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The concepts behind Lean manufacturing were built on common sense. In his book “Poor Richard’s Almanack”, Benjamin Franklin wrote “He that idly loses 5s. [shillings] worth of time, loses 5s., and might as prudently throw 5s. into the river.” If I read this right what he meant was “if you don’t need it, don’t waste your money on it.”

While it was Henry Ford who took the concept of waste reduction into the manufacturing floor, it was Toyota that concretized the practice into what we now call lean concepts.

Lean manufacturing processes have revolutionized the way many leading enterprises deliver products to their customers and manage their supplier relationships. Over the past few years, the use of Lean techniques has expanded well beyond the automotive industry to delivering dramatic results in other sectors, including aerospace, consumer goods, and industrial equipment, among others.

According to AberdeenGroup, Lean concepts have helped manufacturers streamline processes and reduce cycle times in complex manufacturing and supply chain environments. For example, when applied to product development these same concepts result in increased productivity and potentially the ability to develop more profitable products.

In “The Lean Benchmark Report, Closing the Reality Gap,” Jane Biddle, Vice President of Manufacturing Research, AberdeenGroup, notes that although C-level executives are enthusiastic about the benefits that can be derived from “Leaning out” operations. A large performance gap exists between those companies that are simply using Lean techniques on the shop floor versus those that have built a culture based on Lean thinking.

Lean manufacturing is nothing new. Some of the best run manufacturing businesses in Asia have deployed Lean manufacturing to streamline operations, reduce cost and increase operational efficiency.

Asia awareness levels

Just how familiar are manufacturers with regards to Lean concepts? Large manufacturers with multiple operations spread across different countries understand the concepts well and are in various stages of implementation (bear in mind that in the case of Toyota, adoption of lean concepts is an in-going process).

Ronald Li, Director of Industry and Product Marketing at Infor, says that the level of understanding of what constitutes “Lean” in a manufacturing sense varies by country as well as by type of industry. “Across Asia, companies that have taken the road to ‘lean’ are more likely to pursue this strategy to achieve departmental improvements. In mature countries such as Japan, manufacturers have been practicing lean for many years, especially on the manufacturing floor.

Paul Liddiatt, APAC Program Director for Oracle Commercial Applications concurs and adds his thoughts: “The application of Lean manufacturing principles to the entire supply chain is now being seen as the imperative in order to deliver the responsiveness customers require while still keeping a tight reign on costs. Once Lean manufacturing techniques are understood they are seen as the key to eliminating waste in all its forms from the supply chain. Without the burden of waste, the supply chain delivers significant competitive advantage.”

Methodologies vary

As something based on common sense, Lean implementations can come in the form of pencil and paper or entries in a spreadsheet. While workable, these are neither scalable nor sustainable. Companies that have progressed far advanced in implementing lean are likely to depend on systems that take a more holistic approach to support lean deployments.

As companies begin to extend Lean concepts across departments, integrated business applications suites are being seen as helping them to manage information more efficiently.

“These applications rely on a single, integrated source of data to connect disparate business processes, not just within the company and its factory but also throughout its entire supply chain. This may comprise multiple contract manufacturers. When users make a change to one application, every other application is notified, initiating related workflow processes automatically,” said Liddiatt.

ERP vendors have also introduced “enablers” that adapt their applications to a Lean environment, with inherent support for Kanban control, product configurators, and just-in-time materials procurement. This level of integration allows companies to compress the manufacturing process and streamline production, reducing the time for the whole order-to-delivery cycle.

Liddiatt cautions that ERP applications are just management tools that support the operations of a manufacturing plant. An ERP package helps users use information more wisely, eliminate non-value-adding activities and streamline core business processes. “To successfully implement Lean manufacturing concepts, appropriate training and resources need to be invested so users embrace the principles of Lean,” adds Liddiatt.

Lean initiatives, fat benefits

At the end of the day, companies deploy Lean initiatives because they want to save money. Call it ‘cost cutting’ or ‘waste elimination’ or ’saving pennies’ the end goal is the same: eliminate what is not necessary to get the job done and deliver the promised goods.

Biddle surmises that for companies willing to make the commitment, Lean pays dividends in both the short and long term. Successful Lean implementations have met and exceeded the performance expectations of 80 percent of best-in-class companies in areas such as customer service and supply chain flexibility.

“In many cases, technology solutions are enabling best-in-class companies to outperform their competitors by continuously measuring, monitoring, and responding to key production metrics in real-time. Additionally, ERP, Lean Specialty/MES, and homegrown solutions provide the foundation from which companies are enshrining value streams, improving productivity, preparing for new product launches, and driving culture change throughout the company and supplier base,” adds Biddle.

