Lean Manufacturing White Paper: Part 2 of 3

The following is the second excerpt in a 3-part series from Kaufman Global’s updated white paper, Implementing Lean Manufacturing: A Holistic Approach. In this paper we discuss:

  • An integrated model for Lean implementation
  • How to improve engagement and alignment
  • Why “pull” is so fundamental to Lean success

In this installment we discuss why Taiichi Ohno’s original 7 wastes must be updated to include two new ones: Alignment and Engagement – which if not addressed will foil any implementation.

Lean Manufacturing Evolves from Traditional Push Systems as Waste Is Eliminated

Lean is not “installed.” A self-regulating, Lean system is created by a continuous focus on eliminating small instances of waste or “muda” (muda is the Japanese term for “waste”). Waste is defined as any work that does not add value to a product or service. If the customer does not benefit from it, it is muda. All inspections, rework, repairs, walking, material movement, inventory of any sort, waiting, and so on are muda. They all cost money and produce nothing of value for the customer. Lean (pull) slowly evolves from a traditional (push) system as wastes are eliminated little by little. When an organization first begins to initiate Lean activities, it is a traditional system with perhaps a few Lean tactics being applied here and there. At some point, with dedicated effort, it becomes more of a pull system than a push system.

Lean Waste Wheel

Figure 4 – The four categories and nine types of waste (muda)

Figure 4 displays the four categories and nine types of Lean waste. This new model evolved from Taiichi Ohno’s original three categories; People (work), Quality and Quantity, and associated seven types of waste. In the late 90s, an eighth waste that acknowledged the value of people began to appear. That “waste” has been described in a number of ways, including: intellect, creativity, involvement, etc. In the time since it has become increasingly apparent that the people aspect still receives too little attention and prior descriptions have not been specific enough.

Kaufman Global gets more direct by describing the People Energy wastes of Engagement and Alignment. This draws attention to the elements that must be overtly addressed in order to make Lean really work and puts a finer point on the idea of holistic, integrated Lean. It’s necessary to do this because of the almost insurmountable implementation problems that many organizations encounter. Their struggles are driven largely by the fact that people energy wastes are not dealt with as an integral part of Lean adoption. Therefore, we have directly incorporated people energy wastes, along with ways to minimize them, into the basic conceptual model of Lean. The specific definitions of each type of waste are described below.

People Energy Waste

People energy waste wheelPeople energy waste arises from a failure to harness the potential that exists in all workgroups. This form of waste is the most important thing to address in Lean implementation or any other type of change initiative. Failure to harness people energy creates most of the significant problems that organizations encounter when they attempt to do something (anything) different.

Alignment Waste is the loss of value that arises when management and employees at all levels are not consistently aligned and energized to address critical issues. Making this happen is the sole responsibility of leaders and managers who are easily distracted. Alignment requires conscious and planned strategy and tactics that ensure messaging is consistent, priorities are established, communication is open and deviations are explained. “Flavor of the Day” or “Programs of the Month” are good indications of alignment waste. Good alignment means that you start, and stay, the course.

Engagement Waste is the loss of value that occurs when people do not have some control over the work they do. This is one of the toughest things for managers to abide because they feel like they are giving up some control – which they are. True engagement means requiring workgroups to measure their performance at a micro-process level and then expecting them to improve their performance over time. Many organizations waste a lot of energy on faux-engagement activities such as coffee talks and lunches with “their people.”

The idea here is to engage and align the organization via well-defined structures. All the good intentions and skills in the workplace cannot operate seamlessly if responsibilities, resources and personnel are not formally assigned and led. Structure requires a formally dedicated steering committee, work stream leaders and teams, explicitly assigned resources, schedules, charters, and champions.  Alignment and engagement compel two critical outcomes that are essential change- management requirements for successful implementation: relevance and ownership.

Relevance: To sustain any initiative, people must work on issues that are, in some part, relevant to them personally. The most basic and beneficial aspect of good alignment and broad engagement results when individuals and teams are compelled to deliver on improvements and fixes within the processes they control. This creates, by default, an environment where much of the improvement activity is truly relevant to those doing the work.

Ownership: Human beings are territorial and proud. If they are associated with something, it is absolutely essential for them to believe that it is admired and respected by others. This tendency is wired genetically into us all. If people are not permitted to exercise some degree of control and power over their work place, they will not be inclined to identify with it nor will they strive to make it excel. This is the underlying basis for the outstanding performance of all self-directed workgroups.

