What exactly is Lean? | Part 2 of 3
In this article we discussed the basics of Lean thinking and how we, at Stoner Inc. have applied some of those principals. Lean is a journey toward making your facility and office more efficient and profitable. In Part 1, we showed some examples of how we at Stoner got started and how our 5S Plus 1 principals work. Now let's explore how we can continue to improve our processes.
Point of Use
One of the next key components of Lean practices in manufacturing that goes hand in hand with 5S+1 is point of use. The materials you need to do your job should be stored or available right where you are doing your job. One of the challenges I have often heard surrounding point of use is, “Can you put your hands on it in 30 seconds?” Here is why I say this goes hand in hand with 5S+1. If the work area is a mess and disorganized, or things you need are far away, you will not be able to accomplish the 30-second rule.
Point of Use is a powerful concept and you might already be using small examples of it in your office. Coffee pods or beans are stored near the coffee machine and extra paper for the printer is stored near the printer. These are simple examples of point of use that you may already know about. These examples are perfect to demonstrate the need for the 5S+1 Sustain rule. When you use the last of the coffee or printer paper you go and get more and replenish so it is ready to use the next time.
Quick Change Over
Quick change over is usually a key metric in manufacturing that goes right along with the concepts of doing things efficiently and working toward the goal of accomplishing tasks faster. The manufacturing line is only valuable if it is producing so the amount of time it takes to stop producing one product, swap out any components that are different, and reconfigure any machinery to start running a new product is called change over. By finding standard settings, equipment, and methods across multiple products, you can minimize the amount of changes that need to be made between products. If you have good, documented processes outlining the things that need to be changed, the changes can be done quickly and confidently instead of trying to remember all the steps and tweak settings until you get them right.
Throughout our organization, manufacturing has led the initiative for cross training and standards of work which directly contribute to quick change over. There are several manufacturing lines at Stoner and each employee in manufacturing rotates to the different areas to learn how to do different functions. By having standards of work that are written down and similar between the different lines, and by spending time rotating your work between the different lines, manufacturing employees can be absent and others can step in seamlessly.
The same things can happen in the office also. Written standards of work, processes so simple anyone could do them, and information at your fingertips are all key components to upholding customer service despite who is out of the office. Similarly, having a standard of work for our customer service department so that they make customer notes and put on sales orders in a consistent fashion makes them interchangeable. Some of them do have more experience with retail or international orders, but generally they can handle any customer questions. In fact, our customer service people do just that because any call or order that comes into the office is handled by whoever is next in the queue. If you place an order and call back, the next agent can help you just as well as the first one you spoke to.
One of the keys to consistency is doing the same things, the same ways, all the time and not forgetting to do parts of the job.
Batch reduction is another important Lean practice. In manufacturing, batch reduction means doing smaller runs of a product. At Stoner we make to stock and we try to maintain enough stock to fulfill customer orders with same-day shipping but not so much stock that a lot of dollars are tied up in inventory. So, ideally you are producing just what the customer wants, at just the time they want it without surplus. Usually people think because of the amount of time it takes to do setup that once you are set up you should run as much as you can before switching. This thinking, however, leads to overproducing things you might not need yet. Also, if you are still running the first product you are not going to get to the second product quickly, so you are not agile enough to meet the customer demands. There is a limit to how small you can go with batch sizes, but as you drive change over down, you can also drive down batch size. The more turns of inventory and the smaller batches, the efficiency of your processes goes up as well as your ability to shorten your lead times and meet customer expectations.
These same principals apply outside of manufacturing. The first part of batch processing is to break work down into smaller tasks. A great example of this is cleaning your home. If you clean your whole house on Saturday, it takes at least all morning and you feel worn out and disgruntled that it took that much time. If, however, you did dusting on Monday, bathrooms on Tuesday, vacuuming on Wednesday, etc., then by the time you get to Saturday there is only a chore or two left and you feel like you can enjoy the day.
This same principle applies in the warehouse. If every week or day employees take a little time to do an inventory cycle count of a couple rows or locations in the warehouse, then they cycle through the whole warehouse regularly and don’t have to do the exhaustive physical count where they count everything over a weekend. By having smaller batch sizes, you also eliminate waiting for a batch. For instance, at Stoner we send a Safety Data Sheet along when we ship our industrial products. We used to have bins of these Safety Data Sheets and when picking an order, the shipping department would also pick the appropriate sheets. Early in the morning they would print batches of these sheets to replenish the bins. So, a printer was not able to be used because it was busy printing Safety Data Sheets, and perhaps an order could not be packed because the Safety Data Sheet was not printed yet. To eliminate this and make things more efficient, we started printing the Safety Data Sheets when the pick slip printed out. So now, instead of the mass runs of the Safety Data Sheet, only the ones needed are printed with the pick.
Another example, instead of printing pick slips in batches on a regular schedule, we switched to printing pick slips ad hoc during the shipping process. No longer is there wait time for a large batch and a scramble to pick dozens of orders. Each shipper will continually print small batches and single picks throughout the day. Our shipping is so efficient they are often picking an order minutes after our customer service person is off the phone with a customer.
