Lean in High-Mix Low-Volume (HMLV) Manufacturing -- Does it Work?

Lean thinking and methodology have resulted in many organizations instituting powerful initiatives and gaining major improvements, but most still associate Lean principles with low-mix high-volume (LMHV) manufacturers. There are, however, a gamut of high-mix low-volume (HMLV) manufacturers that wonder if the power of Lean is really applicable to them given their very different factors regarding volume, variety, and scheduling.

I recently spoke with Shahrukh Irani – who actually just published a book entitled Job Shop Lean:  An Industrial Engineering Approach to Implementing Lean in High-Mix Low-Volume Production Systems – and asked him the very specific question: “How is Lean applicable in High-Mix Low-Volume (HMLV) manufacturing?” Here is his detailed answer: 

Of all high-mix low-volume (HMLV) manufacturers, a job shop has the most complex production system.  The classification of different production systems that is shown in Figure 1 provides the simplest evidence that forcing a job shop to adopt a production system and tools that were designed to improve a repetitive assembly line’s performance is like fitting a square peg into a round hole. 

Figure 1: Comparison of an Assembly Plant and a Custom Fabrication Job Shop

Currently, nearly every job shop has failed to realize the full gains from Lean because they have stopped at implementing only the Lean tools listed in the left-hand column of Table 1.  In contrast, the Lean tools in the right-hand column of Table 1 are ineffective, often inapplicable, in any job shop.  So how does any Lean job shop reap additional benefits from Lean?  By implementing a new “Job Shop Lean Toolbox” in which the Lean tools in the right-hand column of Table 1 have been replaced with other tools that were developed for job shops!  

Table 1: A New “Job Shop Lean Toolbox” for High-Mix Low-Volume Manufacturers

Lean tools that will work in job shops also	Lean Tools that will not work in job shops
Strategic Planning	Pencil-and-Paper Problem Solving
Top-Down Leadership	Value Stream Mapping
Gemba Walks by Managers	Assembly Line Balancing
Employee Engagement	One-Piece Flow Cells
Workplace Design with 6S	Product-specific Kanbans
TPM (Total Productive Maintenance)	FIFO Sequencing of Orders
Setup Reduction (SMED)	Pacemaker Scheduling
Error-Proofing (Poka-Yoke)	Inventory Supermarkets
Quality At Source	Work Order Release based on Pitch
Visual Workplace	Production based on Level Loading
Product and Process Standardization	Mixed Model Production with Takt Time
Right-sized Flexible Machines	Right-sized Inflexible Machines
Standard Work	Pull-based Production Scheduling
Continuous Problem-Solving	Manual Scheduling with Whiteboards

 

If the Tool Works for High-Mix Low-Volume, Then Job Shop Lean Uses It!

In Table 1, the tools in the left-hand column will also work in HMLV production systems.  “Top-down Leadership” and “Employee Involvement” are essential.  “Standard Work Instructions” and “Setup Reduction” are needed to minimize variation in setup times on any machine (or manufacturing cell) due to different parts having varying setup sequences, tooling packages, material sizes, tolerances, etc.  “Quality at Source” empowers employees to reduce costs, take pride in their workmanship and have ownership for their work.   “Right-sized Machines” appears in both columns of Table 1 because simple machines are easy to learn to use, setup, operate and maintain.    

If the Tool Does Not Work for High-Mix Low-Volume, Then Job Shop Lean Replaces It!

In Table 1, the tools in the right-hand column will almost never work in HMLV production systems because those tools are simply not applicable to MTO (Make-To-Order) HMLV production systems that do not operate like assembly lines.  It is these tools that have been replaced by a more effective set of tools, often enabled by software, to successfully implement Job Shop Lean.

What do you think of Shahrukh's observations? What are the experiences of those who work in a HMLV environment and have been part of a Lean initiative?

Why is Lean Needed in Higher Education?

A few days before William Balzer published the second edition of his groundbreaking book Lean Higher Education: Increasing the Value and Performance of University Processes, I had a chat with him about the successful applications of Lean concepts at major universities. During the conversation, I asked him directly: "Why is Lean needed in higher education?” Here is his complete answer:

Lean provides a proven problem-solving framework to address challenges in any organization or business sector, and higher education is no exception. Universities must be more responsive, efficient, and effective to address the growing number of external challenges disrupting higher education including: 

• Eroding financial support from the government coupled with freezes or caps on cost increases.

