Though many authors relate the term ‘lean’ to a specific business process like manufacturing or logistics, lean is basically a philosophy which believes in identification and elimination of wastage and can be applied to any process or system. The ‘lean manufacturing’ is a Japanese principle of manufacturing proposed by Taiichi Ohno of Toyota Motor Company during 1990s. He is said to be the father of lean manufacturing. The ‘Lean Manufacturing System’ is also known as ‘Toyota Production System.’ Earlier it was introduced as a concept for manufacturing industry but with time it has been applied well into other businesses as well. The objective lies in reducing wastage and maximizing value for customers. The lean philosophy aims to reduce 7 types of waste: overproduction, wasting time, resources, transportation, processing, inventory and motion.
The Benefits of Lean Manufacturing
Lean manufacturing is a series of techniques that allow production of one unit at a time, at a formulated rate, while eliminating non-value adding wait time, queue time, and other kinds of delays. One of the significant features of lean manufacturing is that here the product is pulled as per the customers’ demand rather than pushing it on the basis of planning system. It is about producing the product using least amount of non-value adding activities that add time and cost to the manufacturing process thereby reducing the manufacturing lead time. Lean manufacturing provides the ability to change output rate every day according to the changes in customer demands. One of the main advantages of lean manufacturing is that it cannot be copied easily hence it helps companies to earn sustainable competitive advantage. Other advantages offered by lean system include shorter response time to customer demands, reduced inventory, reduction in working capital requirement, enhanced quality, improved productivity, better floor space utilization, reductions in scrap and rework, increased employee participation and empowering them to make quality decisions etc.
The Indian Scenario
The bad news is that in spite of all the above benefits, lean manufacturing in India is still in infancy stage and the Indian firms are far away from enjoying its complete benefits. The awareness level of Indian firms on lean manufacturing is very low. The concept is largely adopted only by the big firms. One such example is Tata Motors which has created a success story by launching Nano implementing lean manufacturing. Lean philosophy helped to reduce the cost without compromising on size and comfort. Recently many apparel firms have also opted for lean manufacturing owing to reduction in order-to-delivery time from European importers.
But Small and Medium Sized Firms (SMEs) in India are still mostly unaware of lean principle. The lean principles cannot be implemented exactly the same in every industry and therefore the Indian firms need to chose proper tools and techniques according to the work culture, infrastructure availability and working conditions of specific industry. Further, most Indian firms lack the human resources commitment on acceptance of a new philosophy. The implementation of lean philosophy demands a motivated and trained work-force and committed top management which is not available in most Indian SMEs even today. The competition is very tough and lean principles can prove very beneficial for the Indian manufacturing firms to compete globally. It will help them to improve upon product quality and reduce the costs along with speeding up the delivery.
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