How Lean Manufacturing Principles Guide Strategic and Sustainable Success

The pressure to do more with less has never been greater for today’s manufacturing companies, especially as labor shortages continue. Organizational leaders are constantly searching for ways to enhance efficiency, reduce waste, and deliver higher value to their customers.

Enter lean manufacturing — a methodology that revolutionizes the production process by eliminating non-value-added activities and optimizing resources.

How Lean Manufacturing Helps Prioritize High-Impact Activities

Lean manufacturing provides a strategic framework for enhancing operations. Manufacturers can streamline processes, reduce costs, and improve productivity by minimizing waste and optimizing value-added activities.

From lowering changeover times and removing bottlenecks to improving quality and efficiency, lean practices can transform how manufacturers operate.

Lean practices can also lead to significant cost savings. Unnecessary processes, materials, and labor are identified and removed, lowering operational expenses. An emphasis on continuous improvement and error reduction enhances quality, resulting in fewer defects.

Fictiv’s 2024 State of Manufacturing Report found that slow feedback loops that extend production time and fiction created by poor cross-functional visibility into projects are top barriers for innovation within the industry.

Ultimately, lean manufacturing not only boosts the bottom line but also creates a more agile organization. Lean organizations are better equipped to compete in today’s dynamic marketplace and meet customer demands.

graphic outlining lean practices

Key Lean Manufacturing Principles

Value

The first step is to define what “value” means to your customer. All activities and processes that contribute to delivering value are considered essential, while everything else is considered waste.

Value Stream

Once you’ve identified your value, the next step is to map the value stream — i.e., the flow of materials, information, and processes required to deliver the product or service to the customer. This will help you distinguish between value-added and non-value-added activities.

Flow

After non-value-added activities have been removed, you’ll want to confirm the production process can still flow smoothly without interruptions. This may involve reorganizing to prevent delays, bottlenecks, or other forms of waste that disrupt the flow.

Pull

The pull principle is about producing only what is needed based on customer demands. Instead of pushing products through the manufacturing process and hoping they will sell, the pull system encourages production driven by actual orders.

Perfection

The final principle signifies the relentless pursuit of perfection. Leadership should foster a culture of improvement where employees are continuously encouraged to look for ways to minimize inefficiencies.

Case Study: A Real-World Example

The Challenge:

A global air cargo company was grappling with unstandardized processes across its multiple facilities, leading to inconsistent performance and extended cycle times.

The Solution:

The company sought to implement a lean transformation to standardize processes and improve operational efficiency. The cornerstone of this initiative was the 5S methodology:

Sort: Removed unnecessary items and clutter from workstations.
Set in Order: Organized essential tools and materials for easy access.
Shine: Cleaned and maintained workstations and equipment.
Standardize: Developed standardized procedures and layouts for consistency across facilities — i.e., shadow boards.
Sustain: Established best practices to encourage lasting success.

The Results:

Over the course of a 13-week engagement, the company achieved:

Labor Savings: Each facility reported over $1 million in labor savings due to more efficient processes and reduced time spent searching for tools and materials.
Capacity Gains: The implementation of lean practices increased revenue per square foot, demonstrating improved productivity and space utilization.
Operational Consistency: With standardized processes in place, the company is now able to focus more energy on larger, higher-impact initiatives.

Challenges and Considerations for Adoption

Successful implementation of lean principles requires organization-wide commitment and a clear understanding of the cultural and operational shifts that lean demands.

Cultural Resistance and Change Management

There's often a negative stigma attached to lean, with some viewing it as a method for cutting jobs rather than improving efficiency.

This resistance is typically rooted in a lack of understanding or fear of the unknown. Employees may not see the immediate need for change, especially if the current processes have been functioning "well enough."

Overcoming this mindset requires effective change management strategies, including clear communication of the benefits of lean and involving employees in the transformation process. Organizations must maintain a long-term commitment to lean principles, fostering a culture of continuous improvement where employees are encouraged to identify new opportunities for eliminating waste and enhancing efficiency.

Leadership Support

The success of lean manufacturing depends on alignment between top-down leadership and bottom-up cultural acceptance. Leaders must not only endorse the initiative but also actively participate in the transformation, demonstrating their commitment to the process and providing the necessary resources.

Lean is Not a 'One-Size-Fits-All' Solution

Lean principles must be tailored to the specific needs and circumstances of each company. For example, a large-scale manufacturer with complex supply chains will require a different approach than a small assembly operation.

The decision to adopt lean manufacturing should be based on a thorough analysis of current operations, areas of improvement, and an assessment of the resources required for a successful transformation.

In some cases, the effort required to implement lean may outweigh the potential benefits, particularly if the organization’s processes are already optimized or if the industry’s nature limits the applicability of lean principles.

Next Steps for Strategic Manufacturers

Lean manufacturing reduces waste, improves efficiency, and enhances overall quality. However, its success depends on understanding whether lean principles align with your specific business needs and preparing for the cultural and operational changes required.

Eide Bailly’s team of experienced advisors will assess whether lean is right for your organization and guide you through every step of the implementation process. Whether you’re looking to streamline your operations or enhance your competitive edge, we’re here to help.