Adopting Technology to Go Lean in 2015: The Right Choice For Small Manufacturers

To many small companies, the thought of lean manufacturing is a business principle traditionally reserved for the big companies — such as Boeing or General Motors. Yet with the rapid proliferation of technology and cloud computing, “going lean” has never been so easy for small shops.

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To many small companies, the thought of lean manufacturing is a business principle traditionally reserved for the big companies — such as Boeing or General Motors. And of the very few small manufacturers that are adopting lean practices, many are only doing so at a very tactical level. Yet with the rapid proliferation of technology and cloud computing, “going lean” has never been so easy for small shops.

If small businesses embrace lean manufacturing as part of their company’s overall strategy, long-term strategic benefits are possible, including increased profits, decreased costs and long-term efficiency gains, all of which are critical to running successful organizations.

When speaking with small business owners across the country, I regularly discuss the fact that lean manufacturing is a journey that any company can undertake. What I always stress, however, is that it must involve the entire organization and include true behavior change (even if it’s a simple three person shop) to be truly successful. In fact, judging from the fact that most businesses use lawyers and outside consultants, it is clear that even those outside of your company have an interest in your “going lean” journey, too.

At Exact, we talk a lot about lean strategy and how manufacturers need to understand that one size doesn’t necessarily fit all, and that a one-off approach may not always work. Many have heard of the concepts such as value stream mapping, one piece flow/continuous flow or 5S initiatives, but keep in mind that “tools” are not meant to exist in isolation. In fact, true success depends on having a comprehensive strategy in place that is uniquely suited to your business. Having the right types of technology in place can make all the difference.

While traditionalists may scoff at the notion of integrating technology into a lean strategy, for years many large organizations have already been relying on technology such as automated demand planning and forecasting systems, manufacturing execution systems and advanced planning and scheduling systems to drive lean processes. Despite this, the question remains — what else is available to small manufacturers operating on smaller budgets?

Below are three significant steps in the lean journey to guide even the smallest of manufacturers to apply relatively inexpensive technology to eliminate waste and improve productivity in the New Year.

Step 1: Preparing to launch a lean program is the most critical step a company can take to create true behavior change in their approach to manufacturing. Business owners and key leaders within the company must start by developing a detailed business plan that provides an outline and structure for their lean journey. A great place to start is by determining what your business is good at doing and what you want to improve. This is also a great time to evaluate your current use of technology to determine what additional means can be adopted to aid in developing a lean strategy. Typically, lean initiatives have a tendency to thrive and sputter in cycles. Working with outside consultants or vendors may be a good place to begin, as third-party experts can evaluate your current system and help you understand what types of options are available to you and at what price. Most important, however, is to keep the plan simple and commit to the practice relentlessly to ensure long-lasting results.

Step 2: Now is when businesses can get started with some of the basics. To keep improving your lean strategy, it is important to continuously look for ways to reduce waste, decrease cycle time, and eliminate cumbersome volumes of inventory to increase productivity. Many manufacturers deal with a large volume of components with highly variable demand and distribution channels. Traditional Kanban systems, which have been a staple of lean for quite some time, can be improved with technology in the form of “pick to light” systems. These systems consist of lights and LED displays for each pick location to optimize notifications and provide an automated approach to component replenishment. Additionally, cloud technology for word and document processing contribute to a “zero waste” environment by creating a paperless workplace. Decreasing paper on the shop floor leads to a safer environment and increases productivity.

Step 3: Extending the same principles implemented on the shop floor into the operations and financial branches of the company is a significant step in the lean journey. The use of electronic workflow documents hosted in the cloud instead of on email can have a significant impact on increasing productivity by saving time spent reading emails and opening attachments, allowing employees to access critical data wherever they may be (on the shop floor, at a customer site, etc.) and cutting down on redundant files. All the traditional tools of lean can be hosted in the cloud, including flow diagrams, value stream maps and part family organizational charts, but cloud provides a service for the small business owner to host inventory and order documents, as well as accounting information. All relevant business documents in one place saves time and is a more streamlined approach.

Properly implementing and executing a lean manufacturing plan happens over time and with careful attention to planning. It’s most important to be sure your expectations and plans are attainable, understandable and measureable. While technology can be a useful tool in implementing lean, it should not be relied on as a final solution. Remember, even though many large organizations use technology as a means for attaining lean processes, not the end in and of itself. Small businesses need to do the same — allow technology to support your lean program while staying committed to the basics.

Dave Lechleitner is a senior enterprise resource planning (ERP) professional at Exact Online.  

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