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Using Agile and Lean Manufacturing to Reduce Production Costs
Manufacturers today face all sorts of challenges. Besides the up and down economy last year, there’s increasing market volatility, which has led to higher material and labor costs, all while manufacturers are getting pressured to reduce prices. It’s been especially challenging for service-based manufacturers.
Across the board, there’s a need to improve performance and find more efficient ways to produce high-quality products and components. That’s why so many manufacturers are turning to Lean manufacturing principles to guide the path forward.
If you haven’t started on that path, you’re not alone. Despite the challenges, 45% of manufacturers haven’t set in motion any plans to reduce product development cycles and reduce production costs. But this also means that the majority of manufacturers have ongoing programs to optimize their production path. You need to get started to avoid losing any competitive advantage.
What Is Lean Manufacturing?
Lean manufacturing strategies can create significant efficiencies for manufacturers. They can dramatically streamline operations and future-proof your operations vs your competitors by eliminating waste.
Implementing Lean manufacturing practices can lead to improvements in:
- Reducing production costs
- Improving performance and productivity
- Reducing production time
- Having fewer machine breakdowns
- Having less waste, scrap, nonconformances, and rework
- Having lower inventory levels and higher stock turnover
The Benefits of Lean Manufacturing
When you can lower your cost of production while maintaining high quality, you can be more flexible in your pricing strategy, which may be a competitive advantage. You can also expect higher margins for your existing business.
Cutting expenses increases your cash on hand, and reducing your production time gives you the ability to expand your capacity to take on additional jobs or save money on labor.
Together, these efficiencies can make a material impact for manufacturers. It can strengthen operations and competitiveness, especially in emerging markets.
However, having the right technology framework is required for you to see continuous incremental improvements to achieve such lofty goals.
First, let’s go over the Lean manufacturing process.
The Lean Manufacturing Process
Lean manufacturing has its roots in Japan. In the 1930s, Toyota re-engineered its production system to improve efficiency. Over the years, its tactics and methodology have been refined to where they are today.
Improvements using Lean can be as simple as moving raw materials closer to the production floor and as complex as implementing robotic automation. Even small, incremental improvements in the manufacturing production pathway can lead to enhanced performance.
There are eight areas of waste that Lean manufacturing targets. A mnemonic device to help remember them is DOWNTIME:
- Non-utilized talent
The name is fitting because downtime, by its very definition, is wasted time that could be used more productively.
Organizations that have embraced Lean manufacturing have seen astonishing results. When the Intel Corporation overhauled its quality control process and waste reduction using Lean practices, its microchip production path moved from three months to ten days. QT Manufacturing in Dallas increased throughput by 30%.
You can find stories like these in almost every company that’s adopted Lean manufacturing practices.
Companies are applying Lean manufacturing to their entire process for the best results. If that seems daunting, you can start simply by identifying one area that needs improvement and focusing there. For example, by cutting down and creating a scrap material plan, you may be able to reduce scrap by as much as 25%.
While the Japanese word for waste is Muda, Kaizen refers to the process of continuous improvement.
- Kai = Change
- Zen = Good
Enacting Kaizen means adopting a mindset to always seek incremental improvement in everything you do. That means measuring what you do and breaking down every process into subroutines and incremental steps, then using a statistical process to improve quality in all aspects of your manufacturing business.
The Kaizen process breaks down into four steps:
Also known by the initialism PDCA, it can be applied against any process:
- Plan: Define your objective and how you will achieve it.
- Do: Implement your plan and make the changes required.
- Check: Evaluate the results based on a measurable scale, and identify opportunities for continued improvement.
- Act: Make further adjustments based on your findings.
Defining your objective may be obvious, but figuring out how you will achieve it can be difficult. One way to get started is Value Streaming Mapping (VSM).
With VSM, you create a visual flowchart that documents the entire production pathway, from materials and production to operations and shipping. You can also use this to map any process and break it down into its subcomponents.
