Wednesday, March 2, 2011

Don’t lose track of the costs to implement lean

Implementing lean can sometimes come at a substantial cost depending on the organization and complexity of the productive process. It is ideal to have a lean manufacturing budget which is managed by the lean champion or operations manager which tracks the costs of support staff, supplies, presentations, travel costs and technology to implement lean initiatives and operations re- engineering. Remember that at the end of the day a business needs to make money and lean initiatives and process changes must deliver financial results or cost savings to the business on top of enhancing its competitive position.

Scratching below the surface for lean improvements

In order to achieve competitive advantages and realize actual cost savings from lean manufacturing techniques, managers must endeavor to closely examine their operations and cost base quite carefully. It is no use investing time, effort and money in lean initiatives in the production process when stock on hand is many months worth in the warehouse. As a manger it is important to be able to think big and have that high level view, but also not to lose track of the details and always be hands on and inquisitive into what is happening in the business. Many root causes for issues may be simple and are able to be solved with some understanding of details regarding the problem and its surroundings. Lean manufacturing concepts are just tools; managers need to learn how to use these tools in a manner that best suits their organization.