Making business a lean machine

2011-09-13 00:00

OUR unemployment levels are unacceptably high and we must do something about this, but what?

Since the majority of people who need jobs are relatively unskilled and have a limited education, it has been suggested that manufacturing possibly holds the best hope for job creation.

In talking to industrialists about the major barriers to growth (and hence, job creation), it seems that they face many challenges, with the inability to compete with cheap imports listed as the most severe.

So how can we help manufacturers to become more competitive?

Realistically, we are never going to be able to compete with the East on labour as an input cost, so we need to look at other areas of potential cost savings. We need to help industry to become more efficient, to work smarter and leaner, which will allow it be more competitive and hence to grow.

To me, the implementation of lean manufacturing or lean production is a move in the right direction. Lean manufacturing is an operational strategy aimed at achieving the shortest possible cycle time by eliminating waste. It is derived from the Toyota Production System and its main focus is to increase the value-added work by eliminating waste in the process.

Lean is a production practice that sees the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and consequently a target for elimination. Its principles can be applied across all businesses.

Implementing lean decreases the time between a customer’s order and delivery. It is designed to improve radically throughput time, profitability (by lowering costs), customer satisfaction and employee morale. Quicker “throughputs” can be used as a tool to secure preferred relationships with retailers — by “just-in-time” replenishment, retailer stock-holding costs can be saved, making local suppliers much more attractive.

This gave me an idea of how the chamber can help. In an effort to get industry really to understand and to embrace lean, the Pietermaritzburg Chamber of Business, in partnership with Training and Leadership Consulting, and supported by the Department of Economic Development and Tourism, Productivity SA and The Witness, will host a Lean Manufacturing Congress from October 18 to October 20 at the Royal Showgrounds. In so doing, we will be able to provide business with the opportunity to gain a better understanding of lean.

We are thrilled that international lean expert and author Michael Balle has agreed to present at the congress. Balle is an associate researcher at Telecom ParisTech, and holds a doctorate from the Sorbonne in social science and knowledge science. For the past 15 years, he has focused on lean transformation, i.e. how companies use lean techniques to develop a lean culture. He has written several books about the links bet­ween knowledge and management (Managing With Systems Thinking, The Effective Organisation and Les Modèles Mentaux), and more recently, co-authored two business novels published by the Lean Enterprise Institute, one about lean turnaround, The Gold Mine, and one about lean transformation, The Lean Manager. He is a leading expert on lean-transformation initiatives, and an engaging and colourful public speaker, experienced in running interactive workshops with large audiences.

The congress will offer several other presentations during the morning sessions that will address the practical application of lean in various other sectors, like health and government, and it will look at lean application and management. We have two award-winning benchmark factories in Pietermaritzburg and delegates will have the opportunity of visiting these factories in the afternoons. The champions at these factories will share their “lean journeys” and Balle will provide input. I think that it is important for delegates to see lean working in the South African context. Delegates will be shown how lean can be implemented in a labour-intensive factory, and in a highly mechanised environment. There will also be several workshops on offer in the afternoons. The final session will be a practical exercise, during which delegates will have the opportunity to make lean changes in a simulated business environment.

We will be targeting businesses country wide through the chamber network in an effort to spread the lean message as far afield as possible. In so doing, we hope to instil a better understanding of lean, and to inspire delegates to become change agents in their factories and businesses. We also hope to set up a local network of lean forums, where champions can share knowledge.

Ultimately, we hope to help stimulate growth through change, and consequently help create sustainable jobs.

• Melanie Veness is the CEO of the Pietermaritzburg Chamber of Business.

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