Lean Basics

PrintLogin to download pdfWhat is Lean Manufacturing? [KI]

Lean Manufacturing is a system/approach of eliminating waste and enabling continuous improvement.

System/ Approach: A set of tools and methodology guided by lean principles.

Eliminating waste: The greatest emphasis in Lean Manufacturing is the elimination of waste. Waste, also referred as Non- Value Added (NVA) activities, are those activities that take time and/or resources, but do not add to the customer value.

Continuous Improvement: constantly challenging the ‘status quo’ and asks the question: ‘Is there a better way’…i.e. reach for perfection.

Lean manufacturing is derived mostly from the Toyota Production System (TPS) and identified as “Lean” only in the 1990s. TPS is renowned for its focus on reduction of the original Toyota seven wastes * to improve overall customer value, but there are varying perspectives on how this is best achieved. The steady growth of Toyoya, from a small company to the world’s largest automaker has focused attention on how it has achieved this.

Lean is Manufacturing is not only applicable to the production industry. Using the principles of lean, it can be applied to any other industry, such as finance, health care and social care amongst others.

The 5 principles of lean:

The starting point is to recognise who the customers (end users) are.

1.       Value (Value Added Activity)

The determination of which features create value in the product is made from the internal and external customer standpoints. Value is expressed in terms of how the specific product/ service meets the customers’ needs, at a specific time or at a specific price.

2.       Value Stream

The entire sequence of activities across all parts of the organisation involved in delivering the product or service. This represents the end-to-end process that delivers value to the customer.  These activities can be Value- Added or Non-Value added.

Value Added Activities: An activity that transforms or shapes (for the 1st time) material of information to meet customer value.

Non- Value Added Activities: activities that do not contribute value to the product or service (as seen by the customer). By clearly defining Value for a specific product or service from the end customer’s perspective, all the non value activities can be targeted for removal.

3.       Flow

Flow is the uninterrupted movement of product or service through the system to the customer. Once non-value added activities (Wastes) are identified and removed from the process, the product or service will FLOW through the value added activities and to the customer.

4.       Pull

This is about understanding the customer demand on your service and then creating your process to respond to this. Such that you produce only what the customer wants when the customer wants it.

5.       Perfection

Flow and pull are created and established- do not stop there. Continuously look at making efforts to remove non value added activities, improve flow and satisfy customer delivery.

While lean focusses on removing waste, improving flow and continuous improvement, it has also other advantages. Quality is improved. The product spends less time in process, reducing the changes of damage or obsolenscence. Simplification of processes results in reduction of variation. As the organisation looks at all the activities in the value stream, the system constraint is removed, and performance is improved.

Lean involves many people in the value stream. Transitioning to flow thinking causes vast changes in how people perceive their roles in the organisation and their relationship to the product. The organisation must be ready to accept and deal with change and understand different people will take on change at different paces.

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