A Simple Guide to the Lean Manufacturing System

Do you want to decrease waste and increase the quality of your products?

How about decreasing your cost of inventory and increasing your profit margins?

You’d probably like to boost your productivity too, right?

These improvements are usually hard to come by in manufacturing.

But companies around the world are reaping these benefits by implementing one proven manufacturing method…

The Lean manufacturing system.

We’ll show you what this system is, the key principles behind it, the major waste reductions you can expect from it, and the essential tools you’ll need to implement it.

By the end, you’ll have a firm understanding of Lean manufacturing and how it can transform your factory into an efficient powerhouse.

What is the Lean Manufacturing System?

The Lean manufacturing system, often referred to as Lean manufacturing, Lean production, or simply “Lean” is a system for maximizing product value for the customer while minimizing waste without sacrificing productivity.

One of the first major pioneers of “Lean thinking” (although he didn’t know it) was Henry Ford who was a major sponsor and promoter of the assembly line.

But Lean manufacturing as we know it today has its roots in the Toyota Production System (TPS), which was created by Taiichi Ohno and Eiji Toyoda in Japan between 1948 and 1975.

Before it was known as TPS, they simply called it just-in-time manufacturing.

There were 3 things the Toyota Production System attempted to prevent:

1. Muda

Muda is the Japanese term for “waste.” Muda is everything in your manufacturing process that creates waste or causes constraints on creating a valuable product.

According to the Lean Enterprise Research Centre (LERC), 60{cb377218d5687e54e8ee9149518f87201a393a7c1db5e8076e9d750029ec0dc3} of all activities in manufacturing production add no value at all.

According to TPS, there are 8 wastes you should work to eliminate:

1. Defects – The mistakes that require additional time, resources, and money to fix.
2. Overproduction – When those who receive the output aren’t ready for it or don’t need it because workers continue to produce more unnecessarily.
3. Waiting – When work has to stop because someone is overwhelmed, something broke down, you’re waiting for approval or materials, or because you’ve run out of something.
4. Not utilizing talent – Under-utilizing peoples’ talents, skills, and knowledge (not part of the original TPS wastes, but is increasingly sighted as a waste by current Lean manufacturers).
5. Transportation – Too much transportation, leading to increased costs, wasted time, and the increased likelihood of product damage and deterioration.
6. Inventory excess – When there is supply in excess of real customer demand, which masks real production.
7. Motion waste – Any excess movement, whether by employees or machines, that doesn’t add value to the product, service or process.
8. Excess processing – Any task that is processed more than required

These 8 wastes can be remembered using the acronym DOWNTIME.

2. Mura

Mura is the Japanese term for “unevenness in operations.” Mura is everything that creates inconsistent and inefficient work flows.

An example of Mura would be if you stocked a truck with fewer pallets than it can hold for one trip and then stocked it with more pallets than it could adequately hold for a second trip – resulting in longer lead times.

3. Muri

Muri is the Japanese term for the “overburdening of people and equipment.” Muri is all tasks or loads that put too much stress on your employees or machines.

Muri can cause employee burnout – as in the case of having too much work to do and not delegating a portion of it to someone else.

Or, Muri can cause the total breakdown of a factory machine – as in the case of running production for too long or with too many products than is allowed by the standards of that machine.

By minimizing or eliminating Muda, Mura, and Muri the proponents of TPS and the Lean manufacturing system believe you can produce the highest-quality products while increasing your revenue and productivity.

We’ll take a look at the tools that help you prevent “unevenness in your operations” and stop “overburdening your people and equipment” in a moment, but first, let’s take a look at how the philosophy of TPS gave way to the 5 cornerstone principles of Lean manufacturing.

What Are the 5 Key Lean Manufacturing Principles?

In 1996, the book Lean thinking was published, forever solidifying a whole new way of manufacturing.

The authors – James P. Womack and Daniel T. Jones – distilled the lessons they learned from observing TPS down to 5 Lean manufacturing principles.

These 5 principles are still at the core of any Lean manufacturing system.

