The next level contains lean manufacturing primary management and productionstrategies used to achieve the objectives and instill basic principles. The strategiesare general rules for management behavior, and support one another as well as thebasic principles. The third level of lean manufacturing consists of implementationtechniques, which are the practices and procedures for implementing and maintain-ing the strategies. Although these levels are somewhat arbitrary and are not alwaysfollowed rigorously outside the Toyota production system, it is important to notethat each level is built on the solid foundation of the previous level. It helps under-score the point that without the complete system, long-term lean manufacturingsuccess is not sustainable.Lean manufacturing objectives and principles are adapted from the Toyota produc-tion system and over the years have been enhanced by lean practitioners such as JimWomack, Dr. Schoenberger, and numerous corporations and nonpro
t organizationssuch as Lean Aerospace Initiative at MIT, Lean Enterprise Institute, and others.
The basic business objective of a manufacturing corporation is long-term pro
tabilitybecause it is essential to the continued existence of any corporation. To achieve long-term pro
tability, a company must (1) produce products with quality consistentlyas high as the best in its class, (2) ensure that production costs are competitive withmost manufacturers, and (3) deliver a product
service mix that is competitive withthe best in its class as well.Lean manufacturing helps a company stay competitive by serving its customersbetter and continuously reducing costs. Lean gives customers the product varietythey want, in the quantity they want, and without paying extra for a small-lot size.Lean makes a company
exible enough so that customer demands for change canbe accommodated quickly, using lean techniques such as small-lot production.Why do we need lean manufacturing? Simply, the answer is pro
t squeeze(Figure 8.3).In the past, companies simply passed costs on to the customer. The pricingformula wasCost + Pro
t = PriceIn today
s competitive market, customers insist on a competitive market as wellas world-class quality and product features. This means that companies must reducecosts to make a pro
Cost = Pro
tLean manufacturing gives a company a key competitive advantage by allowingit to build high-quality products inexpensively because consumers,
,set prices and determine the acceptability of the products and services they use.Lean manufacturing achieves the above three objectives by adhering to three keybasic principles:
deﬁnition of value, elimination of waste, and support the worker.
© 2002 by CRC Press LLC