How Does Lean Manufacturing Work?

Lean manufacturing has become a craze amongst manufacturing firms across the world, but what is it exactly and how can your firm integrate its ideas into your practices?

The idea takes its starting point from a comparison between companies and the human body. Just like our bodies, firms can become fat, sluggish and wasteful. They take in too many resources, which are directed to the wrong places and fail to turn resources into productivity. This makes firms slow to respond to market conditions and weaker than their competitors.

If that comparison makes sense, it's easy to see why firms should seek to become lean. By slimming down their operations to what is required, firms can cut out the fat and perform at their best.

However, this is just a comparison. What does it mean in practice to implement lean processes in your workplace?

Lean manufacturing begins with knowledge

Implementing a lean production strategy starts with a wholesale assessment of what the company does and how it does it. It is necessary to sort out what is essential to the operations of the firm from activities that are deemed to be wasteful. If an activity is not delivering added value to the firm, then the lean manufacturing strategy will devise ways to eliminate or change this, without damaging the firm as a whole.

Ideally, when the assessment is complete, a blueprint can be produced that will allow the firm to reduce costs, increase efficiency and raise productivity to meet the needs of customers.

Changing how manufacturing works in all aspects

The areas covered by lean manufacturing are numerous. A key focus is on reducing costs, but this needs to be balanced by the need to invest in certain areas such as training or environmental protection. The key question that a lean production strategy will answer is whether a particular cost contributes to value creation. It's not just about cutting costs regardless of their outcome.

Another aspect of lean production is cultural change. The idea of an effective strategy will be to drive a continual process of change. The market does not stand still, and effective lean companies do not either.

This means that the IT systems and protocols within a manufacturing firm need to allow employees to improve all the time and assess how the strategy is working. Enterprise Resource Planning (ERP) packages are a key tool that all lean firms need to consider.

ERP can be modeled as a feedback loop. Information is generated by the initial strategy, which is fed back into the system to drive a constant process of refinement. Leanness is not a quick fix, but a fundamental re-alignment of how a company operates.

The benefits of becoming lean and mean

There are plenty of benefits of implementing a lean production strategy. When waste is minimised profits will generally increase and customers will be served more efficiently, fostering long term partnerships. Employees can become more skilled and effective, while the environment can also be protected through practices like recycling and energy efficiency.

Almost all manufacturing sectors can benefit from lean manufacturing. Chemical firms can blend environmental safety with minimal waste. Food manufacturers can minimise the need for inputs like water or packaging materials. All factory environments can clearly establish the right balance between employee numbers and machinery.

Becoming lean is a virtuous goal for any manufacturer. As with our bodies, it takes time to create the right habits, but by investing effort and using tools such as ERP packages we can get there in the end. So formulate the right lean manufacturing strategy for your firm and reap the benefits.