The Insider's Guide to Business and IT Agility
By Johan Arts, Vice President of Industry Marketing, MRO Software , 12/27/2004
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The principles of lean thinking are applied in manufacturing companies around the world with great success because of their impact on company performance. However, if not executed with the appropriate support systems and infrastructure in place, an improvement project based on lean thinking can adversely impact the company’s risk and can lead to serious business disruption.
Within a company’s maintenance department, removing waste from the value stream can dramatically increase dependency on reliable asset performance (i.e. people, tools and machines). Reliable assets become an absolute prerequisite for running the business. There simply is less and less room for error.
Companies that are implementing lean thinking should consider strategic asset management approaches that help improve the reliability of assets while optimizing the cost of maintenance and operations across a wide range of asset classes.
Lean Principles
Lean thinking is all about the removal of waste from the value chain. Waste is defined as any (human) activity that absorbs resources but creates no value. This definition includes mistakes that require rectification, production of items no one wants and processing steps that aren’t actually needed. Lean thinking provides a way to specify value, line up value-creating actions in the best sequence, conduct these activities without interruption whenever someone requests them, and perform them more and more effectively. In short, lean thinking is lean because it provides a way to do more with less while providing customers with exactly what they want.
Historically, manufacturing companies are organized in “functions” and “departments.” The grouping of workers and assets along functional lines appears to be a logical choice to manage tasks as efficiently as possible. The coordination and planning required in moving goods and services from one function to the next introduces tremendous delays and other forms of waste.
Today, companies can realize significant gains by implementing a lean enterprise. The lean alternative is to align functions and departments with the lines of the value stream, ensuring that work cells and assets are dedicated to performing certain tasks. By using this approach, unnecessary and non-value adding activities can be removed from the system, leading to a more efficient process.
An example of an automotive company that has adopted the lean manufacturing principles is Porsche AG, the famous sports car manufacturer. Their lean initiative was started in 1991 and over a 5 year period, Porsche has doubled its fundamental productivity in operations while cutting defects in supplier parts by 90 percent and first-time-through errors in-house by more than 55 percent. By 1997, it had launched two highly manufacturable products after only three years of development work, cut the needed manufacturing space in half, shortened lead times from raw materials to finished vehicle from six weeks to three days, and cut parts inventories by 90 percent.
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