Basics and Profitable Growth of Lean Manufacturing

Basics and Profitable Growth of Lean Manufacturing

In their attempts to draw closer to clients, many producers have lost focus on what should be a organization’s main success factor -profitable growth. In today’s competitive manufacturing environment, it requires more than quick fixes, outsourcing and downsizing for businesses to consistently achieve their growth and profit goals. While these options may yield temporary fiscal relief, they won’t lead the way to long-term growth and profitability. For organizations to grow and always exceed bottom line expectations, they have to get lean. And, to get lean they need to grasp the basics of lean production. <!–More–>

To get a measure of the shortcomings, one needs only to spend some time at an MRP scheduled production center -especially during the last weeks of their closing financial quarter. In a normal company, you’ll discover that converting the quarterly fiscal prediction into reality still needs overtime, internal/external expediting, last minute”on-the-run” product changes and even a little”smoke and mirrors”. Outcomes are scrap, rework and warrantee prices that negatively affect profitability and quality and dispatch issues that provide less than acceptable client satisfaction. Businesses have spent many thousands of dollars in chasing MRP and ERP simply to determine their growth and profits decrease because of uncontrolled operating costs that generated non-competitive pricing.

Therefore, after introducing MRP/ERP computer systems and much more, why is it that many businesses are still struggling to sustain profitable growth and are no where near achieving their full growth and profit potential? The first explanation is simple -the outcomes attained by any computer system are just as good as the folks in the controls and the integrity of the information they supply. The second is complicated -most production managers facing major daily difficulties and constraints adopt a completely reactive management style. Consequently, their time is consumed with”band-aiding” and/or finding ways to work around process and system problems -leaving them no opportunity to analyze and remove the root causes of ineffective systems and procedures. How can one turn around such a classic”cart before the horse” syndrome? What is required is a company-wide, in-depth comprehension of the basic of lean manufacturing and a whole dedication to the consistent and uncooperative implementation of lean manufacturing principles. Learn more about sters 987 Warehousing Union.

Like Vince Lombardi, who achieved success with his team concentrate on the mastery of football principles -we will need to have our production teams concentrate on the mastery of the lean manufacturing principles. These basics need proactive planning and stubborn execution that needs leadership above and beyond just satisfying”daily” accountabilities. Some managers can not envision the benefits of mastering manufacturing principles, other simply can not find the time. Like practicing blocking and tackling in football, it is not exciting, and like most soccer heroes, managers prefer to run with the ball. But without the stubborn and perfect execution of lean manufacturing principles, business seldom achieve their full growth and profit potentials. Delineated below are the key principles of lean manufacturing:

Information Integrity: it’s not unusual for front office management to become disenchanted with computerized systems outcomes when time programs and promised paybacks aren’t achieved. Truism: acceptable systems results can’t be achieved when systems are driven by inaccurate data and untimely, uncontrolled documentation.

Performance Management: Measurement systems may be motivational or de-motivational. The single goal setting of the 80’s is a fantastic example of de-motivational dimension -it tested one person or group against another and while fulfilling some individual egos, it provided little contribution to overall business growth and gain. These days, the balanced scorecard is the option of manufacturing winners.

Sequential Generation: It requires over systems sophistication for manufacturing companies to gain control of mill operations. To attain on-time imports in healthy profit margins, companies will need to replace obsolete MRPII/ERP store scheduling methodology together with the ease of sequential production. Manufacturing leaders have substituted their MRP store order”launch and expedite” methodology with constant production lines which are supported by real time, visual material supply chains sequential production. The assertion that sequential production only works in large manufacturing, widget-manufacturing environments is a fantasy.

Point-Of-Use-Logistics: Material storage and handling are just two of manufacturing’s high price, non-value additional supply chain management activities. The removal of the stock area, as it’s known now, should be a strategic goal of all manufacturers. Moving production components and parts from the stockroom for their production point of use is quite a return to fundamentals and a substantial cost reducer.

Cycle Time Management: Long cycle times are symptoms of poor manufacturing performance and high non-value additional costs. Manufacturers will need to concentrate on the constant reduction of cycle times. Achieving success requires a particular management style that focuses on”root cause” proactive problem solving, instead of”fire-fighting.”

Manufacturing Linearity: Companies won’t ever reach their full profit potential if they produce more than 25 percent of the monthly shipment plan in the last week of the month or more than 33 percent of the quarterly shipment plan in the last month of the quarter. How linear do your manufacturing departments produce to the business’s master schedule? As companies struggle to stay competitive, one of the approaches by which gains in speed, quality and prices can be achieved is to form teams of workers to pursue and attain linear production.

Resource Planning: One of the significant challenges in business now is the timely right sizing of operations. Profit margins can be eroded by not taking timely downsizing activities and market windows could be missed and clients lost by not upsizing the direct labour force in a timely fashion. These activities demand timely, tough decisions which need precise, well-timed and reliable resource information.

Client Satisfaction: Customer satisfaction is in the eyes of the beholder -the client. Perceptions are what we will need to address in regards to improving customer satisfaction. It does us no good to have the very best products and services in the event the client’s perception of our”as received” quality and support is unsatisfactory. We will need to plan and execute proactive projects that breakdown the communication barriers that produce invalid customer perceptions.