Implementing lean manufacturing

Management Services, Autumn 2007 by Lee, Quarterman

Imitation to innovation

Not much is written on how to implement lean manufacturing. Some firms stumble through with trial and error. Others rely on repeated Kaizen events. Another approach emphasises phases:

1. Stability

2. Continuous flow

3. Standardise work

4. Pull system

5. Level production

6. Continuous improvement

These phases are supposed to roll through the plant like tsunamis. For most firms this is unrealistic and likely to fizzle.

What guidance we do have is highly prescriptive. 'Do these things (followed by a list) and everything will be OK.' This is like a physician with a list of the top twenty drugs. He gives the same list to every patient, regardless of symptoms. Examining the matter more strategically raises several questions:

* Do we need the entire list of 'tools and techniques'?

* If not, which do we employ?

* Which elements come first?

* Do we implement plant-wide or

in focused areas?

* How does Kaizen fit into the picture?

* How detailed should the plans be?

* How long will it take?

* How do we know when we are really lean?

The Toyota model

Wickham Skinner does not consider lean manufacturing to be an actual manufacturing strategy. He likens it to 'blocking and tackling' in football, a necessary skill but insufficient for consistently winning games.

Skinner's point is legitimate. However, many manufacturers cannot even 'block and tackle' and lean manufacturing is a good way for organisations to learn these basics. We will use the term 'lean manufacturing strategy' to refer to a lean implementation that is well thought out and rationally adapted to the company involved. This contrasts with 'lean manufacturing' that refers to blind imitation of Toyota, repetitive Kaizen events or 'list thinking.' 'Manufacturing strategy' refers to an approach that starts with corporate and marketing strategies and then designs a manufacturing system to support them. Understanding the history and background of lean manufacturing can help sort out your implementation approach. Taiichi Ohno and Shigeo Shingo developed lean manufacturing at Toyota over a period of 20-30 years. Their intention was not to develop some sort of 'unified field theory' for all manufacturing. They simply wanted to solve Toyota's specific problems. The solutions they chose, while broad based, do not necessarily apply in all situations.

Ohno first visualised an ideal production system, primarily in terms of workflow. Ohno's ideal production system, inspired by Ford, had a series of adjacent workstations, balanced and synchronised with no inventory between stations. It delivered finished product to the customer exactly when needed (just in time) and drew materials from suppliers, just in time.

According to legend, Ohno then asked Shingo and others what prevented the realisation of this ultimate, no-inventory system. As the reasons for inventory surfaced, Ohno requested that his deputies 'eliminate the reasons.' All of the subsequently developed elements of lean manufacturing aim at eliminating (or at least reducing) the reasons for inventory. Ohno understood that inventory mirrors waste.

For Toyota (and many other manufacturers) the foremost 'reason for inventory' involved the intertwined issues of equipment scale, setup, batching and workflow. The causal diagram (below) illustrates.

The problem starts with equipment that is larger and faster than required for a single product. This causes multiple products to run on the same equipment. Two effects ensue:

1) Changeovers become necessary

2) Different products follow different routes

Large-scale equipment often requires difficult and time-consuming setups. The combination of changeover and long setup forces large batches that bring high inventory. Different routes force functional layouts with their complex material flows that also increase inventory.

High inventory brings all sorts of waste in material handling, space and quality (not shown). This diagram is over-simplified. In reality, it has multiple, subtle reinforcing loops that exacerbate the problem overtime.

Shingo attacked both root causes. First, he developed the SMED system that reduced changeover times and, thus, batch sizes and, hence, inventory. Second, he scaled down the equipment, where possible, thus enabling cellular manufacturing and its simplified workflow.

Ohno and Shingo were 'systems thinkers.' They visualised causes and effects, interactions and dynamic behaviours. This contrasts with 'list thinking' that is static, obscures cause-effect and treats elements of a system as independent.

SMED and workcells did not become part of the Toyota production system because they had cosmic virtue. They were employed because they reduced inventory and waste in the Toyota context. Other techniques addressed other issues. For example, some buffers at Toyota were large because of equipment breakdowns. Total productive maintenance (TPM) addressed this breakdown problem. If your machines do not breakdown frequently, there is no reason for TPM. The key point is:

* Do not copy specific tools and techniques; they are not universal