THE LEAN SUPPLY CHAIN

    The typical response when suppliers are asked to deliver parts just-in-time to their customers’
pull signals is to keep building the parts in large batches, try to stock enough in their finished
goods inventory, and meter them out "just in time." However, this is not really just-in-time and it
is certainly not conducive to spontaneous BTO. Parts availability would depend on the
assemblers’ forecasts, which are becoming increasingly less accurate, and the supplier’s
inventory, which is costly to carry, especially as obsolescence risks increase. There are four basic
techniques that contribute to a spontaneous supply chain:

(a) Kanban resupply. As mentioned in the third point above, parts that qualify for kanban
resupply, and the related techniques of min/max and breadtruck, can be made in batches as long
as the response time and bin (or delivery) size is adequate. Even though parts are made in
batches, this still qualifies for a spontaneous supply technique because the batch (a bin’s worth of
parts) is made upon the pull signal that the current bin has emptied. Of course, the parts
manufacturers may have to implement setup reduction to make small batch production
economical. Thus, kanban resupply avoids the hazards of forecasting, the cost and delays of
purchasing, and the cost and risk of inventory. The resupply is automatic once the pull signal
gets to the supplier.

(b) Spontaneous build-to-order of parts. For parts that do not qualify for kanban, suppliers
themselves would need to implement spontaneous BTO so that they could actually build on-
demand to their customers’ pull signals. This is the only way to supply mass-customized parts
on-demand, which may be needed for mass-customized products. Spontaneous BTO of parts
may require (1) the development of vendor-partner relationships for suppliers to establish the
ability to build parts in any quantity on-demand and (2) versatile information systems to process
and distribute the necessary information.

(c) In-house part fabrication. In order for spontaneous BTO to work, all parts and materials
must be available on-demand. If there are any key parts that are not suitable for kanban and no
supplier can build them to your pull signal, then you might have to bring those operations in-
house. Companies that have outsourced certain operations in the interest of focusing on
functional "core competencies" may have to reevaluate their strategies. Unfortunately, most
outsourcing is a batch operation which does not lend itself to spontaneous BTO.

    If the new core competency is to be spontaneous BTO or mass customization, then the
manufacturer will need a complete supply chain that can build products and all their parts on-
demand. This may require the selective "reintegration" of certain key steps.8  One of the author’s
clients, Badger Meter, of Milwaukee, Wisconsin, found it was able to build a wide variety of
water meters flexibly except the printing of the face plates, which had to cope with several ways
of measuring water flow plus the logo of every customer (utility). So they learned how to print
face plates in small quantities to complete the picture.

(d) Strategic stockpiles. Strategic stocks may be necessary until one of the above three
techniques can be applied. As far as overall inventory strategy is concerned, this could be
considered temporarily moving one step backwards after moving twenty steps forward.
Hopefully these parts are standardized and consolidated so that there would be few to stock and
each would have a good chance of being used one way or another.

Agile manufacturing is a term applied to an organization that has created the processes, tools, and training to
enable it to respond quickly to customer needs and market changes while still controlling costs and quality.

An enabling factor in becoming an agile manufacturer has been the development of manufacturing support
technology that allows the marketers, the designers and the production personnel to share a common database of
parts and products, to share data on production capacities and problems — particularly where small initial problems
may have larger downstream effects. It is a general proposition of manufacturing that the cost of correcting quality
issues increases as the problem moves downstream, so that it is cheaper to correct quality problems at the earliest
possible point in the process.

Agile manufacturing is seen as the next step after LEAN in the evolution of production methodology. The key
difference between the two is like between a thin and an athletic person, agile being the latter. One can be neither,
one or both. In manufacturing theory being both is often referred to as leagile. According to Martin Christopher,
when companies have to decide what to be, they have to look at the Customer Order Cycle (the time the customers
are willing to wait) and the leadtime for getting supplies. If the supplier has a short lead time, lean production is
possible. If the COC is short, agile production is beneficial.

Goldman et al. suggest that Agility has four underlying components:

1. delivering value to the customer;

2. being ready for change;
3. valuing human knowledge and skills;
4. forming virtual partnerships.