Role of technology

Many Lean initiatives start on paper. Over time these “technology-less” implementations become impractical for a number of reasons. According to Biddle, customer expectations continue to escalate, driving the need for additional variations to existing products, faster launches for new products, and decreased order cycle times; this requires increased flexibility in existing plants, with suppliers, and across the supply chain.

Pricing pressures have driven many manufacturers to outsource production, which has resulted in a lack of visibility into foreign operations; this is driving the need for web-based solutions that enable decision makers to see and control key operations remotely.

Finally, leading companies are scaling and extending their Lean processes beyond a single plant to encompass supply chain partner processes; this is driving the need for a technology infrastructure that facilitates the design and implementation of customer-focused business processes.

Lean technology solutions can provide a solid foundation from which manufacturers can manage Lean transactions across core value streams that extend from the customer, through production, and back to the supplier.

Lean solutions should support Toyota Production Systems (not because you work for Toyota) by dynamically managing key control points, scheduling and tracking critical resources, and promoting continuous improvement programs. In addition to managing transactions, solution technologies should facilitate the capture of standardized processes and value stream operating models.

Finally, Lean solutions should support the principles espoused in the ‘Toyota Way’ by embracing common language, promoting a shared understanding, providing tools that enable collaboration, and institutionalizing a culture of Lean for the long term.

Lean challenges persists

AberdeenGroup warns th
at for any manufacturer, transitioning from a traditional to a Lean manufacturing environment is a major change for many reasons. A significant cultural change needs to happen. It may be business as usual but certainly the way to go about business as usual will not be the same. People need to be willing to change the way they do things and that process of change is where much of the challenge lies.

Another challenge will be a persistent and firm commitment from senior management. Lean will mean a company’s long-term vision and senior management must not be distracted by short-term concerns when Lean initiatives are concerned.

Lean manufacturing goes against the grain of many manufacturing traditions. The old measures of success of efficiency and utilization need to be replaced with agility, lead-time, inventory turns and quality across the board.

Liddiatt warns that an upheaval inherent in Lean programs means that the engagement of senior management is required for successful implementation. “A top-down approach is necessary for adequate resources to be allocated to train employees and change the thinking within the company, and resolve is also necessary to push through reorganization in production processes and inventory management,” adds Liddiatt.

Beyond integrating legacy systems with the new Lean initiative is the necessity of integrating external partners and suppliers into the Lean program.

“Meeting customer requirements for just-in-time deliveries requires the support and cooperation of not only finance and logistics, but also the suppliers who provide the raw materials, components, and assemblies that are used early in the manufacturing process,” Biddle says.

Liddiatt agrees and adds that as Lean principles take hold, innovative companies will realize that they need to involve their suppliers and even their customers to achieve continuous improvement. “Suppliers should be considered an extension of the company, and the most successful lean companies involve their suppliers in product design in order to improve quality and simplify manufacturing. They work together to improve communication methods and shorten lead times throughout the supply chain,” says Liddiatt.

Manufacturers are constantly on the prowl to weed out waste and inactivity. As Toyota has shown, this is a continuous process with benefits trickling right across the operation. Because Lean concepts cut across functional barriers, it is entirely, some experts actually support the idea, to shift the focus from Lean manufacturing to Lean enterprise.

Lean manufacturing’s main keys are the following:



Perfect first-time quality – quest for zero defects, revealing and solving problems at the source



Waste minimization – eliminating all non value-adding activities and safety nets, maximization of scarce resources (capital, people and space)



Continuous improvement – reducing costs, improving quality, increasing productivity and information sharing, pull processing: products are pulled from the consumer end, not pushed from the production end



Flexibility – producing different mixes or greater diversity of products quickly, without sacrificing efficiency at lower volumes of production, building and maintaining a long term relationship with suppliers through collaborative risk sharing, cost sharing and information sharing arrangements.



The world’s economy today is always changing and more competitive than ever. There are new companies created everyday and old ones tightening their grip on their thrifty empires. For any of these companies to remain successful or become successful, they must find a way to stay on top of their game and please the customer better than ever before. Increasingly, successful companies are turning to lean business practices (lean manufacturing, lean customer service, lean office, lean distribution, lean public sector) as the answer to staying on top of their industry. Lean 5S is not necessarily a particular way of producing a product. It is instead a philosophical way of thinking.

