Completing the Lean Manufacturing Journey With Digitalization

The breakneck speed of technology change, fluctuations in supply chain costs, and ever-greater competition on a global scale mean that today’s manufacturing executives now more than ever rely on foresight on industry trends for opportunities to reduce overhead and squeak out greater manufacturing ROI on the shop floor.

Understanding that greater efficiencies and more effective processes on the shop floor translate directly to the continued solvency and profitability of their organizations, the manufacturing C-suite seeks any available advantage.

Years ago, when I was a manufacturing manager with medical device maker Danaher, I found that adapting to changes on the shop floor is a situational imperative and a critical part of production. There are specific goals executives and managers are trying to hit each year, but the overarching objective is to continuously improve product quality and the experience of the customer.

A key method manufacturing leaders use to keep operations tight is lean, the systematic school of thought for waste minimization in manufacturing processes that doesn’t sacrifice productivity. Based largely on the Toyota Production System, lean manufacturing techniques can help manufacturers achieve gains through the reduction of non-value-added activities and costs.¹

Lean Manufacturing Principles

Five primary lean manufacturing tenets comprise the leading principles typically associated with 1990’s “The Machine That Changed the World”²:

1. Specify value as perceived by the customer: Not just on the product you provide but the customers’ needs and wants.
2. Identify the value stream: Rather than thinking in terms of departments, visualize the value stream as an interconnected flow of processes that derive value.
3. Make the value flow through the value stream: Prioritize value-adding steps ahead of non-value adding steps.
4. Pull the value from the value stream: Avoid inventory management waste by employing a single-piece flow to produce product on demand.
5. Strive for perfection: The goal isn’t to surpass the competition in improvement but continuous improvement in all facets of your organization.

Based on a case study of Johnson Controls, a global electronic and HVAC component manufacturer, the comparative benefits of implementing lean manufacturing production measures can be a game-changer.³ As a result of implementing lean manufacturing practices, the company experienced:

• 22% reduction in safety affordable incidents.
• 12% improvement in quality.
• 68% improvement in employee retention.
• A tripling of its energy savings.
• Exceeded target improvement in year-over-year conversion costs by 700%.

A manufacturer can reap significant benefits from lean manufacturing practices, including waste reduction and increasing value-added production by upgrading equipment, training employees, and implementing more efficient processes.

Lean Manufacturing and Technology: Upping the Ante

Yet for all the benefit that lean offers manufacturers, a lean manufacturing program can only be as efficient and valuable as a company’s data management system. A manufacturer that relies on a manual paper-based or hybrid document manage is prone to systemic errors and delays stemming from incomplete, missing, or unstructured documents. For the life sciences or similarly regulated manufacturing, that translates into inefficient batch record processes, data tracking that can result in shipment delays, product quality issues and incompatible systems.

But manufacturers still must keep track of the batch and manufacturing execution paperwork, which necessitates extra time for operators to manually write deviations or nonconformances or physically walking a traveler to a shop floor computer to enter production information. In short, the product is complete but can’t be shipped because the paperwork is incomplete.

Contrast that with a fully digital, software-based document and manufacturing execution management system for your data, documentation, signatures, and communications that breaks down silos, drives efficiencies and improves levels of quality and control. Along the same lines, an electronic batch record (EBR) gives a manufacturer the ability for real-time batch record form validation, quality reporting, and corrective action potential.

Manufacturers that pair an automated and integrated document control system with a lean manufacturing program can eliminate greater amounts of waste and experience much higher levels of quality than they otherwise could with the limitations of a paper-based system.

But despite all the investment and effort required on the lean journey, it’s surprising how many companies stop short of the end goal by failing to make the digital transformation in manufacturing. Research compiled in MasterControl’s “The State of Digital Maturity in Pharma and Medtech Manufacturing” report shows that more than 90% of life sciences manufacturers haven’t digitized manufacturing execution processes or have significant gaps in the processes that are digitized. Companies that don’t implement advanced manufacturing execution tools aren’t just lagging in digital maturity – they’re falling behind digitally savvy competitors who have enhanced efficiency and overall effectiveness by embracing a digital transformation in manufacturing.

Complementary Efficiency: Lean and Digital

I identified the following key lean manufacturing principles through which a manufacturer’s operational effectiveness can be significantly amplified when processed in a digital documentation system:

1. Eliminating waste: Where many manufacturers still depend on paper-based systems to manually track critical production information, implementing lean manufacturing measures remains problematic, time consuming, and costly.

For example, if you’re seeking to reduce the number of steps required by an operator to access a part needed in production or the time it takes to access a tool, employees must track down the correct paperwork and production records. A manufacturer can eliminate a much greater amount of waste by capturing production and manufacturing execution information digitally in real time with a system that automatically verifies accuracy and completeness of documents. The data is stored and readily available from a single access point for analysis and decision-making by stakeholders and managers.

2. Just in Time (JIT): A form of lean manufacturing and a logistics method of inventory control.⁴ It’s a system of customer-based manufacturing on demand: what the customer wants, in the quantity the customer wants and when she wants it. The reduction or elimination of buffers or inventory is possible with JIT, and allows the use of delivered components within minutes of their arrival.

However, a manual data system means that data is difficult to track and verify with the result being that product ends up sitting on the shipping dock awaiting the correct documentation rather than on its way to customers. The automation afforded by a digital transformation in manufacturing allows personnel to review batches in minutes instead of weeks while simultaneously decreasing the amount of carried inventory to maintain short lead times and more on-time deliveries.

3. Poka-yoke: A Japanese term that means to dummy proof your processes so that neither a production operator (nor a customer) will make a mistake. This manufacturing execution data can include a range of critical information, including equipment calibration dates, tolerance measures, pass-fail qualification, etc.

Using a modern manufacturing execution system (MES) for electronic data capture ensures that operators follow the correct standard operating procedures (SOPs) and processes every time. A digital solution can also confirm that operators are trained and qualified to upload product data into the system.

4. Kanban: Another Japanese word that conveys that idea of using signs or cards to indicate where in the production process a product currently is, i.e., pre-production, in process, and complete. This lean manufacturing technique helps manufacturing managers and line supervisors to only pull those parts or materials needed in a specific run or batch of product. This contributes to less waste and excess inventory.

Through digital production record software integrated into operations systems on the shop floor, batch records that include materials, parts and production quotas are carefully managed in real time so that products are not overproduced. This reduces costly errors that can easily result with paper-based systems because all the data and production records are connected and accessible from a single point of entry. Digital manufacturing execution systems keep data and processes connected, allowing a manufacturer to enhance the principle of Kanban by limiting waste and errors than impair compliance.

Digital Transformation in Manufacturing: The Next Level of Lean

lean manufacturing principles can only get a manufacturing organization using a legacy data system so far. To fully maximize the benefits of lean that can lead to greater ROI, manufacturers will need to invest in a digital transformation in manufacturing and take active steps not only to upgrade to an automated manufacturing execution solution, but also introduce a companywide culture where everyone contributes to improving quality and reducing waste.

References:

1. "What Is Lean Manufacturing?” GBMP Lean Consulting Service & Continuous Improvement Training.
2. "The Power of Lean Manufacturing,” Iram Chavez, Manufacturing Tomorrow, Dec. 26, 2019.
3. "Four Foundations: The Johnson Controls Manufacturing System,” Ricardo Estok, Business Transformation and Operational Excellence Insights, Sept. 27, 2017.
4. Supra note 2.