Lean Production

What is Lean Production?

Lean production, also known as lean manufacturing, comprises a set of tools aimed at eliminating activities that do not add value for customers and represent losses for the company.

Purpose of Lean Production:

The philosophy associated with lean production stems from the idea that customers are willing to pay only for what satisfies their needs. In practice, this approach means that if two products of equal quality are available on the market (which may include services as well), customers will choose the one with a lower price. The lower price is a result of better, more efficient utilization of resources required for product realization.
Diminishing the quality of inputs (purchasing cheaper raw materials, machinery, utilizing cheaper and less skilled labor, reducing workforce) leads to a reduction in product quality. In this case, customers weigh two factors: price and quality, with price not always being the determining factor. Thus, contrary to assumptions, customers might prioritize higher quality despite a higher price.
Logically, it is more appropriate to focus on reducing costs by looking inward within the organization and identifying potential savings there. Unfortunately, despite the proven positive impact of this approach, relatively few companies have adopted this kind of thinking.

Application in Practice:

The foundations of lean production were established in post-World War II Japan, with the contribution of process experts from the USA. These teams developed a set of techniques known today as lean production.
Lean production is at the core of the Toyota Production System. The circumstances that led to the adoption of lean production were derived from the situation in post-war Japanese economy, which was on the brink of collapse. With limited resources at their disposal, they had to make the most of what they had. Thus, they realized that wasting resources was a path to ruin.
This environment gave rise to concepts such as value-added activities (activities that transform resources into a product that customers are willing to pay for), non-value-added activities (activities for which customers would not pay), and waste (MUDA). Additionally, seven categories of waste were identified, referred to by the acronym TIMWOOD. Over time, an eighth category, I, was added to these fundamental seven.

Today, the eight fundamental types of TIMWOODI waste are as follows:

1. Transportation - Waste related to unnecessary movement of materials across lines, plants, or between companies. Arises due to poor logistics and production organization.
2. Inventory - Excessive stockpiling of raw materials, semi-finished goods, or products, tying up resources. Arises from poor planning, supply and demand conditions, or inadequate production planning and management.
3. Motion - Unnecessary employee movement. Employees needlessly bend or walk around. An ergonomic issue.
4. Waiting - Downtime caused by poor work organization, supply, or logistics. Production halts due to resource shortages or the inability to store finished products.
5. Overproduction - Producing excess items, creating products for storage without certainty of sale. A failure in marketing, sales, planning, or logistics. The company does not know the real demand for products or has overestimated production capacities and produces merely for the sake of production.
6. Overprocessing - Unnecessary processing steps in production. This category encompasses actions that are not required for product manufacturing. It could involve excessive cleaning, outdated procedures, or redundant quality checks. Increasing post-production or in-process quality control implies that the company cannot manage the quality of the process and attempts to catch deficiencies through inspection.
7. Defects - Defects, including rework or incorrectly performed tasks. Defects are an indication of poor process control and unmanaged processes that behave randomly (out of control).
8. Intellectual - Loss of human initiative and critical thinking. A manifestation of a too rigid, directive company culture where employee opinions carry little weight. Lethargy and employees' disinterest in company results are typical. Motivation often doesn't help, and punishment leads to the departure of the best employees.

To eliminate these types of waste, an array of lean management tools is employed. Lean management is based on the gradual elimination of waste, utilizing the initiative of every employee. Changes should be made through continuous improvement, gradually addressing a manageable number of issues in smaller steps. Conversely, the introduction of radical, revolutionary changes with uncertain outcomes and unexpected side effects is not recommended.

How we can help you

If the philosophy of lean production interests you, we can provide you with theoretical foundations through our training. We can also help you implement lean production elements by involving our instructors.

Recommended training:

Training name	Training duration	Venue	Price	The nearest date
LEAN Management	2 days (8:00 - 14:00)	Online	810,00 € 972,00 € VAT included	17.12.2024 - 18.12.2024 + 4
Japanese methods of improvement according to TPS (Toyota Production System)	1 day	Company in-house training	On request	According to you