Dedicated to the LEAN business community
of Western North Carolina

What is Lean?

Lean manufacturing or lean production, which is often known simply as “Lean”, is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination. Working from the perspective of the customer who consumes a product or service, “value” is defined as any action or process that a customer would be willing to pay for. Basically, lean is centered around creating more value with less work. Lean manufacturing is a generic process management philosophy derived mostly from the Toyota Production System (TPS) (hence the term Toyotism is also prevalent) and identified as “Lean” only in the 1990s.[1] [2] It is renowned for its focus on reduction of the original Toyota seven wastes in order to improve overall customer value, but there are varying perspectives on how this is best achieved. The steady growth of Toyota, from a small company to the world’s largest automaker,[3] has focused attention on how it has achieved this.

Lean manufacturing is a variation on the theme of efficiency based on optimizing flow; it is a present-day instance of the recurring theme in human history toward increasing efficiency, decreasing waste, and using empirical methods to decide what matters, rather than uncritically accepting pre-existing ideas. As such, it is a chapter in the larger narrative that also includes such ideas as the folk wisdom of thrift, time and motion study, Taylorism, the Efficiency Movement, and Fordism. Lean manufacturing is often seen as a more refined version of earlier efficiency efforts, building upon the work of earlier leaders such as Taylor or Ford, and learning from their mistakes.

The four goals of Lean
manufacturing systems

1Improve quality: In order to stay competitive in today’s marketplace, a company must understand its customers’ wants and needs and design processes to meet their expectations and requirements.

2 Eliminate waste: Waste is any activity that consumes time, resources, or space but does not add any value to the product or service. There are seven types of waste:

1. Overproduction (occurs when production should have stopped)
2. Waiting (periods of inactivity)
3. Transport (unnecessary movement of materials)
4. Extra Processing (rework and reprocessing)
5. Inventory (excess inventory not directly required for current orders)
6. Motion (extra steps taken by employees due to inefficient layout)
7. Defects (do not conform to specifications or expectations)

3 Reduce time: Reducing the time it takes to finish an activity from start to finish is one of the most effective ways to eliminate waste and lower costs.

4Reduce total costs: To minimize cost, a company must produce only to customer demand. Overproduction increases a company’s inventory costs due to storage needs.

Steps to achieve lean systems

The following steps should be implemented in order to create the ideal lean manufacturing system: [2]:

1. Design a simple manufacturing system
2. Recognize that there is always room for improvement
3. Continuously improve the lean manufacturing system design

Design a simple manufacturing system

A fundamental principle of lean manufacturing is demand-based flow manufacturing. In this type of production setting, inventory is only pulled through each production center when it is needed to meet a customer’s order. The benefits of this goal include: [3]:

• decreased cycle time
• less inventory
• increased productivity
• increased capital equipment utilization

There is always room for improvement

The core of lean is founded on the concept of continuous product and process improvement and the elimination of non-value added activities. “The Value adding activities are simply only those things the customer is willing to pay for, everything else is waste, and should be eliminated, simplified, reduced, or integrated”(Rizzardo, 2003). Improving the flow of material through new ideal system layouts at the customer’s required rate would reduce waste in material movement and inventory. [4]

Continuously improve

A continuous improvement mindset is essential to reach a company’s goals. The term “continuous improvement” means incremental improvement of products, processes, or services over time, with the goal of reducing waste to improve workplace functionality, customer service, or product performance (Suzaki, 1987).

Stephen Shortell (Professor of Health Services Management and Organisational Behaviour – Berkeley University, California) states:
“For improvement to flourish it must be carefully cultivated in a rich soil bed (a receptive organisation), given constant attention (sustained leadership), assured the right amounts of light (training and support) and water (measurement and data) and protected from damaging.”

Measure

A set of performance metrics which is considered to fit well in a Lean environment is overall equipment effectiveness, or OEE.

Sponsors

Haywood Community College
Waynesville, NC.

Tri-County Community College
Marphy, NC

Southwestern Community College
Sylva, NC

Contact

Sonja G Haynes

Executive Director, Foundation/
Small Business Center Director

Southwestern Community College

828-586-4091 ext 218