Viewpoint: Needed: A Lean Enterprise Standard
William A. Levinson, PE, CMfgE, CEI
SME Senior Member
Levinson Productivity Systems, P.C.
Today's steady hemorrhage of American manufacturing jobs is prima facie evidence of the need for a lean management system (LMS) standard that has the same stature as the ISO 9000 quality management system (QMS) standard.
Standardization (making the best known way of doing the job the standard for the job) and best practice deployment (sharing the best known way to do a job with similar activities) were central parts of the business system developed by Henry Ford. However, Ford did not standardize the management system that had rendered him such impressive service. It is now time to correct this omission by developing a LMS standard that has the same force and stature as ISO 9000.
Some companies will doubtlessly complain that a LMS standard is another "burden" on top of ISO 9000. First, ISO 9000 becomes a burden only when management treats it as a costly annoyance with which the company "must" comply to "get the certificate." It's a moneymaker if treated as a system for reducing quality costs. Second, lean enterprise encompasses much of ISO 9000. If you do one, you are automatically doing a good part of the other.
Lean enterprise is even more compatible with ISO 14001. Henry Ford made enormous profits by avoiding environmental waste or finding uses for it, in an era when he could have legally dumped into the river whatever wouldn't go up the smokestack.
The LMS standard must incorporate the following features. (This is by no means a comprehensive list. Where applicable, the tie-in with ISO 9000 is shown.)
- Management responsibility: Lean culture and leadership tie in directly with ISO 9000's provisions for management responsibility. ISO 9000 requires management to define, disseminate, and support the organization's quality policy through communications, policies, and periodic reviews. Little extra effort is required to add lean policies and methods to this aspect of ISO 9000.
- Management must train and empower organizational members to identify and eliminate waste.
- Top management must show commitment to the lean culture. Henry Ford practiced visible leadership by talking with workers on the shop floor instead of trying to manage from a corner office.
- Performance measurements and rewards must support a lean culture.
- Financial metrics must support a lean culture. Traditional measurements like overhead absorption and equipment utilization for its own sake produce dysfunctional results.
- A closed-loop corrective action (CLCA) system is necessary to drive improvement projects to completion. Any modification of plan-do-check-act, or Six Sigma's DMAIC (Define, Measure, Analyze, Improve, Control), will work as long as it is used diligently. ISO 9000 already requires CLCA for reacting to quality problems. A LMS simply extends this requirement to proactive improvements.
- ISO 9000's requirement for controlled work instructions (section 5.5.6) already covers standardization, or making the current best-known way of doing a job the standard for that job. The business must ensure that similar processes and operations are aware of improvements that they might find useful.
- Lean methodology: audit for its use where applicable. Lean audits can easily be combined with ISO 9000 audits, again due to the strong synergy between many lean and quality-management methods.
- The company should practice supplier development by teaching its suppliers lean methodology. This consideration can piggyback onto ISO 9000:2000 section 7.4, Purchasing.
- The company must manage its logistics to minimize transportation time, delivery lead time, and costs.
The concept of ISO 9000 recognizes that quality management systems are a prerequisite for world-class quality. It's now time to apply the same principle to lean management systems. Only through lean enterprise can the US halt and possibly reverse the loss of its manufacturing capability and the good jobs that go with it.
This article was first published in the February 2005 edition of Manufacturing Engineering magazine.