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Updating Lean for the Manufacturing 4.0 Era

Posted By Jeff Moad, October 11, 2016 at 3:10 PM, in Category: The Adaptive Organization

Avnet_Group.pngWith the current intense focus on IoT, digital transformation, and real-time data leading to transformative change, it sometimes seems as if manufacturers have moved on from more traditional and continuous approaches to operational improvement—such as lean.

But, at a recent Manufacturing Leadership Council plant tour and roundtable discussion at the Avnet, Inc., Global Solutions Center in Chandler, AZ, Avnet operations and supply chain leaders and 40 members of the ML Council made it clear that continuous improvement and the adoption of lean culture and processes remain bedrock manufacturing strategies. But they also made it equally clear that lean must evolve to become much more agile and to deliver results much more quickly in an era of rapidly increasing operational complexity and real-time data.

To accomplish that, executives from Avnet and other manufacturing leaders attending the plant tour said they are emphasizing lean’s potential to achieve process agility through standardized workflow and cell design. And they are augmenting lean tools such as kaizen events with approaches that directly recognize and reward individual contributors and teams as a way to accelerate the flow of process improvement ideas that can drive agility and reduce costs.

Several ML Council members participating in the Avnet plant tour and roundtable, for example, said their companies have initiated what they call “Shark Tank” sessions to encourage employee engagement and accelerate the generation of improvement ideas. Patterned after the popular ABC TV reality TV show in which celebrity venture capitalists hear pitches from start-ups and decide on the spot whether or not to invest, these sessions by manufacturers encourage line workers and other employees to pitch their improvement ideas to a panel of experts. When their ideas are accepted, the employees can receive cash payments and/or other forms of recognition. And the improvements can end up benefiting production teams when they result in measurable performance gains.

Manufacturers said the “Shark Tank” approach has increased employee engagement and the generation of new ideas for improvement. For example at Avnet, a $26 billion distributor and integrator of electronic components and systems, the approach has reversed a pattern of slowly diminishing returns using traditional kaizen events. Now the “Shark Tank” sessions augment kaizen.

Manufacturers also said they have been focusing lean on improvements that can drive production agility and workforce efficiency in the face of dramatically rising complexity and customer expectations. At Avnet, for example, customers increasingly request the company to fully configure system solutions—including hardware, software, and testing—and, of course, to cut delivery lead times. As a result, at the 228,000-square-foot Global Solutions Center, Avnet has adopted fully-standardized work cells that can support a wide range of product builds and be configured very rapidly. The approach, which has now been implemented across Avnet, also simplifies operator training, making it easier for Avnet to incorporate temporary workers into the mix at busy times such as the end of a quarter.

Avnet and other manufacturers participating in the plant tour and roundtable discussion also said they focusing lean on enhancing their customers’ experience by improving end-to-end processes that cut across functions and departments. This will allow manufacturers to measure and improve customer-centric performance metrics such as perfect order fulfillment performance.

This end-to-end process improvement focus will require better collaboration among lean leaders as well as more consistent lean capability across departments and functions. As a result, manufacturers such as Avnet have begun focusing on new ways to assess the lean maturity of their various teams and departments by looking at organizational lean capability rather than just, for example, the number of kaizen events held.

The bottom line, say these manufacturers, is that lean remains an important competitive tool even in the age of digitization and Manufacturing 4.0. But, in order to remain relevant, lean must adapt by enabling greater agility and faster improvement.


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Written by Jeff Moad

Jeff Moad is Research Director and Executive Editor with the Manufacturing Leadership Community. He also directs the Manufacturing Leadership Awards Program. Follow our LinkedIn Groups: Manufacturing Leadership Council and Manufacturing Leadership Summit



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