The concept of Lean comes from the US, but it’s based on Toyota’s TPS – Toyota car Production System. Toyota invented TPS to catch up with the US market in 3 years by making their industry as efficient as it could be. They focused on the complete elimination of waste from the manufacturing process and achieved it through their 8 Muda. Muda simply means wasteful or unproductive, and Toyota found waste in these areas:
- Overproduction
- Defects
- Transportation
- Waiting
- Inventory
- Motion
- Overprocessing
- Unused creativity
Given that Toyota went on to become one of the world’s largest and most profitable car producers, it’s not surprising that other areas look at the benefits of Lean. Hospitals are also seeing how they can make resources more efficient.
Lean logistics. Make changes in 3 dimensions
According to Joakim there are 3 critical factors that need to work together for logistics to be really Lean and mean. They are operating systems, management structure and mindsets & behaviour.
1. Operating systems
The operating system refers to the way physical assets and resources are configured and optimized to create value and minimize losses.
To prevent waste creeping back into processes, the following has to be applied to operating systems:
- Relentless loss elimination
- End-to-end design
- Priority on people: health & safety
- Production planning & logistics
- Quality systems
- Maintenance systems
- Manpower systems
It’s all about producing and conveying what is needed, when it is needed and in the amount needed in the shortest possible lead-time.
2. Management structure
Management structure refers to the formal structures processes and systems through which the operating system is managed to deliver business objectives. Management has to be streamlined and effective, with clear objectives, and have the right processes for good training and communication. The key areas to continually improve on are:
- Performance Management Systems
- Organizational Structure
- Capability building processes
- Support function processes
- Infrastructure that supports continuous improvement
Joakim comments, “Wherever there is a process you should be able to answer 3 questions: Is there a standard way of doing this? Is there a visual system that lets me know if this standard is respected? And is there a standard reaction in case of a drift, if things don’t go according to plan?
If the answer is no to any of these 3 questions, then you’re probably heading for trouble from a management point of view.
3. Mindset and behaviour
Mindsets and behaviour refer to the way people think, feel and conduct themselves in the workplace, both individually and collectively. Teamwork, training and flexibility all have to be present and the following areas need to be addressed:
- Focus – compelling purpose & clear direction
- Execution – people work well together day-to-day to get things done
- Skills – People work effectively in their roles
- Improvement – relentless drive to do better
Changing mindsets needs a credible change story that is communicated in a believable way, and skills need to be developed in Lean behaviour, Lean competencies and leadership behaviour.
Choose your direction
Joakim emphasises the importance of structure when implementing Lean. "You need a simple, consistent framework for assessing work with structured guidelines to put a given process under control," he says, "standards can be improved when the situation is under control and stabilized, but there is no standard without control and no continuous improvement without standards."
Joakim’s checklist for successful implementation of Lean reads like this:
- Go, look, see. Leaders are role models and should be able to “go, look, see what is going on while admitting their own mistakes or flaws
- The shop floor is nr 1. Spend real time where things happen and keep in touch with reality to solve any issue as soon as it arises
- Set goals not means. Give employees the goals you want to achieve and leave the means up to them
- Trust and coach. Invest real time in coaching them to achieve the goal.
Just choose the way
Lean, then, is just about choosing direction. Choosing the right way may feel difficult, but if you know where you want to go in the long term, it doesn’t matter if you go left or right at the next crossroads. The important thing is to take a step forward – towards the goal.
One example, Carlsberg and Lean logistics
Source
Kristoffer Andersson
Warehouse Manager at Carlsberg Sverige
Carlsberg are running a pilot programme to develop ‘Lean Logistics’ methodology in their Sweden and UK warehouses. Using the Falkenberg warehouse for one of the trials, the challenges are to address a tightened budget, increase the Perfect Order rate (PO) and to increase employee engagement. The goal is to identify best practice then roll it out to other Carlsberg warehouses across Europe.
By looking at the three areas of operating systems, management structure and mindsets & behaviour, Carlsberg set about on an improvement plan with a timeline of 25 weeks. They took the following actions:
Operating systems
Carlsberg looked at the waste losses and use of resources beyond what was needed. They drew up a "Muda-like" checklist of 8 types of waste to identify inefficiencies:
- Overproduction
- Scrap and rework
- Waiting?
- Inventory
- Motion
- Transport
- Over-processing
- Unused talent
They then completed a “waste walk” describing in detail each waste, the observations they made and the possible actions to them
Management infrastructure
Carlsberg looked at ways of visualising the situation. Bringing out the facts and focusing on and prioritising problems. Questions like:
- What happened on the last shift?
- If we didn’t reach goals, why not?
- What’s important for the coming shift?
- Can we do anything ourselves to remove deviations and avoid problems?
Mindsets and behaviour
Using teamwork and group exercises, Carlsberg agreed on a set of norms that included keeping time, honesty, delivering and saying early if people can’t, informing everyone, and being constructive. The main concerns were to get everyone involved in reaching improvements.
Reaching KPIs
Results were impressive. Attendance rose, accidents and near accidents were drastically reduced, as was delivery precision, picking productivity and picking accuracy.
Next steps
The pilot project in Falkenberg, Sweden, has been successfully completed. Carlsberg is now implementing Performance Management Systems and the 5S methodology globally within logistics, as well as starting up continuous improvement teams.