By September 11, 2006 4 Comments Read More →

A Factory on a "Diet"?

Aero-News Network: Columbia Aircraft Puts Bend Factory On A Diet

Read the article and answer me this: did Columbia Aircraft have this bass-ackwards? They were facing booming demand (350% increase), yet they delayed lean for 12 months until after the growth.

“The decision to adopt Lean Manufacturing principles was made 12 months ago,” stated Bing Lantis, president & CEO of Columbia. “However the short-term need to rapidly increase production in order to meet growing demand and reduce the backlog superseded the Lean initiative.”

So, how did they manage the growth without lean?

“This meant adding more production employees, increasing the footprint of the manufacturing facility & increasing inventories. That phase is complete and daily production volume is commensurate with demand. Now a Lean Manufacturing team will help Columbia improve efficiency across all manufacturing operations.”

Ugh, typical mass production thinking, that more production requires MORE of everything. Imagine if they had used lean and eliminated waste, rather than duplicating that waste into a bigger factory. They could have increased production without as many extra employees, as much extra space, and as much extra inventory.

Now that the growth is done, they will go back and take away all of that? Reduce space that they just expanded into? Get rid of people they just hired?

It’s a shame that leadership didn’t see Lean as a tool that could help them grow. What do you think? Are we being too hard on them? Better to come to Lean at the 11th hour than not at all? What do you think? Ever used lean to help drive growth instead of in a shrinking business?

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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an eBook titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

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4 Comments on "A Factory on a "Diet"?"

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  1. JWDT says:

    Its not a shame the leadership didn’t see LEAN as a tool, it is a shame that the leadership has the same Vision as the majority of other companies (i.e. industrial, healthcare, etc.) of the World. That vision is of complaceny and mediocrity instead of improvement.

    In regards to your questions: No, we are not hard enough on them, think about it their inefficiencies drive our costs up.
    Yes, but isn’t the 11th hour too late at times? Can we really call it leadership when they have the “hero” mentality, that is, we need to create the need or urgency to survive?

    Better idea is how do we Articulate the Story well enough to help them see that Lean can drive growth instead of shrink business? Maybe we need to start with the Financial department, they are the ones who drive the majority of the shrinking biz.

  2. Mark Edmondson, Lean Affiliates says:

    Mark & JWDT –

    Your comments are spot on. As consultants and change agents, I’m sorry to report that we see this too often. Instead of a way of thinking, doing, and improving, lean is thought of as a project or initiative that detracts from primary business activities, and takes staff time.

    Sometimes – not always – we get through by directly linking their objectives to their lean “initiative”. For example, we’ll declare an initial objective for lean as increasing throughput by 30% within 18 months using existing resources. But even this is viewed as a higher risk option than simply adding resources.

    But as Mark stated, the real risk is adding resources which invariably affects agility, financial breakeven, and competitiveness.

    Here’s another real example of “conventional” thinking creating resistance: Right now, a privately-held company is reluctant to pursue lean because of the short term hit to profitability as they decrease inventories. Cash flow goes up, productivity up, lead times down, inventories down – and as a bonus, income taxes go down. Even after carefully explaining how this is a quirk of accounting regarding inventory – along with its allocated labor and overhead – as an asset. And how in reality there’s nothing unfavorable or costly with crediting inventory on the balance sheet and debiting COGS on the income statement – other than the paper effect on “profit”.

    If you think about it, conventional cost accounting for manufacturing provides a sure fire way to quickly improve your financial profile: just transform labor cost and overhead expense into an asset by building stuff and storing it (but don’t sell it!).

  3. Luke Van Dongen says:

    Some great comments guys. I need to chime in on this one as well.

    WHAT A MISSED OPPORTUNITY !!!!

    Would it not be an order of magnitude easier to implement lean thinking BEFORE you start adding people, floor space, equipment and processes? Unfortunately thus far in my career, I can only dream of what could be done with a completely clean slate.

    Think of the wasted opportunity! Equipment design, cycle times, layouts, material handing routes, employee training etc. etc. etc. could have all been put together with a lean mindset. Imagine being able to design and implement these processes and systems the right way, up front instead of having to spend all that time and energy working to change what’s already in place.

    Rather than starting with every possible advantage, they are now no further ahead than anybody else who is working to implement lean. Their entire operation might as well be 25 years old.

  4. Mark Graban says:

    If it makes you feel any better, Luke, many hospitals (not all) are using lean this way. The firm I work for has helped many hospitals “do lean first” before building a new laboratory, often finding out they don’t need a newer, larger lab, because lean helped them make better use of space and resources. Or, if they’re building a new lab (or pharmacy, etc.), we’re partnering with design people to make sure it’s “built lean” from the get go.

    As with factories, the design of a hospital drives a lot of inefficiency, waste, walking, and cycle time — stuff that’s sometimes hard to fix AFTER construction was done.

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