More Stories from the Lean Workplace

Companies continue to find clever ways to reduce waste and make things easier for all their employees. This month, I want to share ways companies have applied lean concepts to improve their processes. Perhaps you have similar situations and can benefit from these strategies.

• Centralized versus decentralized storage. There are pros and cons to either storing supplies in a central area or maintaining multiple storage locations. Arguments for centralized storage include improved control over supplies and simpler replenishment procedures. Decentralized storage reduces the amount of travel required to get supplies and can provide a better picture of what is available.

One company was using a system that was both centralized and decentralized. Supplies would come into a central “supplies cage” and periodically be transferred to two satellite storage locations in the plant. This system required multiple handling steps, as supplies would be pulled from the central cage, placed on pallets or heavy-duty carts, moved to the satellite locations, removed from the pallets or carts, and loaded onto storage racks. At any time, quantities in the satellite locations could range from nothing to a six-week supply.

Recognizing the problem, the company reviewed its supplies ordering history and purchased a small cart for each satellite location for the purpose of holding a one-day supply of each item. Now, carts are loaded in the supplies cage at the end of each day (in quantities clearly noted on the cart) and moved to the satellite locations. Supplies are consumed as needed the following day. As a result of this change, the storage racks were removed from each satellite location, freeing valuable 
space, and the average supplies inventory was reduced, saving unnecessary expense. In addition, the inventory now is being managed more effectively with better-timed deliveries to the central supplies cage.

• Organizing incoming work. Through effective organization techniques, we can manage the work we have within our work centers. Unfortunately, it’s not always as easy to organize the work coming into our work centers. One company tackled this issue by using color-coded containers. When incoming work arrived, it was immediately placed in a container with a color that corresponded to the next process required for the job. In some cases, those handling the upstream process were able to place the work in the appropriate containers themselves. The result was that the incoming work was easier to manage, as less time was spent reading (and re-reading) work orders and handling the work itself. Color coding provided clear visibility as to where the work had to go next.

• The operator/machine ratio. The question of how many machines an operator can effectively manage has been asked, most likely since the introduction of the first automatic machine. Today’s CNC operations are faced with the same question. One company thought it was saving money by assigning one operator to manage four CNC machines. Unfortunately, a subsequent study of machine uptime revealed the four machines were only producing parts 30 percent of the time. Throughput actually suffered in this less-than-ideal operator/machine arrangement.

Another company deliberated whether to have one operator run two CNC lathes, or one CNC lathe and a manual machine for the secondary operations that the CNC lathe could not handle. After evaluating each approach, it decided to have the operator run one lathe and perform the secondary work during the lathe’s machining cycle. This approach reduced throughput time, yielded a higher percentage of machine “uptime” (as the cycle time for the secondary operation was always less than the CNC lathe’s cycle time) and produced better-quality parts. The operator was able to catch out-of-spec conditions sooner, during the secondary operation, and make adjustments to the CNC lathe when needed. This company saw first-hand how throughput time had to take precedence over perceived gains in machine efficiency.

• Eliminating the unnecessary queue. Often companies hinder their operations by creating unnecessary delays. One company received customer orders via email, fax and regular mail. The faxed and mailed orders were placed in separate queues, while emailed orders were directed to an electronic mailbox. Throughout each day, employees would grab a portion of each stack of faxed and mailed orders and pull emailed orders from the electronic inbox so they could be entered into the enterprise resource planning (ERP) system. Unfortunately, this process did not prioritize orders based on when they were received but on when they were reviewed. This meant that orders were often entered on a last in, first out (LIFO) basis. Recognizing the problem, the company tied its fax machines into its email server so that 95 percent of the customer orders were stored electronically and could be sorted by date received. The remaining 5 percent of orders received by regular mail were addressed each day on a first in, first out (FIFO) basis. The order backlog and handling of paper was reduced significantly, and on-time order fulfillment increased.