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Supply chain experts challenge manufacturers to rethink lean technology

Incorporating software into a lean project can be challenging. CSCMP 2010 attendees learned about the variety of lean technology options available and how to use them to boost supply chain visibility and efficiency.

SAN DIEGO -- Lean is not a new concept in the manufacturing world. The decades-old philosophy centers on the reduction of waste and unnecessary spending with the goal of increasing productivity and efficiency. But many manufacturers still struggle to find the right software to fortify their lean initiatives. This year’s Council of Supply Chain Management Professionals annual global conference featured a variety of lean technology options, many of which take lean thinking beyond the shop floor.

At a discussion panel on emerging lean technologies, Gene Nusekabel, T&L industry marketing manager for Sterling Commerce, outlined what he believes manufacturers should keep in mind when approaching lean. “I believe the biggest challenge is not the technology; it’s [getting] us as individuals to collaborate,” Nusekabel said. To be effective, lean tools should be used to manage information throughout the entire supply chain and not just relegated to production, he said. “The future is about having the ability to have the analytics built into the system, so it’s doing the work for you.”

Lean technology in unexpected places

An important part of the supply chain that extends well beyond the production environment – yet can still benefit from technology-enabled lean practices -- is logistics. 

“A lot of the things people study with supply chains are about how to take human interaction out, how to get rid of mistakes,” said Thadeus Avvampato, vice president of sales at iGPS. “Anytime you can engineer a process, you’re going to make that process happen more consistently and repeatedly.” Radio frequency identification (RFID), typically thought of as a tool used for SCM, also can support lean practices. RFID tags produced by Alien Technology are encapsulated into iGPS’ plastic pallets, which can then be tracked throughout the warehouse and into the field using software engineered by iGPS. “Anytime you can track an asset or product discretely, it increases your odds of finding it, not losing it, and being more efficient,” Avvampato said.

Kiva Systems, a maker of robotic order fulfillment systems, also highlighted its lean functionality during the session. Peter Blair, director of marketing for Kiva, explained how the company’s robots -- which are used to move pallets throughout the warehouse -- receive directions from order-processing software. The warehouse floor is mapped out in a digital grid, Blair said, and the robots’ movements are programmed into it.

The Kiva technology also incorporates lasers and barcodes on the pallets to reduce human error; the laser points to which item should be selected, and the barcode is scanned to confirm selection. “Lean always has a component of customer value in it, how what you’re doing is taking out waste and providing value to the customer,” Blair said. “So in terms of distribution, things like short lead time  and accurate orders, that’s a value to the customers if I get it to them quicker.”

Richard Douglass, global manufacturing and logistics industry executive for Sterling Commerce, offered manufacturers a back-to-basics explanation of lean. “Lean to me is about cutting out non-value added activities,” he said. “I think companies are still focused on lean and Six Sigma, but how do you get that focus outside of the four walls? People are still very focused on the plant.”

Wireless field services technology -- also known as enterprise mobility – helps to extend lean practices by getting warehouse shipment data in the hands of drivers. “What we do in enterprise mobility is we bring that information in real time to a device in the form of workflow,” said Meredith Powers, senior manager of manufacturing industry solutions at AT&T Global Services. “People in the field that are mobile can make real-time decisions that will help them increase productivity and the visibility of their assets.”

Lean thinking precedes lean technology

Despite the growing number of lean tools on the market, many manufacturers still don’t view software as a necessary component of their lean projects. 

“In the general sense, computer systems tend to slow us down rather than to help us get to a goal,” said Tom Lyons, continuous improvement manager for Watlow Electric Manufacturing Company, a maker of industrial heaters, sensors and controllers. “We want to streamline our processes.” Lyons said. Watlow only uses Excel spreadsheets for its lean projects.

Lyons stressed the importance of achieving cultural change before embarking on technological change. “We’re five and a half years into our lean implementation; as we get more mature, we’re seeing areas where software would be useful, like in process automation and scheduling,” he said. “Once we reach our best practices, then we can go into lean software. Putting software in too early will just lead to automating bad practices.”

Lean software boosts supply chain visibility

Industry analysts echoed some of the sentiments expressed at the CSCMP session. “It’s very challenging to implement lean without having good communication,” said Anil Gupta, principal at Applications Marketing Group. “One of the first tenets of lean is how to use collaboration technology. Pure collaboration means that all steps of the supply chain -- production and suppliers -- are leaner.”

Like Douglass, Gupta emphasized that lean technology should be something that reaches beyond the plant floor. “People are focused on the four walls, on just making the manufacturing process lean,” he said. “The only way to implement lean is to make the whole supply chain lean; focusing on just your enterprise isn’t enough.”

According to Robert Liptrot, president and founder of Boston Industrial Consulting Inc., buying software packages that are designed for lean environments, rather than trying to cobble together a homemade system, can be worth the investment. “Often in the past, when people didn’t have these tools, they would just paste together Excel charts and hand charts,” he said. “You want the software to be as organized and streamlined as possible to benchmark progress, and a lot of lean tools have good recording mechanisms to measure that.”

Use lean technology as a tool -- not a crutch

One of the biggest lean implementation mistakes a manufacturer can make, according to Liptrot, is to rely too much on software and ignore the cultural changes that make lean possible.  “Whenever people over rely on software, they fall victim to the fact they don’t spend enough time actually on the floor getting the project done,” Liptrot said.

Liptrot cautioned against managers getting too involved in lean software’s functionality and ignoring its real-world applications. “Use the lean tools so you don’t have to spend time generating reports and can get out into the shop floor,” he said. “The most successful are those who use the tools to offset the activity on the floor. Like any software product, some people look at [lean software] as a magic wand, and it’s not.”

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