LEAN FOR ETO MANUFACTURERS

Lean Manufacturing fundamentals were founded on the Toyota Production System, or Just In Time Manufacturing, which embraces the concepts of minimal inventories, and continuous improvement through the identification and elimination of waste throughout an entire Company.  This process was developed and mastered by Toyota and remains one to the early examples of world class manufacturing practices.  In an effort to adopt the principles to a broader base of manufacturing companies in the United States the principles of the Toyota Production System were “re-packaged” and “re-named” -  Lean Manufacturing.  The foundation of Lean Manufacturing is built on a repetitive manufacturing model.  However, the concept of continuous improvement and elimination of waste applies to all organizations.  The techniques or methods to be selected must recognize the environment in which they are to be applied and measured to achieve desired cost/benefit objectives. 

Can these principles be applied to the Engineer to Order and Make/Build to Order manufacturing environment?? You Bet They Can!!

As with any attempt to improve operations, however, THE critical mindset is “Always Better, Never Best”.  Without the visible and sustained support of management old habits are hard to change.  As a philosopher once said – I am as I am measured.  The

corollary is – Without measurement, I will be what I am.

The techniques presented below comprise the fundamentals of Lean Manufacturing.  They are organized from the perspective of cost/investment to implement - Low Cost/No Cost to Higher Investment. The application of the techniques must be continuously applied and reinforced by management, not one-time efforts, for Lean Manufacturing to be considered IN PLACE.  In addition to a brief description of each technique, an indication of its applicability to NON-REPETITIVE Engineer to Order and Make/Build to order manufacturing environments is presented.

Work Place Organization

A disciplined approach to logically arranging materials, equipment and operators in manner that will minimize throughput time and help identify wastes such as long material flow time, worker waiting or schedule delays, access to required hand tools, WIP build up within the production process, etc.

Applicable in Engineer to Order manufacturing: YES

 Visual Controls 

A factory simplification technique that creates an environment in which all employees can VISUALLY understand what authorizes the production and movement of materials

through the production process.  The statement ”the shop floor talks to you” or “a visual factory” is a reference used to describe how the manufacturing floor should look when proper visual controls are in place.

Applicable in Engineer to Order manufacturing: YES

Error and Mistake Proofing

Statistical process control SPC was developed in the US and is based on the premise that 100 percent inspection is both burdensome and time consuming and can be adequately replaced by sampling inspection and statistics.  However, this statistical approach

assumes a certain level of defects must be tolerated or accepted.  Therefore, in a zero defect approach to manufacturing a pure SPC approach will not achieve the objective. 

Other error Proofing techniques are required. 

Error and Mistake Proofing techniques require the involvement of the work staff throughout the product design, supply, production and delivery process.  The reference to “quality at the source” is frequently used to describe the mindset that every person in the process to complete an order is a customer of the preceding activity.  In this environment each person is responsible for the quality of their work and a defective “work product” is never past on to the next operation/person.  Inspectors assume the role of trainers to the workforce.

Applicable in Engineer to Order manufacturing: YES, but requires clear communications of specifications to each operation along with work instructions.  The identification of  “similar” or “frequently use” components and related operations will increase the effectiveness an “error and mistake proofing” program in the ETO company.

Set-Up Reduction

This technique analyzes existing set-up methods by identifying the individual steps required in the set-up process.  This is followed by a brainstorming activity to identify opportunities to reduce/eliminate machine downtime in the set-up and to “externalize” as many activities to the set-up as possible, in order to minimize downtime for a machine during the set-up activity.  This technique is based on the idea that set-up is a non-value added activity in the production process.  The reduction of set-up time increases productive capacity of a machine or piece of equipment.  Set-up time reduction also is the

critical element in reducing overall throughput time, reducing lot sizes and achieving one-piece flow.

Applicable in Engineer to Order manufacturing: YES

Lead Time Reduction

A technique used to first identify all steps in a process including the time and distance involved for each step.  Then each step is classified as value added or non-value added, followed by a methodical approach to reduce or eliminate the time of each activity in the process, therefore improving throughput.

Applicable in Engineer to Order manufacturing: YES, with reoccurring orders. 

Standardized Work Methods

Standardized work methods are used to structure work activities and produce repeatable processes.  Standardized work methods identify the work activities to be safely carried out with all tasks organized in the best known sequence and using the most effective combination of resources, including; people, materials, methods and machines.  Using Standardized Work Methods directly contributes to the related initiatives of Work Place Organization, Throughput Time Reduction and Zero Defect Processes.

Applicable in Engineer to Order manufacturing: YES, with reoccurring orders. 

Pull Production

Often referred to as a Kanban System, is a technique to control the flow and manufacturing of material based on customer consumption of materials.  Used in this context, a customer is the next worker in the production process is the “customer” and

visual signals – kanbans – are used to indicate when specific work tasks are to be preformed to re-supply an item used by a down stream work activity.

Applicable in Engineer to Order manufacturing: Unlikely

Value Stream Mapping

Material and information flow mapping is used to depict current and future, or “ideal” states in the process of developing implementation plans to reduce non-value activities thereby reducing waste.  This is a primary tool used to identify and eliminate waste in a process.