The 5 principles are:

1. Value

The first principle of Lean manufacturing is value, which says a company should deliver the most valuable product to the customer. Value is therefore determined by the customer, not the company or its managers.

2. Value Stream

The second principle of Lean manufacturing is value stream, which says that after you’ve determined the value you’re going to provide your customers, you should map out the steps and processes required to manufacture those valuable products.

In a Lean manufacturing system, you should actually draw out every step of your process, from raw materials to finished product.

The goal is to identify every step that doesn’t create value and find ways to eliminate those steps.

3. Flow

The third principle of Lean manufacturing is flow, which says that after you’ve eliminated most or all of the waste from your system you undergo the process of ensuring all of your value-adding steps flow smoothly without interruptions, delays, or bottlenecks.

4. Pull

The fourth principle of Lean manufacturing is pull, which says that products should be built on a “just-in-time” basis so that materials aren’t stockpiled and customers receive their orders in weeks, instead of months.

5. Perfection

The fifth principle of Lean manufacturing is perfection, which says that you should make Lean thinking and process improvement a core part of your company culture.

Lean is not a static system, it doesn’t work the same for all companies, and managers aren’t the only ones who implement Lean – employees play an active role in making companies Lean, too.

To make the Lean manufacturing system more concrete and less abstract, let’s look at a few tools you’ll need to implement Lean in your business.

What Are the Most Useful and Actionable Lean Manufacturing Tools?

To get rid of Muda, Mura, and Muri there are a variety of tools you’ll need to implement and learn how to use.

Here’s a short list of some of the most important tools in the Lean manufacturing system:

The 5S System

The 5S system is a method of organizing your workplace materials for quicker access and better maintenance. This system is essential for eliminating waste that is produced by poor workstations and tools in poor condition.

The 5 S’s are:

1. Seiri (Sort) – Remove all unnecessary items for your current production, leaving only what is necessary.
2. Seiton (Set In Order) – Organize remaining items and label them accordingly.
3. Seiso (Shine) – Clean and inspect your work area and everything in it every day.
4. Seiketsu (Standardize) – Write out your standards for the Sort, Set In Order, and Shine steps above.
5. Shitsuke (Sustain) – Apply the standards you’ve set for your company and make them habits for everyone in your organization.

Plan, Do, Check, Act (PDCA)

PDCA is a 4-step method of continual improvement in your process and products. It applies the scientific method to manufacturing so that you can iterate the best results over the life of your business.

Here is each step:

1. Plan – Determine the goals for a process and needed changes to achieve them.
2. Do – Implement the changes.
3. Check – Evaluate the results in terms of performance.
4. Act – Standardize and stabilize the change or begin the cycle again, depending on the results.

Heijunka (Production and Demand Leveling)

Heijunka (production and demand leveling) is a technique specifically designed to reduce Mura (unevenness) by producing goods in smaller batches at a constant rate.

This helps reduce lead times and reduce inventory since each product or its variant is manufactured more frequently at a predictable rate.

Kaizen (Continuous Improvement)

Kaizen is the practice of continually observing, identifying, and implementing incremental improvements in the manufacturing process.

It encourages all managers and employees to be involved in the process of manufacturing improvements.

Kaizen ensures that waste will be gradually reduced through the collective talents and knowledge of everyone in the company working together to change the smallest inefficiencies daily.

Kanban (Pull System)

The Kanban (pull system) allows employees to “pull” work into their work station when they’re ready. This prevents Muri (overburdening employees) and allows managers and employees to focus on the right tasks at the right times without wasted effort or time.

How Do You Track Inventory in a Lean Manufacturing System?

Holding inventory is typically seen as a problem in Lean manufacturing. The closer you can get your inventory to zero, the better.

But you still need a way to manage the inventory coming into your warehouse, along with your purchase orders, customer orders, etc.

Since Lean manufacturing requires you to be flexible and fast when orders come through, it’s necessary to have an inventory management system that can respond quickly and fulfill orders as fast as you need them.

You won’t get that from manual spreadsheet inventory management.

But you can get it from cloud-based inventory management.

Find out how below…