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Implementation Of Lean Concepts

The concept of "Lean" as currently being used in the business world was mostly developed and refined by Toyota. It is sometimes called Lean Manufacturing, Kaizen or the Toyota Production System. Taiichi Ohno is credit for developing the Lean approach while working at Toyota. But he never called it Lean. The term Lean was first used by Jim Womack and Daniel Jones to describe Toyota methods. Ohno claims to have based much of his initial efforts on the works and ideas of Henry Ford. The Lean approach grew out of many years of trial and testing to continuously improve methods and results. Lean ideas and techniques still are being refined and advanced.

Manufacturers have embraced Lean and achieved remarkable results. Companies, using Lean, have seen improvements in the following areas:

  • Manufacturing Lead Time - less than 1 day
  • Delivered Quality - 3 PPM (Parts Per Million so 3 PPM means three defective parts in a million parts - this is operating at a Six SIGMA level)
  • Delivery Performance - 99+%
  • Inventory Turns - Greater than 50 turns per year
  • Conversion Costs (materials to finished goods) - 25 - 40% less than mass producers
  • Manufacturing space - reduced 35 - 50% less than mass producers
  • New product development - less than 6 months

Lean is more than a set of techniques. It is a way of thinking about how work is performed to achieve greater value to the customer. Toyota's goal is to "Give customers what they want, deliver it instantly, with no waste." Value' is what the customers need and are willing to pay for. Waste is any work that is not value added. Lean identifies eight kinds of waste. Kaizen means continuous improvement and Lean companies live Kaizen. Lean is not just for the production floor but applies to the office and management. Lean is most successful with applied throughout the whole company and when all employees are engaged in Kaizen.

Lean is not just for manufacturing. It is now being applied in hospitals, the post office, car repairs services, help line/call centers and government functions. It works well in any operation or service when applied correctly.

The Lean techniques include:

5S: The 5S's came from Toyota and are used to organize and visually control the workplace to eliminate waste. The 5S's are Sorting, Simplifying, Sweeping, Standardizing and Self-Discipline.

Just-in-Time (JIT): A system for producing or delivering the right amount of parts or product at the time it is needed.

Kanban: A Japanese term meaning "a signboard"; it is a communication tool or signal used to tell workers to pull parts or refill material to a certain quantity used in fabrication or production. A two-bin system for storing bolts can be a Kanban tool. When one bin is empty, it's time to reorder. Use Kanban to reduce excess inventory.

Kaizen Event: A quick-hit method for Lean process improvement, typically consisting of several days of intense training combined with immediate application of the concepts just taught to identify and eliminate waste. It takes place at the work location.

The Last Planner System (LPS): A tool developed by the Lean Construction Institute for applying Lean to project management. The Last Planner is the field supervisor who assigns work to the crews. The LPS shields the crews or project team from the variability associated with all projects. This allows the crew/team to deliver the project on time and at or below budget.

Poka-Yoke: A mistake-proofing method developed by Shigeo Shingo that is used to prevent an error or defect from happening or being passed on to the next operation.

Rules of Release: Established requirements to ensure that hand-offs are done right the first time. Lean concentrates on the hand-offs between operations. These rules list the information and product quality required by the receiving side to be able to do the next operation correctly.

Spaghetti Chart: A physical map of the work area that shows the path taken by the specific product or a person being observed. A line is drawn from start to end indicating the path moved by the product or person.

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