Lean production has ended up being a preferred and commonly adopted financial and corporate management viewpoint. Companies worldwide are beginning to count on it in the middle of political and recessions even in the most progressive all countries.

Yes, the tough times have extended from the 3rd world nations to the fully developed or first world nations. It is since economies are now led and influenced by volatilities involving oil producers and business.

Because all industries are practically run and powered by energy, companies appear to not get away from the troubles hounding the energy sector.

For practically even more than a year now, companies all over the world have actually been experiencing crunches brought about by the increasing and skyrocketing rates of oil worldwide market.

A lot of business have actually fallen and have weakened due to the increasing oil prices. There are a growing number of business now applying for bankruptcy security, not due to the fact that their management messed up or some executives defrauded them, however because of the external environment positioned by unstable oil prices.

That is why, lean production is getting an increasing number of attention, and more and more companies are choosing to lastly carry out the concepts of the strategy.

Lean manufacturing

Exactly what specifically is lean production? The popular Web website Wikipedia specifies lean production as an approach in management that concentrates and looks carefully at the reduction and elimination of the 7 wastes.

The seven wastes are the typical jobs, equipment and practices discovered in the modern-day day work location. The seven wastes are recognized as factors that hinder productivity or significantly damages it.

The seven key wastes LM attempts to eliminate are the following:

  • Over manufacturing– management professionals believe that overproduction is a complete and unnecessary waste of energy, effort, and capital. That is since overproduction leads to oversupply that results in inventories piling up, which in turn will lower or bring down rates for the made items. Essentially overproduction leads to devaluing the goods that are produced because of simple laws of supply and demand. Create too much and you then have more supply than the market can reasonably demand and then you are forced into selling inventories at fire-sale prices.
  • Overproduction likewise drains capital from companies, with most of the excess items either put into the trash bin or reaching expiration dates. Production always comes at a cost. If you produce more than the market can bear, you can’t get any return on investment for goods or products that collect dust. It’s best to invest in production when you have reason to expect the market to sustain your production levels.
  • Over-processing– Over processing is essentially just like overproduction, only that over processing commands extra and unneeded processes.
  • Transportation and movement– Lean producing objectives to minimize unneeded expenses for transport. Motion is the pace of action within the workplaces. If the workstations are too compressed and small, employees will not have the ability to move easily, affecting their efficiency.
  • Inventory and waiting– As mentioned earlier, lean production removes accumulated inventories. Waiting time in all elements is abolished since of the streamlined structure and due to the fact that efficiency is increased.
  • Scrap and flaws– Mostly, lean production aims to fight the production of commodities and merchandise with scrap and problems. Goods and outputs with scraps and flaws are undervalued in the market. Exactly what is worse is that the trustworthiness and picture of the business producing them are polluted, resulting to poor sales, poor profits, then eventually to loss, and further, to bankruptcy and business closure.

Organizational modification

Not since lean production is a strategy that initially and principally targets the structure of business is lean production always regulating and requiring for organizational modification.

Yes, lean manufacturing aims to justify, simplify and speed up business operations. However, its does not imply organizational changes follow.

The organization is generally not modified or changed upon execution of lean manufacturing principles. Lean producing never targets organizational modification, but rather strikes changes in the companies’ environment design and work practices.

Organizational modifications, nevertheless, are suggested and carried out together with lean production only when the desired results and outcome from lean manufacturing practices are not obtained.

Failure of lean production is constantly found to be connected to the effectiveness and adherence to the actual concepts in the implementation of lean production principles and techniques.

That is the only time when organizational change along with lean production is executed. The effects and gains from the implementation will balance out all the difficulties and expenses sustained, so why hesitate anyhow?

At what point does it make sense to seek help?

Lean process is not something that can always be achieved internally because it goes against our human nature to be completely objective about the businesses we ourselves run. I personally believe that hiring competent and experienced consulting professionals is well worth the investment. Oftentimes, lean processing consultants may also provide ISO or AS9100 certification services. If you contact a consultant, be sure to do lots of research ahead of time and ask for plenty of references.