The roadmap to `lean' and beyond
Source: Bangkok Post
This week we continue discussing the basic roadmap for implementing ``Lean'' thinking and processes across the supply chain. Remember that lean is a journey and not a destination, and that the ``leaning'' of the supply chain is a continuous improvement initiative. Vision and lean training. Communicating lean thinking effectively throughout the organisation is vital to its successful implementation. Effective communication has to begin at corporate and senior management level so it is vital to begin the roadmap by gaining top-level vision and support.
In the competitive global economy, management must appreciate and understand the financial opportunity and long-term business benefits of converting from traditional batch operations and structures to a streamlined, lean process in such critical areas as manufacturing, supply chain and administration.
The conversion to lean requires an understanding of all its components and principles for their integration from supplier to customer. For example, the supply chain is activated in a plant by developing products, securing supplies, ensuring a quality manufacturing performance, and making timely shipments to customers. Key stakeholders must know the tools that can introduce lean to the entire supply chain flow.
A learning organisation must be established with embedded knowledge so that the transition to lean can continue even if key people leave. Formal lean training and certification demonstrates an organisation's professionalism of the total overall lean approach and willingness to invest in its people.
Take a structured approach. Without a structured system to make things happen, a conversion to lean is doomed. Two layers of management committees are recommended to drive the conversion throughout the firm, and to set and evaluate relevant performance metrics:
Lean Improvement Management Council: consists of a dedicated Lean Champion/Kaizen Facilitator responsible for identifying and implementing improvement opportunities. This group is also responsible for prioritising the opportunities and maintaining the schedule of continuous improvement in the form of ``Kaizen events''.
Senior Management Council: assures that the resources are made available and provides the organisation's strategic goals while setting and reviewing key performance metrics allowing for progress reviewing of the Lean Improvement Management Council.
Identify the value stream. Lean cannot be solely focused on manufacturing operations. Implementing lean requires a total business strategy review _ from the first-tier supplier through manufacturing to the end customer. By identifying the total supply chain product flow in terms of time and time constraints, the road map of priority actions required to reduce cycle time and eliminate waste can be identified.
Getting quick wins. In any organisation, it is important to demonstrate results quickly. A well-proven mechanism is training followed by action with continuous improvement (Kaizen as the Japanese know it) events. Kaizen produces quick improvements in order entry, demand planning, product development and any administrative areas by applying appropriate lean tools.
Many companies initially implement lean within the production areas. Results and improvements in such areas are easily visible for all to see. Attaining visible improvements helps to convince staff of the merits associated with lean and allows for a smoother roll out within the wider functions of the organisation.
Lean the entire supply chain. To be a lean operation, an organisation will require the support of both its suppliers and customers. To attain lean, an organisation must partner with its major suppliers, and each supplier must adopt a lean implementation strategy where improved quality standards and flow production are achieved and delivered through lean logistics. Achieving a smooth flow of the entire supply chain is the most essential step toward becoming a lean operation.
Maintain the momentum. Management's strategic vision for maintaining the momentum for change must include rewarding people for buying into continuous improvement. That's why celebrations, credentials and rewards are crucial. Recognition and gain-sharing programmes embedded in the organisation's culture will provide a bridge to continuous improvement, even in the face of high management turnover.
Beyond lean _ operational excellence. The leaning of the supply chain targets the easier-to-get ``low-hanging fruit'', while another set of tools, Six Sigma, allows organisations to target the ``high-hanging'', harder-to-get fruit.
Typically Six Sigma combats more technical issues and is mostly used to improve process capability and reduce process variations by means of enhanced design tools and a Six Sigma generic problem-solving tool.
A combination of Lean and Six Sigma ultimately gives organisations the powerful tools that are necessary to enable successful development of world-class products and services.
