According to Gygi and Williams (2012), Lean refers to creating value to customers using fewer resources. The main idea behind the concept of lean is maximising customer’s value and minimise wastes. Manufacturing refers to the process of production of goods. Therefore, lean manufacturing refers to the production of superior quality goods for the customers at significantly affordable prices. Some of the importance of the lean manufacturing to the business organization includes:
- Building quality in the production process
- Elimination of waste in the production process
- Developing a unique approach towards corporate management.
- Developing techniques which help in smooth operation of the business.
Goals of lean manufacturing
Reducing cost by elimination of wastes; in order to maximise profit within the organization, there is need to continuously reduce wastes within the organization. In order to reduce production costs, the organization should produce only the products determined by sales in a timely manner. One of the ways by which a business organization can reduce wastes through lean manufacturing is by observing employees and equipments among others. Elimination of waste in important in the organization because it can never improve value but instead increases the costs. Conner (2004).
Creating conditions to guarantee product quality; an organization that produces quality products is likely to attract more customer base. This enables the organization to compete favourably in the market. However, for product quality to be guaranteed there is need for certain conditions to be set. Lean manufacturing gives the operators the responsibility to check quality at every stage of production. Wang (2010). The operator ensures that the factors of production such as the equipments are in good condition. This ensures that defect products are not produced. Lean manufacturing ensures that measures are taken whenever defect in quality occur. It provides appropriate way through which such occurrence can be prevented so that it does not recur.
Quality first; according to Conner (2004), high quality products is necessary if the organization is to attract more customers. Customers are likely to run away or such for other avenues where products produced are of high quality. Irrespective of how cheap the product may be, the organization is likely to make losses if product quality is not taken care of. This implies that attaining high quality work must be given consideration in the work because failure to do it might lead to severe consequences. The operators should ensure that defect products do not reach downstream processes as that is likely to scare away the customers. Therefore, for organization to succeed, such organization should ensure that products produced are of high quality. Dennis (2007).
Inspection of work; has something to do with judging whether a particular good produced is good or bad. It also entails looking at some of the causes of defects in a particular good after which the real cause of defect is pinpointed out and the effective measure taken to prevent reoccurrence of such defect. Preventing the occurrence of defect helps the business organization to reduce cost of production hence increasing the efficiency of the organization. The lesser the cost of production, the higher the profit and reverse. Hobbs (2004).
Just in time production; just in time is a concept of lean manufacturing which emphasise the importance of building what is required at the right time and in the required quantity. It is important for the organization to look at what is currently in demand in the market before they embark on production. The organization should analyse the current market situation before deciding on what to produce. Producing what is required when it is required just give the organization an edge over its competitors. It enables the organization to minimise waste and so does the cost. Organization that minimises the waste is indirectly maximising on profits.
Respect for humanity; human resource is an important component of the organization. They contribute immensely towards the success of the organization. Without the people who work in the business organization, such organization is likely to fail. Respect within the organization is crucial if the organization is to succeed. This is because an organization where people feel not respected it becomes a problem to implement lean.
Researches shows that most people feel encouraged and even perform beyond the expectations of the organization if what their contributions are appreciated and recognised within the organization. Therefore, as the manager of the organization, you should ensure that you continuously appreciate the work of the contribution of your employees in the organization.
Continuous improvement; this is the most critical concept of lean manufacturing. There is need of continuous improvement if the organization is to succeed in its operation. Customers love the organization which constantly improves its products and services to meet the requirements of the present generation. Without continuous improvements, the organization is likely to fail since it will lose a lot of customers. Improvement promotes constant change which is necessary for the achievement of the desired state. Feld (2001).
Efficiency within the organization; efficiency is a critical factor in the organization. Improvement in efficiency within the organization lowers the cost o production. Efficiency ensures that important products in the organization are manufactured with minimum resources in the best time possible.
How the concepts of lean manufacturing can help improve the organization
It reaches a time when the business organizations are not able to manage stiff competition from their opponents. At this juncture, some may opt to reduce their prices in order to attract more customers. However, lowering prices is not the best way to counter competition because it is likely to reduce the profit significantly.
The best thing for the organizations to do at this stage is to implement lean manufacturing. Therefore, since the Arrod organization is experiencing stiff competition, it should implement lean manufacturing strategies. Some of the advantages that lean manufacturing shall bring into the business organization includes the following:
The concept of lean manufacturing stresses on how businesses organizations can achieve cost reduction. This concept will enable the organization to understand the measures that ought to be taken into consideration so as to completely eliminate waste. Reduction of waste is crucial for the organization like Arod. This is because elimination of waste helps the organization to reduce the production profit therefore increasing the profit margin. Vallespir and Alix (2010).
