Lean Manufacturing

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Lean manufacturing or lean production, which is often known simply as “Lean”, is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination. In a more basic term, more value with less work. Lean manufacturing is a generic process management philosophy derived mostly from the Toyota Production System (TPS) (hence the term Toyotism is also prevalent) and identified as “Lean” only in the 1990s. It is renowned for its focus on reduction of the original Toyota seven wastes in order to improve overall customer value, but there are varying perspectives on how this is best achieved. The steady growth of Toyota, from a small company to the world’s largest automaker, has focused attention on how it has achieved this.

Lean principles come from the Japanese manufacturing industry. The term was first coined by John Krafcik in a Fall 1988 article, “Triumph of the Lean Production System,” published in the Sloan Management Review and based on his master’s thesis at the MIT Sloan School of Management. Krafcik had been a quality engineer in the Toyota-GM NUMMI joint venture in California before coming to MIT for MBA studies. Krafcik’s research was continued by the International Motor Vehicle Program at MIT, which produced the international best-seller book co-authored by James Womack, Daniel Jones, and Daniel Roos called The Machine That Changed the World (1990).

For many, Lean is the set of “tools” that assist in the identification and steady elimination of waste (muda). As waste is eliminated quality improves while production time and cost are reduced. Examples of such “tools” are Value Stream Mapping, Five S, Kanban (pull systems), and poka-yoke (error-proofing).

There is a second approach to Lean Manufacturing, which is promoted by Toyota, in which the focus is upon improving the “flow” or smoothness of work, thereby steadily eliminating mura (“unevenness”) through the system and not upon ‘waste reduction’ per se. Techniques to improve flow include production leveling, “pull” production (by means of Kanban) and the Heijunka box. This is a fundamentally different approach to most improvement methodologies which may partially account for its lack of popularity.

The difference between these two approaches is not the goal but the prime approach to achieving it. The implementation of smooth flow exposes quality problems which already existed and thus waste reduction naturally happens as a consequence. The advantage claimed for this approach is that it naturally takes a system-wide perspective whereas a waste focus has this perspective, sometimes wrongly, assumed. Some Toyota staff have expressed some surprise at the tool-based approach as they see the tools as work-arounds made necessary where flow could not be fully implemented and not as aims in themselves.

Both Lean and TPS can be seen as a loosely connected set of potentially competing principles whose goal is cost reduction by the elimination of waste. These principles include: Pull processing, Perfect first-time quality, Waste minimization, Continuous improvement, Flexibility, Building and maintaining a long term relationship with suppliers, Autonomation, Load leveling and Production flow and Visual control. The disconnected nature of some of these principles perhaps springs from the fact that the TPS has grown pragmatically since 1948 as it responded to the problems it saw within its own production facilities. Thus what one sees today is the result of a ‘need’ driven learning to improve where each step has built on previous ideas and not something based upon a theoretical framework. Toyota’s view is that the main method of Lean is not the tools, but the reduction of three types of waste: muda (“non-value-adding work”), muri (“overburden”), and mura(“unevenness”), to expose problems systematically and to use the tools where the ideal cannot be achieved. Thus the tools are, in their view, workarounds adapted to different situations, which explains any apparent incoherence of the principles above.