• Rising costs at universities to maintain their educational mission coupled to the growing price sensitivity of students and families worried about the long-term burden of student loan debt.

• Attracting and retaining the best faculty and staff in a labor-intensive operations where we have not resolved how equitable compensation increases can be offset with gains in productivity.

• Greater competition such as online universities and free Massively Open Online Courses that compete for a shrinking demographic of college-aged students and employers who question whether a college education is really the best preparation. 

As we speak, COVID-19 is already sending shock waves through the higher education community.

The application of Lean to improve processes in higher education, grounded in the principles of continuous improvement and respect for people, offers a way forward, as documented in my book by 16 exemplar universities from around the world that are using Lean. When correctly implemented, practiced, and sustained, Lean Higher Education (LHE) will meet – and even exceed – the expectations of those served by these processes, engage and develop university faculty and staff who deliver critical academic and support processes (including teaching, curriculum development, and research), and enhance the efficiency and effectiveness of the university through cost avoidance, cost reduction, and greater revenue generation. 

The potential of LHE is great at any university regardless of mission, size, and resources; in the 10 years since the publication of the first edition of Lean Higher Education, LHE has demonstrated that it can help universities reinvent themselves to earn or grow their reputations as preeminent institutions that should be valued and supported. 

Are any readers affiliated with universities or colleges that have implemented some type of Lean initiative?  Have you experienced the benefits that William Balzer described? 

The Lean IT Transformation -- Is There a Roadmap?

During the past few years, many books have been published addressing the advantages of deploying Lean continuous improvement in IT operations. In addition, there are many books on DevOps, Agile software development, Lean project management, Lean startup, continuous deployment, and IT Service Management. In fact, in 2010 Productivity Press published Lean IT: Enabling and Sustaining Your Lean Transformation (authored by Steven Bell and Mike Orzen), which has been called the most comprehensive and definitive resource on Lean IT.

Recently, Mike released a new book with coauthor, Tom Paider titled The Lean IT Field Guide: A Roadmap for Your Transformation, and I had the chance to sit down with the authors and ask them why they wrote this book and why it is different from the myriad of books recently released on Lean IT and related topics. Here are the highlights from that conversation:

What inspired you to write this book?

The first book, Lean IT, was well received by the Lean and IT community, but many of the people we spoke with consistently said the same thing: “Great book, but how do we do it?” The first book thoroughly explores the “what” of Lean IT by providing definitions, examples, models, and case studies. We have always been uneasy with the idea of prescribing the “how” of Lean IT because I learned it through many years of trial and discovery. Our coaches and sensei always emphasized the need to experience one’s own discoveries and made it rather painful by not providing a roadmap. They used open-ended questions to develop our thinking, but it was up to us to figure to the direction we were going to take. Similar to the approach used in the first book, these teachers explained the goal and targets and helped us to envision a future-state, but they did not tell us how to get there. They seemed to intentionally avoid providing us with a roadmap, so we would discover our own way. We had to find our path forward through an endless series of experiments, reflection, and more experiments until the route ahead began to come into focus.

Is it possible to provide a roadmap to Lean transformation without being prescriptive and creating a implementation?

That is the very question we struggled with before committing to write this book! On the one hand, we had received many requests to share the “how to” mechanics of Lean IT transformation. In the final analysis, we realized we could share the key elements of building a Lean management system that effectively drives transformation without violating the necessary learning and discovery that is required to develop and engage people to become Lean practitioners. In a Lean transformation, particularly in IT, the actual steps and adjustments we will need to take will become apparent as we progress -- they cannot be known at the outset. We were very careful to stress the need for personal experimentation -- trial and discovery, using PDCA and refection -– to position the reader to successfully launch and deliver on a Lean transformation without approaching it like an implementation. An implementation presupposes that we know all the steps needed to reach the goal.

A Lean transformation can take years of hard work, in your opinion what is the hardest step in the journey?

In our experience, by far the hardest step is the first one – actually beginning your first set of routine team-based lean activities. In the book, we call the the first step "day zero" and provide details of the elements and preparations required of leaders, managers, and associates to success launch the transformation effort. During the years, we have found that sequence is just as important as content. What we mean by that is: you can do all the right things, but if they are done out of sequence, the impact and lasting effects just don’t take place. The sequences we share are based on years of trial, error, discovery, and success!

Are any readers currently involved in a Lean initiative focusing on aligning the IT function? If so, what were your biggest obstacles?