What is in this article?:
Have new technologies made lean irrelevant? And how can a lean enterprise embrace the new wave of manufacturing technology?
- Resetting the scene for lean
- Still the beating heart
- The clash of IT and production
- Reconciling innovation and efficiency
Lean manufacturing, which originated as the Toyota Production System, is one of the most well-known process strategies in modern manufacturing. It migrated to the U.S. in the 1950s and began to draw serious attention in the 1980s. Since then, it has become the industry’s default best-practice approach and has been widely adopted in manufacturing facilities worldwide. But where does lean stand today? Have new technologies made lean irrelevant? Have the retiring Baby Boomers, yesterday’s lean pioneers, taken the secrets of lean success with them into retirement?
Lean manufacturing has two main building blocks: reducing waste and creating customer value. Continuous improvement is the ultimate goal. To achieve this, manufacturers strive to eliminate information silos and, instead, optimize the flow of products and services through the entire value stream—across departments, processes and equipment to customers.
Lean became synonymous with modern manufacturing until economics derailed the transformation journey for some companies. As the world economy plunged into recession in 2009, manufacturers were forced to cut back on spending and use of resources, covering only the bare necessities. While this eliminated every bit of excess, it also tended to eliminate the proactive continuous improvement projects that were part of the early lean initiatives. Projects that required investment in training, upgrades in equipment or investment in technology were often put on hold.
Today, lean processes are still at the heart of most manufacturing operations worldwide and are increasingly important in other industry sectors, including distribution and financial services. As the manufacturing industry recovers from the recession and moves into a growth phase, analysts are starting to once again pick up the lean dialogue, as though it simply had been paused. In response, managers are starting to review their original lean strategies in light of today’s changing market demands. Some are asking, “Is lean still relevant?” Others wonder, “How does a lean enterprise also embrace investment in new technologies like 3D printing and the Internet of Things (IoT)?”
The manufacturing industry has changed dramatically since lean principles were first adopted, especially in the areas of manufacturing technology and information management. When many companies first rolled out their lean initiatives, the Internet was in its infancy and few could imagine a workplace that included use of mobile devices, online portals for customers and suppliers and real time collaboration with suppliers in other continents. It’s a quickly evolving global market place today with highly demanding customers. How do lean principles hold up to this new paradigm?
Since the early days of lean adoption, IT managers and production managers have often clashed as they struggled to find the balance between big powerful ERP systems and streamlined minimalist processes with as few steps as possible. The monolithic ERP systems that tried to impose a one-size fits all structure were not always lean compatible.
Today the manufacturer must, above all, be able to connect customer needs with a company’s ability to deliver a product—on demand. Multiple tactics and tools are required to make on demand manufacturing feasible—and profitable—from product configuration solutions to component subassemblies, co-manufacturing partnerships and late-stage assembly strategies. Modern ERP solutions bring these tactics and tools together into one streamlined process flow. Today, the highly flexible ERP system acts as the central nervous system, connecting process flows and making a lean philosophy attainable.