|Lean Manufacturing or Operations Transformation ... Which is it?|
|by Laurie Harbour-Felax, ASG Renaissance|
|Production Summer 2006|
Any business professional who reads the
newspaper, watches the news, or pays attention to industry trends is
familiar with lean manufacturing and its great success for companies that
dedicate themselves to improvement. Conversely, you can find companies that
did not implement lean or continuous improvement strategies and have since
either gone out of business or moved overseas. And while it is true that
implementation of lean manufacturing can generate huge savings and help
companies reduce cost, executives often get confused thinking “lean” is the
entire process when, in reality, it is only one tool to become a better
In our operations improvement work, we focus on transformation utilizing the Operations Transformation Model (OTM). So how does a company transform itself to survive in this competitive environment? To transform an operation really requires four fundamental steps. Each of these steps has numerous tentacles that are required for success.
I. Leadership’s Admission – it should go
without saying but…
Operations improvement or lean initiatives never can be successful without leadership commitment from the top. This is a very simple lesson that should probably go without saying, but it is a common mistake made in the majority of facilities failing at their improvement efforts. There are many examples even within companies like GM where business operating systems failed over and over again because leadership support did not exist. In most cases, once the leadership team was on board, admitted to the problem, and committed itself to change,
progress happened more rapidly.
II. Setting the State of Improvement
Another common mistake is the lack of a benchmark established upfront. Companies often fail to gather the appropriate data to establish baselines, making it literally impossible to measure changes in performance. Data gathering/benchmarking is a difficult but absolutely essential step to any successful improvement effort. Once the data is gathered and improvement goals are created, the leadership team must work on the development of tools and systems to regularly track data to the plan. The tools developed must be used and used consistently to begin to see progress. Leadership and middle management must utilize the tools to drive the business plan. It takes discipline and hard work to stay focused and not stray from the plan. Again, leadership commitment is critical to drive the team to the vision rather than towards the fire that needs extinguishing today.
A great example of this stage is a $100 million stamper in Michigan who struggled for years to improve using every new program read about in a lean book, but without any plan or vision for the company. Employees were confused - never knowing what would be the next “program of the month”. Finally with formal development of a plan, data gathered to baseline the operation, leadership coaching, and discipline to drive the plan, the company made 45 percent productivity improvements, 77 percent improvement to quality, and grew its business 25 percent – all in one year.
III. Return on Investment
The key to transforming is training the workforce on the available tools, when to use them, and how to measure progress. Companies must invest in teaching and coaching their employees on how to recognize improvement opportunities and how to solve problems effectively. Once people have the basic skills and are turned loose, leadership teams are often surprised at the savings that can be found. Leadership has to coach and allow for mistakes in this stage so that the lessons learned can be incorporated and operations transformed.
IV. Don’t Settle for Impact in the First
Even Toyota, who is arguably the manufacturing leader, is constantly challenging the Toyota Production System and improving on its beginning. Leaders need to continually ask the question – how can we do it better? I liken it to a sports team – without the right coach constantly pushing his team to be better, the team wouldn’t be playoff contenders. Companies and employees are no different; to constantly be competitive we have to – daily - push to transform.
So lean manufacturing or operations transformation? Companies that react quickly and implement a total operations transformation are the ones that will be standing when the dust settles. And what is transformation? TRANSFORMATION = LEADERSHIP. It starts there and it ends there.
Laurie Harbour-Felax is president of Harbour-Felax Group. She is a regular presenter at key conferences on the topics of manufacturing and overall business operations improvement and is regularly quoted in local and national publications as an experienced analyst. Harbour-Felax can be reached by calling (248) 414-3866, e-mailing firstname.lastname@example.org, or visit www.harbourfelax.com for more information.
Lean Manufacturing Training Programs
The University of Kentucky and the University of Michigan offer formal training programs in lean manufacturing.
University of Kentucky
(859) 257-6262 ext. 214
The University of Kentucky’s Center for Manufacturing in the College of Engineering has a Lean Systems program in place. Working in partnership with Toyota Motor Corporation, the team studies the Toyota Production System to learn why it works as effectively as it does. Based on that research, the university offers training programs at several levels, including Leadership Institutes, Fast Courses, and an intense Boot Camp. Go beyond the surface with courses on Lean Accounting and Human Resources for the Lean Model. Learn how to transform the shop floor. Make sure the entire company is on board by exploring the principles of lean thinking. Learn how to apply lean tools and techniques in a unique hands-on system simulation and learn to champion and firmly plant lean ideals within a business unit. On-site courses and workshops also are available.
University of Michigan
The University of Michigan’s Center for Professional Development develops and delivers programs and services that enable engineers, managers, and technical professionals to be more effective, productive, and competitive. Course participants walk away with immediately applicable knowledge and proven tools based on research performed by the world-renowned faculty at the University of Michigan’s College of Engineering. Course offerings include a Lean Manufacturing ten-day certificate program, a Lean Product Process Development five-day certificate program, a Lean Office five-day certificate program, a Lean Logistics ten-day certificate program, and on-line Six Sigma certificate training. Any of the programs offered by the Center for Professional Development can be customized and delivered at a company’s site.