Lean – “The Means for leveraging growth”

What is Growth: Growth is a kind of oil and power for company development. Companies without growth never progress. Rather they are eaten by termites called loss and eventually they stop functioning.Growth is indispensible for smooth functioning. Thus, the company has to make efforts to create sufficientleverageto maintain and constantly strive to improve on.

There are broadly two kinds of growths:

  1. Top-lineGrowth: It refers to an increase in gross sales/revenues. It indicates how effective a company is at generating sales but doesn’t take into consideration of operating efficiency and does not guarantee an increase in profit.
  2. Bottom-linegrowth: It refers to an increase in net earnings after all expenses deducted fromgross revenues. It indicates how efficient a company is with its operating costs andguarantees an increase in profit.

Both these figures are useful in determining the financial strength of a company, but they are not interchangeable. However, this is not to say that a company cannot experience both top-line and bottom-line growth at the same time. This can be achieved if a company earns more revenue (top line) and reduces its operating costs (bottom line).

Typical Challenges in manufacturing industriesfor bottom-line growth
Be it Electronics, mechanical, plastics, packaging or pharmacy industry,they face following challenges:

  • High in process defects & low throughput efficiency resulting delivery delays
  • Delivery delays resulting penalties or transport de-growth
  • Very low logistic efficiency impacting productivity
  • Very low material productivity year on year because of lack of benchmark

Overall,lackof involvement by people in everyday problem solving leads to many challenges.

Typical focus for manufacturing industries for top-line growth
Traditionally Quality, Cost and Delivery are the deciding criteria for becoming a supplier of choice. Today with fundamental change in customer satisfaction definition these are rather intrinsic requirements. The four domains which are to be focused for top line growth are:

  1. Reliability: The ability of an organization to consistently perform its intended or target mission on demand without failure.
  2. Capability: Measure of the ability of an entity to achieve its objectives, especially in relation to its overall mission.
  3. Flexibility: Ability to change easily according to customer need.
  4. Information: It is a paradigm of supporting users in doing their work by delivering them information proactively related to the current working.

Considering “Make in India” initiative, lot of global manufacturing focus will be towards India. Opportunities are enormous; organizations need to develop strategies and implementation tactics to become a supplier of choice for tomorrow.
Lean enables us to look at the time line, from the moment the customer gives us an order to the point when we collect the cash and we are reducing that time line by removing the non-value-added wastes in each process.

Benefits after implementing Lean in manufacturing industry
Lean works on overall aspects of organization giving top-line as well as bottom-line leverages

Process Area Indicator Benefit Realized Quantum of Improvement
Business (P&L) Variable cost Reduced 8~10%
Business (P&L) Gross Margin Improved 5%

How to Implement Lean in manufacturing industry
Typical roadmap to initiate or strengthen lean implementation in any manufacturing organization has following milestones:

  1. Assessment: This involves assessment of current state through on site audit to understand the gaps which leads to action plan.
  2. Lean Projects or Kaizen Workshop: It is to involve people and demonstrate systematic way to carry out improvement in identified pain areas through trained professionals.
  3. Develop and train core team: It is to develop sustenance and involve people in day to day problem solving.
  4. Track Key Performance Index: To track the progress and further improvement.

Approach of Lean Technocrats India Pvt. Ltd. towards leveraging growth:
Lean Technocrats provides services considering overall aspects of Lean implementation through:

  1. Manufacturing Process Consultancy (MPC): To Assess, Priotize, Allign, Formulate, Establish and Sharing best practices to implement Lean Maturity Tracking System.
  2. Kaizen Blitz (KB): Based on the pain areas, design and execution of Kaizen workshops to be executed on site along with the Cross Functional Team to realize bottom line growth.
  3. 360 degree Training towards Building Lean Culture: Training programs to build lean culture to achieve objectives towards Operational Excellence.
  4. Daily Management System (DMS): Design and software development of the Daily Management System to monitor the Operational Excellence Indexes.

Expertise domain for Lean Technocrats:
In order to successfully implement the strategies, there are three major domains of manufacturing set up which are being focused simultaneously by our experts:

  1. People connect: Quality, productivity and elasticity come from the willingness of staff rather than a particular technique.
  2. Process connects: Each process must be – Simple (Lean Manufacturing), Reliable (Design for Six Sigma), Flexible (almost zero change over time) and Elastic (very quick changes in capacity).
  3. Management of logistic processes: The design and implementation of the supply chain must meet the customer’s exact requirements: Delivery:When they want it, Quality:Get what they order and it works, Design: Meets their requirements

We have qualified industry experts on board who becomes part of your Lean Journey……
Lean is the means to leveragegrowth.It’s a culture, more than a set of efficiency and improvement techniques. For further details please contact:

 

Arun Dakhole, +918978993358, arun.dakhole@hcitechnocrats.com

 

 

Sudipta Sarkar, +919701698285, Sudipta.sarkar@hcitechnocrats.com

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