I recently developed and delivered a training course on the things that are important to Manufacturing people. The course was directed towards sales people selling to Manufacturing and Supply Chain businesses in general and its intent was to unlock the mysteries of what buttons to press with these potential customers.
I was reminded once again how often misunderstood the concept of “Lean” and “Waste” are as they relate to Manufacturing. I believe one issue is that these words have a meaning in English which is not quite the meaning they have to Manufacturing people (and this is true for the term “Agile” in the IT world too).
Lean to Manufacturing does not mean just doing it cheap, it means;
Lean = Manufacture the product with minimum or no Waste
Of course Waste too has a special meaning in this context. While purists might have a more complex definition, I like to define Waste for Manufacturing as;
Waste = Adding anything the customer is not prepared to pay more for!
Put another way, if the customer is prepared to pay more for it, it is not waste. So Lean is not just about being cheap. A car company may be deemed to be a reasonable Lean Manufacturing company, even though it is adding heated leather seats to it luxury brands, because the customer is prepared to pay for them.
Defining and truly understanding what Waste is in your Manufacturing process is the key and sometimes controversial part of Lean.
For instance Rework is nearly always waste. On the face of it this is where the English definition of Waste and the Manufacturing definition come into conflict. If you don’t make something perfect first time, and you don’t rework it, you have to scrap it and now that we can all agree is waste! The point is that the customer is not going to pay anything extra for the unit that had to be reworked before it could be sold, even though the act of reworking has a cost, therefore by the definition above the rework is a Waste. Scrapping is also a Waste, and often a bigger one than rework so we take the lesser Waste and rework. However if we could avoid the rework and make it right first time always, we would be eliminating a Waste and moving towards a Leaner business.
There are 7 Wastes defined for Manufacturing, a definition of each is beyond the scope of this blog. However did I mention I know someone who developed a training course to explain all this a lot better…….