The core aim of Lean is to eliminate non-value-adding activities (those which the customer would not want to pay for), to compress time and to create competitive advantage by optimizing the use of limited resources (people, space, capital).

Toyota’s success was remarkable – in the 1980s a Toyota took 17 hours to build and was ready to be shipped. A Mercedes spent that time in the rework area alone.

Toyota defined seven types of waste (Muda) to describe Non-Value-Added activities:

• Overproduction (making more than is needed, or making it earlier than needed).
• Defects (the effort involved in inspecting for and fixing defects).
• Excess Inventory (having more inventory than is minimally required).
• Unnecessary Transportation (moving products further than is minimally required).
• Waiting (products waiting on the next production step, or people waiting for work to do).
• Unnecessary Motion (people moving or walking more than minimally required).
• Excessive Processing (unnecessary process steps).

Key Lean principles include:

Jidoka (Right First Time quality) – the quest for zero defects, revealing & solving problems at the source. Methods used include:

• Stop the Line where the power is given to the employee to stop the line if a problem is found, enabling the root cause to be identified at source before the line is restarted. The expense involved is the driver to ensure urgency to fix the problem.
• Poka Yoke or mistake-proofing, e.g. designing equipment to make it impossible for a component to be inserted the wrong way round.
• One-Piece Flow – using a batch size of one between processes so a defect is detected at the next process immediately, resulting in one defect rather than perhaps hundreds of defects in a batch.
• Just In Time (JIT) – reducing the cost tied up in inventory and reducing throughput time by implementing One-Piece Flow (see above) and ‘pull’ production (making only what the customer wants). This stops overproduction, one of the most expensive forms of waste. Methods used to implement JIT include:
• Kanban – tightly-controlling small quantities of strategically-placed inventory. When a piece is removed, a signal (or Kanban) is sent to tell the production process to replenish what the customer has used. The Kanban signal could be electronic, a card or even just an empty space on a shelf.
• Single Minute Exchange of Dies (SMED) – changeover reduction. By reducing the time taken to changeover from one product to another, the quantity of stock required in the Kanban can be minimised. SMED was used at Toyota to great effect to reduce the time taken for a car panel press to be changed over (e.g. from pressing the floor panel to pressing a door panel) from 3 days to under 1 minute.
• Production Smoothing – installing flexibility to produce different mixes or greater diversity of products without compromising efficiency. It is not unusual for saloons, estates and hatchbacks to be following one another down the line, all of different paint colors, different interiors and additional options (e.g. heated seats, CD multichanger, parking sensors etc).

Today, these principles have been successfully transferred for use in non-manufacturing businesses worldwide, such as banks, call centres and even hospitals and military procurement.

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