The condition of adding value to a manufacturing process is satisfied only when the activity either directly adds some exceptional worth to the final product or it directly influences customer satisfaction. The entire system of adding value to manufacturing process is aimed at serving three purposes, namely:
- Making customers feel that the product is worth the pay
- The product maintains a close proximity with what the customer wants
- Getting the right thing done in the first attempt
However, beyond fulfillment of these conditions and objectives, adding value to manufacturing has another purpose, which is, along with intermittent improvement identifying and eliminating the waste that may slow down manufacturing process. There are three crucial components that play key roles in structuring the system that adds value to a manufacturing process and they are Lean Manufacturing, Performance Improvement and Process Management.
- Lean manufacturing
Lean manufacturing is known by many other names, such as, lean enterprise, lean production, and on many occasions simply “Lean.” The modern manufacturing trends support lean management to a considerable extent as it takes into account usage of resources for several other goals but it doesn’t include creation of value to be wasteful for an end customer. In this way, this practice annihilates each and every factor that could have turned value addition process a waste. Value addition, in the context of product manufacturing is defined as any process, action or asset that is included in the product and it would function as a key factor when it comes to convincing customer in paying the for the product.
The core of lean management promotes the idea of value preservation with less effort. During the 1990s, learn started finding its way into the modern management ideas through the initiative of Toyota Production System (TPS). TPS, for the first time, shifted the attention towards cutting down on the seven wastes and in this way they attempted to improve the overall customer value. However, with the course of time, newer methods have evolved in improving customer value altogether or how it can be achieved most conveniently. However, experts believe that this very initiative of Toyota created a major difference in guaranteeing a steady growth for the company and helped them becoming one of the most renowned vehicle producers of all time.
Beyond the limited scope of management as an academic and corporate discipline, lean signifies development of the expertise that optimizes output. Several factors that function as the pillar of the theory are increasing efficiency, reducing wastage, evolving with empirical approaches to identify the goal better and finally cross check all the pre-existing ideas before replying on them blindfolded.
The seven wastes that Lean Management attempt to Control:
- Sorting out products that are not required in the manufacturing and not spending for transportation of the same
- Preparing an inventory for all items whether in the process or finished but not processed yet
- Employees and instruments if are done with their immediate job responsibilities or they have lesser pressure, should be reassigned to product processing
- Stay alert for the next production step
- Overproduction is welcome as the stock remains ready when there is not even enough demand but it may rise high at any time
- Avoiding over processing as, especially when it is done by low quality instruments or the final design is not appealing enough
- Reasonably balancing issues related to product defects, especially while running an inspection or deploying resources to fix defects
Apparently, reducing waste is simple and easy-to-handle subject. The term waste is quite commonplace and we seem to have adequate idea about how to identify waste. However, in a production environment the task is a challenging one as there are several factors in this environment that cannot be immediately decided whether regarded as waste or not. In order to narrow down on waste identification and make Lean management a success, Toyota segmented waste in three categories: muda, muri and mura. Once the items are categorized into the right category, the company needs to evaluate, measure and calculate size of the waste, determine the right course of action in handling the problems and start the journey towards achieving the goal.
- Performance improvement
Performance is the best way to quantify the extent of the results achieved or a straight measurement of what has been attained. Performance efficiency, on the other hand, is the proportion between effort put forward and results in hands. Performance improvement is an idea that continues measuring the output level of a system and attempts to affect the overall efficiency of all employees involved in the system.
Performance improvement, at a specific organizational context, is the parameter of finding the effort those employees and managers of an organization may put forward. It also shows the current level of performance that the overall organization is accomplishing and what kind of changes can be introduced at the behavioral and infrastructural level so that better output can be attained. It is important to remember that the main goals of organizational improvement are increasing organizational efficiency and impact of the body in the business sector. Organizational efficiency is something that combines fulfillment of goals and objectives cordially.
- Process management
Process management is a collection of activities related to planning and monitoring how a process is performing in an organizational setting. Business and manufacturing process usually fall within the scope of process management. However, in this context it must be mentioned that business process management (BPM) and business process re-engineering are not same but they are interrelated.
Process management requires application of everything that requires an organization to prosper, namely, knowledge, expertise, application of machinery and tools, making use of these tools strategically and overall improvement of the production process. The ultimate goal of accumulative application of these aspects is meeting satisfying the need of customers without sacrificing on the organizational profit. ISO 9001 promotes the process approach to managing an organization.
…promotes the adoption of a process approach when developing, implementing and improving the effectiveness of a quality management system, to enhance customer satisfaction by meeting customer requirements. (Source: clause 0.2 of ISO 9001:2008)
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