3 Lean Manufacturing Techniques to Contain Costs

August 20, 2020 | Article

With the ever-present insecurity and volatility in manufacturing, adopting some common lean manufacturing practices can help your organization contain costs and run more efficiently. If you’re weighing new strategies, know that some will be effective, while others could hurt your business in the long-term. The key is to identify strategies that will work for your operations – not your competitors.

Don’t sacrifice next year for this quarter. The lean manufacturing methods you implement now should serve to bolster your business today and into the future. Consider how the following strategies could help you contain costs and run lean, yet strong, especially in periods of substantial growth.

Learn how Tige Boats contained costs and optimized their accounting practices during a time of tremendous growth.

Strategy 1: Strategically Implement Technology and Automation

Strategically implementing technology and automation in key areas of your business is great for short- and long-term success. The operative word here is “strategically.” For every new technology, there must be purpose, management and training to ensure results and warrant the investment.

Of course, technology has an upfront cost, but it’s an essential investment in your organization’s survival. Inefficient and limited legacy technology drains profits and growth potential for manufacturers daily.

With newer technology, you’ll run more efficient processes and can better allocate your staff to optimize their productivity, skills and abilities. You can even use this technology to overcome the common industry challenge of finding qualified staff. In essence, if you find yourself running a lean workforce out of necessity rather than preference, technology can help in both physical and digital processes.

  • Use robots and “cobots” (collaborative robots that work with your employees) on your production line to fulfill tasks or work alongside employees.
  • Use automated machines for redundant tasks, like turning and packaging. This adjustment also reduces the potential for common workplace injuries.
  • Automate runs for large batches of parts where possible.
  • Automate simple activities, like managing lights. This simple change has the added benefit of saving on energy costs.
  • Use sensors, industrial vending machine options and inventory management software for product storage and delivery to track, manage and view inventory, reducing manual entry and error. This also provides real-time visibility to your inventory.
  • Automate manual data processes such as input, manipulation and calculation with software that intelligently recognizes, processes and populates relevant information.
  • Automate processes from website order to work order creation, scheduling and picking.
  • Use operational analytics to examine and optimize your operations.
  • Integrate software and applications to reduce manual processes.
  • Use cloud-based software to automate workflow operations, which reduces manual administrative work, while increasing accuracy and speed.
  • Use cloud services and real-time data to make decisions faster with a more immediate view of your entire organization.

Strategy 2: Reduce Lead Time

The benefits of reducing lead time go beyond accelerating production. Reducing lead time can also greatly reduce waste in your production process and help you retain customers, both of which are vital components of staying competitive. To reduce lead time, focus on optimizing the actual touch time on a part.

If you map a part’s journey from order to shipment, it’s likely that there’s more downtime than touch time. Oftentimes, a lot of the journey is spent waiting between operations or phases. Although this may not seem like a big deal, it very well can be.

  • Downtime involves a lot of wasted movement. Parts get picked up, moved and potentially damaged.
  • Errors tend to occur after a part has been waiting and moves to the next operation.
  • With long production windows, a customer may change or cancel mid-production, wasting parts and labor.
  • You may lose business if customers get faster production estimates from your competitors.

To minimize wait time between operations, perform an assessment of your operation:

  • Analyze the timing of the queue for parts. How can you optimize that timing, minimize it and ensure readiness at each phase of the operation?
  • Identify common points of error or delay, then strategize to eliminate them.

You could also consider the following tactics:

One-piece workflow: In a batch workflow, if a customer orders 50 parts, the first operation will make all 50 parts from start to finish before they move on to the next operation. In a one-piece workflow, you move each piece to the next operation as soon as it’s finished. Therefore, if an error is found downstream or a customer cancel, you won’t have to scrap all 50 parts. This eliminates downtime for both the parts and the operators. It also reduces waste because you remove the window of opportunity for parts to get damaged.

Cellular manufacturing: With this strategy, you cross-train employees to perform multiple operations and take a product from start to finish. For instance, instead of having three operators perform three separate tasks, one individual would perform all three tasks within an area that contains the necessary stations or machines. This eliminates waiting time, and it also reduces waste because there’s no wait window, so the operator will immediately see if a part is out of spec.

Manufacturing automation: As mentioned, technology and automation can greatly aid a lean strategy, and they’re a great solution if you’re trying to reduce lead time. Automated machines and robots can perform single functions or multiple functions faster – and with fewer errors. You can also take employees off redundant tasks to optimize their time.

Strategy 3: Implement 5S lean methodology

5S lean methodology is popular in manufacturing. The five stages are:

  • Sort,
  • Set in order,
  • Shine,
  • Standardize

The goal of 5S lean methodology is to maintain clean and organized workstations according to a set standard. With this practice in place, anyone can walk into a workstation and know where things are, quickly identify missing items and have all needed tools within reach.

When the area is clean and standardized, any staff member can begin work immediately, or locate the item they need. Unnecessary tools aren’t cluttering the area, and less time is spent searching, organizing and readying the station for operations.

This approach is helpful at any time, especially if you’re facing the challenges from a disruption. Efficiency is critical for manufacturers, and the 5S system optimizes employee time and productivity. Whether you’re running a smaller staff with shorter hours, or you’re creating workstation standards for full-capacity operations, this technique will improve efficiency, save time and effectively contain unnecessary costs.

Lean Manufacturing for Today and in the Future

Of course, this is not an exhaustive list of lean strategies. However, these three methodologies will make a difference in your business today, tomorrow and for years to come.

Improving efficiency and optimizing the resources you have always serves to strengthen core operations, and these measures will help you remain competitive and relevant while serving the short-term need of containing costs.

As a manufacturing organization, cost is always top of mind. The right ERP system can help you leverage your data to analyze costs and make better business decisions.

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