Many OEMs have adopted lean manufacturing as a keystone for success in today’s worldwide market. A lean manufacturing approach offers companies an array of benefits. When lean principles are applied, sources of waste are reduced, or even eliminated, improving operations efficiency and product quality – adding significant value for customers. With shorter production times, manufacturers are more nimble and able to respond to customer needs and market conditions. Additionally, lean strategies can be applied to supply chain and product development processes, leading to quicker speed to market and a significant competitive advantage. Whether OEMs perform production in-house or outsource to a contract manufacturer, like RiverSide Integrated Solutions (RIS), it is important to understand lean principles and how they can give your team a competitive edge.


The 5 Key Principles of Lean Manufacturing

Lean principles focus on streamlining production to improve value and productivity while minimizing waste. From a lean perspective, waste is considered anything that does not add value.  Below are the 5 key principles of lean manufacturing: identify value, map the value stream, create flow, establish pull, and seek perfection. When your contract manufacturer effectively implements these concepts, lean manufacturing results in significant efficiencies and productivity gains that lower production costs – providing the advantage companies are seeking. These principles can be successfully applied to any manufacturing sector.


1. Value – this lean manufacturing principle is based on how the customer defines “value”. It is nearly impossible for contract manufacturers to streamline a manufacturing process if the value points are not clearly defined and communicated.

In manufacturing, value requires designing and manufacturing products that meet the needs of customers as well as removing features or “extras” that are not necessary. Design for Manufacturing is an example of a process that companies often use to identify – and eliminate – waste in product design and production. Design for Manufacturing (DFM) is the process of designing a product for ease of manufacturing as well as a creating a better, more cost-effective product. DFM is a vital product-development step that looks to simplify and optimize the design to ensure high quality and efficiency during production along with integrity once in the field. The goal of DFM is to reduce manufacturing costs and avoid costly disruptions without sacrificing quality or performance. Visit our website for additional tips on how to incorporate Design For Manufacturability (DFM) as part of lean manufacturing.

2. Value Stream – this step involves mapping out the processes that contribute to the value stream from beginning to end. It often starts with raw material acquisition and ends when the final product is delivered to the customer. Once the value stream is mapped, it is easier to identify and address steps that do not add value. This is a critical aspect of lean manufacturing as the purpose is to identify potential waste areas and then work to reduce or eliminate the waste.

Identification and elimination of waste are crucial to the success of lean manufacturing. There are several types of waste that are often identified when contract manufacturers apply a lean approach to manufacturing, and below are some of the most common.

·Waiting: this applies to personnel or machinery. When time is wasted by waiting on machines to be available or materials to arrive, the efficiency of the facility suffers.
·Unoptimized Inventory: too much or too little inventory both lead to inefficiencies and waste.
·Inefficient Logistics: logistics includes the workflow of the product on the manufacturing floor but also extends beyond the facility to include the acquisition of raw materials as well as the transportation of the final product to the customer.
·Over-processing or Over-engineering: the objective of manufacturing is to meet specifications per the agreed upon design. There is often a significant amount of wasted time, equipment and resources spent on over-engineering and over-processing a product.
·Unnecessary Motion: this can be wasted motion of personnel or equipment. Reducing unnecessary motion is key to improving the entire manufacturing supply chain. Facilities that are organized and laid out well excel in this area.
·Defects or Other Quality Issues: scrapped products and rework of off-spec products can be a huge area of waste if quality control is not properly built into the manufacturing process.

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3. Flow – once the waste is removed, operations should run more smoothly and efficiently – improving product flow. Efficient product flow requires items to move from procurement to production to secondary operations to packaging to customer delivery with minimal delays or interruptions.  Contract manufacturers that apply lean manufacturing principles should follow raw materials throughout the manufacturing process to better understand areas for improvement and optimize the facility layout, materials handling, and personnel touch points for success.  A well-organized manufacturing facility achieves efficient product flow, reducing production times and inventory requirements.

4. Pull – with the process running more smoothly, contract manufacturers are able to use a pull-based production system – another principle of lean manufacturing. Products can be manufactured and delivered “just in time”, reducing inventory requirements and costs. This also results in shorter time to market, further driving competitiveness.

The key to pull systems, like Just-in-Time (JIT) manufacturing, is to have the right materials and products at the right quantity where and when they are needed during the production process – in order to produce only the volume that is required at the right time. With JIT, order placement triggers when products should be manufactured. For this reason, raw material and final product levels are kept low to reduce waste on surplus inventory and avoid overproduction. Comparatively, with traditional, push manufacturing systems, a supply purchase triggers the process and material is “pushed” through the process even when an order may not exist. These push systems are easier to create, however, they often result in larger inventories and other waste.  For more on the benefits of RIS’ Just-in-Time manufacturing, read our short article.

5. Perfection – the final principle is to seek perfection. This concept is about continuous improvement as lean manufacturing is intended to be an on-going assessment to avoid waste and inefficiencies from creeping back into the process. This principle often seems easy but is very difficult to implement as it requires contract manufacturers to be diligent continuously – not just for a fixed period of time.

One way to seek perfection is with the company culture. Companies with a lean culture ensure all personnel are empowered to participate in continuous improvement efforts. It is important that all levels of the organization participate in the lean culture from management to the production floor. At RIS, a key focus of our lean manufacturing approach is maximizing customer value while minimizing waste – and we empower every employee to make a difference.

About RIS

RIS is an advanced contract manufacturer providing robust solutions in circuit board assembly, product assembly, kitting, supply chain management, fulfillment, distribution, and reverse logistics. We employ more than 300 people and provide services to OEM’s across the world. We operate 3 state-of-the-art manufacturing facilities within the U.S, and as your one-stop-shop we have the capabilities, capacity, quality assurance standards, and resources to provide you with support for all of your manufacturing needs.

With all of the choices in contract manufacturers out there, we know it can be difficult to find someone that not only understands your business model but also has your best intentions in mind. RIS has proven to always be a win-win focused relationship. As your one-stop-shop, we have the capabilities, capacity, quality assurance standards, and resources to provide you with support for all of your manufacturing needs. We understand that supply chain management is difficult and very time consuming, so we urge our customers to utilize us in the fullest capacity. Our total-package solutions include:

· Extensive supply-chain network

· Purchasing and inventory management

· Dedicated Program Manager

· Warehousing and drop-shipping capabilities

· Flexible order fulfillment

· Product assembly: sub-assembly and full product

· Scalability to meet your needs

Contact us today at (507) 523-3220 to see how we can help with your manufacturing project, or click here for a quote.

Lean Manufacturing Principles
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Lean Manufacturing Principles
Lean manufacturing principles for contract manufacturers: identify value, map the value stream, create flow, establish pull and seek perfection.
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RiverSide Integrated Solutions
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