness to customer demands, small companies grow into large ones. And as they do, the stakeholders have to buy more equipment.
To capitalize on tooling and employee experience, they generally group all the common equipment together into departments. This is the point at which many companies begin to see trouble, because now the materials that used to flow naturally from one process to another may need to go into another building or into racks for days, weeks, or months. Long setup times become a driver of larger and larger lot sizes. Customers begin ordering larger and larger quantities to hedge against running short. They may see the growing pains the supplier is having and begin to doubt the supplier's ability to deliver as promised. The pipeline gets plugged even tighter with orders no one really needs. You wake up one morning and the manufacturing scale reads "Unlean."
Getting back to lean means getting back to the basics. In the beginning, your shop probably had small, right-sized equipment and a production stream that had a high ratio of value-added activities. It also probably ran on line-of-sight management, in which managers could physically see and control all aspects of the manufacturing or assembly process.
The steps required to return to lean depend greatly on how far away from lean you are. Several key fundamentals lie at the heart of a lean transformation.
Reduce Setup Time. Your setups should not take longer than 10 minutes orconsume more than 10 percent of your planned run time. The Japanese technique single-minute exchange of die (SMED) is the best tool to use to get your arms around this fundamental tool.
Divide and Conquer. Sort out what you make. This is known as product, quantity, and routing (PQR) analysis. Group parts into families according to the processes that they require. Then, map the value streams of like families of products.
Create a Model Line. Develop a showplace within your shop where everyone can see how it should be done. Start small, but don't pick a project that has no challenges. Develop key measurements before and after the production line so that people can watch the progress of your get-lean initiative. Finally, create a future-state map that acts as your ideal value stream.
Train Teams in Kaizen Disciplines."Kaizen" is a Japanese term used to describe a team-based, incremental approach to continual improvement.
Teach teams to work together and reward them as a team. Then, burn the deadwood - - clear the underbrush of barriers that hold team members back (sometimes this includes their manager). Celebrate the small successes. This is a journey, not a destination.
Focus on the rate of production, or takt time. This is a heartbeat measurement for the team. One-piece flow is ideal, but any flow is better than no flow. Pull at the demand of the customer, if possible. Then, pull the material through the process rather than push it along. This may take time. Setting up small work-in-process (WIP) or finished goods inventory (FGI) locations from which teams can pull material through production can be a good place to start. Holding areas also are known as Kanban areas, or supermarkets.
Don't Race to the Romantic Stuff. Don't swing into a full-scale plant reorganization until you master some fundamentals, such as setup time reduction, machine reliability, and machine capability.
Don't Wait Until All the Stars Align Before You Begin. There is never an ideal time to start redoing your manufacturing process. There always are reasons you should wait or gather more data, but a ready-fire-aim approach is not all bad if it is applied to smaller aspects of the project.
How fast a child matures many times is up to the kid. It's the same way with companies.
Companies led by visionaries who set clear, definable goals and drive change quickly often can institute a new system on their own, especially if they have someone in the organization who has been through the steps or knows how it should be designed. Sometimes, though, because of a lack of knowledge, experience, or drive, outside help is needed to speed things along.
Organizational inertia, being happy with the status quo, can slow a company's progress. Establishing the leverage to dislodge dinosaur thinking or to move paralysis-by-analysis managers off top dead center often can be achieved by hiring an outside consultant.
Having someone outside your company participate can be beneficial. Ask a customer, vendor, or anyone familiar with the lean approach to allow you or your team members to participate in one of their continuous improvement, or Kaizen, events. You also can ask them to participate in one of yours. Let the outsider offer feedback on your approach and then listen to it. Correct what you need to, and praise what you can.
Maybe a better question is, "How long did it take you to get unlean?"
Getting your business back into shape may take more work than you think. A 45-year-old cannot hope to recapture a 22-year-old's body in one visit to the gym. It takes discipline and a regular exercise routine to control weight. In the same way, discipline and dedication also are needed if you hope to undo years of mistakes or neglect in your manufacturing firm.
Some small companies with, say, $20 million in annual sales, turn around in a matter of months. Others take years. It has a lot to do with the makeup of the management team. If you have cost accountants who force the project teams to spend all their time cost justifying each microstep before they release resources to move ahead, progress will be very slow.
A measure of faith is necessary. For example, without jet engines, a modern airplane has the aerodynamics of a crowbar. Yet most people fly from time to time with faith in the physics of thrust and lift. You do not have to be a physicist or engineer to have such faith - - enough data has been gathered to convince you that air travel is relatively safe. Enough data also exists to prove beyond reasonable doubt that stepping toward a lean approach will cost something but that payback is a sure thing.
If you want your company to fly, you need to take the steps others have taken. Learn from their experience, successes, and failures. Go to workshops, seminars, and tradeshows. Talk to others who have learned to fly. Become a reader, and encourage your team to become disciples of lean by reading books and trade journal articles related to the lean approach.
Set up reciprocal visits with other companies that are on this path. Companies can get better together when they share their experiences.