Lean manufacturing, SAP, Kanban, Heijunka and factory logic

In a recent post in ARC web they announced the acquisition of Factory Logic Inc by SAP the leading ERP solution of the world. To understand the importance of this acquisition we have to understand SAP and Factory Logic and the need for them to become one and operate as one.

SAP is the worlds leading ERP solution. Without a doubt it is a winner in the world of ERP. So compacted and integrated and durable, SAP implementations include the biggest companies in the world. Visit SAP website to get more details on their SAP implementations. Among all of these implementations there is one which standout in lean manufacturing context. Toyota is also known to be on SAP. So no need to say the acceptability of SAP as a software which can be used even in a lean environment. On the other hand, on the same news page ARC declares SAP as a leader in eKanban market based on a survey conducted by them. Kanban being one of the prime tools of lean manufacturing this shows the importance SAP has given to their lean customers. This is very interesting indeed.

On the other hand Factory Logic is known as a good Advanced Planning and Scheduling software. This is known as Heijunka or workload balancing. So the combination of successful ERP, ekanban and a Heijunka system is going to be better for all the parties involved. SAP, Factory Logic and more importantly the lean manufacturers using SAP as their ERP will definitely benefit from this move.

Apart from the business perspective of this story, I believe this implies something more interesting to all the manufacturers around the world. Even SAP is trying to cater lean manufacturers. This means there is a strong trend towards lean manufacturing all around the world. The worlds leading ERP is trying to cater this market. I am so interested about this trend. If you are a traditional manufacturer it is the time to have look at lean and the opportunities it can open up for you before the rest of your competitors does.

Merry Christmas

First of all we wish all of you a merry Christmas and a happy holiday season. It is almost a year to our lean manufacturing blog. It was a great journey throughout this year. We are very grateful for all our visitors who visited our blog and supported us in many ways. We are looking forward to work with you in future as well.

What is lean manufacturing?

Interesting question isn’t it? Lots of people talk about lean manufacturing, but when it comes to defining it, it is not easy. In fact lean is a philosophy which evolved for many years based on some simple concepts. Understanding these concepts and principles will help us in understanding the lean manufacturing itself.
Lean manufacturing is a manufacturing methodology where wastes are identified and removed continuously from the system in order to create value. Earlier the term just in time manufacturing is used to identify similar concepts. In Toyota’s website they define Jikoda and Just In Time as main pillars of lean manufacturing. Jikoda is the concept where if there is a defect it is identified and solved immediately. For an example if there is a problem in machine, the production line will be stopped and the problem will be fixed immediately. JIT or the Just In Time is the manufacturing philosophy where goods are made available in the correct quantities in the correct time and in the correct place.

History of lean manufacturing has a very closer link to the Henry Ford’s early line assembly system. Sakichi Toyoda who was the founder of Toyoda group and the inventor of automatic loom stopping system converted his business into automobile manufacturing in 1930’s. His son Kichiro visited Ford manufacturing facility and got the understanding of the concepts behind it and more importantly the problems incorporated to that system. This is a very strong evidence to prove the closer relationship between Ford system and Toyota system.

Although the concepts were developed by the owners themselves in the initial stages, the real guru of lean manufacturing is considered as Taiichi Ohno. He understood the principles behind lean and then developed them to suit the requirements of Toyota. Concepts and tools like Total Productive Maintenance (TPM), Single Minute Exchange Of Dies (SMED), TAKT time, KanBan, Kaizen, Pokayoke, Jikoda, which are very important to the success of any lean manufacturer are developed over the time to facilitate this manufacturing philosophy.
Definition of waste, maintaining customer supplier relationship internally and externally, empowerment and respect to people, idea generation and using of ideas generated by employees to the betterment of the organization, organic management structures, ability to adopt to the fast changing situations, looking into the bigger picture by avoiding sub optimization, simplicity are among the key features of any lean system.

