Laws of Manufacturing

Manufacturing operations are governed by a series of laws.  Wallace J. Hopp and Mark L. Spearman, developed and mathematically proved a series of fundamental relationships in manufacturing.  These were captured in their book Factory Physics.  The "laws" of Factory Physics describe the underlying logistical behavior of manufacturing systems, including the fundamental relationships between basic performance measures such as throughput, Work-In-Process, manufacturing cycle time, and process variability. By understanding these relationships, and using the powerful analytical tools described in the text, managers can diagnose their manufacturing systems and make major improvements in throughput, cycle time, customer service, and quality.

In particular, these laws of manufacturing give managers a way to identify the largest sources of waste and variability and to compute the effect of alternative improvements before implementing them. 

Here, the top ten laws of manufacturing by Hopp and Spearman are summarized:

1. Little's Law: Work in progress = Throughput X Lead Time.  This is the basis of Factory Physics.  So if the throughput is 100 units per week and the lead time is 2 weeks, then the WIP is 200 units.
2. Law of Capacity: In steady state, all plants will release work at an average rate that is strictly less than the average capacity.
3. Law of Inventory: In an unconstrained system, inventory builds relentlessly.
4. Law of Bottleneck: Accumulation of inventory is not necessarily an indication of a bottleneck (or a constraint).
5. Law of Variability: Increasing variability always degrades the performance of production system.
6. Law of Corollary: In a line where releases are independent of completions, variability early in a routing increases cycle time more than equivalent variability later in the routing.
7. Law of Conservation of Material: In a stable system, over the long run, the rate out of a system will equal the rate in, less any yield loss plus any parts production within the system.
8. Law of Utilization: If a workstation increases utilization without making any other changes, average WIP and lead time will increase in a highly non-linear fashion.
9. Law of Move Batching: Cycle times over a segment of a routing are roughly proportional to the transfer batch sizes used over that segment, provided there is no waiting for the conveyance device.
10. Law of Variability Buffering: Variability in a production system will be buffered by some combination of inventory, capacity, or time.

For Lean, the implications of these laws are profound.  Variation is the enemy of planning and control systems must recognize these laws.  The laws of manufacturing are of prime importance for a deeper understanding of scheduling.

If you enjoy this post you may want to connect with me on Linkedin or follow me on Twitter.  You can also subscribe to this feed or email to stay updated on all posts.  For those Facebook fans join A Lean Journey on our facebook fan page.

Lean and the Rhode Island Experience

This past week I had an amazing trip to Rhode Island.  It started with visit to VIBCO, who manufactures high-quality, low maintenance industrial vibrators, construction vibrators and other vibratory equipment.  VIBCO practices lean manufacturing and is committed to True North which they characterize as quality, throughput, innovation and same day, next day service.

During my visit to VIBCO I met some really great people including Karl Wadensten, president; Linda Kleineberg, marketing manger; and Paul Cary, Lean Sensei.  VIBCO truly understands the people aspect of Lean manufacturing.  While walking the plant, their friendly and outgoing team was more than happy to tell me about all the ways they are improving their job.  There was an enormous sense of pride in the work they do to service the customer.  Yes, they relate all activities in terms of value to the customer.

Karl and the team had been successful in breaking down the walls of the traditional organization physically and literally.  There isn't a typical management hierarchy to stifle improvement.  The culture is open and so are the work spaces.  It creates an environment of collaboration and team work.

Mark Graban just wrote about a recent trip to VIBCO where he learned what makes you want to do better.  I would recommend any lean practitioner taking the time to visit or learn more about VIBCO.  They are probably the best example of employee engagement I have seen.

Later in the day Karl, the VIBCO Team, and I went to the Rhode Island State House to broadcast The Lean Nation Radio Show live from inside the rotunda with a Tax Day Tea Party in the background.  As the guest on the show we discussed Lean leadership, government waste, and the call for engaging those within the system to work on improvement.  If you missed the radio show you can listen or download here to listen to the Lean revolution, complete with a visit by RI State Governor Carcieri.

One last story really speaks volumes to the VIBCO teams' lean culture.  During the preparation for the radio show there was trouble with Karl's microphone.  It kept dropping down because of a lose clip.  With only a few minutes to air the VIBCO team stopped what they were doing and jumped in to help Karl fix the microphone.  They tried some impromptu solutions in a trial and error fashion.  Working together they were able to tighten the microphone with only seconds to spare.  After the fix the team went back to what they were previously doing.  It was natural and in the moment but nonetheless a great example of Lean, where working together to solve problems is common place.

