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The LEAN e-NEWSLETTER: #002
May 5, 2006
PRESIDENT'S CORNER
Hello again. This month I have added a twist to the question of who should be implementing Lean Manufacturing practices. I was recently invited to be a keynote speaker at an Indian Institute of Materials Managers (IIMM) conference. I thought it was a great opportunity to spread the philosophy of Lean to another group of professionals who could use it.
While the article below talks about India, you can substitute Malaysia, Thailand, Russia, or China in the place of the word "India". All of these countries are experiencing the same problems as they try to keep up with the more advanced nations and compete in the global marketplace. Lean Manufacturing practices should be applied throughout the entire Value Stream from purchasing of raw materials, through movement of materials in the manufacturing and assembly processes, to packaging and shipping. Many companies around the world have seen some of the largest cost reduction occur after applying Lean to their Materials Management processes. Good luck as you continue on your "Lean Journey" and I'll be seeing many of you around the world.
Mike Wader
FEATURE ARTICLE
Why Indian Logisticians Need To Get Lean NOW!
By Mike Wader
Are manufacturing, service organizations and supply chains in India ready to compete in the global market place?
Today's competitive environment of tight budgets and fast frequent turnarounds have made the effective integration of suppliers, manufacturers, assemblers, warehouses and stores a competitive necessity.
Please take notice that manufacturing and assembling are in the middle of this chain. Lean manufacturing tools can help you analyze and improve every step in your supply chain and significantly reduce distribution costs and delivery times while increasing bottom-line profit.
... tight budgets and fast, frequent turnarounds have made the effective
integration of supplier, manufacturers, assemblers, warehouses, and
stores a competitive necessity.
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Over the last five years I have visited more than 40 companies spread over eastern and southern India. The repeated picture is that they started to implement Lean Manufacturing tools a few years ago and today have let it lapse into something less than ideal. In a September 2005 speech to MMA members, Mr. Arun Shourie, Member of Parliament & former Union Minister asked a haunting question, "What happened to USSR, East Germany, Czechoslovakia – they were said to be the 'new' civilization. Where are they now?" Many Indians companies are falling short of continuing good practices they started earlier.
According to an award winning presentation given at the 31st National Competition for Young Managers the team from Madura Garmets said, "The future belongs to those willing to ... constantly screen the best practices around the world and selecting the ones that pertain to their industry/function ..."
In April 2004, Mr. K. Mahesh, Chairman of the ACMA Center for Technology (ACT), during an interview about Lean Manufacturing, pointed out that Indian industries would not be able to survive unless they adopted global standards of efficiency and cost competitiveness (Lean) across the value chain.
Can the integration of Lean Manufacturing tools and Supply Chain Management tools work in India as the have in other developed countries around the world? The answer is a resounding YES! The Indian automotive, electronics, and pharmaceutical industries are currently using Lean Manufacturing techniques to be more globally competitive. They have used Value Stream Mapping to identify hidden wastes all the way from customer order entry to shipping and delivery of goods to the customer. After four years in India and visiting many factories, I feel India is in a position of great opportunity to apply simple tools supported by knowledgeable managers to strengthen its global competitive position not only in Asia, but throughout the world.
Companies like Larsen & Toubro, Royal Enfield, GlaxoSmithKline, Hyundai, and Valeo in India have shown that the best practices used in Japan and the USA to become world-class manufacturing centers can be used here in India. Dr. Raghava , Site Director of GlaxoSmithKline, in Mysore said, "India's position in the Asia Pacific region holds great opportunity for investments and growth and the time to take action is NOW." He went on to state that Lean is a way of work and a way of life that can help India be cost efficient in a price sensitive market.
Working with his senior managers and Lean Sigma experts, his staff has used Lean tools to quickly reduce the cost of operations and improve overall production. They had personnel at all levels involved in developing Visual Controls, using 5S techniques, and making process improvements. His team of Lean Experts reduced cycle time, increased the number of inventory turns and removed the hidden waste from his internal supply chain. His leadership support and positive attitude for the use of these Lean techniques, and their success, proves that it can work in India, as well as the U.S., Japan, and Europe.
These are common sense practices that identify and eliminate unneeded waste within processes. But often common sense is an uncommon commodity. These simple practices are meant to be used on the shop floor and in offices by common people to remove everyday problems from procurement of goods to material handling to shipping the product out the door.
Lean manufacturing tools like the 5S Workplace Organization system will remove unneeded and obsolete inventory, Total Productive Maintenance will reduce machine downtime, Quick Change-overs allows for manufacturers and assemblers to respond quickly to changing customer demands. Just-In-Time techniques, and the use of Kanbans are simple Lean tools to ensure a smooth transition of materials through manufacturing and assembly. They have been used by Toyota, General Electric, Raytheon, Delphi and other companies around the globe, including India, to identify and eliminate wasteful delays in the external and internal supply chain.
If you always do what you have always done, you will always get
what you always got!
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So why now? Why not now? There is an old saying that applies around the world, "If you always do what you have always done, you will always get what you always got!" Most Indian manufacturers are not satisfied with their current global, Asian or domestic, competitive position. If they stay on their present path they will get the same results they have always gotten. Lean Manufacturing tools can help logisticians improve their processes all the way from order entry to delivery to the customer. The Indian management consultant Arindam Chaudhuri was correct when he stated, "success is a matter of attitude." Take the attitude that we have good examples of Lean manufacturing tools clearing the way for a smooth transition in the total supply chain already being used here in India. Management needs to identify them and get help to implement them in a manner that will last for the long haul. Implementation of Lean manufacturing tools is a positive step forward that is working in India for some companies and it should be spread throughout India. India, Lean, and Now should be part of the new Indian attitude!
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