Lean production has been of great importance in industry for many years. Numerous companies use the organizational approach to become more competitive. When implemented correctly, the philosophy leads to improved productivity, optimized product quality and increased flexibility. To achieve these goals, however, several prerequisites must be met.
What is Lean Production?
The term lean production (also lean manufacturing) is a subarea of lean management. Translated, it means "lean production". This special organizational form of production is essentially about avoiding waste. Accordingly, all production factors (e.g. personnel, materials and operating resources) should be used as economically and efficiently as possible. Furthermore, lean production aims at an uncomplicated organization with flat hierarchies (lean administration), as this increases productivity and reduces costs.
What are the goals of lean production?
Lean Production pursues several goals. These can be summarized as follows:
- Increasing the productivity of all production factors
- Ensuring high product quality
- Increase flexibility
- Waste reduction
- Reduction of lead times (production times)
- Efficient use of resources
- Cost reductions
- Continuous improvement
Particularly important are the Pillars of productivity, quality and flexibility. They are therefore described in more detail below.
In this respect, the aim is to reduce the use of production factors while maintaining the same output. To this end, inventories are reduced, throughput times are shortened and underutilized capacities are cut. Furthermore, the implementation of Just-in-time. This refers to a principle that delivers the exact quantities at precisely the time when they are really needed. Added to this are measures such as the introduction of flexible working hours and the reduction of hierarchies.
Increase in product quality
To increase quality, continuous quality controls are introduced that take effect at an early stage of the production process. Defective products can thus be reworked or sorted out immediately. This reduces scrap. Quality is also taken into account as early as the product development stage and in collaboration with suppliers. It therefore becomes relevant for the entire value chain.
This pillar of lean production aims to make the manufacture of different product variants and quantities as cost-effective and time-saving as possible. This is realized by introducing flexible production systems and working time models.
How did lean production come about?
The concept of lean production originated largely in the 1950s at the Japanese car manufacturer Toyota. Back then, the company was already reorganizing its manufacturing operations so that they produced exclusively according to actual demand. To implement this approach (known today as Just-in-time principle), Toyota had to completely reorganize its production and optimize it to such an extent that it was particularly trouble-free and time-saving. To this end, the manufacturer developed a system for synchronizing its processes. In addition, a continuous improvement process was created with regard to quality, throughput time and resource utilization.
Why should companies focus on lean production?
Today, companies in the industry are confronted with high, global competitive pressure. Product life cycles are becoming shorter and product diversity is increasing. At the same time, customer requirements in terms of customizability, quality and availability of products must be met in the best possible way in order to survive on the market. Nevertheless, it is necessary to keep costs low in order to remain economical.
All these aspects require optimally functioning processes which, on top of that, can be adapted flexibly and quickly to changes. These goals can be achieved by implementing lean production. Because, as already mentioned, the philosophy ensures high productivity and assured quality. Furthermore, inventories, production space, personnel, waste and errors in production can be reduced, which leads to significant cost reductions.
What requirements should be met for lean production?
Several prerequisites must be met for the successful implementation of lean production. First, companies should create transparency regarding current weaknesses, sources of errors and cost drivers in production. Then, processes must be standardized and gradually optimized, with the focus on value-creating activities. Furthermore, a new error culture should be created, characterized by openness and commitment on the part of all employees. This is the only way to achieve continuous improvement.
Lean production should always be understood as an overall concept and lived accordingly. If, on the other hand, a company only implements individual measures (e.g. a Kanbanintroduction), there are usually only short-term successes.
What are the advantages and disadvantages of lean production?
Lean Production offers several advantages for companies that consistently and comprehensively convert to Lean Production. Among other things, it is possible to speed up production, supply customers more quickly, save factory space, conserve human resources and reduce inventories. Likewise, sources of error can be identified and eliminated, thereby increasing process and product quality. In sum, all these factors lead to a further expansion of competitiveness.
On the other hand, there are also some disadvantages and risks. For example, companies are dependent on a functioning supply chain due to the just-in-time principle. If supply disruptions occur, this cannot be mitigated due to the scarcity of inventories. The result is expensive interruptions to production processes. Furthermore, just-in-time delivery is critical from a sustainability point of view, as it causes many small material deliveries and corresponding CO2 emissions. Furthermore, lean manufacturing generally aims to reduce product variety. This contradicts the current trend toward product customization.
Lean Production: an overview of the most important terms and key figures
Production systems are only successful if they are aligned with customer benefits. In this country, this insight leads to the term holistic production systems (GPS). Systems of this type use various methods and design principles of lean production, each of which is described by a technical term. The most important ones are briefly described below:
Muda (prevention of waste)
The lean philosophy distinguishes between value and waste (muda). The goal is to increase value and reduce waste. To achieve this, all non-value-adding production factors are minimized. In addition, all processes are geared towards resource efficiency and speed.
Specifically, the lean philosophy recognizes the following forms of waste that must be avoided:
- Stocks too high
- Transports (intralogistics)
- Waiting times
- too elaborate processes
- Too long ways
- Unused potential (employee know-how)
Holistically designed production systems strive for perfection. Therefore, existing systems and processes are continuously optimized. Every single employee is involved in this continuous improvement process (CIP). Usually, this involvement takes place with an idea management or a company suggestion scheme.
Standardization pursues the goal of defining the individual steps of processes. This is done with the aim of removing non-value-adding activities from the processes and ensuring stable processes.
This approach prevents errors from being passed on from one process unit to the next. This is realized by implementing quality controls in the standard processes and by error prevention methods.
This principle means that production is based on customer orders. Production is therefore based on concrete requirements. The opposite is the push principle, in which production is based on forecast requirements. The pull principle reduces the control effort in production and helps to minimize inventories.
The flow principle is responsible for a smooth flow of materials and information. For example, products are transported directly to the next station in production without intermediate storage. This reduces throughput times in the entire value-added process.
Visual management is the pictorial representation of production and its processes. This measure provides transparency with regard to the goals, performance and processes of the production system. Through this insight, managers and employees identify more strongly with their company. In addition, deviations from targets are recognized more quickly.
Lean leadership refers to goal-oriented management including a pronounced employee orientation. Employees are regarded as a significant resource for continuous improvement and innovation. The focus is also on a waste- and error-free way of working.
Numerous key figures exist in the area of production. The following are particularly relevant for lean production:
- Lead time: Time period for the production of products
- Flow rate: Ratio of processing time to lead time
- Flow number: Ratio of transport and/or waiting times to processing time.
- Flow factor: average length of a queue for a workstation
- Degree of value creation: Ratio of value added to total output
- OEE (Overall Equipment Effectiveness): total equipment effectiveness)
Overall, companies can achieve many positive changes with lean production in terms of productivity, throughput times, quality, flexibility and profitability. Despite these advantages, the approach is still not implemented holistically in some companies. There are several reasons for this. For example, the introduction of lean production requires a change in culture and the involvement of all employees and suppliers. In many places, therefore, only individual methods and principles are implemented. However, this does not allow lean production to develop its full effectiveness. The goal should therefore be to implement the entire concept step by step.