Lean production (overview)

Production & operations - Lean production (overview)

Lean production is an approach to management that focuses on cutting out waste, whilst ensuring quality.

Lean production aims to cut costs by making the business more efficient and responsive to market needs.

The lean approach to managing operations is really about:

Doing the simple things well
Doing things better
Involving employees in the continuous process of improvement
…and as a result, avoiding waste

The concept of lean production is an incredibly powerful one for any business that wants to become and/or remain competitive.

Why? Because waste = cost

Less waste therefore means lower costs, which is an essential part of any business being competitive.

The pioneering work of Toyota (a leader in lean production) identified different kinds of waste which can be applied to any business operation. These are:

Type of waste	Description
Over-production	Making more than is needed – leads to excess stocks
Waiting time	Equipment and people standing idle waiting for a production process to be completed or resources to arrive
Transport	Moving resources (people, materials) around unnecessarily
Stocks	Often held as an acceptable buffer, but should not be excessive
Motion	A worker who appears busy but is not actually adding any value
Defects	Output that does not reach the required quality standard – often a significant cost to an uncompetitive business

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