It's fair to say that process improvement probably isn't the No. 1 topic keeping manufacturing executives awake at night. It may have been at one time, when manufacturers stopped fearing Toyota and other Japanese manufacturers 30 years ago and started to adopt their practices. In those days early adopters of the Toyota Production System (TPS) principles became threatening competitors because of their lower production costs. Those that were slow to change realized that they must in order to compete. And change they did.
Today, manufacturers face threats in a variety of forms, most of which they can't control: Chinese currency manipulation, rising raw material costs, vapid consumer confidence.
Nonetheless, now is not the time to forget about process improvement. In fact, now is the time to right the ship so that when the storm calms, you have a clear path and can forge on full speed ahead.
That said, let's review the basics of process improvement.
Process improvement should follow a continuous path that is carefully pursued while watching the customer. In manufacturing it is designed to overcome the Seven Wastes of Manufacturing, identified by Toyota's Chief Engineer Taiichi Ohno. Ohno's crucial insight on waste and its elimination led to the core of TPS, that has helped Toyota to become the most efficient automobile manufacturer in the world.
Ohno recognized that, in manufacturing, there is a need to overcome:
- Overproduction (before an item is required).
- Waiting (or in-process bottlenecks).
- Transportation (of products).
- Over-processing (products).
- Excessive inventory.
- Excessive movements (of products).
His solutions to these wastes included:
- The invention of just-in-time delivery and production systems.
- The linking of processes so that products would feed immediately from initial processes into subsequent processes.
- The elimination of excessive movement through the previously mentioned linking of processes.
- The establishment of a system of process improvements.
- The formation of quality circles that evolved into the concept of total quality management.
- The concept of just-in-time delivery and kanban systems with suppliers and customers.
- Additional process improvements.
Addressing these seven wastes in any manufacturing facility has to begin with a critical assessment of key processes, and improvements that can be made to each, while considering how the key processes can be effectively integrated with each other for the greatest efficiency.
But, for continuous improvement, that's just the start.
Subsequently, the continuous improvement process incorporates increased value in vital processes, and distributes that added value to all processes throughout the manufacturing facility.
However, such continuity in process improvement often is a challenge in the face of the proverbial alligator-filled swamp. Shortages of raw materials, manpower or transportation, rising costs of energy or parts, unplanned machinery downtime, competition from foreign competitors and rushed, new demands from customers who face their own swamps present crises that defy even the most dedicated lean manufacturers.
Keeping Ohno in mind, though, can provide comfort during times of such adversity.
He developed his simple and elegant assessment of manufacturing's basic problems and his solutions to them when Toyota was a fledgling company, constantly on the verge of bankruptcy and harassed by what were then the Big 3.
And, the argument that such practices are either easier to adopt or more necessary for a smaller operation, which Toyota was at that time, plainly doesn't hold water. Returns from lean manufacturing and continuous improvements multiply accordingly with the size of the facility.
Bruce Verny is a senior editor at IndustryWeek. He is based in Cleveland.