Lean Manufacturing

Lean manufacturing or lean production, often simply lean’s origins date back to the post World War II era in Japan. It was developed by Taiichi Ohno, a Toyota production executive, in response to a number of problems that plagued Japanese industry. The main problem was that of high‐variety production required to serve the domestic Japanese market. Mass production techniques, which were developed by Henry Ford to economically produce long runs of identical product, were ill‐suited to the situation faced by Toyota. Those conditions faced by Toyota in the late 1940s are common throughout industry and lean is being adopted by business all over the world as a way to improve efficiency and to serve customers better.

The Lean approach [the term Lean was first coined in the late 1980s by MIT researchers, John F. Krafcik (1988)] systematically minimizes waste – called muda – in the value stream. Krafcik’s research was continued by the International Motor Vehicle Program at MIT, which produced the international best‐selling book coauthored by Womack, Jones, and Roos entitled The Machine That Changed the World (1990).

Muda includes all types of defective work, not just defective products. Wasted time, motion, and materials are all muda. Ohno (1988) identified the following types of muda in business:

1. Defects
2. Overproduction
3. Inventories (in process or finished goods)
4. Unnecessary processing
5. Unnecessary movement of people
6. Unnecessary transport of goods
7. Waiting

Womack and Jones (2003) added another type of muda:

1. Designing goods and services that don’t meet customers’ needs.

To “think lean” is to declare war on muda. It is to focus on muda’s opposite value. Defining values mean answering the questions:

• What are customers willing to pay for?
• By what processes are these values created?
• How does each activity in the process help meet the wants and needs of the customers?
• How can we make the value creation processes flow more efficiently?
• How can we be sure that we’re producing only what is needed, when it’s needed?
• How can we become perfect at creating value?

The Lean answers to these questions can be grouped into five categories: value, the vale stream, flow, pull, and perfection.

Overview

For many, lean is the set of “tools” that assist in the identification and steady elimination of waste. As waste is eliminated, quality improves while production time and cost are reduced. There is a second approach to lean manufacturing, which is promoted by Toyota, called the Toyota Production System (TPS) in which the focus is upon improving the “flow” or smoothness of work, thereby steadily eliminating mura (“unevenness”) through the system and not upon “waste reduction” per se. Techniques to improve flow include production leveling, “pull” production (by means of kanban), and the Heijunka box. This is a fundamentally different approach from most improvement methodologies and requires considerably more persistence than basic application of the tools, which may partially account for its lack of popularity (Liker and Hoseus 2008). The difference between these two approaches is not the goal itself, but rather the prime approach to achieving it. The implementation of smooth flow exposes quality problems that already existed, and thus waste reduction naturally happens as a consequence. The advantage claimed for this approach is that it naturally takes a system‐wide perspective, whereas a waste focus sometimes wrongly assumes this perspective.

Both lean and TPS can be seen as a closely connected set of potentially competing principles whose goal is cost reduction by the elimination of waste (Ohno 1988). These principles include pull processing, perfect first‐time quality, waste minimization, continuous improvement, flexibility, building and maintaining a long‐term relationship with suppliers, autonomation (smart automation), load leveling and production flow, and visual control. The disconnected nature of some of these principles perhaps springs from the fact that the TPS has grown pragmatically since 1948 as it responded to the problems it saw within its own production facilities. Thus, what one sees today is the result of a “need”‐driven learning to improve where each step has built on previous ideas and not something based upon a theoretical framework.

Toyota’s view is that the main method of lean is not the tools, but the reduction of three types of waste: muda (non‐value‐adding work), muri (overburden), and mura (unevenness), to expose problems systematically and to use the tools where the ideal cannot be achieved. From this perspective, the tools are workarounds adapted to different situations, which explains any apparent incoherence of the principles above (Ohno 1988).

Also known as the flexible mass production, the TPS has two pillar concepts: Just‐in‐time (JIT) or “flow,” and “autonomation” (Ohno 1988). Adherents of the Toyota approach would say that the smooth flowing delivery of value achieves all the other improvements as side‐effects. If production flows perfectly (meaning it is both “pull” and with no interruptions) then there is no inventory; if customer‐valued features are the only ones produced, then product design is simplified and effort is only expended on features the customer values. The other of the two TPS pillars is the very human aspect of automation, whereby automation is achieved with a human touch. In this instance, the “human touch” means to automate so that the machines/systems are designed to aid humans in focusing on what the humans do best (Ohno 1988).

Lean implementation emphasizes the importance of optimizing work flow through strategic operational procedures while minimizing waste and being adaptable. Flexibility is required to allow production leveling (Heijunka) using tools such as research and development (R&D). However, adaptability is often constrained, and therefore may not require significant investment. More importantly, all of these concepts have to be acknowledged by employees who develop the products and initiate processes that deliver value. The cultural and managerial aspects of lean are arguably more important than the actual tools or methodologies of production itself. There are many examples of lean tool implementation without sustained benefit, and these are often blamed on weak understanding of lean throughout the whole organization.

Lean aims to enhance productivity by simplifying the operational structure enough to understand, perform, and manage the work environment. To achieve these three goals simultaneously, one of Toyota’s mentoring methodologies (loosely called Senpai and Kohai which is Japanese for senior and junior) can be used to foster lean thinking throughout the organizational structure from the ground up. The closest equivalent to Toyota’s mentoring process is the concept of Lean Sensei, which encourages companies, organizations, and teams to seek third‐party experts that can provide advice and coaching (Womack and Jones 2003). Spear and Bowen (1999) identified four rules that characterizes the “Toyota DNA”:

1. All work shall be highly specified as to content, sequence, timing, and outcome.
2. Every customer–supplier connection must be direct, and there must be an unambiguous yes or no way to send requests and receive responses.
3. The pathway for every product and service must be simple and direct.
4. Any improvement must be made in accordance with the scientific method, under the guidance of a teacher, at the lowest possible level in the organization.