Introducing Lean 2.0
Enterprise Minnesota works with clients to streamline manufacturing processes while incorporating green practices.
BY JOHN CONNELLY
The concept of Lean Enterprise has been very visible for more than a decade. It is a strong, well known and widely accepted approach to saving a company time, energy and money. Lean Enterprise is a systematic approach to identifying and eliminating waste (non-value added activities) through continuous improvement by flowing the product at the pull of the customer in pursuit of perfection. At Enterprise Minnesota, we’ve been helping companies navigate productivity since we set up shop, and Lean has been our primary tool for most of that time. We encourage manufacturers to find ways to continuously improve processes, making them faster, smoother and more efficient—from the front office to the shop floor.
Green Business on TAP
The Minnesota Technical Assistance Program (MnTAP) is an outreach program provided by the University of Minnesota. MnTAP experts help Minnesota manufacturers go green by specializing in energy efficiency and waste management.
Enterprise Minnesota and MnTAP recently collaborated on a handful of Lean Enterprise projects. With Lean 2.0 in the works, these two entities will continue to complement each other in the future. As Lean 2.0 points out opportunities for greater efficiency, MnTAP can eliminate identified waste.
Enterprise Minnesota spoke with Krysta Larson, MnTAP communications manager, about how manufacturers can use this valuable resource.
Q: How does MnTAP help companies reduce waste?
A: We respond to companies’ needs in terms of pollution prevention, waste reduction and energy efficiency. What we’re really looking at is their process. How are they producing whatever widget they do, and what kind of waste is being generated by that?
Q: Can you give me an example of a company success story?
A: United States Distilled Products (USDP), a bottling facility in Princeton, Minn., came to us and said, “We’re having some waste issues with some bottles on our lines. What can we do?” Through the course of the project, the student [an intern who was assigned to the company] was able to find out why the bottles [were] being wasted. Some of them were falling on the floor, therefore becoming waste. Some of them were having the labels placed on incorrectly, so they were becoming waste. The intern was able to implement quite a few solutions. … One of them was to expand the catch bin for the bottles. When the catch bin was full before, they were all falling on the floor because no one had time to get to that catch bin. So, by expanding the bin and making it bigger, more bottles could fit before somebody had to come and empty it. Also, in that project, the intern and MnTAP both recommended that USDP work with Enterprise Minnesota in terms of Lean.
Q: How can MnTAP and Enterprise Minnesota support each other’s missions?
A: [We can support each other’s missions] through referrals. When Enterprise Minnesota is out doing green supplier network, or working with companies on Lean, it’s important to remember the green aspect. MnTAP is an expert in pollution prevention, and we’re building our experience in energy efficiency. When we’re working with companies and they start asking about Leaning their business and looking at things such as footprints and how their facility is laid out, it is always a good idea for us to recommend Enterprise Minnesota. We kind of go hand in hand. We each have our own specialties that we’re good at. By bringing the two [entities] together, we can really make sure both of our missions are being realized for these companies. —J. C.
In today’s changing world, however, being Lean is just the first step. Companies need to embrace green in order to grow. The good news is that the two concepts aren’t worlds apart. As we begin to focus on the important effect environmental issues will have on our industry, we at Enterprise Minnesota are working on a new take on Lean that integrates sustainability and an eco-friendly mindset. We call it Lean 2.0.
What is Lean 2.0?
As the name would suggest, Lean 2.0 is not meant to take the place of the traditional Lean approach. The manufacturing industry understands Lean Enterprise—the process of removing waste to make the value stream, the focused process, faster. The faster a company’s processes go, the quicker the delivery, the better the output and the lower the cost. Instead, Lean 2.0 is an upgrade. We’re adding value to Lean by incorporating a variety of green lenses into an already successful program.
One of the primary components of Enterprise Minnesota’s Lean Enterprise is the Value Stream Map (VSM). The VSM is a method of analyzing a process, mapping it and discovering ways to make that process faster. The traditional VSM focuses on the amount of time it takes to complete a specific process and how that time can be shortened to save a company time, money and resources. As green becomes increasingly important to everyone from suppliers to original equipment manufacturers (OEMs), we’ve been thinking about the inherent overlap between going Lean and going green. Instead of setting up separate processes to detect things likes wasted energy and materials, we believe that we can integrate green into our already existing VSM.
