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Lean Manufacturing - The importance of creating a value stream and reducing waste

Updated on February 18, 2014

Lean Thinking

What is lean thinking?

Doing more with less, is the basis of lean thinking. In great part it's a commitment to reduce waste. In general, Lean thinking has it's origin in Toyota's Production System.

Basically, we can identify several types of waste that are found in our production, but nevertheless lean is not limited to production or products, it can be applied to services of even you life style.

Lean thinking is based on 3 important things: continuous work flow, eliminating waste, and satisfying clients, making our organization true pull system.

Regarding waste, we can identify several origins:

- Overproduction or early production: the compromise is to produce exactly what the client needs and when he needs it ... a zero stock situation, which is good because all the resources are being used to the full capacity;

- Waiting: doesn't create value, therefore all waiting periods should be reduce to minimum

- Transportation: unnecessary handling of material is waste, most of the time these increase due to early production

- Inventory: excess inventory is a waste, and surely we can find this type in several places, namely excess raw materials, WIPs and finished products. Imagine you have 3 tanks of gas at your company and each one can warehouse 1000 liters, the current price of gas is $1/lt. Therefore your total investment in inventory will be $3.000 if one tank is manageable then you'll be freeing $2000 cash....

- Motion/Change: unnecessary movement of resources people doesn't add value and lean thinking is basically adding value.

- Over-processing: when you have processes that don't add value they should be evaluated as to it's true essence

- Defective units: the cost to make a good unit or a defective one is just about the same, might even say that a defective piece may cost even more to avoid it getting to the market or solving a quality problem

Lean thinking may bring your organization benefits:

- waste reduction: it's the main engine of lean, eliminate waste

- cost reduction: by reducing waste, lead times, inventory and defects you have immediate cost reduction

- decreasing manufacturing cycle: centered on the clients needs

- labor reduction: an increase in productivity will eventually improve your output, labor will be more productive

-inventory reduction: doing what creates value will reduce inventory to the essential

-higher quality: reducing defects will give your products and your whole process higher quality

The Lean approach is resumed in 5 elements:

- Defining value: to create value you'll have to start by defining it

- Map your value stream, an important tools which give you the capability to see where you create value

- Flow, creating a continuous flow in a shop floor will give you a multiple increase in production, resource use, and WIP control

- Pull, centre you main goal in satisfying clients, make them the center of your existence, look at their lead times and adapt your organization to satisfy his needs, he is the reason for your existence.

- Perfection, thriving for perfection is the constant objective of your company and personnel

Of course in theory lean thinking is relatively simple, but in real life, people are the center of it, getting the lean spirit through to everyone is one of the most important phases. As always your success depends solely on your effort, opportunities await you ...

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    • LeanMan profile image

      Tony 

      8 years ago from At the Gemba

      Well done, I have been reading the various definitions of lean here and in other areas of the net and most forget the number one focus of lean - the CUSTOMER.

      Waste reduction is important, but the main focus is in creating value for the customer! If you make that value flow at the pull of the customer you prevent the waste from happening in the first place! Waste prevention not waste reduction!

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