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Cutting Costs with Operational Excellence Essay

Lean Manufacturing is the systematic elimination of waste, and the implementation of continuous flow concepts and customer pull. Lean is the best management system for satisfying customers on delivery, quality, and price. Many companies are turning to lean manufacturing in an effort to become more profitable. Implementing “Lean” can create superior financial and operational results. Lean manufacturing comes from the Toyota Production System. Practiced by Toyota for many years the ultimate goal of the system, is to reduce quality products by cost reduction activities and a cultural focus on employee involvement through empowerment. Lean manufacturing uses concepts pioneered by Toyota Motor Company’s former vice president Tactics Non.

This “new” manufacturing culture is based on working in every facet of the value stream, to include instilling the discipline to reduce cost, to generate capital, to make the money, to bring in more sales, and to remain competitive in a growing global market. Lean Manufacturing The Value Stream of a business is the sequence of steps that a company performs in order to satisfy a customer’s need. In every Value Stream, a 50-70% reduction in the number of steps in the process can be achieved. The first step a company must take to

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change their value stream is to determine its lean status by identifying efficiency gaps and areas for waste/cost reductions. Lean manufacturing is a fundamental enterprise transformation that must be approached as a total organizational and cultural transformation.

Value stream mapping is a good way to train staff to find waste, identify the root cause, and prepare a strategic plan for its elimination. The seven categories of non-value added waste are overproduction, inventory, remonstration, waiting, motion, over-processing, and correction. Overproduction is a source of waste for most firms and is referred to as the batch and queue mode of operation. This large-batch processing mode is an outdated paradigm. Another problem with large batches is that there is no connection between the pace of production and the pace of demand. Reduced lot sizes with quick set-up capability is the paradigm of the 21st century.

Producing various models in small lots improves responsiveness to customers and flexibility to respond to changes in demand. The mailer the lot means the smoother the process flow. The following five areas drive lean manufacturing/production: cost, quality, delivery, safety, and morale. Lean manufacturing views continuous, one-piece flow as the ideal and emphasizes optimizing and integrating systems of machines, materials, people, and facilities. Continuous flow follows the produce one-by-one as efficiently as possible ideology. Lean manufacturing elements Waste elimination, continuous one-piece workflow, and customer pull are the basic elements of lean manufacturing. Focusing these elements in the areas of cost.

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