“Guggina said Delphi implemented lean manufacturing in the early 1990s. The company’s standardized approach is now known as the Delphi Manufacturing System.
‘It means build only what you need when you need it — nothing more, nothing less,’ Guggina said. ‘We hold a very specific amount on the line. It’s kind of like the supermarket mentality: We only use what we need.'”
It’s always interesting to me to think about the concept of “build only what you need ” (a build-to-order or Dell type model that certainly eliminates the waste of inventory) vs the concept of heijunka or leveling. In some cases, especially when capacity is expensive, it can actually make more sense to build at a steady rate and build some inventory before you really need it.
But, as with many things, there are no easy cookbook rules — the sweet spot in that balance depends on your company and your industry, factors including capacity cost, inventory cost, risk of obsolescence, quality risk, etc.
Thanks for reading! I’d love to hear your thoughts. Please scroll down to post a comment. Click here to be notified about posts via email. Learn more about Mark Graban’s speaking, writing, and consulting.