When is Organizational Change Required by Lean Manufacturing?

Lean manufacturing has actually become a popular and extensively embraced economic and business management approach. Business worldwide are beginning to rely on it amidst political and financial situations even in the most progressive all countries. Yes, the tough times have actually extended from the third world countries to the totally established or first world nations. It is since economies are now led and influenced by volatility including oil producers and companies. Since all markets are almost run and powered by energy, business seem to not escape the troubles hounding the energy sector.

For virtually more than a year now, firms all over the world have actually been experiencing crunches produced by the enhancing and rising costs of oil on the planet market. A great deal of companies have actually fallen and have actually weakened due to the rising oil prices. There are an increasing number of business now applying for bankruptcy protection not since their management messed up or some executives defrauded them, but because of the external environment posed by volatile oil prices. That is why, lean production is getting an increasing number of attention, and more and more business are deciding to lastly execute the concepts of the approach.

Lean production

What specifically is lean production? The popular Web website Wikipedia specifies lean manufacturing as a philosophy in management that focuses and looks carefully at the reduction and removal of the 7 wastes. The seven wastes are the usual jobs, equipment and practices discovered in the modern work area. The 7 wastes are determined as factors that hinder productivity or significantly weakens it.

The 7 wastes lean manufacturing attempts to junk are the following:

  1. Over manufacturing– specialists think that over manufacturing is an overall waste of energy, efforts and capital. That is since overproduction offsets over supply and piling up of stocks, which in turn will lower or bring down prices for the produced items.
  2. Over production also drains capital from companies, with the majority of the excess items either put into the wastebasket or reaching expiration dates.
  3. Over processing– Over processing is generally comparable to over production, only that over processing commands extra and unnecessary processes.
  4. Transport and activity– Lean producing objectives to decrease unnecessary costs for transport. Movement is the rate of action within the work areas. If the work stations are too compressed and little, employees will not be able to move freely, affecting their efficiency.
  5. Inventory and waiting– As mentioned earlier, lean production eliminates accumulated inventories. Waiting time in all aspects is eliminated because of the structured structure and because productivity is increased.
  6. Scrap and flaws– Mostly, lean manufacturing aims to combat the manufacturing of commodities and merchandise with scrap and flaws.
  7. Item and outputs with scraps and defects are undervalued in the market. Exactly what is worse is that the integrity and image of the business producing them are tainted, resulting in poor sales, poor income, then ultimately to loss, and further, to bankruptcy and company closure.

Organizational modification

Not due to the fact that lean manufacturing is a technique that at first and mainly targets the structure of companies is lean manufacturing constantly commanding and demanding for organizational change. Yes, lean production intends to rationalize, streamline and increase corporate operations. But its does not imply organizational modifications follow. The organization is essentially not modified or changed upon implementation of lean manufacturing principles. Lean producing never ever targets organizational change, but instead hits modifications in the organizations’ environment design and work practices.

Organizational changes, however, are suggested and carried out in addition to lean production just when the desired outcomes and outcome from lean manufacturing practices are not achieved. Failure of lean production is always discovered to be associated with the effectiveness and adherence to the genuine principles in the application of lean production principles and approaches. That is the only time when organizational change along with lean manufacturing is executed. The results and gains from the implementation will offset all the difficulties and costs incurred, so why be reluctant anyway?

While organization change is something that you may consider given your desire for increasing efficiency and eliminating waste, one consideration is whether you should have an outside opinion such as a gap analysis performed by a qualified consulting services company such as AQM who offers a completely free comprehensive on site analysis. I would consider this the risk free route regardless of my budget.

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