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The early 80s saw worldwide adoption of Japanese manufacturing practices with mixed results. By the 90s, interest began to wane. It took a landmark 5 year multi-continent study by MIT to conclusively prove the superiority of Japanese methods. The authors also re-christened JIT as
"Lean Manufacturing" rekindling fresh interest in the world of manufacturing. (See Exhibit 1 for evolution)

Lean manufacturing has transcended the automobile domain to other domains. The concept is extending towards a Lean Enterprise where individuals, functions, and organizations come together to form a continuous value stream and collectively creating greater value for the customer.

3. What is Lean Manufacturing?

Lean manufacturing is based on three basic principles: (a) elimination of waste or "muda" (b) cost reduction and (c) employee empowerment, all with the perspective of creating customer value. "The Seven Wastes", developed by Toyota is a tool to further categorize "muda". To eliminate waste, it is important to understand exactly what waste is and where it exists. While products significantly differ between factories, the typical wastes found in manufacturing environments are quite similar. For each waste, there is a strategy to reduce or eliminate its effect, thereby improving overall performance and quality.

The seven wastes consist of: -

a. Overproduction - Overproduction is manufacturing before actual requirement. It prohibits the smooth flow of materials, creates excessive lead times, results in high storage costs, and makes it difficult to detect defects.

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* Contributed by -
Amandeep S. Bedi & Namit Puri,
Indian School of Business (ISB),
Hyderabad.