This technique is again focusing on the goal of faster, so let’s move on and look at some other techniques to address the goal of better or quality.
So, let’s say you take these techniques to heart and you reduce change over and you drive down batch sizes in your work and you are starting to feel good about this Lean stuff. The next thing to consider is, are you really doing the right work? Is what you are spending your time doing value added? Efficiently doing things that don’t need to be done is not good either.
One of the key questions to ask yourself is, “Would the customer pay for this?” Then eliminate as many of the things the customer would not pay for as you can. For example, the customer will pay for a good product or service, they will pay for innovative packaging that makes the product work better or last longer, and they will buy from a company that can ship immediately. The customer does not want to pay for employees to fix broken machines or rework products that had defects or wait months for products to arrive. The exception to value added is regulatory compliance. For instance, the customer may not want to pay for all the paperwork that is needed to ship product internationally, but if you don’t follow the government regulations, you will not be able to ship and sell your product.
The key principle of value added is to focus on things that customers are willing to pay for; those things that have value to the customer. Internally, this means getting information for people when they ask for it, not next week. It also means responding to system problems immediately to keep users up and running. Basically, focusing on the value added helps to eliminate all forms of waste. These concepts of waste are important enough that they should be addressed in detail.
There are a lot more aspects to eliminating waste than you might think. In Lean, waste is generally categorized into the following categories.
• Extra processing and rework
Defects are any rework or corrections of any kind – ever. In manufacturing, this is often a physical defect or a defect that effects the function of the product. In the office there are defects also, usually in the form of data entry errors or inaccurate information.
Waiting for any reason is wasteful, whether you are waiting on products, people or computer systems. In Manufacturing, this can be waiting for a piece of equipment to get fixed or waiting for a raw material to arrive. In the office, waiting often revolves around approvals. Anything to make approvals of purchasing, accounting and other systems more efficient significantly helps to reduce waste. Look for systems that can email approvers and provide links and easy one-click approvals to keep processes moving.
While waiting on things and people is often the first thing you think of, waiting also includes slow computers or computer systems. Investing in improving or eliminating computer slowness makes all users more effective.
Excess movements, walking or searching is a waste. Good 5S+1 systems and having equipment and information at the point of use as discussed earlier goes a long way toward eliminating motion in both manufacturing and the office. In the office, a good example of eliminating motion is the use of email instead of postal mail. Email can be automatic, and it eliminates printing, folding, sealing stamping and posting a piece of paper. Getting all documents stored electronically eliminates having to walk to filing cabinets or having to call someone to find a piece of paper.
Over production is making more product than you need or making product sooner than is required.
We discussed this concept of producing more than you need in manufacturing by using larger batch sizes than you need. This puts more product in inventory and does not really meet customer demands.
In the office when you talk about over producing, the easiest example that comes to mind is automatically sending out reports that are never used. It wastes computer resources, and possibly paper or clutter on a network drive or in a user’s email.
When thinking about over production you must consider prioritization and time. This is one of the few instances where procrastination can be good. Don’t work on projects that are not due for months because they might be cancelled, or the requirements might change.
Extra Processing / Rework
Extra processing or rework is doing more than the customer requires or desires. In the manufacturing world, you don’t add fancy boxes or gadgets if the customer just wants a plain cardboard box. Don’t make more than a customer will buy and don’t over complicate. Often doing the extra processing leads to reworking what you have produced. The key here is understanding user requirements both in manufacturing and in the office. We often find at Stoner that our users ask for something specific because they think it will solve a problem. If we simply implement the specific request, we are often coming back to do rework. Instead when we get improvement requests we usually don’t take them at face value. We ask, “What problem are you trying to solve?” Then we consider several solutions to the problem and work with the user to come up with the correct course of action the first time around.
The best thing you can do to eliminate over-processing is to spend time automating repetitive tasks or to slightly change processes. To truly address excess processing, it is important to consider a process across departments.
Sometimes the transfer of work to another department is needed to create efficiency. At Stoner we transport finished goods and raw materials between our manufacturing facility and our warehouse. Our process used to be to leave the finished goods on the dock. The truck driver would arrive at the manufacturing facility, unload the raw materials from his trailer, load the trailer with the finished goods, record the items he loaded into a computer and then print a BOL.
For efficiency, we now leave an empty trailer at the dock and manufacturing will load product onto this trailer as they complete pallets. The also record the trailer number and item they are loading into the trailer on their own computer screen. The driver confirms the load visually, and then prints the BOL. Instead of manufacturing leaving the pallet on the dock, they now just drive a few feet further into the staged trailer. This small shift of workload had a huge impact on the truck schedule and helps it have faster turnaround times.We know this is a lot to grasp, and we'd like to stress that LEAN is a process, not a quick change. We're here to help and there are many other LEAN resources available. If you're still interested in learning more, in Part 3 we will wrap up with how LEAN thinking translates into saved dollars. At Stoner, we've seen some significant savings. Next month we'll show you some examples. So Stay Tuned!
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