If the following benefits sound like something you may like for your company, scout through these lean manufacturing principles: 70%+ waste reduction 60% of lower production costs 70-80% reduction in inventory 85% lower cost of quality 70% increased labour productivity Lean is like a habit or a way of life that is focused on reducing waste. It was initially used in manufacturing; however, it can be used to reduce waste while maintaining high quality no matter what industry you are in. The key is being aware of what each principle means and how it is used, which is what we are going to talk about today! Lean was born out of manufacturing practices but in today’s world, it has transformed the world of knowledge in management. It strengthens continuous improvement and is based on one idea that is regard for people. Womack & Jones spoke about the five principles of Lean manufacturing in their book “The Machine That Changed the Worldâ€. These principles are treated as a formula for improving efficiency at the workplace.
The Five Lean Principles Explained:
1. Define Value
To understand the first principle of customer value, it is important that you understand
what value is. Value is what your customer is willing to spend on your product. It is
about discovering the actual needs of the customer. Usually customers do not know what
they want. This is especially common when it comes to unique products or technologies.
There are many techniques such as interviews, surveys, demographic and web analytics
that can help you filter and discover what exactly your customer finds valuable which
includes the price of the product and how they want it delivered.
2. Map the Value Stream
In this step, the goal is to use the customer’s value as a reference point and identify all the activities that contribute to these values. Activities that do not add value to the end customer are considered waste. The waste can be broken into two categories: non-valued added but necessary and non-value & unnecessary. The later is pure waste and should be eliminated while the former should be reduced as much as possible. By reducing and eliminating unnecessary processes or steps, you can ensure that customers are getting exactly what they want while at the same time reducing the cost of producing that product or service.
3. Create Flow
After removing the wastes from the value stream, the following action is to ensure that
the flow of the remaining steps run smoothly without interruptions or delays. Some
strategies for ensuring that value-adding activities flow smoothly include: breaking down
steps, reconfiguring the production steps, leveling out the workload, creating crossfunctional
departments, and training employees to be multi-skilled and adaptive.
4. Establish Pull
Inventory is considered one of the biggest wastes in any production system. The goal of a pull-based system is to limit inventory and work in process items while ensuring that the requisite materials and information are available for a smooth flow of work. In other words, a pull-based system allows for just-in-time delivery and manufacturing where products are created at the time that they are needed and in just the quantities needed. Pull-based systems are created from the needs of the end customers. By following the value stream and working backwards through the production system, you can ensure that the products produced will be able to satisfy the needs of customers.
5. Pursue Perfection
Wastes are prevented through the achievement of the first four steps: 1) identifying value,
2) mapping value stream, 3) creating flow, and 4) adopting a pull system. However, the
fifth step of pursuing perfection is the most important amongst them all. It makes Lean
thinking and continuous improvement a part of the company’s culture. Employees are
expected to strive towards perfection while delivering products based on the customer
needs. The company should be a learning organization and always find ways to get a little
better each and every day.
Applying the Principles
The Lean principles provide a skeleton for creating an efficient and effective organization. Lean allows managers to discover weaknesses in their organization and
deliver better value to customers. The principles help in creating better flow in work
processes. By practicing these principles, an organization can remain competitive,
increase the value delivered to the customers, decrease the cost of doing business, and
increase their profitability.
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