Joe Pentlicki Vice President/COO, Oliver Manufacturing

The simplest definition of lean manufacturing (lean) is to systematically focus on eliminating waste in every process within an organization whether in manufacturing, sales, marketing, engineering or administration. Each process has a series of steps. Some steps add value, some don’t. Lean’s focus is to improve or eliminate processes that do not add value to the customer or the business.

Oliver began looking at lean philosophies around 2008. We focused on product and informational flows to minimize waste and to make each process more effective. Following this analysis, we changed the layout of manufacturing flows. We consolidated some assembly operations; redefined and implemented a new accounting process; implemented pull production for inventoried items and first-in, first-out flow for make-to-order items.

As a result of these changes, we elevated on-time completion of new machines to 95-100 percent on a consistent basis. We also reduced lead times by 38 percent and inventory by 55 percent.

Team Support Essential for Success

To be successful, lean must be supported by all levels of senior leadership. Team members at all levels had to be educated on what lean entails. We had to be open to both change and failure. Some changes don’t work as expected. We had to leverage those failures to learn and re-evaluate the process to make continued improvement.

A lean environment must be open to talk about problems, focus on root causes and implement changes to eliminate those root causes.

One of the biggest hurdles we had to overcome was gaining an understanding of waste as it relates to individual jobs. A team member might have to go and retrieve parts from somewhere. Since they have always done that task, they viewed it as a natural part of their job. In reality, this is a transportation waste. Getting members to fully understand that just because something was always done that way does not mean it adds value from a customer’s perspective.

To be a value-added step, an activity has to change the fit, form or function of the work product. It has to be done right the first time and it has to be something for which the customer is willing to pay. Getting too attached to what we do impedes our understanding of waste in the spirit of its elimination and adding the most value for customers.