Lean Production and Quality Management

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Lean Production: producing goods and services with the minimum of waste resources while maintaining high quality

Simultaneous Engineering: product development is organised so that different stages are done at the same time instead of in sequence

Cell Production: splitting flow production into self-contained groups and responsible for whole work units

Kaizen: Japanese term meaning continuous improvement

Quality Product: a good or service that meets the customers expectations and is therefore 'fit for purpose'

Quality Standards: the expectations of customers expressed in terms of the minimum acceptable production or service standards

Quality Controls: this is based on inspection of the product or a sample of produc

Lean production is closely linked to:

quality circles

empowerment

efficient capacity

just in time

The overall objective of this production is method is to produce quality outputs with fewer resources - therefore less waste and less duplication.

Lean production means cutting out anything in the production process that adds complexity, cost and time, and does not add value to the customer.

The seven main sources of waste in industry have been identified as:

excessive transportation of components and products

excessive stock holding

too much movement by workers to get supplies of components etc.

waiting - delays in the production process

overproduction - producing ahead of demand

over-processing - making goods that are too complex as they could have been designed more simply

defects - products tat do not come up to quality standards

Simultaneous engineering is a method of developing new products by ensuring that essential design, market research, costing and engineering tasks are done at the same time as each other (simultaneous).

Advantages:

new products can be in the marketplace month or years earlier than would be the case with sequential methods

Cell production is a from of flow production, but instead of each individual worker performing a single task, the production line is split into several self-contained mini production units - known as cells.

Each cell has a team leader and below that a single level of hierarchy made up of multi-skilled workers

The performance of each cell is measured against pre-set targets including output levels, quality and time

Cells are responsible for the quality of each of their own complete units of work (linked with total quality management)

The cell production system has lead to:

significant improvements in worker commitment and motivation because there is teamwork and a sense of ownership of the complete unit of work

job rotation within the cell

increased productivity

Success cell production depends on well trained and multi-skilled workforce prepared and able to be flexible and accept a more responsible style of working

Flexible specialism is when instead of making the same unchanged product for several years, lean production recognises that both technological advances and changing consumer tastes can lead to vert short production run

Changing from one design from product to another requires flexible working in three main areas:

flexible employment contracts that allow non-core workers to be called in or not employed as demand conditions change

flexible and adaptable machinery - often computer-controlled - that can be quickly switched from one design to another

flexible and multi-skilled workers able to perform different jobs on different product ranges

The great benefits of this flexible approach will be seen in quicker responses to consumer demand changes, wider ranges of products offered to customers, reduced stock holdings as goods can be made to order, and higher productivity

This approach to production is sometimes referred to as time-based management because it aims to cut out all wasted time during the development and production process

Just-In-Time stock control principal

Kaizen - Continuous improvement

The philosophy suggests that in many cases workers actually know more than managers about how a job should be done or how productivity might be improved

Someone who works at the task all day is actually more likely to know how to change it to improve either quality or productivity than a manager with perhaps no hands-on experience of production at all

Improvements in productivity of not just result from massive one-off investments in new technology, but a series of small improvements can overtime amount into a major new investment

Many workers now use the kaizen approach but it needs to adopted throughout the organisation

Kaizen process has a knock-on effect and improvements in one part of the production process requires improvements further down the production line

Conditions necessary for Kaizen to operate in:

management culture for kaizen must be directed towards involving staff and giving their views and ideas importance

team working - suggesting and discussing new ideas to improve quality or productivity s best done in groups. The groups are likely to be drawn from the work team operating in the place of work. Regular meetings need to be held (therefore time and necessary training needs to be provided by management) to discuss problems that they have identified

empowerment by giving each kaizen group the power to make decisions regarding workplace improvements, which will allow for a speedier introduction of new ideas and motivate staff to come up with even more ideas (link this to Herzberg's concept of enrichment)

all staff should be involved

Kaizen Evaluation

Limitations:

some changes cannot be introduced gradually and may beed a radical and expensive solution

there may be very real resistance from senior managers to such a programme due ti their existing culture - authoritarian managers would find this impossible to accept

at least in the short term there may be tangible costs to the business of such a scheme, such s staff training to organise meetings and lost output as a result of meeting time

the most important advances tend obtuse made early on during the kaizen programme - later changes can be less significant and this has led some observers to believe that there could be diminishing returns from such an approach

Main advantages of lean production:

waste of time and resources is substantially reduced or eliminated

unit costs are reduced, leading to higher profits

working area is less crowded and easier to operate in

there is less risk of damage to stocks and equipment

new products launched more quickly

Are lean procession and JIT appropriate in all business situations?

Lean production concepts cannot be introduced into a business overnight. The following conditions are necessary for successfully adapting a business towards lean production

A. Finance

Purchasing new and advanced capital equipment is expensive

without machinery that can quickly be adapted to different products, lean production is impossible

small products runs and fast switch-over times are essential to make waste and stock reductions a real possibility

by specialising in niche-market products, which are less price sensitive, firms may still be able to maintain competitiveness without changing to lean production

retaining staff with multi-skilles are needed to produce a range of different products which will be expensive

B. Management of Change

if lean production is being introduced into a traditional business, then existing workforce and management teams will need to be prepared to accept the necessary changes in working conditions and levels of empowerment

the new culture will need to accept much more workers involvement

staff need to realise the crucial importance of their reliability and dedication - as few stocks are held and no buffer stock exists, the commitment of the workers to the success of lean production depends just as much upon flexible and cooperative staff as it does upon machines

Lean production may not be suitable when:

businesses have real difficulty in forecasting demand and so are running on virtually no stock - this would be a major problem if demand rose unexpectedly

production processes are very expensive to start up after a break in production

firms may use it as a device for extensive redundancies. Lean production can result in job losses - this is one aspect of increasing efficiency. However if a firm does this to cut job numbers they are unlikely to get the support from the workforce they need

businesses depend on customer service as as their unique selling proposition - in this situation a less lean approach might give customers more choice of finished goods and more certain delivery dates

the cost of new technology are retraining might be so substantial that some businesses night have to survive on making existing systems more efficient rather than fully embracing lean production principals

Definitions

Notes