Today the lean concepts have reached many other industries including healthcare, service providers and even military. The variety of organizations that are practicing lean concepts in them goes to show the universal applicability of lean concepts or lean thinking. Lean technologies may be unique to the implementation but the lean thinking is universal.

It is important to understand that lean is not about just tweaking the current systems. It is a conceptual change to the system. This requires lots of change management and care for people. People are the most important resource for any lean manufacturer. If any manufacturer wants to cut down in number of heads it should not be in the name of lean. Lean is not about cutting corners either. It is about elimination of waste from the system continuously. Many implementations of lean fail due to the lack of understanding on basic lean concepts and general knowledge, not because of the problems in lean itself.

Now the lean has gone over its manufacturing premises and lean manufacturers are now becoming lean enterprises. Lean enterprises consist of customers and suppliers of the manufacturer. They help each other in the process of value creation and ultimately getting rewarded collectively for their efforts. Large amounts of wastes do exist in interfaces where each party separated in the supply chain. In today’s competitive markets most of the manufacturers are willing to reach their suppliers and customers and treat them as partners not as separate parties. In fact it is very hard to become a lean manufacturer without having a good supplier base at least.

Lean has a great potential for the future. Lean concepts can be used in almost all the areas. Achievable of lean including low prices, high quality, ability to supply on demand, waste free way of manufacturing and eco friendliness and human resource development are the requirements of future.

Respect different personalities – a lean thought on people handling

One of the cornerstones of lean manufacturing is the teamwork. It is not the individual performances which will improve your system. It is the collective effort from all the parties from top management to all workers will make the system a success. That is why teambuilding activities, leadership programs, organic management structures are very prominent in a lean environment.

When we think about a team, a tea is consist of it’s members. Members are individuals who might have different requirements, thinking patterns and lifestyles. But these different people work together for a common goal in a team and might have to come out from their comfort zones and lifestyles in doing so. Yet as lean thinkers we must understand that these people are unique and they are not carbon copies of each other, and especially they are not carbon copies of managers. People will not always work towards the requirements of the management. They might deviate slightly from your expectations. But as a manager and a lean thinker you must understand people do not belong to you and you have no right to say that there thinking is wrong. In this world there are very limited number of things which can be classified as good or bad. In most of the cases it is the non alignment of two activities or thinking patterns which we interpret as good or bad in respect to other. But in the reality even in the organizational context, if the deviation is slight from the baseline which is the expected outcome, everyone should respect that deviation because that is what makes people so unique and especially interesting. There are no good or bad personalities. They are made good or bad only in the context of requirements and the alignment of that personality for that requirement.

Managers must respect the differences in the personalities. Before a manager say “he is not suitable to be in my team” the manager must ask himself have I respected that person and his capabilities and what are the mismatches I have with that person.

As a lean thinker I believe strongly those differences in people as an asset to any organization. It is the responsibility of the management to use correct people in the correct context to get the required output. Most of the people so called trouble makers in conventional organizations are the people with so many talents. More importantly they are out of box the thinkers. They might fight even with higher managers for what they believe as correct. These mismatches cause them to be labeled as troublemakers and hence these most creative people in your organization will be frustrated and ultimately you will loose them. How many people have sacked from one job and perform superbly in their next assignment. So don’t loose hundreds of talented people because they don’t match with you. If many who are working under you are frustrated and leaving you must start thinking about your strategies, before someone above you start thinking should I keep this guy anymore.

Lean manufacturing implementation – step by step approach

Most of the organizations implement lean because it is big wave these days. Lean manufacturing is a hot and stylish word catching the world of manufacturing in breeze. But some of the organizations go for lean because they have identified that their current systems are not appropriate for the future. This kind of manufacturers are very keen on learning and implementing lean principles in their organizations. They expect lean to deliver results quicker so that they will solve their immediate problems as soon as possible. They will take aggressive decisions and will make the changes to the systems. Change is one important aspect of lean implementation. But how we should change an existing process? This is an important question to answer even before thinking of changing an existing process.

