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.

The real cost of Lean

What is the cost of Lean? the cost of lean in this sense is referred to the cost to the business to bring change to their systems and processes to introduce lean manufacturing. It is important to take into account the industry and nature of the business' operations in order to select the Lean concepts and techniques applicable to the business and its different operations.
In my experience businesses run into trouble and fail to reap the benefits from lean when their management and staff do not know what lean really is and how to use the tools effectively. They most commonly try a blanket or shotgun approch which leads to very little benefit at the end, high implementation and project costs and an overburden of work for staff.

Lean manufacturing engineers in large companies

The people in charge of collecting data and carrying out lean manufacturing initiatives can vary depending on the organization, its size, and complexity.
In large organizations they usually have a lean team led by a lean champion and they will have a work group consisting of process engineers, continuous improvement engineers or industrial engineers. This structure is very focused and allows the progress of lean manufacturing initiatives without interruptions to day to day operations.

Company lean culture

An important and sometimes forgotten ingredient in making any strategy work is company culture and failing to bring people on board to participate in the continuous improvement process. This at times can be difficult as there are people who will resist change. These people are demotivated and can be a challenge to get them to participate in the lean manufacturing improvement process.

Replacing old machinery

Machinery is one of the most important factors in a producing good quality products and producing them at low cost. Most machinery and plant can be depreciated over 10 years and some large industrial plant and equipment over more. The actual rate of depreciation should match the use of the machinery during its life minus any scrap value. All plant and equipment should be maintained properly and effective monitoring put in place to detect any premature wear and maintenance requirements. This is one aspect in attaining a reliable plant and being able to produce effectively in a lean manufacture system.
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Unreliable Plants in Lean Manufacturing

The unreliability of a plant can be detrimental to the process of continuous improvement, specially in a continuous or continuous batch process due to the limited material/ WIP flow alternatives within the process. Many plants may be old and have new technologies fitted to old backbones which can also compound the problem. It is a great advantage in having at least plant up times of around 95% because this will allow engineers to implement quicker change over times and improved cycle times.