lean manufacturing

This article is all about the efficiency of warehouse operations and the way "Lean" can reduce warehouse labor. It says almost nothing about the effectiveness of warehouse operations. From this article's perspective, driving an empty forklift is a waste to be eliminated, but there is not a word about using other means than forklifts to move goods, in perhaps less than pallet quantities, such as carts or small trains. There is not a word either about locating frequently used items in the locations that are easiest to reach, or collocating items that are frequently used together...

At least in manufacturing operations, the number of people used in warehouse operations is a tiny fraction of the number used in production, and increasing their productivity is not the issue. A Lean implementation may instead increase their numbers to improve service and achieve much larger productivity gains in production. 

The pursuit of fully loaded forklifts and trucks may increase the efficiency of storage, retrieval, and transportation operations, but also delay e deliveries and hurt the performance of the business as a whole. This is not just my own observations. It has been described as a systematic phenomenon by researchers like Hau Lee.

While critics have often claimed that low inventories made Lean supply chains vulnerable to natural disasters, Toyota's record in actual events says otherwise, in cases including, in the US,  the Mississippi flood of 1993 and, in Japan, the Aisin Seiki fire of 1997 and now the Fukushima earhquake of 2011. 

As it turns out, the combination of vigilance in logistics and relationships that make it possible to enlist the supply chain in rapid recovery works better than inventory. In the case of the Fukushima earthquake, more inventory would simply have meant more losses. 

Since when is purchasing parts from half-way around the world a "Lean manufacturing practice"? Toyota and Honda do import parts into the US from Japan, but they have been working steadily to increase the domestic content of the cars they build in the US. 

In a Lean supply chain, you use as many local suppliers as possible and  only buy from afar if you can't help it. And local suppliers are subject to the same disasters as you, and inventory in the pipeline is just one more asset that can be destroyed in the earthquake or tsunami. 

In the late 1930s, the German aircraft industry organized its supply chain in a system called "ABC," which involved frequent deliveries from nearby suppliers and almost no inventory at the assembly site. It was in anticipation of a man-made disaster: enemy air raids. Allied bombs could not destroy components that had yet to be made. 

The article just reiterates the old belief that you can protect yourself against shortages by holding inventory. It may work for crude oil, but not for the 30,000 items needed to build a car. To protect against a Fukushima type event, you would have to keep weeks of safety stocks of all the items all the time, which is not a practical idea. 

Based on the article, it boils down to 5S.

While not a story about manufacturing, it is a cautionary tale that manufacturing professionals who use Excel should ponder.

It is about two economists from a prestigious institution whose sweeping conclusions have been leading foreign governments to adopt disastrous policies and fueled the argument in favor of the same policies in the US. 

Reviewing the Harvard paper, researchers Thomas Herndon, Michael Ash and Robert Pollin have discovered that Reinhart and Rogoff had selectively excluded data, calculated averages in "unusual ways," and made a mistake in an Excel calculation. 

On the face of it, the general sloppiness of the work would be forgivable in a summer intern, but the Excel error should give us pause. When inputting the range of a sum, they didn't drag the cursor down far enough and left five rows out.

With Excel, this kind of error is easy to make and difficult to detect. In spreadsheets generated by others, I have found products with no sales showing positive revenues, and formulas with exponents applied to the wrong parameters. And I suspect others may have found errors in my own. 

Following are a few recommendations that may protect you from egg on your face:

1. Use meaningful names for cells and ranges. Refer to cells as "GDP" or "Viscosity" rather than "A3" or "RR1." It will be easier to validate formulas, as they will more closely resemble their mathematical forms and errors will stand out. 

2. Break down complex formulas into simple ones, with additional cells or columns for intermediate results. 

3. Include comments explaining your calculations.

4. Whenever possible, use built-in functions or pre-existing templates from a trusted source. 

5. Explain the innards of your spreadsheet to a colleague for validation, and return the favor. 

6. Use Excel for calculations and graphic displays, but NOT as a database management system (DBMS). Use a real DBMS for data storage and retrieval. 

The example is about the hypothetical application of the concept of takt time to a doctor's office. Mark's post rebuts a statement that it would imply kicking out a patient at the end of the allotted time regardless of whether the patient's problem was solved.

This is actually what psychiatrists do when they tell patients "Your 50 minutes are up." But that is because these patients would otherwise linger on indefinitely. At the opposite end of the spectrum, a general practitioner I know who is an excellent diagnostician once explained that she knew what was wrong with 90% of her patients almost the second they walked into her office, and could confirm it within minutes but stayed longer with each patient just so that they would feel cared for and would trust her diagnosis.

In general, however, I don't see the concept of takt time as applicable in situations where the work content of transactions varies in a way that cannot be anticipated. An MD can't know how much time a patient will need. Likewise, a maintenance technician cannot know how a long a work order will require, even in preventive maintenance, because you can't know exactly what you will find when you open a machine. 

Incidentally, takt time is not "the rate of customer demand," first because it is a time and not a rate, and second, because it is not only a function of demand but also of work time available. It is the time that must elapse between two consecutive unit completions at every operation in order to meet demand within the net available work time. It takes 26 words rather than 5, but the definition really cannot be simplified further. 

It is an extremely useful concept to plan repetitive sequences of operations done by different people and machines during a shift. But I don't see much value in applying it, for example, to people who are on call 24x7 to respond to emergencies, particularly when they do it individually. An MD in an office treats a patient end-to-end; it is in not similar to an assembly line, even if patients sometimes feel that way. 

There are other approaches to managing such situations. For example, a takt-based approach to computer networks called "token ring" had its day 30 years ago. A token was passed around between computers in a loop at fixed intervals, and only the computer that had the token was allowed to speak while the others listened.

This takt-based approach was abandoned and superseded by Ethernet, in which computers essentially "grab the mike" whenever they have something to say, with a protocol to resolve confilcts when two or more speak at once. It was a better fit to the way computers communicated and is still the basis for your local office or home network today. 

Ford is closing its plants in Australia, which threatens the entire local automotive industry. The author looks to Canada for a model Australia could follow for this industry to survive and thrive. The article is mostly about Canada, and specificially about the Magna Dortec door latch plant Northeast of Toronto. 

If you have been wondering about the specifics of Lean in the Australian bottle cap industry, the article will disappoint you.

It is a generic discussion about management, strategy, training, and metrics, with arguable points that could be made about any business, from car making to slaughtering pigs and selling insurance. All you would need to do is change the title and the picture. 

Without setting foot in an bottle cap plant in Australia, however, it is not difficult to imagine some of the specific challenges the industry faces, like a market of only 23 million consumers spread over an area almost as large as the US.

Given that resin pellets and pigments are less bulky than caps, they are easier to truck around and you might wonder whether this leads the industry to set up many small plants near customers rather than a few large plants. 

You might also wonder whether they are delivered to customers as heaps in bins or in sleeves with a controlled orientiation for easy feeding into capping machines... 

These are just a few of the questions the article does NOT answer. So why clip it? To successfully implement Lean in a new industry, you need these answers and many others about its management and its technology.

Then you need to work with managers and engineers to not only copy approaches and tools from other indusries, but also adapt them and invent new ones as needed. The article's authors may have done this, but it is not what they are sharing. 

Would my top 10 list be exactly the same? Probably not, but there would be extensive overlap. 

In the current issue of Reliable Plant, Darren Dolcemascolo explains the concept and the value of one-piece flow in simple terms, including the prerequisites for it to work.