Quick response manufacturing

QRM emphasizes the beneficial effect of reducing internal and external lead times. Shorter lead times improve
quality, reduce cost and eliminate non-value-added waste within the organization while simultaneously increasing
the organization’s competitiveness and market share by serving customers better and faster. The time-based
framework of QRM accommodates strategic variability such as offering custom-engineered products while
eliminating dysfunctional variability such as rework and changing due dates.[1] For this reason, companies making
products in low or varying volumes have used QRM as an alternative or to complement other strategies such as Lean
Manufacturing, Total quality management, Six Sigma or Kaizen.

The concept of Quick Response Manufacturing (QRM) was first developed in the late 1980s by Rajan Suri, at the
time professor of Industrial and Systems Engineering at the University of Wisconsin-Madison. Combining growing
academic research in Time-based Competition (TBC) with his own observations from various lead time reduction
projects, Suri conceived QRM as a concept espousing a relentless emphasis on lead time reduction that has a long-
term impact on every aspect of the company.[5]

In 1993, Suri, along with a few Midwest companies and academic colleagues at the University of Wisconsin-
Madison, launched the Center for Quick Response Manufacturing [2], a consortium dedicated to the development
and implementation of QRM principles in an industry setting. Proposed by Suri, the newly-coined term "Quick
Response Manufacturing (QRM)" signifies the new strategy.

QRM extends basic principles of time-based competition while including these new aspects [6]:

 Singular focus on lead time reduction

 Focus on manufacturing enterprises
 Clarification of the misunderstanding and misconceptions managers have about how to apply time-based
strategies
 Companywide approach reaching beyond shop floor to other areas such as office operations and the supply
chain
 Use of cellular organization structure throughout the business with more holistic and flexible cells
 Inclusion of basic principles of systems dynamics to provide insight on how to best reorganize an enterprise
to achieve quick response
 New material planning and control approach (POLCA)
 Specific QRM principles on how to rethink manufacturing process and equipment decisions
 Novel performance measure
 Focus on implementation and sustainability
 Manufacturing Critical-path Time (MCT) metric to measure lead times

Suri’s continued research into QRM through industry projects along with enthusiastic responses to various articles
on lead time reduction issues led him to develop a comprehensive theory on implementing speed in a manufacturing
company, covering all areas in the enterprise. He formulated his theory in the book Quick Response Manufacturing:
A Companywide Approach to Reducing Lead Times (1998) providing a framework for the implementation of QRM
in manufacturing companies.

[edit] QRM Strategies and Tools

[edit] Lead time as a management strategy

Traditionally, U.S. manufacturing firms have focused on scale and cost management strategies based on the division
of labor practices formalized by Frederick Winslow Taylor and pioneered by Henry Ford.[7]

From the time-based perspective of QRM, the high degree of labor specialization and hierarchical department
structures at purely cost-based organizations have these negative effects on lead times:[8]

 Products and product orders require long routes through numerous departments
 Hierarchical communication structures involving various management levels require a significant amount
of time to resolve even routine issues
 Focus on efficiency and resource utilization encourages workers and managers to build backlogs, slowing
the response to customer requests
 Trying to minimize costly machine setups, managers and workers resort to running large batch sizes. Large
batch sizes result in long run times, leaving other jobs waiting and increasing lead times
 Making large product quantities to stock leads to high inventory, often prone to inventory obsolescence –
when stored products have to be discarded because of market or engineering changes
 Low skill levels lead to low quality and high levels of rework

All these factors contribute to long lead times, ultimately resulting in waste throughout the enterprise such as
excessive forecasting, planning, scheduling, expediting, work in progress (WIP), finished goods costs and
obsolescence. These increase the overall costs and lower the organization’s competitiveness.

QRM suggests that an enterprisewide focus on reducing lead times will result in improvements in both quality and
cost. Eliminating the time-consuming – and often self-reinforcing – practices described above can lead to large cost
savings while improving product quality and customer responsiveness. Hence, on a management level, QRM
advocates a mindset change from cost-based to time-based thinking, making short lead times the yardstick for
organizational success.

