Five Benefits of Lean Manufacturing for Small Businesses

Many small business owners don’t consider the opportunities available in Lean manufacturing as it seems like a big business philosophy. However, Lean principles can provide benefits for businesses of all sizes, as they’re ideal for improving overall operations efficiency and reducing mistakes that lead to business waste. With the right planning and smart production partnerships, the benefits of Lean manufacturing for small businesses are easy to realize. 

 

The Principles and Benefits of Lean Manufacturing for Small Business 

Each principle of Lean—value, value streams, flow, pull, and perfection—is designed to improve business efficiency in every way. Every single one of these principles leads to a direct business benefit almost from the moment they’re implemented: 

#1: Value drives improved product design

The value principle of Lean is about establishing the end value of the product to the customer.  By focusing on value, small business managers design products with the customer in mind. All products solve problems. Taking a problem-focused approach always ensures a viable product, while products developed just for the purpose of creation tend to flounder.   

Consider the creation of Post-it notes, which were initially developed by mistake. Dr. Spencer Silver with 3M was researching ways to create strong adhesives. The product he came up with didn’t work as expected, and it wasn’t designed with any purpose in mind. This lack of direction resulted in a project that, at the time, wasn’t suited to any purpose. Dr. Silver struggled to find a use for it for years. 

It wasn’t until developers discovered a problem that needed solving that the adhesive became useful. 3M scientist Art Fry noticed he had a problem correctly marking his space in his hymn book during choir practice, as bookmarks only marked the page, and any other option would damage the book. The adhesive which could stick to, but also be easily removed from any surface was the ideal option for resolving this issue. The design of Post-its was developed and helped grow the small company into a billion-dollar conglomerate. 

By taking a solution-based approach to product design, 3M was able to turn a failed product into a massive success. Being solutions-oriented in creating products is ideal, as it helps creators focus their efforts in the right places.  

#2: Value stream mapping reduces labor costs 

Mapping all stages of production provides a clear roadmap that can be completed over and over again. With no variances in the process, employees are able to learn faster, which minimizes training time. As the process reduces mistakes, wasted time on unusable products is eliminated. 

The creation of the Dyson digital motor that powers the company’s vacuum cleaners is evidence of the power of smart value stream mapping. The small devices are uniquely designed to spin more than 100,000 per minute to generate 425 watts of power—and their creation is entirely automated. The company broke down the construction of these instruments into a series of efficient steps that allow assembly by a team of 50 robots. Dyson estimates they create one of these engines every 6 seconds. 

Value stream mapping allows companies to better understand production so they can seek out ways to improve it. With this process, they eliminate unnecessary steps and employ automated efficiency that reduces the cost of labor. 

#3: Seamless flow creates production efficiency 

The development of “flow” in a process allows the continuous creation of products with minimal disruption. As there are no delays, business owners can produce more products in less time. Flow is probably best exemplified in the assembly line production process created by Henry Ford in the early 1900s.

In 1913, Ford wanted to simplify the creation of the automobile in a cost-effective way.  The moving assembly line complemented the series of 83 steps he established to build a Model T. Machines that could complete simple tasks helped to ensure the line never stopped moving. Over the next decade, that assembly line supported the creation of 10 million vehicles. 

Automation and movement are crucial parts of establishing flow in production. Machines are adept at managing simple, repetitive tasks, and have become invaluable on production lines. Today, just about all products, from simple cotton swabs to complex technology, are made available through the mass-production power of assembly lines. 

#4: Pull eliminates overproduction 

The principle of pull is about Just in time manufacturing, where products are only created in response to actual—rather than anticipated—demand. Traditionally, manufacturing followed a “push” philosophy, where products were created based on forecasts. Pull manufacturing ensures nothing is made until it’s ordered by the customer. 

Toyota is a commonly cited example of pull manufacturing, in that they only create cars as they’re needed by the dealership. A customer purchases a vehicle, and this signals the need for a replacement, much like a produce manager in a supermarket would replace oranges or apples. 

Keeping an inventory would require space, electricity, climate control, and other expenses that would continue until the inventory was depleted. Pull manufacturing eliminates waste both by cutting back on the unnecessary production of items and eliminating the need to manage an inventory. JIT manufacturing offers far-reaching cost reduction opportunities, which makes it an ideal business model. 

#5: Striving for perfection minimizes mistakes 

Product mistakes can lead to wasted supplies and resources in the best-case scenario. In the worst cases, they create dangerous conditions for consumers and require expensive recalls. The perfection stage of Lean is about eliminating all mistakes through continuous improvement. 

All the steps of Lean help to improve production to the point where all waste and mistakes are eliminated. By constantly striving for perfection, business owners ensure every product that comes off their line is just as good, or better than the one that came before it.  

How Small Business Leaders Can Implement Lean Practices 

Many small business owners avoid adopting Lean practices because they seem like they’d be difficult or expensive to implement. They may also be dependent on outsourcing for much of their production. However, these business owners can gain all the benefits of Lean without the trouble of implementation, simply by working with a facility that makes it one of their guiding philosophies. 

There are many benefits of Lean manufacturing for small businesses that can be gained through effective partnerships. Choosing a Lean partner in product design and manufacturing is the turnkey way to leverage it for small business owners. Through Lean, they improve productivity and save on expenses by taking a more logical approach to production.