Applicable in Engineer to Order manufacturing: YES

Constraint Management

A method of achieving throughput improvement/higher yield through strategic improvements at the most restricted operations in a process.   By using controlled buffers of inventory to protect the process against starvation or blockages, you can eliminate the headaches of having dissatisfied Customers due to missed or delayed shipments caused by a process constraint.

Applicable in Engineer to Order manufacturing: YES, in situations in which a critical

                resource is required by numerous production operations.

Level Scheduling

The ability to create level schedules is directly related to the backlog level or the ability/willingness of customers to provide a plan for their product needs.  In most Engineered to Order organizations these rarely exist.  Even in those situations where production forecasts and backlogs exist, customers change their minds.  However, without an outlook of “expected” orders or “work hours” it is impossible to plan and schedule resources.  History may be as good as it gets.

Applicable in Engineer to Order manufacturing: YES, within a “reasonable” use of

staff to plan production schedules and resources.

Supply Chain Management

A technique that brings the various tiered levels of the supply chain together to work as a team to identify and eliminate waste in the entire material pipeline.  Such efforts decrease costs and improve throughput.  This technique is commonly referred to as Material Value Chain. 

Applicable in Engineer to Order manufacturing: YES, generally with major suppliers.

Employee Empowerment

Based on the premise that every person in the organization is responsible for identifying and eliminating waste.  Employee empowerment can be realized only through the training of employees in Lean Manufacturing and factory simplification methods and providing the time to apply the training.  The most successful organizations also use Team Concept methods to allow for employee involvement and expression of ideas.  This can only be accomplished by having employees who are given the responsibility and are accountable for the accomplishment of improvements.  The reality of Employee Empowerment is that not all employees want to be empowered nor does management

always desire them to be empowered.  Without a total commitment that is consistently reinforced this concept will fail.

Applicable in Engineer to Order manufacturing: YES. Involving staff in problem solving, work area layout, set up reduction and design for manufacturing can be very beneficial.

Total Productive Maintenance

A world-class initiative for optimizing the effectiveness of manufacturing equipment with a focus on the machine operator, who touches, hears, sees & knows the equipment better than anyone else.  Therefore, in TPM the machine operator is the first line of defense against unplanned equipment downtime; however, in traditional organizations the machine operator is normally not involved in equipment maintenance activities. 

Another feature that makes TPM unique is that it brings together people from all departments concerned with equipment to identify the activities and establish the schedule for preventative maintenance on each machine or piece of equipment.

Applicable in Engineer to Order manufacturing: YES

Six Sigma

A data driven and structured method which can be applied to any aspect of a business.  Its results are used to eliminate waste, increase profits and improve Customer satisfaction.  The focus is to identify the activities that are creating variations in the business process and minimizing them to an acceptable level thereby improving the quality and reliability of each process.  Six Sigma training, however, is not the first step towards lean manufacturing.  It is very focused and will require total commitment from everyone in the organization. It is strongly recommended that any organization thinking about getting into Six Sigma should first be trained, educated and experienced in all Lean Manufacturing methodologies.

Applicable in Engineer to Order manufacturing: YES, with workload and similar components considerations.

Tool Engineering

The concept, design, and building of any tooling necessary to run a given process with the least amount of stress placed on the employees.  This includes new and existing processes.  Proper Tool Engineering will also give you a repeatable, qualified process, which will produce the highest quality products.

Applicable in Engineer to Order manufacturing: YES, but of minimal importance in

true “one time” only production.

Identification and Elimination of Waste

Waste in the factory has been redefined within the context of Lean Manufacturing. The leading manufacturers in the world today are continuously identifying and reducing/eliminating all forms of waste from their operations. Waste, in a Lean Manufacturing organization, is classified as ANY “non-value” added activity.  A non-value added activity could be viewed as any activity that exists because the process is inadequately designed or not functioning as designed, OR that could be eliminated without affecting the output to the customer. 

As an organization identifies waste or non-value added activities, it is at the same time identifying activities that are “value” added.  An activity adds value if; the customer

recognizes the value and is willing to pay for it, it alters process input, it’s done right the first time, it’s required by laws and regulations. Value added does not mean it can’t be

accomplished in a BETTER way.  It is possible to reduce the process time required to perform value-added activities.  Reduction of waste from all processes is one of the

fundamentals of continuous improvement & the driving force in the pursuit of factory simplification.

The identification and elimination of waste is more an attitude than a technique or method.  All companies are, or should, be working to improve their business processes.  However, without a focused and consistent effort accomplishments are random and unpredictable.  Walking the talk is required to support a Lean Manufacturing initiative.

Applicable in Engineer to Order manufacturing: YES.

For more information on LEAN MANUFACTURING and its implementation in the Engineer to Order and Make/Build to Order company complete this Information Request from and we will contact you to discuss your interests and objectives.

In Arizona, Visionary Solution Resources, Inc. is an Alliance Company of Beach, Fleischman & Co.