Companies are looking in the wrong places For companies with failed Lean improvement experiences, their cost reduction efforts were mostly limited to physical change to eliminating unnecessary space, reducing level of WIP. The main focus was mainly on connecting processes to eliminate retention and WIP and also on downsizing production lines which improved a bit by cutting waste due to reduction of the number of workers. To do this, they mapped the value stream of specific product to identify waste related to materials and information flow that affects lead time, space and cost. Unfortunately, those efforts haven’t been enough to make real improvements in the bottom line. Because VSM alone will not eliminate all waste. Materials and information flow only accounts for 20% of the waste in a typical garment factory. That’s because 80% of the total product cost comes from the factory floor which found primarily in practices and processes. Reducing the time value of practices can bring real cost reduction and profit gains. 40% of productivity improvement can generate 350% of profit gains. Unfortunately, none of you has access to any financial data to analyze the payback and most assessment have been initiated without any strategic focus in line with future core goals. It is kind of hunting mission hoping to find some wastes. No strategic and engineering thinking at all. To reduce cycle time, some companies have invested heavily in technology to reduce product cycle times but not every company has the financial resources for such investments. Keeping in mind, technology alone doesn’t eliminate waste since any time reduction can easily be offset with more wasteful motions as workers struggle with unreliable work methods. What I discussed now is not lean yet is mostly to identify the current state. Manufacturers are aiming for a sustained change not just targeted incremental improvement. Once product changes, companies have to restart from scratch. It takes a culture embedded in human system. Key success factors and driving forces – all must be considered at the time of planning an assessment in order to target the future state. In the upcoming videos, I will discuss the trial and error culture and the key driving forces in manufacturing Stay Safe, focused and connected, the more to come See you then