The primary objectives of any manufacturing operation are to produce quality products as quickly as possible for the lowest cost, with safety of workers never compromised, and with no negative impact on the environment (green). Lean manufacturing principles fully implemented will drive velocity improvement and reduce the per unit cost. Six sigma and ISO 9001/2000 certification properly and consistently executed on the factory floor should deliver world class product quality. Safety should be at or below world class standards of incidents rates of two or less with no lost time accidents (LTA). As a manufacturer of Industrial Products (my target market), you should combine metrics in all of these areas to form a standard of achievement that you define as Manufacturing Excellence for your business.
Manufacturing Excellence defined:
Lean – With the lean process, continuous improvement is a given. Therefore, you are never really done improving your processes and eliminating waste. However, you can and should rate your progress. I think the best measurement is how your cycle time compares to competition. From order entry to product shipment, are you faster than your competition (like for like products)? If not, determine the areas keeping you from being the best and use process mapping to find solutions.
Quality – Being ISO certified is a requirement. However, it is not the end-all. I have seen companies pass ISO audits and still have poor quality performance yielding high scrap and rework rates and unacceptable warranty and returns. First pass yield should be 100%. Overall product quality should be no less than three sigma (99.7%). If you are not at these levels, identify the areas causing the problems and resolve the issues. Your customers expect nothing less.
Safety – Your safety program illustrates in real terms the concern you have for your employees’ well-being. Lost time accidents are never acceptable. Incident rates below two are considered world class. If you are falling short in either of these areas, you have work to be done before you can classify yourself as having excellence in manufacturing. Your safety program should be ISO 18001 certified.
Environmental – Being a good corporate citizen is expected in today’s business world. It is simply the right thing to do. Being ISO 14001 certified and 100% compliant for every audit is the standard for manufacturing excellence.
My point is that if you are just focusing on lean initiatives, it is not enough if you are trying to attain true manufacturing excellence. Quality, safety, and environmental programs that are deficient cost the business every bit as much as processes that are not lean. However, excellence in safety, environmental, and quality when teamed with lean processes deliver winning performance in the marketplace, the income statement, and employee pride and satisfaction.