2009 Lean Ideas, All Rights Reserved1 Lean Manufacturing For Lean Times

2009 Lean Ideas, All Rights Reserved2 Lean Manufacturing Principal Thrust: The Total Elimination of Waste Result: Continuous Improvement

2009 Lean Ideas, All Rights Reserved3 A Simple Definition Deliver the most value from your customers perspective while consuming the fewest resources. Or Do more and more with less and less -Womack, James P. & Daniel T. Jones. Lean Thinking. Simon & Schuster, 1996

2009 Lean Ideas, All Rights Reserved4 TPS Toyota Production System Just-In-Time (Materials needed, when needed, and in the quantity needed) -Shortened lead time -Reduced operations other than processing -Reduced inventory -Obtaining a balance between processes -Problems become clear Autonomation (Automation with Human Touch) -Problems become clear, solutions are found and implemented -Quality assurance -Heightened sense of need for improvement -Accepting challenge for a higher level -Management centered on controlling abnormalities

2009 Lean Ideas, All Rights Reserved5 TPS The Minus-Cost Principle Traditional formula: Cost + Profit = Selling Price Minus-Cost formula: Market Price - Cost = Profit Manufacturers Can No Longer Control Margins by Increasing Selling Price

2009 Lean Ideas, All Rights Reserved6 TPS The Ultimate Response to Demand Is Production To Order The requirements of production to order: -High diversity -Low-quantity production -Quick delivery -Load fluctuation handling Make What You Sold, Not What You Plan To Sell

2009 Lean Ideas, All Rights Reserved7 What no one tells you about Lean

2009 Lean Ideas, All Rights Reserved8 HO-HUM! Why Doesnt Everyone Do This? Easy to Agree With Hard To Do Why Is It So Hard?

2009 Lean Ideas, All Rights Reserved9 All Our Current Processes Are Built for Batch Forecasting systems Factory layouts and equipment base Computer programs/systems Accounting systems Accounting and Computer Systems are Biggest Hurdles

2009 Lean Ideas, All Rights Reserved10 Not just an element of strategy Cannot be delegated down in the organization - without first removing the barriers –Make the month –Absorption accounting –MRP and other computer systems –Direct to indirect employee measurements Try it bottoms up - never works Lean is not Some Manufacturing Thing

2009 Lean Ideas, All Rights Reserved11 Lean Priorities IT Legal Finance Internal Controls Human Resources Environmental Regulatory Compliance Quotes/Order Entry Application Engineering Planning/Scheduling Purchasing Receiving Material Stores Production Warehousing Shipping Logistics Invoicing Collection Returns-Credits-Deductions Customer Relations Vendors Marketing Sales Advertising R & D External & Future Internal Support

2009 Lean Ideas, All Rights Reserved12 LEAN PRIORITIES 1. One Piece Flow 2. Set-Up Reduction 3. Quality at the Source 4. Equipment Performance(TPM) 5. Standard Work 6. Shorten Demand Horizon 7. Make Every Product Every Day 8. Pull System

2009 Lean Ideas, All Rights Reserved13 Shorter Lead Times Reduction of Defects Better Service To Customers Increased Inventories Turnover Greater Control of Expenses Reduction of Expenses Additional Capacity Alternative to Investment THE RETURN