Top Incentives For Implementing LEAN Manufacturing

The Top Incentives For Implementing Lean Manufacturing

Lean manufacturing has many perceived benefits: greater efficiency, helpful to the environment, and so on. As a manufacturer, how do those benefits really affect you where it matters most? Here’s a look at some of the top reasons to switch to lean manufacturing, including lower costs, higher productivity and more.

Better bottom line. Lean manufacturing is most broadly defined as eliminating as much waste from a function as possible. Anything that doesn’t add to the value (defined as a quality a customer will pay for) of a product or service is considered waste. In other words, if something (a product characteristic, or process step) is not actively adding value, then it’s a cost, and it’s taking value away.

Lean seeks to maximize profit, your bottom line, by minimizing costs. When embracing the broader definition of cost that lean provides, you are better able to identify and eliminate profit-impeding waste areas.

Decreased inventory. Inventory is antithetical to lean principle. It requires management, packaging, storage, movement and countless other efforts to maintain. Customers do not pay you for excess inventory that you aren’t using (even in cases like emergency deliveries — you are being paid to hold only as much inventory as that delivery requires, and no more). Adopting a lean philosophy can help you attack the problems of excess inventory at their root to better manage stock.

Lower transportation costs. Lean proficiency goes further than just at the plant. Taking a holistic view of your shipments, deliveries and other transportation needs can help you determine where time and resources are being wasted or misused. A more effective transportation scheme means lower costs and higher throughput.

Increased worker productivity. Worker inactivity is just as much an impediment to lean manufacturing as overworking is. By finding the “sweet spot” — the right level of productivity that cuts down on product imperfections, worker turnover and even morale — lean organizations can reduce the costs associated with those situations.

Benefits to company culture. A major tenet of lean manufacturing is “continuous improvement.” Meaning that true lean perfection can never be achieved, and that there are always improvements to be made, and improvements upon those, and so on. Bringing this culture to your entire company, from management executives to line workers, can instill the notion that everyone can contribute to lean success. Making everyone a stakeholder instills a sense of ownership that can improve morale while encouraging adherence to lean.

Wider potential customer base. Industrial suppliers who enact lean manufacturing can open themselves to more potential buyers. Lean manufacturers are often more environmentally friendly, for instance, since there is less material waste, which may be a requirement for a project due to government regulations or supply chain rules. Potential customers may also be attracted to the benefits of lean that you can pass to them, both in pricing and process.

More repeat business. Depending on your industry, it can be difficult to retain repeat customers, because of marketplace fluctuations, long sales cycles, or other business realities. The benefits of lean manufacturing give you an advantage across the board: more reliable service, better quality, high efficiency, and an improved end to-end customer experience — thanks to the reduction and elimination of non-value-adding aspects of your operation. Setting yourself apart from other suppliers this way can make it easier for you to build a base of long-term, repeat customers.

Lean manufacturing requires a company-wide, top-to-bottom assessment of every area of your business. It may also require some tough decisions. For those reasons, you may encounter pushback or a proclivity to taking shortcuts on the way to embedding this philosophy in your company. As you’ve seen through these reasons, however, the long-term benefits are valuable and tangible.

About the author:
Christina Chatfield is Marketing Communications Manager of HARTING USA in Elgin, IL. HARTING Technology Group develops and manufactures industrial electronic components, including current sensors, Ethernet switches and more.