Sometimes the difference between profit and loss lies in the processes used to create the product. However, if a company doesn't look at those processes, the opportunity to survive difficult economic times and thrive when times are good is lost.
On Thursday, South Dakota Manufacturing & Technology Solutions (MTS) conducted a workshop in Sioux Falls to give representatives from a variety of businesses -- from manufacturing to broadband -- an opportunity to begin learning how to streamline processes to eliminate waste and increase profitability.
"This is to give people a taste of what we do," said MTS business adviser Trevor Weinrich.
However, the introductory workshop provided just a taste of what the organization does. As part of the Manufacturing Extension Partnership, a nationwide public-private partnership that works with U.S. manufacturers, MTS conducts workshops, provides training for SME (Society of Manufacturing Engineers) Lean Certification, hosts an annual summit and provides business consultations for transformational development.
"We go there and we ask a lot of questions," Weinrich said about the latter.
This leads to a values stream map, an analysis of where the organization is, where it wants to be, and gap analysis. Once this has been done, MTS helps an organization apply Lean principles to the workplace to improve operations.
"Our goal is to get them where they can drive it," Weinrich said. "It's nice when someone can lead a project from within."
MTS can become involved with an organization through a variety of contact points, from their website and referrals to the newsletter and summit.
On Thursday, Weinrich and colleague Kellie Ecker introduced workshop participants to Lean principles in a systematic manner, providing hands-on opportunities to practice implementing changes discussed. The same workshop is sometimes offered in the workplace to help an organization launch a cycle of improvements.
"It's a nice way to get everyone on the same page," Weinrich indicated.
During the presentation, Ecker showed that manufacturing is now the leading industry in South Dakota, overtaking agriculture. Lean principles can be applied to all of them, according to presenters.
"The objectives of Lean methods are simple: reduce cost, improve quality and compress time," Ecker said, explaining that this is an ongoing process. "You're always looking to improve your processes."
The goal is to create a win-win-win cycle which includes investing in employees, satisfying the customer and growing the company. The first step is to eliminate waste, or what Ecker called "non-value-added activities."
There are essentially eight: overproduction, motion, inventory, waiting, transportation, defects, extra processing and underutilized people. The workshop looked at causes for each form of waste and noted the impact.
"We need to make sure that whatever we do with our processes, we don't affect the customers," Ecker told workshop participants.
She then introduced a number of strategies for eliminating waste, including the 5S program: sort, set-in-order, shine, standardize and sustain. The goal with this program is to create a well-organized work environment.
"You should be able to find whatever you need in 30 seconds," Ecker said.
After each instructional session, participants worked for 15 minutes to construct simplified circuit boards with springs, resistors, diodes and LEDs. The first hands-on activity created a baseline with a disorganized workplace impeding productivity and profitability. The second improved the organization without changing processes.
The third hands-on session involved changing processes to improve productivity. Changes included standardizing the way tasks were performed, using point-of-use storage for work materials, and placing an emphasis on quality.
"We don't accept bad quality; we don't do bad quality; we don't pass on bad quality," Ecker indicated. In addition, production at this point in the training is based on actual consumption.
Finally, workshop participants saw success during an exercise. They were able to achieve the goal set by workshop leaders in less than the 15 minutes scheduled for the exercise.
In addition, the quality of the completed work was high and the morale of participants creating the circuit boards was high. A sense of cooperative camaraderie was evident for the first time during an exercise.
"Lean is a system and part of the system is the culture," Ecker said.
The final hands-on session of the day was more complicated and designed to create an even more efficient work environment which offered greater flexibility for those industries that create a variety of products. Productivity suffered, but the profit remained strong because labor costs had been reduced.
"You can lose two-thirds of your business and keep the company going," Weinrich said. "During downturns, you can continue to offer stable employment."
In concluding, Ecker talked about the importance of having the whole organization embrace the concept of applying Lean principles in order for the change to be successful.
"Management are the ones who own the vision; employees are the one that implement that vision," she said.
Ecker explained it's important to start small when implementing changes and then to have them "cascade across the organization." Employees must be trained, motivated and involved in making these changes.
"We want to make sure people feel safe to try new things," she indicated. "We can't improve is we don't go out there and try."