How Lean Manufacturing Can Help You Hit Those New Year’s Resolutions
With the dawn of the new calendar year comes the inevitable New Year’s resolutions. And whether you’re a manufacturing company or an individual, one of the most popular new year’s goals is to lose weight. For manufacturers, this comes in the form of reducing resources that cause a drag on their production and bottom line profit. To accomplish this, lean manufacturing practices are implemented.
If you’re in manufacturing, or operate a supply chain-related business, explore the information posted below to learn how implementing lean manufacturing can help your business shed those unwanted pounds.
What is Lean Manufacturing?
The goal of lean manufacturing is to work continuously to eliminate waste or resources that are not needed from the manufacturing process. What is often misunderstood is that this term is not solely related to manufacturing. In fact, the concept can be used in multiple industries throughout the supply chain.
Essentially, lean manufacturing focuses on identifying waste and either removing it or fine-tuning the operation to improve efficiency and cut-costs. There are 4 specific types of waste that are more common than others.
Maintaining an accurate inventory level is a vital component of the day-to-day operations of any manufacturer. From raw materials to finished products, many manufacturing companies struggle to determine what quantities of inventory are best suited to maintain an efficient operation. However, what most managers don’t realize is that inventory levels can also feed other areas of waste. Raw materials require shipment to the factories, storage, and movement – which we’ll identify further in the information below.
Anytime you move any materials from one point to another – that’s a resource. It’s considered waste when it provides no value to the product being manufactured. For example, if you’re paying someone to transfer raw materials or finished products from one location to another – without adding these costs to the finished products value – it’s wasteful. This is why many manufactures spend a tremendous amount of time fine-tuning their transportation methodology. If they don’t need a storage depot and can ship their products directly to the end consumer – they are eliminated transportation wastes and thus increasing profits. Like inventory above, the key is to find that balance between waste and maintaining an efficient operation that does not compromise quality or your ability to take care of customers.
So, let’s say for the sake of argument, that you are operating a shoe manufacturing company. You’ve spent money transporting your raw materials to the factory and have placed those materials in strategic locations to reduce the amount of time, resources, and equipment needed to move those materials into production. This is an example of movement – and why proactive manufacturers work with experts in lean manufacturing to set up their internal supply chain to reduce every possible movement. Every time a pallet needs to be moved, it requires an expenditure of payroll, an allocation of an employee, and can take away from your manufacturing efficiency. This is a classic example of waste that can be improved through lean manufacturing process.
Maintaining a smooth-running operation is not a black or white definition. In fact, each manufacturing company has unique definition of what they consider “efficient”. Case in point, if Company “A” has a goal of producing 1,000 units every hour, and Company “B” has a goal of manufacturing 2,000 units per hour – who is the more efficient? Truthfully, you can’t answer this question because we don’t know how many people, machines, materials or other important attributes are used in this production. If company A uses 5 people, 2 machines and has zero down-time, but company B uses 20 people 10 machines and has to wait 5 minutes every hour for materials – that’s waste. The smart manufacturer understands that finding that perfect balance of efficiency without downtime is an effective plan.
Regardless of the type of business you operate, if the four items above impact your operation – you could benefit from implementing a lean manufacturing concept. An exceptional resource for learning more about lean manufacturing and how to implement it in your business are experienced third-party logistics companies . While we focus on shipping and movement of products, we also go above and beyond to help our clients reduce waste. If you’d like to learn more about how we can assist your company implement lean manufacturing, contact us today.