Lean Production

Lean production Lean production refers to the range of measures that can be put in place in the workplace to help reduce waste. Although traditionally used in manufacturing, lean principles can equally be used in service industries.

Lean production concepts Cell production Just-in-time stock control Kaizen (continuous improvement) Total quality management (TQM) Time based management

Cell production Involves team working Production is split into self-contained units (cells) Each cell is responsible for a complete product or production process Workers in each unit are multi-skilled, allowing for greater flexibility Wastage can reduce as each cell is responsible for its own quality there should be few communication problems as the cells are small

Just-in-time (JIT) This is a stock control method whereby materials are delivered just as they are needed. JIT therefore... reduces need for storage improves working capital as little cash tied up in stock reduces risk of stocks becoming damaged or obsolete relies on the reliability of the suppliers limits ability to respond to an unexpected order or increase in demand

Kaizen and TQM Kaizen is a Japanese concept of making ongoing incremental improvements to quality and efficiency Ideas for improvement come from the workers Quality circles may be used within Kaizen Total quality management is a quality assurance approach whereby ALL workers are responsible for quality TQM aims to ‘get it right first time’

Time based management Time based management aims to eliminate time wasted during design and production. Time based management... analyses where time is wasted and acts to reduce this e.g. equipment set-up times looks for opportunities to carry out processes simultaneously reduces new product development and launch times makes firms more responsive to market changes

Critical path analysis (CPA) Critical path analysis is a decision making technique CPA looks at the shortest possible time to carry out a project by identifying when tasks can be carried out simultaneously CPA allows for planning and monitoring of a project Allows resources to be allocated only when they are needed

Benefits of lean production Cuts costs Increases efficiency Increases responsiveness of firms to market changes Provides competitive advantage