Production is subject to major changes, not just because of the coronavirus pandemic.
Lean Manufacturing is based on the premise that reducing waste, eliminating redundancies and working precisely are the keys to success in the market.
In this model, additional inventory equates to wasted resources. A supply chain is required that is always active, always available and always responsive.
But as we can see, this assumption doesn’t always work. For manufacturers who make parts for cars, airplanes, machines, and other essential pieces of equipment, for example, a just-in-time inventory model can be used, where you only hold the minimum of additional inventory you need to meet customer demand. They cannot be operated if the plants have been shut down for three weeks, for example due to a global pandemic.
This new reality poses a challenge to lean manufacturing, but it does not mean that the model itself is no longer relevant. This means that transparency and real-time visibility are vital if companies want to keep operating on lean principles.
One company, iBASEt, has been involved in supply chain visibility for some time and over the past year the demand for its services has skyrocketed. I recently spoke to iBASEt CEO Naveen Poonian about how lean manufacturing is changing in the wake of the pandemic. Here’s what he had to say.
The challenge for lean companies
The biggest challenge facing manufacturers in industries like aerospace and automotive as we emerge from the pandemic will be: Finding ways to keep their lean practices from negatively affecting their recovery.
“What we do know is that when the demand comes back, it will come back quickly,” says Poonian. “There is so much pent-up demand for travel, for example for new cars. If manufacturers wait for their supply to hit until the comeback is obvious, you are in trouble. Other companies will have moved in first. ”
In other words, if your principle is that you want as little idle inventory as possible, you are not ready to boot up as fast as necessary.
Real-time information is key
One way to balance lean processes with the “almost normal” that the pandemic is wearing off is to invest in technology that provides real-time visibility into everything from your supply chain to your orders.
In this way you can not only prepare for the future with more and better information. Plus, you can react faster as demand accelerates or slows down, giving your business a real competitive advantage. “Companies need to improve their real-time visibility so they can see the important metrics,” says Poonian. “Seeing all of your results in real time is very different from seeing them in a report at the end of the week.”
Cloud-based technology enables better interoperability and system integration
G Suite, Microsoft Office, and other cloud-based programs we’re all familiar with have made quick and easy software updates the norm. Since everything is based in the cloud, software updates can be frequent, automatic, and without disrupting user workflow.
However, this is not the norm in manufacturing, which in many cases is tied to monolithic, server-based systems, the maintenance of which is both time-consuming and costly. In addition, it is often difficult to integrate these programs with other systems that come online as the needs of the facility change or become mature.
The problem with this, in addition to the drain on resources, is that real-time visibility and performance can only be achieved if you have interoperable, integrated systems.
iBASEt is the first manufacturing technology company to use this cloud-based microservices architecture model, which follows Amazon, Netflix and Spotify, among others. “With this model, you don’t have to tear out the old and use the new – you just keep improving it. They will continue to be updated and changed without affecting the user experience, ”says Poonian. “It is perfectly prepared to meet the need for real-time data. And there is no problem connecting one cloud app to another, as this is done via APIs. ”
Lean Manufacturing has to adapt to achieve this “almost normally” and soon. Companies that wait to be sure the demand is there will be out of the running – while those that invest in technology that create more transparency and real-time visibility will be ahead.