Think Lean

A lean manufacturing philosophy that eliminates waste will shorten the time between order placement and product delivery and deliver a healthier bottom line.

With “convenience” being the mantra of today's consumer, the flexible packaging industry faces a promising future. In the Flexible Packaging Association State of the Industry Report 2002, flexible packaging shipments were forecast to grow at a rate of 5.5% to $21.2 billion for the year. The Graphic Arts Marketing Information Service (GAMIS) reported “flexography is the primary printing method used overall in the packaging industry. The value of flexo printing currently is almost $15 billion; it is projected to increase to $18-$22 billion by 2005.”

While an opportunistic future is exciting, it is also daunting. Just-In-Time (JIT) delivery is now a necessity. Fortunately, most modern flexo presses can run in excess of 400 fpm and can be changed over in 15-20 min (excluding clean-up time). But in spite of impressive press capabilities and a promising future, most of us won't make capital equipment investments based on optimism alone. Understandably, we want to find other ways to increase shop capacity. But how?

First we must determine current capacity by computing the number of press hours available to sell per month. We need to look at runtime-to-downtime ratios (these will vary depending on the number of changeovers) and the average size and number of jobs per day.

If you are like many printers, when you complete these calculations, you will discover the humbling fact that your presses only run 50%-60% of the time. In fact, if your presses run 60%-65% of the time, you are considered by many to be posting good performance figures.

What other industry would accept its most expensive piece of capital equipment sitting idle 40%-50% of the time? Why does the package printing industry accept such numbers? How can we do better?

Increasing Capacity through Lean Manufacturing
J.D. Rockefeller Jr. once said, “If you want to succeed, you should strike out on new paths rather than travel the worn paths of accepted success.” It's time we strike a new path and discover the untapped production capacity that already exists in our operations.

Let's start by acknowledging that package printing has evolved into a manufacturing process. Then if we look at how other manufacturers have overcome challenges similar to those we face today, we likely will discover that lean manufacturing is the common denominator.

In Lean Production Simplified, Pascal Dennis lists some of the problems Toyota faced in 1950 when it developed the new manufacturing methodology now known as Lean Manufacturing: “fragmented markets demanding many products in low volumes, tough competition, fixed or falling prices, rapidly changing technology, and high cost of capital.” Sounds hauntingly familiar, doesn't it?

The Basics of Lean Manufacturing
Lean manufacturing is a business and production philosophy that shortens the time between order placement and product delivery by eliminating waste in equipment usage, labor resources, and materials to produce higher quality products and greater profit margins.

Lean manufacturing is based on four core principles —Value, Value Stream Mapping, Pull Production, and Flow. First, to implement a lean environment, value must be defined from the perspective of the customers. Second, both waste and value must be identified through value stream mapping, the exercise of taking pencil to paper and symbolically representing the steps necessary to convert raw materials into salable product. Third, produce only what is needed, when needed. This is pull production. With waste eliminated and pull production in place, value can flow.

While the precepts of lean manufacturing are incredibly simple, implementing it is not easy. Why? Because lean manufacturing does not fit comfortably into the mass production, economies-of-scale business philosophies that most of us have been taught. In a lean manufacturing environment, the prevailing idea is to synchronize operations so the entire workflow produces the product when the customer needs it, in the amount needed.

If and When to Get Lean
Who's thinking, “So, it's simple but not easy, counterintuitive, and it was developed to dig an automobile company out of a hole 50-odd years ago?” If you are, you're correct. But don't stop here. There are many compelling reasons to investigate the benefits of leveling your workflow with lean manufacturing principles.

For one, lean does not require a large capital investment. Tom Mast of Lean Strategies Group, a consulting firm focused on assisting companies to begin a successful lean conversion, says, “If and when to get lean? — good questions. What happens if you don't get lean and your competitors do? Would you like to be a competitor of Dell Computer or Southwest Airlines? Both are very lean in their operations. When should you do it? The sooner, the better. There is typically little investment required, and the resulting reduction of inventory and other savings more than pay the costs.”

Another reason to look at lean manufacturing is pull production, as this enables you to reduce raw materials, work in process, and finished goods inventory. Jim Ollier, general manager of The Printing Plant, a narrow web flexographic label printer, talks about his experience with lean manufacturing. “We implemented lean manufacturing techniques to help us reduce our inventory. After consulting with TechSolve, a lean consulting firm, we studied customer demand and re-order points. This enabled us to move to more of a pull production schedule. So far we've reduced our inventory by $300,000 and increased our inventory turns from 8 times a year to 15.5 times a year.”

The Package Print Shop of the Future
While lean print shops currently are not the norm, they are likely to become more common in the future. Rich Niedermeier, senior management consultant and director of North American operations at Productivity Inc., a lean consulting, training, and publishing company, says, “The earliest applications of the Toyota Production System were in industries characterized as piece-part operations. People, not machines, added most of the customer-centered value. It took a while for managers to make the connection between lean manufacturing and process businesses such as printing where ‘value-adding’ is done — to a great extent — by the equipment. While the focus is still on the time metric and flow of materials through the value stream, what controls the value stream rate is distinctly different. In printing it's the uptime of the equipment and synchronizing all of the elements of production to be ready to run at a single point in time.”

Your press is the only piece of equipment on the floor that generates revenue. When it stops, so does your revenue stream. Therefore, it makes sense to consider production techniques that focus on adding value and removing costs. In a lean print shop, the workflow has one job: Keep the presses running.


Chris Faust is the director of business development for Chromas/Aquaflex, headquartered in St. Bruno, Que., Canada. He has more than 18 years of print industry experience spanning flexo, offset, letterpress, and gravure markets. Recognizing the value of lean manufacturing, Faust has helped to integrate these lean principles into the Chromas/Aquaflex ICT (Instant Change Technology) workflow systems. For more information on applying lean principles to print operations, visit the Chromas/Aquaflex Lean Initiative Web site at chromaslean.com, or call 800/CHROMAS.

The views and opinions expressed in Technical Reports are those of the author(s), not those of the editors of PFFC. Please address comments to author(s).


RESOURCES
Web sites:
Chromas Lean Initiative,
chromaslean.com

Lean Enterprise Institute, lean.org

Lean Strategies, lean-strategies.com

Productivity Inc., productivityinc.com

TechSolve, techsolve.org

Books:
Becoming Lean: Inside Stories of US Manufacturers

by Jeffrey Liker

Lean Production Simplified
by Pascal Dennis

Lean Thinking by James P. Womack and Daniel T. Jones

The Machine That Changed the World by James P. Womack, Daniel T. Jones, and Daniel Roos

Toyota Production System by Taiichi Ohno



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