[edit] Manufacturing Critical-path Time (MCT)

QRM’s strong focus on lead time reduction requires a comprehensive definition of lead time. To accomplish this,
QRM introduces Manufacturing Critical-path Time (MCT). It is based on the standard critical path method; defined
as the typical amount of calendar time from when a customer creates an order, until the first piece of that order is
delivered to the customer.[9]

A metric designed to calculate waste and highlight opportunities for improvement, MCT gives an estimate of the
time it takes to fulfill an order, quantifying the longest critical-path duration of order-fulfillment activities.[10]

[edit] Organizational structure

QRM requires four fundamental structural changes to transform a company organized around cost-based
management strategies to a time-based focus:[11]

 Functional to Cellular: Functional departments must be dissolved. In their place, QRM cells become the
main organizational unit. QRM cells are more flexible and holistic in their implementation compared to
other cell concepts, and can be applied outside the shop floor
 Top-down Control to Team Ownership: Top-down control of processes by managers and supervisors in
departments needs to be transformed to a decision-making structure in which QRM cells manage
themselves and have ownership of the entire process within the cell
 Specialized Workers to a Cross-trained Workforce: Workers need to be trained to perform multiple
tasks
 Efficiency/Utilization Goals to Lead Time Reduction: To support this new structure, companies must
replace cost-based goals of efficiency and utilization with the overarching goal of lead time reduction

[edit] QRM Cell

The main building block of the QRM organization is the QRM cell. Extending the concept of cellular
manufacturing, QRM cells are designed around a Focused Target Market Segment (FTMS) – a segment of the
market in which shorter product lead times provide the company with maximum benefits.[12] Resources in a cell are
dedicated (only to be used for jobs in the cell), collocated (located in close proximity to each other) and
multifunctional (cover different functions).[13] QRM cells complete a sequence of operations ensuring that jobs leave
the cell completed and do not need to return.[14]

The work organization in QRM cells is based on team ownership. Provided with a job and a completion deadline,
teams can decide independently on how to complete the job. To ensure quick response to high-variety demand,
workers in QRM cells need to go through cross training.[15]

The main performance measure for a QRM cell is lead time as defined by MCT. To measure MCT reduction,
managers can use the QRM number [16], a metric designed to show management lead time trends for cells.[17]

[edit] System Dynamics

In QRM, the product-focused cell structure has to be complemented by a thorough understanding of system
dynamics in order to make better decisions to reduce lead times. Based on principles of system dynamics, QRM
identifies high utilization of machines and labor as well as running large batch sizes as major obstacles to lead time
reduction.
[edit] Create spare capacity

Many cost-based organizations aim for machines and labor to be utilized at close to 100% of capacity. QRM
criticizes this approach as counterproductive to lead time reduction based on queuing theory, which shows that high
utilization increases waiting times for products. In order to be able to handle high variability in demand and
products, QRM advises companies to operate at 80 percent capacity on critical resources.[18]

[edit] Optimize batch sizes

Common efficiency measures encourage production of parts in large batch sizes. From the QRM perspective, large
batch sizes lead to long waiting times, high WIP and inventory, and ultimately long lead times. Long lead times in
turn result in multiple forms of waste and increased cost as described above. Thus, QRM encourages enterprise to
strive towards batch sizes that minimize lead times.[19]

[edit] Enterprisewide Application

QRM emphasizes time-based thinking throughout the organization, creating a unified management strategy for the
entire enterprise. Extending beyond traditional efforts to optimize shop floor operations, QRM applies time-based
management principles to all other parts of the organization.

[edit] Office Operations

QRM identifies office operations such as quoting, engineering, scheduling and order processing as major
contributors to lead times. To achieve short lead times in the office environment, QRM suggests implementing
several changes according to the time-based approach described above.