McDonald’s can be said to have recently implemented a lean technique. McDonald’s no longer makes an abundance of food to wait in holding bins in anticipation of a meal time rush. If a rush does not happen, then there is an obvious waste of food as well as labor. Instead, McDonald’s has focused on making the food when the customer orders to provide a fresher and hotter meal. A focus on consistent labor training and improvement is the key to keeping this service speedy and reliable. By implementing this new “leaner” way of thinking, waste of food and labor has been minimized, which is the main goal of the lean process.

Lean manufacturing was actually born in 1914 with Henry Ford and the mass production moving assembly line. Lean relies on keeping a steady flow of product out the door to the customer. Ford’s system did exactly that, though it was missing some of the most important and common factors in today’s lean philosophy. The original Ford assembly line was putting out thousands of Model T cars at a vast rate. The problem was that it did not matter what the customer demand or requests were; there was a base black Model T available. They didn’t worry about customer satisfaction or demand whatsoever. The Ford motor company stuck with mass production and had a large stock of inventory (waste) just sitting around. Although Toyota is credited with beginning Lean Production with their Toyota Production System, the roots of “lean” date back as far as the 16th century. In 1570, King Henry III of France watched in amazement as the Venice Arsenal built galley ships in less than an hour using the continuous flow process.

Later in the 1940’s The Toyoda Loom Company had problems of its own. After World War II when Japanese industry was decimated, the Toyoda family decided to extend Toyoda Automatic Loom Company to start an automotive company. They had some cash but did not have the infrastructure. They certainly could not compete directly with the established companies like Ford. Therefore, their sole demand was in Japan, which meant supplying small quantities with high variety, while Ford was selling any color Model T you wanted as long as it was black. Toyota also had to rely on outside supplier partners to make the capital investment needed to get in business. Taiichi Ohno, leader of the Toyota manufacturing enterprise, came up with a system now called the Toyota Production System (TPS). He did not do this alone though. Ohno diligently studied Henry Ford and his company’s philosophies on manufacturing. Toyota and Japan had the problems of not enough space, resources, or demand to compete with the larger automobile manufacturers of America. By assessing and solving these problems, Ohno began the TPS and the manufacturing revolution known today as Lean Manufacturing.

After WWII, Ford was ten times more productive than Toyota, but between 1945 and 1970, Ohno’s Toyota Production System was revolutionizing the Japanese automobile industry. It was during this time the rest of the world and particularly the United States started realizing the overwhelming benefits of lean manufacturing. The U.S. auto industry paid particular notice when The Machine that Changed the World was published highlighting the great accomplishments of Toyota and the huge gap between Japanese quality and productivity and auto companies in the West. The book coined the term “lean manufacturing” because Toyota was doing more with less of everything – less space, less people, less capital and less inventory.

As said before, Lean’s main goal is to eliminate or at least minimize waste. Lean 5S also seeks to streamline the workflow throughout the production process. By eliminating waste, a lean system eliminates variability in the process itself and in the cycle time of materials. The cycle time is the length of time production materials spend in process, while processing time is the length of time required to process any particular item at any given workstation. By eliminating variability within these two lean concepts, companies become more efficient, and are able to reduce the final costs of producing a customer-demanded quality product. Reducing variability is a core objective of Lean. In fact, variability reduction could be defined as Lean in action. Some of the benefits of reducing variability or practicing lean principles are shorter cycle times, shorter lead times, faster response times to customer demands, lower costs, greater flexibility, higher quality, better customer service, and higher revenue. Certainly, these are all elements of creating a successful company, capable of meeting the changing demands of a highly-competitive marketplace.

The International Society of SixSigma provides the acronym DOTWIMP for recalling the seven wastes associated with Lean:

· Defects : A defect is defined as anything produced through the process that the customer is not satisfied with or is unwilling to pay for. Usually referred to as errors, defects disrupt the production process and require a greater final investment to produce a product for profit. Initially, most defects require less production time to produce than the intended high-quality product. This is because most defects occur because at least some facet of the production process was skipped or missed. In the end, however, defects are cost nightmares for companies. The additional steps they add to the production process are exponential, since most steps in the process are repeated. In addition, the intrinsic costs are immeasurable. Lack of customer confidence, added customer operating costs, and dissatisfaction with the purchased products are all end costs of defects that destroy company profits and longevity in the marketplace.

· Overproduction : Think back to the Ford model of production in the early 1900’s. What value did the hundreds of excess Model T’s create? In essence, they only created greater expenses for the company. Valuable resources were tied up in goods that could not be readily sold. This creates wasted time, labor and resources that could be allocated to other areas, such as customer needs, process improvement, or business growth.

