Can Lean Manufacturing Drive Operational Efficiency and Resilience?

Lean is a popular manufacturing methodology known to enhance operational efficiency. Although this approach is highly effective, it’s still susceptible to disruption. In a post-pandemic world, this could prove to be a problem.  


The good news is that resiliency and efficiency aren’t polar opposites. As the planet continues to face supply chain disruptions, lean manufacturing can potentially hold the key to optimum resilience.


What is Lean Manufacturing?

Lean production or lean manufacturing is a process that concentrates on simultaneously boosting productivity while reducing waste. In this case, waste is perceived as anything that doesn’t add value to the customer.


Waste in this context includes:

  • Defects
  • Delays
  • Inventory m
  • Overproduction
  • Over-processing
  • Unnecessary transportation


Lean is popular among leading companies like Intel, John Deere, Nike, and Toyota. In fact, the lean approach is based on the Toyota Production System. This approach was adopted extensively by companies using enterprise resource planning (ERP) systems.


Key advantages of lean manufacturing include:

  • Reduced operating costs
  • Reduced lead times
  • Improved product quality


However, with the onset of the Covid 19 pandemic, multiple factors caused supply chain disruptions. One of the key contributing factors was surprisingly lean manufacturing methodologies.


For example, the age-old practice of enterprises intentionally not holding on to inventory to cut costs didn’t work anymore. In this scenario, raw materials and components were shipped to arrive just in time to fulfill the demand for new products. However, supply chain disruptions brought manufacturing operations to a standstill.


So, can lean manufacturing still drive operational efficiency and resiliency?


The short answer is a resounding “yes!” Businesses can potentially make the most of both with the “right” technologies and strategies.


Leverage Best in Class Technologies to Ensure Operational Flexibility

According to McKinsey, the most resilient companies worked on improving efficiency and developed business models around operational and financial flexibility. However, the pandemic confirmed the fact that financial and operational flexibility wasn’t enough to reduce costs while increasing revenue.  


Building resilience for an unpredictable world demands digitization. During the Covid-19 pandemic, companies that digitized their operation early were able to continue to cut costs while boosting revenue—putting them far ahead of competitors still struggling to build resiliency.


With the benefit of oceans of data from disparate sources, companies leveraged predictive analytics to adapt their workflows to a rapidly changing environment.


How to Build a Resilient Manufacturing Operation?

Naturally, the first step to developing an efficient and resilient operation is digitization. Once complete, manufacturers can churn potentially excesses and waste to optimize every system and process. When all this comes together, they can ensure efficiency.


Digitization also helps avert potential disruptions by combing efficiency and resilience. For example, with the benefit of end-to-end operational visibility across the supply chain, enterprises can anticipate possible shifts in demand and identify and rectify potential issues before it derails the entire supply chain.


Enhanced real-time digital visibility also highlights what raw materials and components manufacturers need and when they will need them. They can perceive how the supply chain provides them and switch suppliers if required before a major disruption.


When all stakeholders have a clear view of the entire supply chain, they can quickly understand demand and sales metrics. They can also analyze different production variables, logistics, and more. This approach enables smart decision-making based on a single source of truth.


In the same vein, technology (especially the Internet of Things) and real-time monitoring solutions can avert the potential breakdown of machinery. Machine health monitoring also comes with the benefit of performance predictions for different conditions.


As such, technology is the missing link in the lean production process. When you support lean manufacturing methodologies with cutting-edge tools, manufacturers and different stakeholders can achieve exceptional operational efficiency and resilience levels across the supply chain.


At MMI, we have helped leading brands leverage our extensive network and sub-brands to overcome manufacturing and supply chain challenges. Our decades of experience will help you bring products to market on time both domestically and abroad.


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