The main requirement for reorganizing office operations in QRM is the formation of a Quick Response Office Cell
(Q-ROC) around a Focus Target Market Segment (FTMS).[20] In their focus on closed-loop, collocated,
multifunctional, cross-trained teams, Q-ROCs are similar to QRM Cells. Q-ROCs, like QRM cells on the shop floor,
break down functional departments and can complete jobs through multiple functional steps.[21]

[edit] Material Planning

QRM criticizes commonly used material planning and scheduling systems such as Material Requirements Planning
(MRP), Manufacturing resource planning Manufacturing resource planning (MRP II), and Enterprise resource
planning (ERP) for not incorporating system dynamics in their analysis and not accounting for the cost of long lead
times.[22]

QRM recommends simplifying existing MRP systems to a Higher Level MRP (HL/MRP) concerned with high-level
planning and coordination of material and not with detailed scheduling of operations.[23]

[edit] Production Control

To coordinate and control flow within the QRM structure of cells and HL/MRP, QRM utilizes POLCA (Paired-cell
Overlapping Loops of Cards with Authorization).[24] POLCA is a card-based shop floor control system, designed as
the QRM alternative to Kanban.

POLCA differs from commonly used Kanban systems in the type of signal it sends to move jobs/material through
the shop floor. POLCA constitutes a capacity signal, showing that a cell is ready to work on a new job, whereas
Kanban systems rely on inventory signals designed to replenish a certain quantity of parts.[25] For this reason,
POLCA works well for low-volume and/or custom products.
[edit] Supply Chain

QRM encourages companies to work with suppliers to reduce their MCT. Long supplier lead times can incur
"hidden" costs such as high inventory, freight cost for rush shipments, unplanned engineering changes creating
obsolete inventory, and reduced flexibility to respond to demand changes. [26] QRM recommends that MCT be
included as a significant factor in sourcing decisions.[27]

[edit] New Product Introduction

QRM highlights strategic advantages of rapid New Product Introduction (NPI).[28] Applying the MCT metric to the
NPI process provides valuable information on the current NPI performance. Based on these findings, QRM
encourages managers to rethink cost-based decisions in terms of their impact on the NPI MCT. For example, cost-
based purchasing policies can result in long purchasing times for prototype materials, in turn delaying the NPI.[29]

[edit] Implementation

QRM theory recommends following four common steps when implementing QRM:[30]

[edit] Creating a QRM mindset

QRM implementation requires company personnel to embrace the strategy’s time-based principles. In a first step, a
team of management and employees trained in QRM principles should compile a list of wastes due to long MCT,
creating awareness for the negative impact of long lead times on operations.

If the company decides to take action, QRM theory recommends the creation of an organizational framework for the
implementation effort. In this framework, a high-level QRM Steering Committee oversees all QRM efforts, while a
QRM Champion – an experienced employee with sound QRM training – is charged with driving and overseeing
projects on a day-to-day basis.

With this structure in place, the Steering Committee can pick a set of products as the target for the first QRM
project.

[edit] Changing of organizational structure

Following the general direction of the Steering Committee, a cross-functional planning team starts studying the
project, including a detailed analysis of the MCT, product volumes, strategic needs and other factors. This analysis
leads to the definition of the FTMS for the QRM project. Using QRM principles, the planning team designs a QRM
cell for the FTMS.

With approval from management, an implementation team consisting of the people in the new cell and members of
the planning team can start training activities, cross-training of operators and – if needed – relocation of equipment
to launch the cell. After cell launching, the implementation team continues support for the new cell and measures
MCT to monitor lead time changes.

[edit] Inclusion of system dynamics

During both design of the cell and its operation, the implementation team should reexamine policies on utilization to
properly plan the loading of the cells and to maintain spare capacity.

Furthermore, cells teams should be encouraged to engage in a program of batch size reduction.
[edit] Enterprisewide expansion of QRM

After completing the initial project, the company needs to evaluate the results of these QRM efforts and publicize
successes throughout the organization. Following the same pattern as described above, the company should identify
additional FTMSs for other QRM projects and start the implementation process. As more cells are formed,
restructuring of the MRP system and implementation of POLCA may become necessary.

To maximize benefits of a time-based management strategy, QRM projects should span across office operations, the
shop floor and supply chain.

[edit] Practice

Quick Response Manufacturing is used by a variety[who?] of companies from different sectors worldwide. As an
enterprisewide strategy, QRM has found applications in all areas of the company from shop floor to office
operations to supply chain and beyond.

