business The Skinny on “Lean” Manufacturing September 01, 2016 How lean are your manufacturing operations? Taking time to use the least possible amount of staff time, equipment and floor space can be of great benefit to your company. Capital constraints are seen as a major barrier to growth, according to KLR’s 2016 Manufacturing Industry Survey report. Roughly 40% of manufacturers expect direct costs to increase over the next 12 months — and 60% of respondents rated supply chain management as important or highly important. Lean manufacturing practices can help you free up working capital to spend on growth opportunities, such as marketing existing products and developing new ones. Here are some innovative ways to make your operations leaner. Balance Priorities Lean companies strive to become more efficient, using the least possible amount of staff time, equipment and floor space. Care should be taken not to operate so lean that your company can’t respond to changes in demand, however. You might run into a situation where you lose a key employee or supplier, for example. It’s important to balance priorities and continue to meet deadlines. Assess Work Flow Make a flowchart of the steps in your process from start to finish — then evaluate how work moves through your shop. Lean manufacturers organize workspaces to minimize bottlenecks, limit unnecessary movement and reduce steps employees must make to complete tasks. For example, suppose an employee spends 30 minutes of each eight-hour shift walking back and forth to an outside storage facility to obtain parts. This unnecessary transportation time reduces productivity by more than 6%. Moving storage space closer to the workspace would put more time into production. Eliminate Waste Are your dumpsters always full? Owners and managers should evaluate what’s being thrown out and brainstorm ways to use less — plus recycle or reuse the waste. Keep track of each worker’s output and provide additional training to workers with below-average ratings. Strong quality control measures can help catch defects before products are shipped to customers, which will help minimize returns and improve customer satisfaction. Remember to also think outside the garbage can: Waste includes underutilized labor and inventory. If some materials or supplies are covered in dust, don’t ignore it — consider moving them out to free up space for something better. Plan Ahead How much does your workforce ebb and flow? Some fluctuations in demand are expected, but dramatic changes can result in overtime pay, hasty workmanship and stressed-out workers. Try to forecast demand by collaborating with your customers. Some manufacturers even grant trusted suppliers access to their enterprise resource systems to monitor inventory levels and anticipate demand. Train salespeople to alert the plant manager about upcoming changes in demand. The plant may need time to ramp up production, making room in the pipeline for large orders — or time to downsize if a major customer looks likely to be going out of business. Never Stop There’s no end to successful lean initiatives — the concept was designed to be continuous improvement. Don’t expect instant results; it’s a journey, not a lightning strike. After a while, you may even find it challenging to locate new ways to streamline operations, but you’d be surprised by what a fresh perspective from an outside expert can offer. Contact KLR’s manufacturing specialists for a consultation on the latest and most effective lean initiatives.