Concerning all People Waste, understand that it’s not that the people are being wasteful but rather that these are wastes that are visited upon people by a non-Lean configuration of work.

People Work Waste

People Work Waste WheelPeople work waste arises from human actions involving processes. This type of waste is most analogous to the waste encountered in industrial engineering concepts. It can be divided into three categories: processing, motion, and waiting.

Processing waste is the result of inefficient work. Typical causes are inadequately trained workers, hard-to-use / locate tools or poor-fitting parts. Employees are hard at work, but there is a better way to do the job.

Motion waste is all movement that does not add value. All walking and reaching for parts or tools is muda.

Waiting waste is people waiting for parts, help, a machine that is broken or down for a die exchange, and so on. People can add no value to the product or service while they are waiting.

Quantity Waste

Quantity Waste WheelThere are three types of quantity waste that arise because material (or data or paper) must be processed. This type of waste comes from creating too much inventory between workstations (WIP), Raw and Finished Goods inventory and material movement and transport – think; forklifts, stackers and trucks.

Inventory waste arises when inventory is not being used but has been paid for, perhaps has had value added to it, takes up space, requires expensive storage and retrieval systems and becomes lost, damaged and / or obsolete. Finished Goods inventory is even worse, as all of the intended value has been added and several weeks or even months may pass before it is paid for.

Work In Process (WIP) waste is inventory somewhere in the system between Raw Materials and Finished Goods. Whenever there is material waiting between two processes, it is waste. WIP waste occurs because process times are not balanced and matched with takt time.

Movement waste is all transportation of materials. Shigeo Shingo, the conceptual organizer of Single Minute Exchange of Die (SMED) and poka-yoke (error proofing) concepts, humorously observed that forklift and conveyor salespeople must routinely bribe traditional plant managers. Why? Because, he jested, no other mechanism could explain the incredible amount of unnecessary movement built into the processes of non-Lean plants.

Quality Waste

Quality Waste WheelFixing defects is the sole quality waste. Each defect turns value-added work to waste and requires more nonvalue-added work to be repeated during rework or repair. Prior to the implementation of Lean, quality waste is usually the most visible waste due to its impact on customers and the tendency of a traditional push system to fail to recognize the other types of waste as significant. Ironically, reduction of the other wastes through Lean always results in a dramatic decrease in defects. This occurs even without the focused implementation of powerful tools such as error proofing or Six Sigma.

The next section presents an integrated discussion of Lean tools, concepts and implementation techniques. The tools and methods should not be separated from the implementation approach. While this paper does not provide a detailed examination of Lean tactics, it does present sufficient information for the reader to determine what they must learn in order to develop a successful Lean implementation initiative in their organization.

Implementing Lean Manufacturing

As muda is eliminated through the application of various Lean tools and methods, a pull system gradually emerges. Figure 5 presents the Master Jargon Chart of Lean Manufacturing. The Master Jargon Chart summarizes and presents the various Lean wastes, tools and methods into a single conceptual framework. Figure 5 is Lean; that is, in order to “do” Lean, the waste reduction approaches and corresponding tools and methods shown there must be comprehensively applied in an integrated manner.

All of these tools and approaches need not be implemented simultaneously. In fact, it would be a mistake to do so. Further, the criticality of each tool varies in different environments. This is why a “one-size-fits-all” Lean implementation is a mistake. While all successful Lean organizations use many of the tools to some extent, various tools are more comprehensively applied in certain environments than in others. As we discuss specific tools and approaches, this will become obvious.

The Master Jargon Chart of Lean Manufacturing by Kaufman Global

Figure 5 – The Master Jargon Chart of Lean

The left two columns of Figure 5 present the four categories and nine types of waste described earlier. The structure of this model might suggest that each waste category is targeted by a specific approach and / or method. While this is true to some extent, all of the methods are extensively interdependent and interactive. You cannot “cherry pick” tools and techniques and expect long-term Lean success. In particular, if you do not employ the methods required to address people energy wastes, the other methods will fail to achieve competitively meaningful results.

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To be continued. In Part 3 of this series, we provide describe a fail-proof system for implementation. Or, if you’re ready to read the entire white paper now, click here to access it via our Resources page.