Lean Manufacturing Concept & Principles for Optimization

Lean Manufacturing Concepts February 05, 2021

Hanh Truong

Writer

Manufacturers, distributors, and retailers from across all industries have been adopting lean manufacturing practices into their processes. Lean concepts help administrators to thoroughly evaluate their operations, reduce spending, and minimize waste.

It also promotes making regular and sustainable adjustments, ensuring that the business is continuously improving.

What is Lean Manufacturing?

Lean manufacturing is a series of methods that emphasize minimizing waste within a manufacturing or service operation while maximizing productivity. This form of waste generally refers to products or services that consumers do not find valuable or worth purchasing. It also encompasses how efficiently inventory, labor, and transportation are used.

These practices help managers optimize their operational processes by incorporating incremental changes. This helps business teams to continue their workflow without disruptions.

Additionally, lean manufacturing focuses on customers, specifically, what they value and how much they are willing to pay for goods. This helps companies curate products that meet exactly what shoppers need. Since customers are also constantly comparing prices and quality, lean concepts help businesses maintain a competitive edge.

3 Lean Manufacturing Concepts

There are 3 essential lean manufacturing concepts that businesses can integrate into their operation.

1. Waste Elimination

Different organizations will have different meanings for what they consider as waste. Most commonly, companies view waste as products or services that do not bring value to an end product.

Some other forms of waste are-

Extra wait time between processes or production stages

Overproducing or overstocking inventory levels that exceed consumer demand

Poor supply chain management or logistics

Unproductive employees and excess idling time

Flawed or poor quality goods

Underutilized employees

Inefficient processes

Businesses can effectively eliminate waste by identifying and classifying the different waste that they have. This helps managers understand what processes they will need to optimize, such as employee training, team building, and demand forecasting.

2. Prioritize Consumer Needs

In order to reduce waste while maintaining the quality of a good or service, management must take a consumer-centric approach. This enables any innovation or adjustments to be made according to what customers need or expect in a product.

Some factors that companies need to consider is customer's spending limits, their preferences in a product or service, and their values.

By monitoring and tracking shoppers' expectations, executives will have better insight into what features they cannot compromise on and what products customers are not interested in buying. This helps businesses understand what parts of their process or products are or are not wasteful.

3. Optimize With Kaizen

Kaizen, which means, change for the better in Japanese, is a lean concept that promotes continuous and gradual improvement. There are two forms of kaizen - system kaizen and process kaizen.

System kaizen refers to reorganizing the movement of information and materials within the entire company, while process kaizen is used to optimize specific processes.

Organizations usually use both practices together to identify waste and bottlenecks, and how to efficiently improve their operations.

5 Principles of Lean Manufacturing

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When establishing lean manufacturing methods to integrate into business processes, management should consider the 5 key principles.

1. Value

Businesses must understand what their customer values in their products and services because it helps with determining how much money they will pay for it.

This then enables executives to identify a target price, as well as what features they can eliminate from their processes or services as waste. By effectively doing so, businesses can satisfy customer needs and maintain high levels of profitability.

2. Value Stream

The value stream refers to a product's life cycle, from when it is a raw material to when it is an end product. By understanding the value stream, businesses can remove any steps, materials, or features that do not add value to the item's life cycle.

3. Flow

To properly and effectively get rid of waste, management must be knowledgeable about the value stream's flow. If there are any interruptions in the production process, they should be removed to maximize productivity.

4. Pull

The principle of pull ensures that products are made at the right time. Rather than traditionally creating or purchasing inventory based on forecasted demand and market trends, the pull concept directs companies to only manufacture or stock items when a customer order is made.

In order for this approach to work, a business must have the flexibility and reliable suppliers who can provide the necessary products in a timely manner. An efficient communication system is also important because it ensures all parties are aware of new orders and their fulfillment.

5. Perfection

By making gradual and small improvements, businesses can attain a perfect operational process. The drive towards perfection fuels lean practitioners to consistently monitor their procedures, measure their performance, and make effective changes to outmatch their competitors.

Lean manufacturing requires careful planning and productivity improvement strategies. With effective implementation, businesses will be able to eliminate waste and maximize their earnings.