A majority[who?] of companies use QRM to address lead time issues in some parts of their organization or as an
addition to existing continuous improvement efforts such as Lean, Six Sigma or others.

Another group of companies including Alexandria Extrusion, Omnipress, RenewAire and Phoenix Products have
transformed their entire operation according to QRM principles making full use of QRM’s enterprisewide reach.

In a 2008 article in Barron’s magazine profiling the five companies most successful at boosting their sales and cash
flow from among the 500 largest (by sales) publicly traded companies in the U.S. and Canada, Merrill Miller,
chairman and CEO of National Oilwell Varco (NOV) mentions improved manufacturing efficiencies based on QRM
as a large part of NOV’s growth.[31]

In recent years, QRM principles have also found applications in the healthcare and pharmaceutical sector.

[edit] Center for Quick Response Manufacturing

Founded in 1993 by Rajan Suri, along with a few Midwest companies and academic colleagues at the University of
Wisconsin-Madison, the Center for Quick Response Manufacturing has been a driving force in the development and
implementation of QRM.

Organized as a public-private consortium including faculty, students and company members, the Center has assisted
more than 200 companies in applying QRM principles over the past 16 years.

The Center provides general information on QRM and hosts a variety of training events each year. Companies
interested in implementing QRM can become members of the Center and take part in improvement projects
conducted in cooperation with engineering students and university faculty.

Lean manufacturing is an initiative that focuses on cost reduction and

increases in turnover by constantly and methodically eliminating activities
that do not add value to the manufacturing process. Basically what lean
manufacturing does is help companies to achieve targeted productivity, as
well as other things, by introducing tools and techniques that are easy to
apply and maintain. What these tools and techniques are doing is reducing
and eliminating waste, things that are not needed in the manufacturing
process.

Here are the steps you will need to take to implement lean manufacturing.

Step one:
The first thing that you are going to need to do is to make sure that your
upper management or senior management is onboard and are willing to
practice what they are preaching. Employees most often learn by example
and nobody sets more of an example than your upper management, so in
order to implement lean manufacturing it must started from the top and
work its way down.

Step two:
The next thing that you are going to need to do is to pick a project leader.
Keep in mind when picking the project leader you are going to want to pick
somebody who gets along well with others, is well liked and respected by
their employees, not to mention somebody who has a persuasive
personality. The reason you want somebody like this is because they are
going to be responsible for bringing together teams from a cross functional
environment.

Step three:
The next thing that you are going to need to do is to pick a small group of
people, around 3 to 5 people, from different departments. These people you
are picking are going to be working with the project leader in implementing
lean manufacturing. And since they are going to be in charge of switching
over to lean manufacturing you are going to want to make sure that they are
enthusiastic about it and support it.

Step four:
After you have picked out your entire team, the project manager and the 3
to 5 people from the different departments, you are going to want to begin
training the team on lean manufacturing. What you are going to be teaching
this team is the various lean tools and techniques.

Step five:
After training the team on the various lean tools and techniques you are
going to want to choose the most appropriate techniques for your company,
you can decide as a team or use management's decision in this case. After
choosing the right techniques for your company you are going to want to
prioritize them so that you can implement them in the order you feel is most
important. But keep in mind that you do not have to implement all of the
lean tools and techniques; you should only implement the ones that work
the best for your company.

Step six:
After you have decided what you are going to you will need to address the
entire workforce as to what you are doing. When you are talking to the
workforce be sure to tell them why you are choosing to implement lean, how
it will affect them and what you require from the employees.

Step seven:
You do not want to just suddenly switch your entire company over to lean
what you are going to want to do is to select one area (pilot area) and one
project (pilot project) where you can begin to implement lean. When
introducing lean you will want to introduce something that is easy and will
give you results immediately.

Step eight:
Make sure that you continue with this program for at least 2 to 3 months so
that you can learn from your mistakes. Once you have gotten the hang of
the first project you can begin the process for implementing lean in other
areas of the workplace.
Systemic Continuous Improvement—a Next Generation Manufacturing Success Strategy

Old habits die hard. Companies can invest a lot of time and money in Lean efforts or other
improvements, but if people eventually go back to their old ways, the gains won’t be sustained over
time and improvement stalls.

