Lean: From Theory to Practice

CM_J39.LA_E12 (Process Management) Exam Synopsis: Lean: From Theory to Practice Name: <redacted> Hand-in date: 29 Oct 2012 4 Pages, 7116 characters

What is Lean? Lean Production is a business improvement philosophy that was first formally described in Womak and Jones book, Lean Thinking. It comes from a philosophy developed at Toyota since after World War II, although acceptance greatly increased after Toyotas remarkable manufacturing and productivity success in the early 1990s. The primary objective of Lean is to lower costs through the elimination of waste, where waste is defined as something the customer is not directly willing to pay for. Lean is also a method of operations planning and control. Lean synchronization as defined by Slack, Chambers and Johnson, aims to meet demand instantaneously, with perfect quality and no waste. This involves supplying products and services in perfect synchronization with the demand for them. How does Lean work? The basic principles of Lean production systems are as follows: Just In Time Eliminating Waste Value Stream Mapping Zero Defects Kaizen - Continuous Improvement Pull Systems Empowered Multifunctional Teams Information Management Systems

Just-in-time is defined by Toyota as the rapid and coordinated movement of parts throughout the production system and supply network to meet customer demand. It is operationalized by means of heijunka (levelling and smoothing the flow of items), kanban (signalling to the preceding process that more parts are needed) and nagare (laying out processes to achieve smoother flow of parts throughout the production process). Wastes, as defined in Lean, were originally of three types - Muri, Mura and Muda Overwork, Unevenness, and Unnecessary. Muda can be of seven or eight types, depending on the practitioner. Needless Over-production, Waiting time, Transport, Process, Inventory, Motion and Defectives are the traditionally accepted Muda Wastes. Kaizen, or continuous improvement, is originally a daily process involving a local improvement within a workstation or local area and involves a small group in improving their own work environment and productivity. In contemporary usage, "kaizen blitz" or "kaizen events are limited in scope and designed to address a particular issue over the course of a week. A typical technique is the 5 Whys technique, a form of root cause analysis where the user asks Why to a problem and its answer five times in succession.

Value Stream Mapping, or VSM, visually maps a product or services path recording both the direct activities of creating products and services, as well as the indirect systems that support the process. The end result is that problems are diagnosed and changes suggested, making a future state map that represents the improved process, operation or supply chain. Pull Systems are a way of exactly matching of supply and demand by using pull control, where work is not pushed to the next department or workstation, but each department requests more work only when they have processed previous work. In the words of Richard Hall, Dont send nothing nowhere, make em come and get it. Multifunctional Teams are groups of employees who are able to perform many different tasks. These teams are usually organized along cellular manufacturing systems within the product flow. The numbers of tasks in the group increases, but groups are empowered to take decisions affecting the entire line. This is due to the resultant decentralization of responsibilities. Vertical Information Management Systems play a major role in implementing Lean, as strategic and operational information is important in order for the multifunctional teams to be able to perform according to the goals of the company. Contrasting Lean with other methods TOC and MRP The Theory of constraints (TOC) has been developed to focus attention on the capacity constraints or bottleneck parts of the operation. This works by removing bottlenecks and increasing the throughput of the process and utilization of workstations. However throughput and utilization optimization is from the organization perspective and not useful directly from the customer perspective. MRP is a planning and control calculation mechanism that is a Push system. It seeks to meet projected customer demand by directing that items are only produced as needed to meet that demand. In this it has the same objective as Lean, however it essentially works from the other end and is not customer-facing. TOC and MRP can be combined, depending on the complexity of product structures, the complexity of product routing, the volumevariety characteristics of the operation and the level of control required. Extremely Complex structures combined with complex routings may demand a PERT-like technique. Measuring Lean Implementations Lean is a way of life, and when adopted in an organization is all-encompassing. Lean implementation can be measured by a number of determinants, as described by Karlsson and hlstrm. While evaluating the progress of a Lean implementation, it is important to focus on the changes in the determinants, and not on their actual values.

Criticism of Lean implementations Over time, Lean has evolved some habits or practices that are targets of criticism. One such is an over-reliance on complex process-value-stream-mapping practices. While this is a great tool, Lean practitioners need to avoid over-complicating the process of deriving root cause and calculating the value or cost of waste just for the sake of stamping a textbook solution on it. Another criticism of Lean is the practice of conducting large events in order to execute Lean improvements. For example many organizations conduct Kaizen Events, which is in reality an oxymoron as continuity is inherent in the Kaizen concept. The Lean approach to people management can also be viewed as patronizing, and employees of Toyota speak about the inhumanity and the unquestioning adherence of working under such a system. This can cause problems in societies where the culture has a low power distance. The future of Lean Lean is a relatively simple methodology that is reasonably adopted and executed by most anyone; it does not require great skill other than some proficient problem solving. It has already become commonplace enough that most manufacturing engineering, production engineering, industrial engineering, manufacturing management, and process improvement roles identify it as a required skill set. Software development processes have also implemented Lean-inspired best practices as Agile development. The next Lean movement or revitalization can occur in transactional processes. However the future challenge for Lean is extending itself to such processes in the Office environment. Lean was born on the manufacturing floor, in an age when production was majorly accomplished on the floor. These days the greatest wastes come from the office, where a large number of processes are to be found. When people try to apply Lean philosophy to cut down on office waste, they often tend to use traditional Lean methods. Unfortunately, solutions like u-shaped production cells fail to improve office productivity, because in such processes traditional locations are far less influential than communication channels. I believe that businesses that rely more on common sense and the spirit of Lean will be more successful than those who treat Lean as a religion and stick to textbook examples of Lean.
References: Karlsson, C and hlstrm, P, Assessing changes towards lean production, International Journal of Operations & Production Management, Vol. 16 No. 2 1996, pp. 24-41 Slack, N, Chambers, S, Johnson, R: Operations Management, 6th ed., 2010 Nicol, A: What Are The Futures Of Lean And Six Sigma? Manufacturing.net 2012