· Transportation : This deals with the movement of raw materials from vendors, to parts through the production process, to the finished goods reaching the end user. Lean seeks to streamline this movement so that unnecessary handling of raw materials, excess movem
ent of parts, and increased steps in the distribution process are eliminated.

· Waiting : One of the major problems with the Ford assembly line approach is that not all steps are in synchronization with each other. One step might require five minutes of labor to complete, while the following step might require only two minutes to complete. Obviously, when this is the case a disruption of movement will occur, and the process will be in a “waiting” mode. Lean works to eliminate or minimize this waiting period by combining some steps and separating others, so that each step is more closely matched to the ones before and after. This reduces the amount of time an employee has to sit idle while being paid.

· Inventory : When Toyota began developing into an automobile manufacturing facility, they were forced to eliminate as many additional costs as possible. One way they did this was to eliminate capital resources sitting unused in their parts warehouse. They realized that if their revenue was tied up into parts that could not be turned around into saleable goods in an efficient manner, then they would most likely not survive as a young company. Instead, they worked closely with their supply partners to receive inventory that was needed to manufacture goods in accordance with customer demand. The goods were then sold more quickly, and greater cash flow was created to purchase the next order of parts from suppliers.

· Motion : Hours and hours of production are wasted seconds. Lean addresses this problem by streamlining the production process at the workstation itself. If a worker takes minutes to find the parts needed to complete their step in the process, Lean finds a way to make the parts more accessible, thereby reducing the minutes to seconds. This might not seem like much of a waste reduction, but consider this model. One worker uses one screw per product in their step in the process. The same worker produces one hundred of these products each workday. The worker must stoop down below the work table each time the screw is needed. This step takes thirty seconds, or 3000 seconds per 100 products. By placing the screw bin in front of the worker at shoulder height, the worker can retrieve the screw with less effort and in only 10 seconds. This motion reduction has saved 2000 seconds per 100 products. When calculating the end cost of this reduction annually, it becomes obvious how reduced motion saves money as well as time. This simple example can save a company as much as 137 production hours over the course of a year. These costs really start to add up when one considers that there are several production steps involved in creating a product for sale. Ergonomically, reducing physical motion decreases cumulative trauma disorders associated with time and expense loss due to injury.

· Processing : This concept can take on several dynamics. It can be simplified to say that any flaw in the process which creates a slowdown in production, a disruption of the process flow, or an increase in needed labor greatly increases a company’s initial investment to create a desired result. This, of course, creates a greater cost, which hinders a company’s ability to remain competitive in the marketplace.

Go Lean or Go Home

Lean is currently a hot topic in most major industries and is coming to an industry near you. Practically every type of industry is currently using Lean: distribution centers, electrical, government agencies, manufacturing, mechanical, office, healthcare, customer service and software and system companies. The current big players in lean manufacturing are Cascade Engineering, General Electric, Hewlett Packard, Intel, Microsoft, Oracle and Toyota. The use of lean thinking is being applied to improve competitiveness and accelerate a company’s growth by managers and CEO’s alike. Perhaps, the most interesting aspect of Lean is that it does not stop with upper management. Instead, Lean is a philosophy that embraces the worker who actually produces the product or service being bought and sold. Today the leader in manufacturing is the United States, due at least in part to the implementation of lean principles in so many of our industries.

Other industries have taken notice and are now applying lean principles to compete. Channel 9 billionaire James Packer had this to say about Lean, “New management at Channel 9 has launched a concerted attack on its cost base in order to restore margins through eliminating waste, improving efficiency and lowering programming costs.”

Companies, no matter how big or small, are switching practices over to Lean methods. Many companies that implemented Lean practices such as General Electric and Hewlett Packard cut their overhead operations by 30% or more. Furthermore sales double and they’ve continued to grow at an accelerated rate. Companies have experienced this growth and success without cutting jobs, which seems to have been the primary solution used to cut cost in the past.

With such overwhelming evidence, and such compelling arguments, it would seem reasonable that all companies would embrace Lean concepts. This is not always the case. There are two primary reasons some companies are not implementing Lean. Some companies are simply ignorant to Lean methodology and clearly do not understand what is involved in process improvement. Since they are ignorant of these practices, they tend to use older methods with which they are more comfortable. Lean cannot and will not happen overnight. Converting to a Lean system takes time and effort, and results-driven people want immediate results. The other primary reason companies fail to implement Lean practices is that they see process changes as new investments, which of course equals new cost. They have invested such great sums of time and money in their current process, regardless of inefficiencies, they fail to understand that initial costs of Lean processes is simply an investment for future growth and profit.

