TECNOLÓGICO DE MONTERREY | THUNDERBIRD

Production Operation Management

Esterline Technologies: Lean Manufacturing

Study Case Report

Ruben Dario Alba Fonseca A01307721

Raul Danilo Blanco Reyes A01307393
Alejandro Pardo Werpajosky A01307723
Adriana Ximena Santos Suarez A01307392
Andres Eduardo Venegas Ramirez A01307391
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1. What is the central question being addressed in this case? Why is it

important to Bob Cremin? What issues are raised in the debate? (OP)

The central question addressed in the case is whether IT should be actively

involved in the implementation of lean manufacturing and its role within the
process to achieve expected results. It is important to Bob Cremin for he
struggled with the process mainly driven by high costs that need be incurred due
to effective IT expenditures to support lean manufacturing. Issues of
accountability in terms of lean manufacturing implementation were raised
among different company departments. There was high hesitation towards the
effectiveness of IT systems due to their “one size fits all” promise that proved not
to be so. Operations was seeing IT systems as a barrier to effectively implement
lean manufacturing measures for it added additional tasks instead of simplifying
processes. The costs were always an issue that concerned the general
management for the ROI in such expenditures was not clearly seen and the
company had already had a prior IT endeavor that didn’t succeed.

2. How does lean manufacturing differ from more traditional approaches to

production? What outcomes can a company expect from an effectively-
implemented lean manufacturing initiative?

Traditional approaches to production are based on scale economies and

maintaining high volume of inventories to satisfy costumers needs. Scale
economies aim to reduce cost, while high inventories look forward to providing
customers with quick and prompt deliveries. In traditional production
approaches, during the manufacturing process, parts and raw materials are 95%
(non-adding value) of the time in standby or waiting to be assigned to another
step of the production line. On the other hand just 5% of the time is used for
manufacturing (add value). Lean manufacturing reduces waste or waiting time
(non-adding value) aiming to increase consumer satisfaction through reducing
delivery timing and it does not require high inventory volumes.

Traditional manufacturing Lean manufacturing

Operating practice Push production system.
Batches through the whole
manufacturing line.
Process Direct and established
architecture process flows.
Material flow Designed in constant rates
discipline to obtain predetermined
quantities of output
Employee Low involvement and the
involvement in supervisors overlook
process improvement themselves.
Pull production system.
Operating practices in ongoing
specialized work cells.
Process flows designed
according to specific
requirements.
Kanban cards
Employees accountable and
encouraged to find and
implement improvement
improvement opportunities
Output volume High volume production High volume production using
using large amounts of minimal inventories
inventories resulting in
waste.
Scheduling Production Schedule driven Scheduling is demand-driven
by push targeted production Uniform plant loading and
Kanban production control
system
Inventory Held in stock in big JIT inventory system
quantities.
Ratio of waiting 95%percent of waiting time Increased touch time
time to “touch and 5% of touch time compared to traditional
time” manufacturing
Maintenance of As per maintenance Preventive focused on
equipment schedule or when a failure inspections and observation,
occurs intervention and replacement
Job Design Is focused on individuals Is focused on individuals
performance by execution of performance by execution of
activities required activities required, but to a
greater extent it is included
skills/competencies
development that leverages
continuous improvement and
process failure detection

3. Based on the case, and your own experience, what do you believe to be the
most significant challenges for implementing lean manufacturing? How can
organizations overcome these obstacles?

Challenge or Potential implementation practice to overcome this obstacle

obstacle
More control to Implementing change management programs can solve this
employees so situation. With this, supervisors can raise awareness in order to
supervisors are meet expectations for their new role. Their new role is more
uncomfortable strategic, becoming sponsors of the change towards continuous
improvement by channeling resources to achieve better
performance from operative employees.
Lean processes Idle employee manpower may be used in other projects and
require fewer processes that can be identified as valuable for customers.
employee – potential Though layoff is a threat, this is an opportunity for the company
job loss is a threat to implement a reward system based on performance and
competences to retain the top class people.
Employees have a Senior management must implement a communication strategy
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natural tendency to to show employees the benefits beneath the implementation of

revert back to lean manufacturing focusing on the benefits to be perceived in
batching - Korry terms of saving time, reducing workload, implementing process
section efficiency and enhancing financial performance.
Tendency to revert Working in interdisciplinary teams will enable the group to
from cross-functional enhance their knowledge with different points of views, finding
cells back to new ways to do things and new procedures. Recognition
functionally- programs carried out by teams instead of individuals will allow
organized work team spirit to prevail.
groups
More reliance in team Teamwork promotes competitiveness resulting in company
work and not all efficiency gains. Recognition programs carried out by teams
employees to work in instead of individuals will allow team spirit to prevail.
teams

In summary, part of the success in the implementation of lean manufacturing,

depends on the time taken to conduct the culture change, thus having everyone
aligned within the organization.

A sound internal marketing campaign is necessary to support the cultural change

with change management programs tailored to the nature of each individual’s job
and targeted to different levels of the organization.