To truly transform into a Lean company, the company’sculture must be addressed. Culture isn’t a vague
term – it is key for improvement success. Creating a Lean Culture addresses both active resistance to
change and the tendency of people, like a dieter reaching for ice

cream, to revert back to old habits after the effort to

change has passed.

“Culture has really been missing over the years,” said

Steve Straub, WMEP manufacturing specialist. During

the 1980s, companies were implementing quality

circles, TQM and other improvement efforts. “It was a

lot of the same improvement changes companies are

making now, but what was missing was getting people

involved in the process.”

Lean Culture deals with this issue by acknowledging

that culture greatly influences many facets of daily work

tasks, as well as improvement efforts. How change is

introduced, and the reaction to it, is determined by

culture.

To better understand the dynamics of a Lean Culture,

it helps to know what business culture is – a pattern

of behaviors or problem-solving techniques commonly

used by individuals in a company. A Lean Culture

has specific qualities that define the behavior of the

employees.
Culture Matters: Why Top Management Must Take the Lead

Lean Culture

Wisconsin Manufacturing Extension Partnership • 877.856.8588 • www.wmep.org

A Lean Culture:

f Focuses on the customer: “Employees need to

understand who the customer is,” said Straub.

“They have internal customers also. How they

serve the external customer is directly tied to

how they treat each other internally.”

f Is totally committed to continuous

improvement: For this kind of commitment

to occur, all employees must be involved in the

improvement process. This means maintaining

enthusiasm about the process and creating a safe

environment for employees to make suggestions

and take risks.

f Communicates a clear vision for the company

to all employees: “This is key,” said Straub.

“If everyone is going in a different direction or

doesn’t understand the vision, it’s difficult to pull

together as one big team.”

f Ensures everyone knows their roles by setting

clear standards and expectations: The expected

behaviors within the organization must be spelled

out. It should be clear that the new culture is now

customer-focused, and that the commitment

to continuous improvement is genuine and

permanent.Lean Culture Lean Culture

A Lean Culture encourages all workers to contribute

ideas, responds quickly to suggestions for

improvement, works to keep everyone learning, seeks

perfection in its products, services and processes,

and enjoys the visible support of all leaders.

Teams are Key

Teams are the basis of the Lean Culture infrastructure

and include a core team, steering team and project

teams. Senior management makes up the core

team, which works to support the Lean process

and remove any roadblocks preventing successful

implementation. The core team also provides metrics

that are directly tied to the company’s success and

that employees can directly affect. The steering

team, a cross-functional, multi-level group, drives

Lean implementation. Finally, project teams work on

specific processes to improve efficiency.

Even after establishing a Lean Culture infrastructure,

some companies have problems sustaining change.

Resistance often comes from middle managers who

feel threatened because decision-making authority

has been expanded. “Resistance can be overcome

when they understand that their new role is to

lead people, not manage them,” said Straub. “They

should be focusing on strategic areas, not day-to-day

decision making.” Lean Leadership addresses these

issues.

Management Support

Changing a culture can’t be done without support

from senior management. “If you don’t have buyin at the top, it won’t work,” said Straub. Senior

managers are important because they set the ground

rules for the new culture. In addition, long-term

commitment to continuous improvement starts with

top management. This commitment is expressed in

policies, practices, language and actions that shape

employee behavior at all levels. Because of the vital

role played by top management, Lean Leadership is

an essential part of Lean Culture.

Training Leaders

Since a primary goal of a Lean Culture is to build

an empowered workforce, empowering leadership

behaviors are crucial. Learning to use empowering

leadership behaviors requires motivation and skill.

Some actions senior leaders can take to create a

Lean Culture include:

f Empowering workers at all levels to act on behalf

of the customer. Assemble project teams made

up of frontline workers and a steering team with

rotating membership to foster the participation of

all workers.

f Respecting and using the expertise of everyone.

Put up a suggestion box that includes a formal

system for implementing good suggestions.

f Encouraging risk-taking to test improvement ideas.