Any change to the existing process must be well planned and backed up by a good contingency plan. Changes must be done in small steps. This will help to asses the improvements in the system after the change. Also if something needs to be fine tuned this approach is perfect for that. You can also revert to the original state without much of an effort and without loosing much of resources.

On the other hand improving processes one after the other can be facilitated easily with a step by step approach. Changing set of processes at once will leave too many changes to the variables in the process. If something is going wrong it will not be easy to locate the problem and correct it. In the process of correcting it people will loose the trust on the new systems and changes. This will make people more resistant and unsupportive to the changes ultimately making your lean effort a failure. But if the changes are done process after process in a continuous manner it can lead to a fool proofed system. People will enjoy the improvements when they see the results. This will build the momentum for full scale implementation.

Changes are inevitable in the process of lean implementation. But these changes must be managed very carefully. Remember changing the processes involve changing people and systems and methods. Once we go ahead with a wrong change to the system it is not easy to reverse it, if it is done in big scale without testing properly. So do the changes step by step and fine tune the processes with the leanings you get and fool proof them before implementing in full scale.

Are 10 products and hour equal to 120 per 12 hours in lean manufacturing context?

I believe you will answer my question without any difficulties. The answer to this question is yes, mathematically. It will make no difference to make 10 products an hour or to make 120 in 12 hours. But in lean manufacturing context this has a difference.

Lean manufacturing is a pull system. This is based on the requirement created by the customer internal or external. Based on this demand and the TAKT time, factory will be synchronized to achieve a target. If it is set to 10 pieces an hour we will have to produce 10 per hour to ensure the smooth flow of manufacturing process. 8 products or parts in the first hour will create an unmet requirement for two pieces in the manufacturing process for that hour. This will make a shortage of two pieces to the factory output for that particular hour.

One important concept in manufacturing is that time lost in production can never be re gained. That is if you loose an hour in manufacturing process for some reason, actually you will not be able to get that lost one hour again. Instead you will pump additional resources to the manufacturing facility and then balance the manufacturing rates to the intended levels.

This shows us an important fact about lean manufacturing. Lean manufacturing is based on continuous flow of value. If this is interrupted there will be a waste in some form in the manufacturing process. Monitoring the manufacturing facilities in frequent intervals will show us problems in the manufacturing facilities as bottlenecks or as delays. So it is better to achieve the production requirements, but we will have to stick to the time requirements and the rhythm of manufacturing.

Lean concepts in communication – Erroneous information

I have been writing about the possibility of applying principles and concepts of lean manufacturing in the field of communication. In fact it is very necessary to streamline the process of communication in lean efforts.

Information is the key in today’s competitive world. It can lead to disasters if not handled correct. Therefore it is very important to make sure that information we send and receive is correct and also the interpretation is correct. As we discussed in our earlier posts on this subject, information can go wrong due to problems in the system itself. Overloading, data accumulation, longer channel lengths are among them. Wrong or erroneous information is the equivalent of defects in lean explanation of waste.

Wrong information, delays and misinterpretation of information can lead to disasters. With the increased freedom and lower costs of communication methods it is very easy to communicate. But for me the effectiveness of communication has gone down in today’s world. Over communicating, that is endless emails and phone calls and chats are wasting our valuable time. This also leads to problems in communication.

This again shows us the importance of a prime lean concept. We should start from identifying the requirements and using tools to achieve those goals. No tool will solve your problem unless you have understood the concepts and requirements correct.

With this we end the series of posts on lean communication. Visit our archives to find earlier posts on the same subject. It is time to map your communication channels and find out the effectiveness of communication in your organization. Find out your wastes and eliminate them continuously. You will be happy after sometime when you have to answer very little amount of phone calls and reply only few important emails. Won’t it be a good reward for your efforts?

Lean manufacturing resources centre

This page will give you a collection of important lean manufacturing links. We want to update this page continuously with useful resources on lean and related topics. If you know any resource relating to lean manufacturing and if you believe it is worth sharing with others please enter a comment to this post. Or email me at azabadurdeen@yahoo.com