Lean Manufacturing: A Different Way of Thinking
Lean manufacturing can be applied in a variety of ways. Here’s an example: One manufacturer was having a problem with an alarming number of workplace injuries. They first attacked the problem with increased training and checklists for operators. This led to improvement but didn’t totally eliminate the problem. Their next step was to put power guards on machines to prevent operators from having direct contact with moving parts. They also added safety mats that trigger the machines to stop whenever someone steps on them.
By continuously assessing the situation and taking incremental steps for improvement, they were able to dramatically improve workplace safety.
Lean Manufacturing Allows for More Rapid Response
2020 taught everyone how to be flexible and adapt to changes. During the pandemic, companies that could respond quickly due to a flexible and Lean strategy had a clear advantage.
Here’s just one success story. Pioneer is a manufacturer of farm equipment. When COVID-19 surged, they shifted production to the manufacturing of hospital cots. Within two weeks, they had a prototype and were able to produce fifty cots on the first day of production. Using Lean manufacturing practices against their process, they reduced task time to just thirty seconds, which meant they could produce two cots every minute. That’s impressive for a company that had never manufactured a single cot a month beforehand.
Lean manufacturing provides the ability to respond to a shifting environment more quickly.
For companies that institute Lean manufacturing practices, it becomes almost a mantra. Employees throughout organizations begin to regularly think about productivity and efficiency. Because the process encourages continual optimization, companies that create a Lean manufacturing culture see demonstrable and sustainable performance gains. It’s not just a one-time improvement.
Barriers to Implementing Lean Manufacturing
If Lean manufacturing provides such benefits, why doesn’t everybody adopt it?
The fear of change often prevents people from doing the things that they know can improve their situation. Even if they’re unhappy with the results they are getting now, they may not be willing to take the steps for improvement. Fear of change is powerful and must be accounted for when making the shift to Lean manufacturing.
It also takes real commitment on the part of team leaders and managers to make Lean manufacturing happen. It’s not something that you can do halfway and expect to see results.
Lean also doesn’t work when there’s poor communication, coordination between teams, and information silos. A lack of transparency and information flow can stop Lean manufacturing in its tracks.
Because of these reasons, a World Economic Forum study concluded that companies now face an urgent choice: go digital or go bust. So, how can Additive Manufacturers create the digital infrastructure they need to enable Lean manufacturing? Bluestreak | Bright AM.
How Bluestreak | Bright AM Enables Lean Manufacturing
Creating incremental improvements in processes, routines, and components, even the small ones, requires the technology for a centralized knowledge base and real-time data to streamline operations and improve productivity.
Bluestreak | Bright AM has a variety of tools that can help improve each process, including:
Also, Advanced Serialization and Advanced Tracking can create repeatable work order part builds, track real-time splitting and combining of parts in various operation steps, and identify and manage nonconformances. It also validates dynamic part quantities before moving on to subsequent steps.
Bluestreak | Bright AM is designed exclusively for the Additive Manufacturing (AM) industry to solve the crucial challenges that AM organizations face in pursuit of lower production costs. It creates a centralized knowledge base and eliminates disconnected information silos.
Bluestreak | Bright AM provides the transparency and tracking that you need for Lean manufacturing, using real-time data for every step of the production pathway. It creates total end-to-end control, from the quote to the finished product. Also, there’s complete visibility and traceability of individual parts and components at every stage of production.
What Additive Manufacturers Want (and Need) for Lean Manufacturing
When asked to rank their technology priorities, manufacturers have been clear about where they will be investing their dollars. They want tech that will help improve their productivity, enhance their data availability, and provide real-time availability of their essential business information. That’s exactly what Bluestreak | Bright AM does.
Contact Bluestreak | Bright AM today for more information. Let us show you how our technology can enable Lean manufacturing strategies, cut your production costs, and help you create a more efficient—and more profitable—manufacturing company.When your quality control process needs improvement, you’re wasting time and money. You are also putting future business at risk, and we know how small of an industry this can be. Dissatisfied customers tend to spread the word to their colleagues, which can hurt future sales. Recognize the warning signs and take action today by contacting Bluestreak | Bright AM.
If your service includes Additive Manufacturing, we provide specific solutions in our Bluestreak | Bright AM software. To request an Additive Manufacturing software demo, click here