I had a great visit to Rhode Island where I experienced lean the VIBCO Way.  I am looking forward to my next visit to learn more about workforce engagement. 

Lean Quote of the Day, April 16, 2010

On Fridays I will post a Lean related Quote. Throughout our lifetimes many people touch our lives and leave us with words of wisdom. These can both be a source of new learning and also a point to pause and reflect upon lessons we have learned. Within Lean active learning is an important aspect on this journey because without learning we can not improve.

Feel free to share some of your favorites here as well.

"Good management is the art of making problems so interesting and their solutions so constructive that everyone wants to get to work and deal with them."  —Paul Hawken, Natural Capitalism

This quote reminds me of a recent post on what it takes to be a lean manager. The challenge of Lean managers is to lead as if they have no power. In other words, shape the organization not through the power of will or dictate, but rather through example, through coaching and through understanding and helping others to achieve their goals.

If you enjoy this post you may want to connect with me on Linkedin or follow me on Twitter.  You can also subscribe to this feed or email to stay updated on all posts.  For those Facebook fans join A Lean Journey on our facebook fan page.

Exciting News from A Lean Journey!

I will be a guest on the world famous The Lean Nation radio show Thursday, April 15 from 4-5pm (ET) on 790 AM Talk and Business, hosted by Karl Wadensten.  We're going to discuss what it means to lead in a lean environment, specifically frontline leadership.  This is an important topic and I'm looking forward to sharing my insights on air to a wide audience of business leaders and change agents.

You can listen to my appearance live on 790AM (Citadel Broadcasting, ABC Affiliate) in Providence, RI.  The show is also globally available via a live audio stream at 790business.com.    I would love to hear your opinions and answer your questions, so feel free to call in to the show.  The call-in number is 401-437-5000 or toll free at 888-345-0790.

Can't tune in live?  The podcast will be available after the show!

The Lean Nation is the hottest new show on 790AM and airs from 4-5pm, weekdays and streams online at 790business.com.  The Lean Nation features real world examples and actionable advice from local and national business leaders on how to reinvent yourself into a lean operation in business and in life.  The show's host, Karl Wadensten, is the president of VIBCO, a Rhode Island manufacturing company. Over the last 3 years VIBCO has created a Lean Revolution, using lean methodologies (based on the Toyota Production System).  I am looking forward to the opportunity to visit the Gemba at VIBCO prior to the show.

Under Karl's leadership, VIBCO is now a high performing business culture where lead times for over 1,300 SKUs have dropped from 4-6 weeks to "same day, next day", inventory has been reduced by more than 50%, over 10,000 sq. ft. of manufacturing floor space is now freed up to accept future growth, and sales are well above industry trends.  These impressive improvements are the result of a workforce that is empowered to improve every day and understands the power of Lean Thinking. 

Listen to The Lean Nation to learn how you can get similar results in your business and learn about lean leadership!

How to Deal with Low Performers

The other day while in the Gemba a production lead asked for some advice.  As we were talking about the performance of a new work cell the lead expressed some concerns about an individual’s performance.  At first I thought this was a question in how to discipline employees but upon further questioning of the situation I realized this was really about dealing with a low performer on the production line.

As we create cells and learn to balance the work content in the cell the flow of the line becomes dependent on everyone meeting their expected outcomes.  Low performers tend to stand out and can become a bottleneck in the cell.  Most employees want to do a good job at work and experience shows that our systems general dictate performance.  A production lead should use this simple 5 step checklist to determine what to focus on when trying to improve an individual’s performance. 

1) Are the tools and equipment the person is using calibrated and working properly?

2) Are the parts and materials they are using within specifications?

3) Has the person been trained?

4) Have the expectations for performance been made clear?

5) Has there been regular feedback on performance?

An answer of “no” to any of these questions will indicate an area for which focused improvement is needed.  If you find you can rule out all these questions then your options are limited.  You must now consider an important distinction between those individuals who “can’t” do the work and those who ”won’t” do the work.  If you can find another area for the individual who can’t keep up in the cell then you should do so.  In the other case you will need to consider a formal progressive discipline system for the “won’t” workers.  With this formal discipline system you may find that many of those in the “won’t” group find a way to meet the expectations.

