Lean production, lean manufacturing or just plain old ‘lean’, has become an essential piece of the inventory management puzzle. With the ultimate aim to reduce waste and increase efficiency, lean practices offer not only the reduction of costs but also the streamlining of inventory processes.
Due to the realities of the industry, long procurement and production lead-times for example, food manufacturing and production has long considered lean methods to be either inapplicable or unachievable.
Fortunately for food manufacturers, this thinking is slowly changing. Businesses are discovering that lean practices can be utilized in every facet of operations, which can facilitate great improvements in both cost-cutting and waste reduction.
Why reducing waste is so important
While the fundamental ideas of lean production methods have been around for at least a century, their use as a cohesive and replicable set of practices is more recent. Famously, both Ford and Toyota developed some of the fundamentals of lean production, including early versions of the just in time model. Ford and Toyota’s interest in how to reduce waste, not just in physical goods but across all inventory processes, is one of the factors that contributed to both their success and the beginnings of lean techniques.
What they discovered, and that others have since improved upon, is that the reduction of waste in all areas of production has wide-reaching, positive knock-on effects.
Let’s take a closer look at the main benefits lean production methods offer food manufacturers.
Streamlining and increased efficiency
One of the ultimate business buzzwords of modern times, streamlining, is – when correctly utilized as part of a clear and achievable plan – everything it’s hyped up to be. What it represents, apart from the obvious benefits like cost-cutting and better use of resources, is constant analysis and improvement. This is something thoroughly important to both lean techniques and business in general.
In a nutshell, streamlining is about finding the best and leanest possible practices for all processes. It can include everything from increased automation of ordering and stock handling to greater inventory visibility and access to information. All facets of a business’ inventory processes are effected by streamlining techniques, or the lack thereof, giving it a high priority among inventory and business managers.
It’s no surprise that streamlining and increased efficiency go hand in hand. In most cases, if lean production methods are being successfully utilized, increased efficiency will follow, causing a positive knock-on effect throughout the entire business. When inventory information and data are accurate and available, waste is reduced or eliminated, and stock handling is automated and accurate, then a business will find their operations better streamlined, more efficient and, usually, more profitable
Reduced costs through lean production
Keeping costs as low as possible is, of course, one of the main ongoing tasks of any inventory or business manager. For all businesses, reducing costs can spell the difference between a viable business or a failure. This is especially true for food manufacturers, due in part to the sometimes-difficult nature of food production.
While long procurement and lead times often make lean methods seem either impossible or counter-productive, lean practices are being utilized to great effect upon the other facets of a food manufacturers operations.
Businesses are now finding that significant cost-cutting is possible by using the ideas of lean production in regards to staffing, accounting, ordering and forecasting, to name a few. In many cases, it is the increased focus upon analysis and improvement that helps lead businesses closer to their goals of minimal waste and maximum productivity.
Constantly evolving production practices
As already mentioned, the analysis and improvement that lean practices require mean that a business’ production processes are constantly evolving. When managers meet to discuss a recurring problem, operating under the ethos of lean practices means not only addressing the problem itself but considering all other contributing factors.
Lean methods encourage us to look beyond singular problems or effects, towards real problem solving and a holistic view. There is an onus then on both employees and managers to be constantly assessing every part of the business’ operations. This in turn helps create an environment of awareness and big-picture problem solving.
Fostering business growth
A common concern among employees is that lean production methods will equate to lost jobs or less hours. It’s an understandable fear as greater efficiency can lead to better productivity with less labor. The common reality however, is that a business whose production efficiency is good, whose operations are streamlined and running lean, is more likely to expand their operations or diversify.
This can be seen all along the business horizon and in every niche and industry. Most successful businesses will look for every opportunity to grow and expand rather than stay on a plateau. Lean production methods are one key way to ensure that when opportunities arise, your business will be ready to accept the challenge.
Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.