Though Lean 2.0 is still in the development phase, we’ve identified two primary opportunities that will benefit clients:
Rethink the time ladder.
The VSM time ladder is a critical component when evaluating the efficiency of manufacturing processes. The ladder determines the amount of time a specific process takes and the amount of time between steps. Examining time helps a company identify opportunities for improvement. That time metric drives companies to look more closely at the components of a process and figure out how to complete that process faster. In Lean 2.0, we recognize that there are useful metrics beyond time. For example, within the process, how much energy is being used? How much water? How much material is changing over the steps of the process? If we look at these initial factors, we would find additional improvements that could make the process leaner and greener, save on energy or materials and eliminate waste.
Take, for example, the process of painting a certain manufacturing part. There’s typically a curing step, and that curing step often calls for heat. The heating application takes a lot of energy to bring an oven up to temperature and keep it at temperature as painted parts move through it in order to cure. It’s important to measure how much of the heat is actually getting to the part versus how much is just ambient around the part. You can also measure how much heat is dissipating out of the oven because of the way it is designed. While the primary instrument for measuring success in a VSM is time, the challenge becomes learning new ways to measure elements such as heat, energy or material waste. Once measured, you can compare how much of that energy is adding value— actually curing the part—or escaping and not really making a difference.
Find overhead costs.
In the current Lean method, we look at very specific processes, usually ones that have to do with a specific sector of the manufacturing business. There are many green wastes that are not necessarily tied to a specific process or obvious in the evaluation of that process.
For example, a company might not recognize how much light is involved in a specific process, because the light is something that is being used across the entire building and across many processes. In Lean 2.0, we’re able to think about green wastes that take place as part of overhead costs, which helps us zero in on additional improvement possibilities.
Going Green
There are several Minnesota manufacturers making great strides in greening up their organizations. They are quite specialized, and many have focused on lighting: swapping out energy inefficient lighting for a better system. To these manufacturers, better lighting equals a greener establishment. For some, green means operating more efficient electric motors. For others, it means keeping a watchful eye on carbon emissions in an effort to reduce their overall footprint. These are all important steps to becoming a more environmentally friendly business. The terms “green,” “sustainable” and “eco-friendly” have yet to be defined in the manufacturing sector, however, so “going green” can mean something different to each manufacturer.
The aim of Lean 2.0 is not to define “green,” but to take what we at Enterprise Minnesota do best and incorporate it into clean, green, sustainable and environmentally aware components. Lean 2.0 is an integration of approaches that provide companies with one analysis and one result.
We’re taking Enterprise Minnesota’s philosophy of examining an entire business and mapping out how the whole system should move forward. We want to apply that philosophy to Lean and green, whichare often handled as two different things. Companies shouldn’t have to choose; they can make something leaner and greener at the same time. It is our goal to create a program that is about overall optimization and efficiency that gets a business overall results.
The Benefits of Lean 2.0
In order for Lean 2.0 to make sense to a manufacturer, it needs to be grounded in important issues that affect your business today, and it needs to benefit your bottom line. The concept of going green isn’t going away; it can have major consequences if ignored, and major benefits if embraced.
Interscapes, Inc. is a great example of a company that has turned going green into a profitable endeavor. The Minneapolis architectural woodworking firm took a $1,600 waste-removal expense and turned it into a $700 revenue stream by grinding up its recyclable waste and selling it. This type of innovation and problem solving is at the heart of Lean 2.0. It’s about taking obstacles and expenses and turning them into revenues or advantages.
Going green gives businesses an opportunity to grow by saving money and by expanding profits. If you can save time, you will save money and the process will be more efficient. If you can save on heat, electricity, water and material costs, you can make your process more cost-effective.
When it comes to revenue, the world is becoming more aware of what it expects out of a good, efficient production. If a company can show clients a green and Lean operation, it will have a competitive advantage in the marketplace and more opportunities for growth. That’s why the concept of combining Lean and green matters to us, because we’re in the business of helping manufacturing businesses grow profitably.