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NAI TECHNICAL REPORT |
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Management Topic: North American Industries is Becoming Lean The Lean philosophy has become a way of life for many manufacturing businesses. Simply put, Lean is a comprehensive way to improve company performance by increasing reliability and speed throughout the organization. Whether an office, manufacturing or field service function, the goal is to increase efficiency by eliminating wasteful activities. As North American Industries (NAI) has moved to serve customers with more complex overhead lifting requirements, its need to handle larger, more complex projects has grown. In particular, the flow of information with customers and within the Company has become more important. In response, NAI began to implement Lean in mid-2009 with the goal of serving all of the Company’s valued customers more quickly and with ’promise’ dates on which customers can rely. After examining all of its processes, NAI management decided to introduce the ‘buffer’ process to its operation. A ’buffer’ is a planned wait time in-between operations. Management uses the buffer to ensure that all work done to that point is timely, accurate, complete and organized. This has resulted in an organization geared to handle complex jobs, particularly those with rigid specifications and/or tight time requirements. Also, the speed with which NAI completes jobs has increased significantly. Activities are coordinated tightly, and reliability in scheduling is at a very high level. NAI has also undergone a review of its product designs, component usage and vendor performance. Over a period of several months, members of all departments contributed to the effort. The result has been a dramatic reduction in the number of SKUs that the Company uses to produce its cranes, while at the same time improving the quality and durability of the cranes. For example, NAI has reduced the number of transformer, motor and enclosure SKUs that it uses by 50-75%. At the same time, the lead times on these components declined from several weeks to 1-2 days. Becoming Lean allows NAI to remain price-competitive while improving its product quality, responsiveness to customer’s needs and scheduling accuracy. NAI has eliminated unneeded materials, simplified its designs, decreased lead times on purchased parts and sequenced activities more closely. Customers are seeing the benefits, based on a number of testimonials. NAI views this as a continuing effort and expects to focus on deeper vendor relationships in the next phase of the process. If you are interested in learning more about how NAI is getting Lean, we will describe different aspects of our Lean culture In upcoming NAI Technical Reports. |
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First Quarter 2010 |