Lean manufacturing is not a set of isolated techniques. It is a complete business system. By eliminating inherent wastes, Lean creates a new way of designing, a new way of selling, a new way of producing, and most importantly, a new way of involving all employees in improving processes, product quality, and customer satisfaction.

It should be recognized and remembered that Lean is not a final goal that a company works towards. It is an ever-changing way of thinking to make the company the best it can be at all times. Simply put, Lean 5S is making the customer happy by getting them their product in the fastest way possible with the highest quality possible while making the largest profit possible. There is no better way to succeed in today’s changing business world. Darwin’s idea that it wasn’t the strongest species, but the most adaptable species that were able to survive and thrive in the changing world, is equally applied to business. Companies who are consistently able to adapt to the changing needs of their customers, and companies who are able to meet these changes with the fewest costs while producing the greatest profits are the companies who will continue to succeed. These companies understand that Lean is a process, a journey, not an end state.

Lead them over the River of Jordan to the Promised Land!

Repo Cars for 90% Off! Seized Cars for $200! Cheap Surplus Cars!

Are these claims true? Sounds like a terrific way to get a bargain car. How does it work? Are these real deals? Is there a catch?

Government car auctions – In a nutshell

Various federal, state, and local government and law enforcement agencies regularly seize possessions, including autos, of bad people and auction them off. Or they buy new service vehicles and auction off the old ones. These are collectively known as “government auctions.”

Banks and lending institutions also repossess property and automobiles from non-paying customers, and sell the goods through auctions.

These auctions are real. They take place almost every day in various parts of the country. In most cases, anyone can attend and participate. And it’s possible to find good deals, but most people don’t know they exist.

Here are some of the common Q&A’s for buying repossessed cars.

Why Are The Cars So Cheap?

Every day thousands of Americans are defaulting on their new or almost new cars car loans and lease payments. Banks and other financial institutions are being forced to repossess more cars than they can store. Automobile storage is a very costly expense, and banks want to get these cars liquidated quickly so that they don’t lose any more money. In fact, car dealers purchase these cars and sell them for a huge profit. You’re effectively cutting out the middleman. You can get access to direct sources where the cars are being sold at prices that look unbelievable to the average car buyer

Can I Really Purchase A Car From $100?

Yes, there are cars to purchase from $100 and they are not junk vehicles. You have the option to inspect them before you purchase them. Many cars at the auctions are almost new with low miles. As an example, if the government seizes a vehicle from an illegal activity, you will have the option to purchase it for pennies on the dollar.

So Why Wouldn’t Everyone Buy A Car This Way?

This is a very protected source of revenue for the majority of car dealerships and is not advertised to the general public. The simple fact is that many people don’t have any idea that they can purchase cars this way so they lose money by paying highly inflated prices to car dealerships. Lots of consumers think these auctions are only available to licensed dealers because they’re not advertised. Car dealerships obviously aren’t going to tell you about it, but we get our members access to the direct sources where they can literally find a vehicle for pennies on the dollar.

Are There Online Auctions That Sell Seized Cars?

Absolutely! The Internet has changed the way auto auctions are done, increasing the ease of access for the public. There are a number of seized auto auctions being conducted online and you can save money right from your own home.

How Complicated Are The Bidding At The Auctions?

They’re not! They ‘re actually a lot of fun! Just arrive at the auction early so you can get a look at the cars that will be up for sale that day. Most bids start at $100. If there are not many bidders at the auction on a given day, you can get your car for a ridiculous price! With our extensive database you won’t have any problem finding these kinds of deals.

Are There Warranties For Auction Cars?

Generally, auction centers and websites offer a 90-day warranty at no cost to you. If you would prefer an extended warranty, you’ll need to pay an additional small fee depending on where you are getting the car. However, many of the cars may even be covered by the original manufacturer’s warranty.

Are There Any Hidden Fees To Worry About?

No. You will be responsible for standard fees like your title, registration, license, tax, etc. You will not be required to pay a luxury tax and you will not be required to pay any dealer-added fees like you would at a dealership.

Are These Vehicles Damaged?

No, they are not. These are repossessed vehicles not salvaged ones. You can inspect these vehicles before you purchase them.

Is There Financing Available?

Yes most of the auctions will have financing. They will provide you with a list of finance companies that will finance you regardless of your credit.

Where Are These Auctions Located?

They are auctions in just about every city throughout the United States.

Did you find the above Q&A on buying repossessed cars useful? You can learn a lot more about how buying a seized car at http://tinyurl.com/yrdbfh