Lean Production And Implementation
Job Shops, Continuous Processing, and Discrete Processing Businesses. Are they Different?
By Jim Myers
Senior Advisor
Lean Advisors Inc.
Job Shops, Continuous And Discrete Processing - Is It Different?
We have had the opportunity to work with all types of industries that want to transform their companies using Lean. We work with healthcare, mining, aerospace, job shops, food processing, medical equipment, hi-tech, textiles, service, logistics, shipbuilding, construction products etc. One of the first comments we get from most companies is that they are unique. And they are right! They are 'not' Toyota and they are unique. But they can take comfort in the fact that even thought they are unique, Lean 'works' if they apply the concepts properly.
Lean is a way of thinking about how you run your business - manufacturing or service. It is applicable and effective anywhere there are activities that are used to provide a product or service. The goal is simply to provide that product or service as quick as possible, at the highest quality, lowest cost (while maintaining the needed margin) and be flexible. Bottom line, acknowledge that you and your organization are unique and then push yourself to also 'see' how similar you are to other industries.
A couple of obvious distinctions between the types of processing are:
» Discrete industries are usually those with high labor content manual assembly operations.
» Continuous processing industries are typically characterized by large-scale fixed capital equipment.
» Job Shop industries often have a large amount of materials inventory and very long lead times.
When applying Lean to varyious types of processing should be based on two principles of Lean - flow and pull. It's the adaptation of these principles to your situation that will influence your ability to transform your company.
Discrete/Repetitive High-Mid Volume Businesses:
These are the businesses where Lean is most easily applied. Here we're talking about basic machining and bench top assembly operations where you're making parts, subassemblies, or final product assemblies (including packaging) one-piece at a time (even if you're currently doing it in batches, and you're running your processes at a high rate of speed, you're still only making one piece at a time). It's easy to see the product flowing, or sitting, in these types of operations.
Here it's fairly straightforward to rearrange machines and workstations into one piece flow cells, and, thereby, achieve continuous flow in this part of your business.
Where you can't flow you can set up kanbans and supermarkets to enable pull in your value stream(s).
This type of processing seems to be much easier for people to understand and visualize how Lean can work for them in this type of setting. It is the closest to what was initially explained when Lean became popular a decade or more ago.
Continuous Processing High-Mid Volume Businesses:
This is where you run into monuments, large fixed assets that are difficult and expensive to change. The product is often contained in large vessels and delivered directly to the machines without being touched or seen by operators. It's often impossible to see one piece at a time being made. It's not an easy task to convert monuments to one piece flow or to determine what a one piece flow size would be. One of our large consumer products client's determined that their one-piece flow was going to be a case size quantity. It was apparent the Monuments on the front end of their business were all designed, built, installed, and operated as fixed assets that needed to be run "flat out" at a rate of 168 hrs/wk. So was the packaging end of their business. Overall Equipment Effectiveness (OEE) and Cost/Case were the 2 metrics the plants were measured on. The result was a whole string of highly efficient manufacturing plants and mountains of inventory! The plants were efficient but weren't flexible at all. The efficiencies were swallowed up by the huge inventory costs!
The monuments were barriers to Lean and would need to be changed. The cost of changing them was significant and so was the cost of not changing them! The answer was to spend capital on designing, building, installing, and running smaller batch-size equipment on the making end and smaller packaging equipment on the finishing end. The reduced inventory costs justified the investment. In these types of businesses, the focus on investing wisely is one of the keys to success. Having the right equipment will give you more flexibility to make a variety of product, cost less to purchase and maintain, better match actual customer demand, and make it flexible so you can easily changeover to other products when customer demand changes.
Job Shop Very Low - Low-Mid Volume Businesses:
These businesses are characterized by custom orders of very low quantities of product, often by a customer who doesn't want to wait a long time for delivery. How does Lean apply here? You might be thinking that it doesn't and that you'll have to respond to actual customer orders using a "push" scheduling system, and do the best you can with lead-time.
You can use lean in a job shop business just as effectively as in high-volume repetitive discrete businesses. The difference is in your flexibility. In a Job Shop environment you'll need 10x more flexibility! We find in many of these job shop enterprises, after developing product family matrices, that a number of products are repetitive anyway. If they're repetitive, you can set up dedicated cells, pull systems, and short lead times to respond to these customers. This will probably cover about 80% of your volume, but only about 20% of your customers. The other 80% of your customers (and 20% of your volume) probably is true "job shop" demand.
For these customers you'll need to set up and run a highly flexibly value stream that can easily changeover (<100 seconds) based on rapidly changing low volume demand. I've working in places where we've simply called these our "all other" product family Value Stream. This is the one you'll need small-scale flexibly equipment, a lower level of automation, a high degree of cross-training, and flexible people who'll instantly move from cell to cell and line to line when required. One other difference between Job Shop and repetitive is the cells may not be staffed anywhere near 100% of the time. "Staffing to the Interval" is the issue in Job Shop businesses.
Job shops just appear on the surface to be totally unique and very difficult to adapt the Lean concepts to. Once you apply it properly, the opportunities become very clear and applying Lean in this environment not only is perfect for reducing your lead-time to customer, it also drives bottom line margin improvements. Lean in all these different situations is definitely an answer to every variation of production and service. Don't get caught up in feeling your business is so unique that you can't adapt Lean. You can and you should! You may not be as unique as you think!