Secondly, it is important to consider the quality of the product because success of the organization lies on its ability to produce quality products. High quality products attract a big customer base which in turn leads to increase in sales. As it stands, the Arod organization is facing stiff competition in the market. Perhaps, this could be as a result of the quality of the products being produced within the organization. Lean manufacturing emphasises on the importance of producing superior quality products within the organization. Therefore, the organization should ensure that defect products are eliminated from the production process then the source of defect identified and corrected in order to avoid recurrence. Feld (2001).
Thirdly, lean manufacturing help the organization to understand the importance of effectiveness in manufacturing. It teaches the managers the importance of producing what is enough because producing more means more effort will be wasted. Dennis (2007). For instance, organizations that produce more than the required amount will require a lot of space and sometimes even the products may be damaged because of lack of enough space. This means that some products will have to be sold at a price lower than their initial price hence creating huge loses.
According to Brue (2005), Six Sigma is a concept which aims at improving the existing methodology for production which is free from defects. The main aim of improving the existing production methodologies is to increase the value of the products to the customers. The six sigma concept enables the organization to survive stiff competition so as to remain strong in the market. It enables the organization to increase its share in the market. The Six Sigma is effective in reducing and eliminating defects. It also contributes immensely towards improving the quality and reducing costs of the products. Wilson (2009)
The core objective of the Six Sigma is to improve the performance of the processes within the organization. Six Sigma processes aims at reducing costs, increase the revenue and improving customer satisfaction. The following are some of the key concept of Six Sigma.
Critical to quality; the term refers to the identification of the elements of the production process which affect the quality of the output. If the factors that affect the quality of the process is not prevented in time, then the customer’s satisfaction is directly affected. For instance, a given business organization may offer superior price for the product. However, if the product or the good is out of service or if there is no clerks to complete the sale, customers are likely to move to the next store to buy the product irrespective of the price of the product in the other store. Therefore, Six Sigma is vital because it enables the organization to identify and improve the critical factors that are crucial to ensure product quality. Wilson (2009)
Defect; a defect product is a product that is not able to meet the customer’s specifications. Six Sigma plays a critical role in identifying and correcting the defects. This ensures that the process delivers a product that is up to the customer’s expectation.
Variation; this is another key concept of Six Sigma. The term variation refers to the change in a particular process which in turn affects the expected outcome. It is true that some variations are likely to be observed in the product. However, the key issue is whether the variation affects the final output of the product.
If variation leads to the creation of superior product that meets the customer’s requirements then such variation is important. On the other hand, if the variation leads to the production of low quality product, then the business organization should consider changing the process. This is because a low quality product is likely to drive away the customer hence reducing the profit margin. Goldsby and Martichenko (2005).
Process control; process control ensures that the improvements made in the process are sustained over a given period of time. It mainly focuses on the final product quality requirements. The main reason for process control is to ensure that anything that might lead to production of defect product is totally prevented. Process control seeks to find deviation from the optimum processes and ensures that quality is guaranteed. Wilson (2009)
Design for Six Sigma; it defines, design, analyse, measure and verify the final product before it is released to the final consumers. Its main reason is to develop new processes for production rather than improving the existing processes. It can also be used to re-design a product or service. Goldsby and Martichenko (2005)
Stable operations; this has something to do with consistency and predictable processes among other things. Stable operations ensure that customer’s satisfaction is taken care of hence improving customer loyalty.
Benefits of Six Sigma
The following are some of the key benefits of Six Sigma:
Better utilization of resources; Six Sigma help the organization to maximally make use of resources. Six Sigma training enables the employees to acquire knowledge and skills on how to effectively make use of the available resources. Six Sigma reduces the cost of operations in terms of materials used and time taken. Six Sigma training enables the workforce to meet the customer’s satisfaction. Wisner (2011).
Reducing costs; Six Sigma enables the organization to reduce cost through improving the performance of the organization. Eliminating defect products by improving operations reduces the cost associated with production.
In conclusion, it is prudent that the organization employs lean manufacturing and Six Sigma strategies in the organization if the organization is to overcome stiff competition. Lean manufacturing reduces cost by eliminating waste and increasing efficiency. This implies that the profit margin of such organization is likely to increase tremendously. On the other hand, Six Sigma strategy improves the process of operation by eliminating defect products. This ensures that goods produced are of high quality hence attracting more customers.
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