The lean manufacturing philosophy is designed to help businesses eliminate waste. It forces them to look at how they create value for their customers and eliminate any processes that don’t directly contribute to this goal.
Following the recession, many businesses have adopted lean principles in the most obvious areas, such as moving production to cheaper locations or reducing non-essential staff. However, simple cost cutting is only a part of the story. To be truly lean, a business also needs to reduce inefficiency in less obvious areas. By using Enterprise Resource Planning (ERP) software, companies have a complete, integrated overview of their entire organisation, combining information from all business areas into one simple system.
The improved efficiency of using an ERP system is vital when transforming a business’ principles. It allows the management team to take a closer look at how processes serve their ultimate goal, and to see where money could be saved through using lean.
A common problem in the adoption of a lean methodology is that many businesses feel they are already perfectly efficient, due to already having made the most obvious cuts. Any further adoption of lean is then hampered as the company isn’t willing, or isn’t able, to identify further areas to improve. Realistically, all businesses have scope for improving efficiency, especially those in the manufacturing sector. Those that fail to address their inefficiencies will only find that they have greater negative impact as time goes on.
Although ERP systems call for an initial investment, the costs are far outweighed by the savings to be gained through improving businesses processes. Taking the time to use lean principles ensures that businesses avoid wasting resources on areas that aren’t relevant and can set a company on course for strong and efficient future growth. Take a look at our website to find out how manufacturers can take advantage of ERP suppliers.