Urge workers to try new ideas, such as changing

the location of equipment to improve efficiency.

The final decision on where it goes should be made

by the people working in that area.

f Using Lean to improve the way people do their

jobs, not to eliminate jobs. When you find extra

capacity in one area of a process, there is usually

another area where more capacity is needed. A Lean Culture

Wisconsin Manufacturing Extension Partnership • 2601 Crossroads Drive, Suite 145 • Madison WI
53718-7923 • www.wmep.org

Value Stream Map shows the locations of both

bottlenecks and overcapacity. People can shift

from one area to another.

f Building consensus on and establishing clear

ground rules that support the vision. Get feedback

from workers to make sure new rules are realistic.

For example, can parts be supplied to assembly

within a day? Find out before setting the rule in

stone.
f Supporting continuous learning for everyone and

actively seeking continuous learning for yourself.

Set a specific goal (hrs/yr) for the amount of

employee training.

f Making needed changes to align organizational

structure, management systems and

measurements with the vision. If you implement

Lean on the shop floor, it will also be necessary

to align the accounting system to Lean, i.e., Lean

Accounting, which uses different measures.

Willingness to Learn

Being an effective leader requires a willingness to

learn new leadership strategies, including personal

effectiveness and interpersonal effectiveness.

Personal effectiveness helps people understand their

own personality and recognize personality traits in

others so that they can interact more effectively with

them. Interpersonal effectiveness shows how to be

a better communicator, actively listen and handle

conflict resolution while preserving employees’ selfesteem such as collaborative strategies that help

managers lead in a constructive, positive way.

Leaders also are skilled at leading teams and

managing change, especially when addressing the

normal fear associated with change. “So many people

have been put in a position of leadership, and they’ve

not been given the tools to do it effectively,” said

Straub. “When they find out about these strategies,

they say, ‘Wow, I wish I’d known this before.’”

The benefits of Lean Culture and Lean Leadership

include retention of good employees, an improved

bottom line and sustainable improvements. Without

a Lean Culture, companies risk spending “hundreds

of thousands of dollars on technical changes with

no buy-in or ownership to sustain the change,” said

Straub. “They realize short-term gains, but don’t get

the long-term gains.” Lean Culture is not abstract but

a real factor in generating long-term results, because

changing the culture makes continuous improvement

a way of life.

here are some Basic Rules for the Lean Implementation if you are interested.

To keep it clear and concise I’d like to refer to the implementation steps that
worked the best, from my experience.

Surely your business has some business objectives that span across many years
to come. But, how do you align the operating strategy to meet those business
objectives?

1. Lean Leadership

First, start by bringing together your operating committee or senior

management team that will provide the support and resources required to
start this process. Without their commitment and dedication, things will get
tough.

2. Lean Fundamentals Training

Send them out for lean overview training. They need to be trained in lean, to
be able to understand it and believe in it.

3.Value Stream Mapping Training It would be a good idea to have them attend
a workshop for value stream mapping as well.

4. Plant Tours

Visit with your leadership team some companies (non-competitive businesses)

that are more advanced in the lean implementation. Learn from them how
they did it, ask questions.

5. Change Agent

You may want to either appoint somebody from your managing team as a
change agent or hire an experienced Lean Manufacturing Manager.

Also, you need to have Value Stream Manager(s). If you have a main product
or family of products one person is enough. For products that are quite
different as far as the process flow goes, you may need to have multiple VSM
managers.

They can be people who are the most familiar with the product, such as
engineers, the plant manager, somebody who has the authority to make
changes in the plant and be responsible for the overall quality, delivery and
total cost of the product.

6. Value Stream Map Workshop (VSM)

Use the Value Stream Map to visualize the product flow for your major
products, the information flow related to the product and valuable information
related to non-value added content, system constraints etc. In other words,
you get some of your baseline process measurables.

Brainstorm and mark opportunities for improvement on the Current State Map

Draw the Future State Map, which represents an ideal state at this stage.

7. Lean Implementation Plan

With the information from the workshop, write down the lean implementation
plan, with responsibilities and due dates.

