Best Practices For Implementing Lean Manufacturing Software Systems

Lean manufacturing enables companies to eliminate wasteful resources from the production process, thereby increasing efficiencies and cutting costs. The practice has become vital to manufacturers that are looking to optimize business processes, particularly in a slower economy and increasingly global market.

Clearly there are strong incentives to building leaner operations and getting products to customers more efficiently and at less cost. Research firm Aberdeen Group, in a recent research report, stated that decreasing operational costs and meeting customer mandates are more important than they’ve been for years.

A survey of 117 companies conducted by the firm showed that when organizations consider lean manufacturing, they are more likely than ever to be considering the handoffs between the manufacturing process and the supply chain.

A huge part of the lean manufacturing effort, including the various handoffs between processes, relies on business automation software. Lean manufacturing software systems come in many shapes and sizes, including electronic kanban systems, simple pick-to-light systems, value-stream mapping software, or adding lean-enabling functionality to traditional ERP applications, says Dan Miklovic, vice president of the Manufacturing Advisory Services at Gartner Inc.

How can companies most effectively implement business software applications used in lean manufacturing? Here are some tips and lean manufacturing best practices from industry experts:

1. First, make sure your organization actually needs to adopt lean manufacturing software. "If the existing lean initiative is a single plant with simple take time and kanban recalculation, then you don't need enterprise software," says Bob Parker, group vice president of IDC Manufacturing Insights. "If it is a corporate lean program being implemented at multiple plants, then lean software to support those efforts consistently can be very valuable." It’s vital to understand the requirements of the organization, Parker says. "Know where your lean complexity comes from. If you have highly variable demand and you need to refresh plans frequently, focus on the planning elements," he says. "If your challenge is coordinating suppliers or feeder plants, then focus on kanban synchronization. If you have challenges on both sides, a full platform plus services offering may be needed."

2. Ensure that the lean software accommodates a pull-based production model (where production is controlled by actual demand along with forecast factors such as causal effects which include purchase trends, weather and promotions), not just the typical Manufacturing Resource Planning (MRP) II push model, Miklovic says.

3. Assuming the manufacturing software accommodates pull-based production management, Miklovic says, decide which product lines need to operate in a demand-driven model versus those that have extremely long lead times and might need a mixed-mode model. Also, design the electronic kanban functionality to reduce work in process (WIP), and use large Andon-style displays to make current performance visible throughout the workplace.

4. Consider a layered application architecture in the event your corporate/centralized ERP system is not lean-friendly. "That is, consider a plant-level ERP or powerful MES [manufacturing execution system] that may be lean enabled, which runs the day-to-day operations and feeds the master ERP," Miklovic says.

5. Don't forget about the accountants. "Lean manufacturing runs counter to traditional cost accounting concepts like overhead allocation," Parker says. "Make sure your manufacturing software vendor can support lean accounting needs so that the right metrics are being tracked." Also recognize that lean manufacturing may benefit from integration to existing cost accounting or project accounting systems.

6. Don’t try to do too much too soon. "Lean needs to be taken in digestible bites and applied appropriately," Miklovic says. "Trying to do a full pull-based lean approach on products that have six-month raw material lead times is not likely to be practical if customers are expecting two-week delivery times. Likewise, just throwing lean at every process at once won't work in that for lean to work, in many cases physical plant layout changes may be needed. Often that may entail capital spending."

The main hurdle is the lean culture itself, "which focuses on simplifying and avoiding complex software," Parker says. "Companies have to be mature enough to realize that the business software will help to make improvements permanent and compliment, not constrain, the initiative."