Lean ledelse

Effective & Efficient

Lean is a customer-driven approach to eradicate operational business problems. It is a perspective, a culture, way of thinking, leading and operating, not just a set of efficiency tools. Lean focuses on what customers need and willing to pay for, not on what the company likes to do. Lean reduces inefficiencies that drain money from the system, caused by waste, strain, and variability. Lean pursues value-driven speed and efficiency; reduced cost is a favorable side-effect but never the key focus of Lean Management.

Leaks drain Money from System

A business makes money by converting lower grade inputs into more valuable outputs. Each business systems has leaks, draining value from the system in form of (1) Waste Muda, (2) Variability Mura, (3) Strain Muri.

Fewer Inputs and shorter Cycles

Lean Management focuses on aligning people, processes and systems to make value flow at the pace of demand; meeting customers’ expectations while reducing resource consumption and cycle-times to a bare minimum.

Reducing inputs to deliver precisely what customers want (not more or different!)
Reducing leaks by using resources more effectively with focus on value creation
Reducing cycle times to increase speed while reducing inventory in the pipeline

Traditional versus Lean

Traditional managers run companies like a planned economy, where a forecast and master schedule drives production. Problem is that the plan is never accurate, causing shortages, stock-outages, downtimes, changeovers and excess inventory – both reduce capacity, profitability, quality, and customer satisfaction. Lean Management pursues a different route, running companies like in a free economy where demand controls supply and allocation of resources.

Traditional manufacturing means Push-to-Plan per schedule (MRP/MPS)
Lean-manufacturing means “Pull-to-Demand” per takt and on time (JIT)

3 Steps to Start

Talk to customers to understand what they truly value and what’s not absoutely required
Align all value-creating activities, connecting them into a chain, manage chain and not parts
Apply lean principles to individual processes comes last, improving speed and efficiency

4 Pillars of Lean

FLOW: arrange parts to make material and data move without interruption
TAKT: synchronize all activities to the pace of balanced customer demand
PULL: replenish only what is consumed, pull control supply and inventory
LEVELING: balance workload to minimize strain and idling resources

5 Steps to Lean

Precisely define customer value for each specific product and service
Identify the value stream from order to delivery for each product and service
Make value flow, remove all obstacles from material and information streams
Pull the value-generation upstream at the pace of customer-demand
Build-in quality, and strive for excellence and never-ending improvement

Going Lean with external Support

Naturally, companies become like “inflated onions”, adding layers of management and inefficiencies over time. This phenomena is noticeable when overhead is growing faster than sales. When inefficiencies are deeply embedded into an organization’s structure and culture, they become part of the corporate DNA, and are well protected and defended from internal change.

An outsider can effectively challenge incorrect assumptions, self-destructive methods and behaviors. Experienced change agents are able to introduce a new way of thinking, leading, and working without hurting anyone’s feelings. Without external stimulation and assistance, organizations typically apply “spot-fixes”, adding administrative load without delivering desired results – or even make things worse.

Supporting the Journey

We are experts in lean-transforming traditionally operating companies and bring them on the path towards lean enterprises. We are skilled in diagnostics, design, planning, and hands-on implementation management. We lead client companies from the current state into the leaner future state, delivering significant savings in the short-term and improved competitiveness in the long run:

Design of the Lean Operating System (LOS) and support infrastructure
Skill-transfer in Lean Six Sigma and modern flow management techniques
Interim management to implement the design until results are achieved

Impact on Scorecard

Quality – stable and reliable delivery in synch with customer demand
Flexibility – able to adapt quicker to changing customer-demand and taste
Productivity – much higher utilization of labor, time, machines, space
Satisfaction – delivering value on demand, specified by customers

Key Success Factors

Lean is the result of planned action and persistent follow-up
Action is based on thorough understanding and system-thinking
Lean is a mindset which works in concert process and tools
Standardization is the precondition of any improvement
All activities must be measurable and related to a set target
Lean is day-to-day work with full dedication and no excuses
Ownership cannot be delegated – it is your job, just do it!
Basic principle of Lean is respect of people and facing reality
Lean means firm decision without procrastination and no way back!

Lean Principles

LEAN is the most effective way to satisfy customer-demand at lowest cost
LEAN creates FLOW in the order-to-cash cycle – over entire value-chain
FLOW happens when barriers (Waste, Muda) are eliminated from the system
WASTE is a product, feature, step, activity that a customer is not willing to pay for
Lean PULLS VALUE through the system, while increasing speed and lowering cost
VALUE is a product, feature, feeling or activity that triggers a ‘buy’ decision
PULL means configuring and controlling resources solely by customer DEMAND
All systems contain waste – cutting waste/leaks creates a competitive advantage
Lean ENTERPRISE is the end-result of applying Lean in all areas of the business
Lean TOOLS are tactical and operational, only effective with long-term philosophy

The Lean Machine

When reconfiguring or designing a new plant, we assist in the design of cellular manufacturing and mixed-model assembly lines. Higher flexibility allows running multiple products on one single line or cell. Products are grouped around processes, not around model, type or customer. Standard-work, setup-reduction (single-minute exchange of dies, SMED) and flex-tool designs reduce change-over times so that a large variety of products can be made by the same people on the same line or cell. Redesigning workflow reduces batch-sizes towards one-piece-flow, implementing pull and controls reduce inventories – moving towards JIT and significantly reduced lead-times. In total, flexibility improves so that people and machines can quickly respond to changing demand, mix and customer taste.

Heart of the Machine

Mixed-model flow-cell is the key to high productivity in any build-to-order environment. The future belongs to companies that are organized to run any product at any given time – exactly to customer-demand. Mixed-model flow eliminates MRP-driven forecasting and individual planning of each single activity, part and work-center – never accurate as the plan lags behind changes in demand. Lean Manufacturing drives all labor, materials and schedules according the pull of the customer – building products to order in a one-piece/container flow method on mix model lines or cells.

Lower Cost is Side-Effect

Lean application allows for significant reduction in cost, inventory, labor-content, delays, defects, and lead-times. Case from an electronics assembly plant:

50% less inventory
50% shorter lead times
75% shorter setup times
15% higher capacity
25% higher operating margin

A traditional batch-&-queue manufacturer can expect 25-50% cost-savings from a combination of Lean-Transformation, mixed-model layout, revamped supply-chain, and modified DNA/culture focusing on problem-solving and performance excellence (first time right). Impact in service processes is even higher; up to 50-80% improvement can be expected.

Lean Application Examples