Never Too Lean

ArvinMeritor plans to use tools in the Oracle suite, such as the flow-manufacturing module, that mirror lean-manufacturing processes such as build-to- sequence. Once its Tilbury, Ontario, and Manning, S.C., sites are using Oracle's flow-manufacturing software, employees there will be able to build products in specific sequences that best suit customer orders. "Customers want trucks to be loaded in such a manner that when the truck arrives at their plant, the products come off the truck in the correct sequence," Cavagnini says. "We haven't had the systems to do that, and we were building in batch."

Dura Automotive Systems Inc. is installing QAD's manufacturing software at nine production sites and upgrading 11 others in North America to the latest version. The project, which will include an integrated ERP platform, common financial software, and QAD's lean-manufacturing, inventory-management, and EDI modules, is expected to take about 20 months and cost several million dollars. "It's our IT budget," says John Knappenberger, VP of sales, marketing, quality, IT, and materials.

Lean manufacturing is a priority at Delphi Corp., an automotive supplier that has used its Delphi Manufacturing System to cut product-cycle times and improve on-time delivery, productivity, and quality. "It's part of a bigger picture to drive cost out of the supply chain through efficiencies," says David Nelson, VP of global purchasing. "There are ways in which companies that use lean techniques can considerably improve manufacturing processes and cut costs" (see story, "Delphi: Parts Maker Helps Suppliers Shape Up").

Just over a year ago, Nelson instituted a program to share procurement and manufacturing secrets with suppliers. Delphi sends employees to supplier sites as consultants to help revamp suppliers' manufacturing and procurement processes. Supplier quality has improved by 34% and "reduction from unforeseen disruptions to the production line has improved by 28%," Nelson says.

The factory isn't the only place that's getting lean. ArvinMeritor has an initiative to infuse its support divisions with tools and techniques rooted in lean's continuous improvement processes. Employees set goals and regularly measure themselves against those goals (see story, "ArvinMeritor: A Lean Culture").

F.W. Murphy Manufacturing Co., a $50 million-a-year maker of process-control systems, is stepping up its lean-manufacturing effort because it won't be able to compete on cost alone against overseas competitors (see story, "F.W. Murphy: Success Brings Broader Initiative"). "We've got to be able to offer things that offshore folks can't, and that's flexibility and variety," says Mitch Myers, VP of operations. "We've got to deliver custom products quickly, within two to three days, and standard products the same day orders come in. And we need to be able to customize products to all our customers' needs."

Author Smalley agrees. "If you have quality products, very short lead times, and are delivering what a customer wants the way the customer wants it, you can get away with charging more," he says. "Higher value is the only way we will be able to compete."

An increasing number of U.S. companies see lean manufacturing as a way to approach and ensure that higher value.

-- with Laurie Sullivan

Illustration by Dave Plunkert