Many times our discipline systems don’t include dealing with low performers in this manner.  This leaves a tremendous burden for our production leads to deal with.  If we are committed to lean production, management must provide a system to support disciplined adherence to the standard that applies to all.  I am reminded of a saying from a fellow lean practitioner, “You deserve what you tolerate.”

If you enjoy this post you may want to connect with me on Linkedin or follow me on Twitter.  You can also subscribe to this feed or email to stay updated on all posts.  For those Facebook fans join A Lean Journey on our facebook fan page.

Lean Quote of the Day - April 9, 2010

On Fridays I will post a Lean related Quote. Throughout our lifetimes many people touch our lives and leave us with words of wisdom. These can both be a source of new learning and also a point to pause and reflect upon lessons we have learned. Within Lean active learning is an important aspect on this journey because without learning we can not improve.

Feel free to share some of your favorites here as well.

“Safety isn't just a slogan, it's a way of life.” ~Author Unknown

When it comes to business the priorities must safety, quality, and then productivity.  There can be no compromise on the first two.  If you do safety and quality well then everything will be easier to accomplish.  Safety must be ingrained into the culture of the organization through daily habits. The best model for daily one-on-one observation and feedback is coaching. The letters of COACH represent five fundamental steps of safety coaching: Care, Observe, Analyze, Communication, and Help.  Review this post for the details of each step of the Coaching for Safety Model.


If you enjoy this post you may want to connect with me on Linkedin or follow me on Twitter.  You can also subscribe to this feed or email to stay updated on all posts.  For those Facebook fans join A Lean Journey on our facebook fan page.

Top 10 Lean Facebook Pages

With 450 million users globally (and millions more being added each week) Facebook is dominating the web in unparalleled ways. Facebook has eclipsed Amazon, Walmart, Netflix and even Google as the foremost brand name in web searches from U.S. users, according to research from Hitwise.  It was the most visited site on the web for the week ending on March 13, 2010, surpassing even Google in week-long stats for the first time in history.  Facebook claims that half of its user login each day and the average user spends about an hour on Facebook.

In honor of these recent achievements I thought I would highlight my top 10 Lean Facebook fan pages, in alphabetical order: 

A Lean Journey – This is the facebook site of A Lean Journey Blog, published by yours truly. This site is dedicated to sharing lessons and experiences along the lean journey in the Quest for True North. The blog also serves as the source for learning and reflection which are critical elements in Lean Thinking. 

AME Connect - AMEConnect is the official fan page for the Association of Manufacturing Excellence.  The website is designed to provide members with the ability to find industry experts, distribute topic-based information in a collaborative format, and empower online communities to work more effectively together. 

K-Dub's Lean Nation Radio Show – This is the fan site for The Lean Nation Radio show hosted by Karl Wadensten on 790 AM in Providence, RI. Get real world examples and actionable advice from local and national business leaders on how to reinvent yourself into a lean operation (in business and in life). This collaborative, interactive show will share best practices and tips to remove waste and cost from your work and life.  

Lean Blog – The fan page of Lean Blog, published by Mark Graban.  Check out this site for discussion about the lean methodology in factories, hospitals, and the world around us.

Lean Enterprise Institute - The Lean Enterprise Institute (LEI) is the official Facebook page of LEI.  It helps companies transform themselves into lean enterprises, based on the principles of the Toyota Business System.  

Lean For Everyone: Simplify your business and your life! - Lean For Everyone is the fan page published by blogger John Wetzel.  Lean for Everyone is about making your business, work and life easier by finding simpler ways to accomplish your daily tasks. 

Lean Learning Center – Jamie Flinchbaugh of The Lean Learning Center manages this Facebook page.  The Lean Learning Center helps individuals and companies with successful lean transformation through education, coaching, strategy, application, and products. 

The Lean Way Consulting – This site is the creation of Ankit Patel from The Lean Way Consulting Blog.  The focus is on improving companies by changing the culture and the processes. 

The Shingo Prize for Operational Excellence – This is the official Facebook site of The Shingo Prize.  The mission of The Shingo Prize is to create excellence in organizations through the application of universal, self-evident principles of operational excellence and the alignment of management systems and improvement techniques throughout an entire organization. 

Value Stream Leadership - This is Facebook fan page of the Value Stream Leadership by Jim Baran and Kristi Boyer. VSL is the first firm to create a solution that fuses the hiring of Lean talent to lean engagement.  

So if you are one of the over 225 Million on Facebook daily you may want to spend part of your hour online staying informed of all things Lean by becoming a fan to these great sites.