Topics

Lean production

What lean production means

Lean production is an approach that aims to produce the same output using fewer resources by removing waste from the process.
Waste means anything the customer would not be willing to pay for: stock sitting in a warehouse, staff waiting for parts, products made and never sold, movement that adds nothing, and defects that have to be remade.
Lean is not a fourth production method. It is a set of practices applied on top of job, batch or flow production.

Just-in-time (JIT) stock control.

Materials arrive as they are needed, rather than being held in a warehouse "just in case".
Cuts the cost of holding stock: storage space, insurance, capital tied up, and stock that spoils or goes out of date.
The risk is obvious and examinable: with no buffer, one late delivery stops production.

Kaizen — continuous improvement.

Many small improvements suggested by the people doing the job, made continuously, rather than one large change imposed occasionally.
Cheap to run and motivating, because staff see their own ideas implemented.

Quality at the source.

Each worker checks their own output rather than passing it to an inspector at the end.
Faults are caught before value has been added to a defective item, so less work is wasted.

Cell production.

Staff work in small teams responsible for a complete section of the process, rather than each doing one repeated task on a long line.
Improves motivation and makes teams accountable for their own quality.

Advantages	Disadvantages
Lower stock-holding costs and less capital tied up in inventory	No buffer stock, so a supply disruption stops production immediately
Less waste and rework, which lowers unit costs	Requires reliable suppliers and good relationships to work at all
Faults are found early, protecting quality and brand reputation	Frequent small deliveries can raise transport costs and emissions
Staff involvement in improvement raises motivation	Staff need training and time, which is a real upfront cost
Space freed from storage can be used productively	Little slack in the system, so it copes badly with sudden demand spikes

Distance makes lean harder here than in Europe or Asia: imported components have long, uncertain shipping times, so a pure just-in-time system leaves a New Zealand manufacturer exposed to a delayed vessel.
Many New Zealand businesses run a hybrid — lean practices internally, but a buffer of imported inputs held locally.
Lean thinking also connects directly to kaitiakitanga: reducing waste means using fewer resources per unit of output, which is guardianship of resources as well as a cost saving.

Lean production is an approach that aims to produce the same output using fewer resources by removing waste from the process.
Waste means anything the customer would not be willing to pay for: stock sitting in a warehouse, staff waiting for parts, products made and never sold, movement that adds nothing, and defects that have to be remade.
Lean is not a fourth production method. It is a set of practices applied on top of job, batch or flow production.

Just-in-time (JIT) stock control.

Materials arrive as they are needed, rather than being held in a warehouse "just in case".
Cuts the cost of holding stock: storage space, insurance, capital tied up, and stock that spoils or goes out of date.
The risk is obvious and examinable: with no buffer, one late delivery stops production.

Kaizen — continuous improvement.

Many small improvements suggested by the people doing the job, made continuously, rather than one large change imposed occasionally.
Cheap to run and motivating, because staff see their own ideas implemented.

Quality at the source.

Each worker checks their own output rather than passing it to an inspector at the end.
Faults are caught before value has been added to a defective item, so less work is wasted.

Cell production.

Staff work in small teams responsible for a complete section of the process, rather than each doing one repeated task on a long line.
Improves motivation and makes teams accountable for their own quality.

Advantages	Disadvantages
Lower stock-holding costs and less capital tied up in inventory	No buffer stock, so a supply disruption stops production immediately
Less waste and rework, which lowers unit costs	Requires reliable suppliers and good relationships to work at all
Faults are found early, protecting quality and brand reputation	Frequent small deliveries can raise transport costs and emissions
Staff involvement in improvement raises motivation	Staff need training and time, which is a real upfront cost
Space freed from storage can be used productively	Little slack in the system, so it copes badly with sudden demand spikes

Distance makes lean harder here than in Europe or Asia: imported components have long, uncertain shipping times, so a pure just-in-time system leaves a New Zealand manufacturer exposed to a delayed vessel.
Many New Zealand businesses run a hybrid — lean practices internally, but a buffer of imported inputs held locally.
Lean thinking also connects directly to kaitiakitanga: reducing waste means using fewer resources per unit of output, which is guardianship of resources as well as a cost saving.