With the above information you can create the Operating Strategy. This means
expressing in words what you plan to do to make sure that the road you are
traveling goes the same way as the dream you have for the business. It is
about expressing your vision.

8. Policy Deployment

Communicate the vision to the whole company through meetings and

presentations. Some companies call this activity Policy Deployment.

9. Master Plan

Develop and post the Master Plan, which is in fact the lean implementation
plan, with some additions, to reflect other aspects of the business, such as
Safety or Morale.

10. Partnership with the Union (if your case)

If you have a union in your company, please make sure that you are in this
together. Commitment and support are crucial for your success. It is, after all,
a matter of survival for everybody.

11. Training Requirements

Based on your circumstances, determine the training needs of your

organization and the people who are going to attend specific lean workshops.

12. Seven Wastes Training

Learn to see the wastes (overproduction, excess inventories, material

movement, excessive motion, waiting, defects, too much processing steps, and
the under-utilization of your resources – number eight). In general this training
is provided in the overview part of the lean implementation.

If not, please spend some time to understand the implications and do a

workshop where the employees can come up with examples for each form of
waste.
13. 5S Workshop

The strategy of implementing 5S in you company can be different. It is an

extremely powerful lean tool. Make sure, though, that you keep always in
mind the Seven Wastes, as the 5S program should help minimize the waste
and not create even more (i.e. by having people walk more to get to their tools
just because they are now removed from the work cell).

1. Pilot Site

I’ve seen plants where it all started with a pilot site, where a small team
of people led by a 5S Champion (either somebody previously trained in
5S, the Lean Manufacturing Manager, or a lean consultant) performed a
small workshop in a work cell or a product line.

Then, with the lessons learned, 5S was implemented in the whole plant

2. Plant Wide

You can begin the implementation right here, instead of using the pilot
site.

The Lean Manufacturing Manager / 5S Champion / Lean consultant

leads the 5S workshop plant wide.

It starts with red-tagging all the excess equipment, materials, etc from
the whole plant and continues with all the other activities.

It requires at least partial plant shutdown time (2-3 days), as everybody

is engaged in this activity and the equipment is being re-arranged or
cleaned as well.

One alternative is to do it on half the plant at a time and continue

throughout the week until it’s done.

14.Visual Factory

It is, in fact, part of the 5S Program but it’s good to emphasize its importance
separately, as part of the lean implementation.
I found that, for me, it went beyond 5S because I was able to look at the plant
as a whole rather than as disconnected areas, each with its own 5S score and
open issues.

It is a management tool as we try to open lines of communication between

departments and make it easy to see if we are on track with the production
numbers, quality issues, deliveries, safety concerns and on and on.

The following are lean manufacturing tools you can use in no particular order,
depending where you hurt more.

If the major issues are with the machine uptime, probably a good way to
continue is by implementing:

15. Total Productive Maintenance (TPM)

If your concerns are related to the poor quality, you’d like to continue with:

16.Error Proofing (Poka Yoke)

The field is also related to the principle of Jidoka and with Autonomation.

If delivery of your parts is a major issue, surely you’ll continue by investigating:

17. Continuous flow or even better, one-piece flow

This is the main component of the Toyota version of lean manufacturing, or

what is called Just-In-Time Manufacturing.

Luckily, it is also part of the Value Stream Mapping optimization process so it’s
been addressed at that early stage of the lean implementation.

18. Kanban System

Pull System Whenever you cannot implement continuous flow, a production

trigger based on withdrawal of previously made parts is the solution. Especially
when you have monumental equipment (i.e. stamping press) it’s obvious you
cannot attain one-piece flow. Then, a controlled batch size and a Kanban
system will be utilized.

19. Level Production
It uses a Heijunka box, which is just a way of organizing the production
requirements in order to minimize the fluctuation in production numbers and
product type.

20. SMED (Quick Changeover)

If you have considerable changeover or setup time, this is a good tool to

investigate. The name came from the success in changing dies rapidly and it
means Single-Minute-Exchange-of-Die.

21. Kaizen Program

I’d like to finish by mentioning this powerful methodology of continuous

improvement. It embraces every aspect of the lean implementation.