COMPARISON BETWEEN TRADITIONAL AND LEAN MANUFACTURING
For years manufacturers have created products in anticipation of having a market for them. Operations have traditionally been driven by sales forecasts and firms tended to stockpile inventories in case they were needed. A key difference in Lean Manufacturing is that it is based on the concept that production can and should be driven by real customer demand. Instead of producing what you hope to sell, Lean Manufacturing can produce what your customer wants with shorter lead times. Instead of pushing product to market, it’s pulled there through a system that’s set up to quickly respond to customer demand.
Lean organizations are capable of producing high-quality products economically in lower volumes and bringing them to market faster than mass producers. A lean organization can make twice as much product with twice the quality and half the time and space, at half the cost, with a fraction of the normal work-in-process inventory. Lean management is about operating the most efficient and effective organization possible, with the least cost and zero waste.
Difference Between Traditional and Lean Manufacturing
TRADITIONAL MASS PRODUCTION
|Business Strategy||Product-out strategy focused on exploiting economies of scale of stable product designs and non-unique technologies||Customer focused strategy focused on identifying and exploiting shifting competitive advantage.|
|Customer Satisfaction||Makes what engineers want in large quantities at statistically acceptable quality levels; dispose of unused inventory at sale prices||Makes what customers want with zero defect, when they want it, and only in the quantities they order|
|Leadership||Leadership by executive command||Leadership by vision and broad participation|
|Organization||Hierarchical structures that encourage following orders and discourage the flow of vital information that highlights defects, operator errors, equipment abnormalities, and organizational deficiencies.||Flat structures that encourage initiative and encourage the flow of vital information that highlights defects, operator errors, equipment abnormalities, and organizational deficiencies.|
|External Relations||Based on price||Based on long-term|
management based on abstract reports
management based on visual control systems maintained
by all employees
|Cultural||Culture of loyalty and|
obedience, subculture of alienation and labor strife
|Harmonious culture of|
involvement based on long-term development of human resources
functional layout, minimal skills, long production runs, massive inventories
cell-type layout, multi-skilling, one-piece flow, zero inventories
|Operational capability||Dumb tools that assume|
an extreme division of labor, the following of orders, and no problem solving
|Smart tools that assume|
standardized work, strength in problem identification, hypothesis generation,
|Equipment management by|
production, maintenance and engineering
|Engineering||“Isolated genius” model,|
with little input from customers and little respect for production realities.
|Team-based model, with|
high input from customers and concurrent development of product and
production process design
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