How can you effectively manage inventory and reduce lead times in a Lean Manufacturing startup?

Carrying inventory means blocking expensive working capital. Inventory is combination of Raw materials, work in process, Finished goods. There has to be E2E connectivity of supply chain. Demand trigger has to be more closely tied with POS and planners must run strong analytics so they may not get trapped into Bull whip effect. Consumer market evolving around Newness can no more afford carrying too much RM, over production or FG. The way forward is Just in time pull system and it needs more efficient upstream and downstream integration.

1. Inventory is the biggest waste among 8 wastes, inprocess inventories are necessary to run the process as per customer demand. However carrying more inventories than customer demand is waste. Some time over production also causes increase in inventories. 2. Plan vs actual also have vital role to control inventories and in lead time reduction. Produce only when it is need and exactly what it is needed.

To optimize inventory and reduce lead times in a Lean Manufacturing startup, employ a demand-driven approach. Implement just-in-time (JIT) principles, utilizing a kanban system for real-time inventory control. Strengthen supplier relationships for timely deliveries, sharing forecasts to streamline the supply chain. Conduct ABC analysis to prioritize high-value items, and leverage technology for accuracy and automation. Foster a culture of continuous improvement, involving employees in problem-solving. Regularly review processes, gathering feedback to identify and eliminate waste. These strategies, combining efficient production with effective supply chain management, enhance overall operational efficiency, agility, and customer satisfaction

Inventory means cost, reduction in cash flow but also normally this is li med to customer satisfaction.. So we need to find the proper balance to satisfy and achieve both goals for the company.. Inventory management programs, supplier relocations closer to the point of use, optimal lots sizes, reduction on LT.. Several options just one goal.

Inventories - all the categories put together must be a one of the most important business matrices which need dynamic monitoring and control. for a fixed volume of business which has a clarity and consistency in a horizon for 6 months, it can still be handled with some mathematical formulae on consumption, lead time, safety stock etc. But when the forecast is dynamic and varies from the LL to UL with less correlation the inventory control becomes most important. The type of industry plays a role, project company cannot afford the delay in execution, hence inventory costs take back seat. & for company with secondary and primary sale model, can still have headroom for optimal delivery time. in that case Inventory control precedes.

In a Lean Manufacturing startup, effective inventory management and lead time reduction require streamlined processes. Implement Just-in-Time (JIT) principles to minimize excess inventory and align production with demand. Utilize Kanban systems for visual management, setting WIP limits to control flow and avoid overproduction. Optimize supplier relationships to ensure timely deliveries and quality materials. Continuously analyze value streams using tools like Value Stream Mapping to identify and eliminate waste. Empower employees to suggest improvements and foster a culture of continuous improvement. These strategies collectively enhance inventory management and streamline processes, resulting in reduced lead time.

Care needs to be taken with traditional lean manufacturing guidance when you are dealing with concurrent design and manufacturing programs common in the defense business. The instability with concurrency related to the volume of changes makes some traditional Lean Principles like flow to takt, JIT, etc very challenging and sometimes more costly than station build. Flow requires stability

Depending upon circumstances, pull is best suited for lean manufacturing and if it is coupled with more flexible manufacturing setup for fast ramp-up than nothing is better.

One thing I have found helpful in the lean manufacturing industry is the implementation of a Kanban system. This visual tool facilitates efficient inventory management by signaling when to replenish materials based on actual demand. An example I have seen in the industry is companies using Kanban cards to represent specific production stages, ensuring that resources are pulled only when necessary. This not only streamlines workflows but also reduces lead time by avoiding unnecessary stockpiling and promoting a just-in-time approach to manufacturing.

In the realm of modern production, the pull system stands out for aligning output with real customer demand. It thrives on producing only what’s needed, when needed, and in the right quantity, steering clear of overproduction pitfalls. By avoiding excess inventory and wasted resources, a pull system excels in responsiveness to changing demands, reducing lead times significantly. Implementing tools like Kanban enhances this efficiency, providing a visual cue system for monitoring work item status. Embracing the pull system, fortified by Kanban, allows businesses to optimize production, minimize waste, and stay agile amid market dynamics—a strategic imperative for sustained success in today’s competitive landscape.

Planning team can provide an accurate batch size based on the experience and data provided from the sales team. They also need to be in contact with the maintenance team.

Line Balancing, contingency planning and Efficient costing methods are the keys... Lean manufacturing requires efficient planning and thread bare costing to create awareness amongst the team as to the resources blocked in carrying inventory. The cost of WIP must include the resource cost including man, machine, tool etc to ensure 'lean' concept. Excess finished goods and 'value added ' inventory usually eats up the profit margins..

This is one of the critical factors. The batch size will affect the lead time and quality of the product. If it is too low, the organization must spend considerable time on the changeover activities. Because of all the above issues, it should carefully define the optimal batch size and by introducing KANBAN mechanisms, the WIP level can be controlled by only satisfying the customer demands. When reducing the batch sizes, an organization can introduce the Quick changeover mechanism to address the startup time-related matters.

Identify the push and pull system costumer to apply the best continuous improvement techniques based in Lean Manufacturing Toyota System and Quality Management System as ISO 9001:2015 or IATF 16949:2016 having a good balance between both to reach and achieve a World Class Manufacturing organization with top management support.

Talvez seja difícil ajustar tamanhos de lote dependendo do tipo de manufatura e seus custos. Mas a conta deve ser feita sempre e qualquer varia??o no processo deve ser reavaliada com a vis?o de custeio.

In order to maximize Lean Manufacturing benefits in the realm of Inventory and lead Time is, by tailoring strategies to the manufacturing process type. Flow or Batch Manufacturing with a Pull System triggered by demand is what to be implemented. Implement JIT for efficient inventory management and value stream mapping for enhanced production process should follow. Incorporate techniques like 5S, waste reduction, and control charts to minimize process variability is the rest if applied strategically will optimize both inventory levels and reduce lead times.

Desde o início da produ??o em massa, o Controle Estatístico de Processo se fez necessário para a redu??o da variabilidade. Quanto menor for, maior assertividade e a garantia do padr?o do produto. Hoje podemos utilizar as tecnologias da indústria 4.0 para nos auxiliar e conseguir agilidade nos resultados esperados, tornando ent?o a empresa mais competitiva no mercado que atua. Entender sobre os controles, ferramentas e a m?o de obra aplicada neste movimento é fundamental para as redu??es esperadas. O uso adequado da gest?o visual também contribui para atuar em a??es pertinentes a esse processo, corroborando assim para a??o nas causas comuns bem como nas causas especiais dos desvios pertinentes a rotina de fabrica??o.

The foundation of lean manufacturing is the reduction of variation at the process level. If you have not got capable processes you do not have a foundation to build from. Quality first, repeatability second and then availability.

Process variations basically can occur due to Man related issues, Machine related issues, Method related issues and Material related issues. However, because of the variations, there can be customer dissatisfaction can be created because of the quality issues. Usually to understand the variations, organizations ‘can use statistical process control mechanisms and sometimes it is OK to use the Six Sigma methodology also. Variation because of Man can be reduced through proper training and monitoring. Method-related issues can be reduced through proper SWS and SOPs. Material-related issues can be solved through strength quality control tools on raw materials. Machine-related issues can be minimised based on the TPM concept.

SPC is just monitoring the trend of determining the capability but there is more than that which is we need to understand through RCA that can be more efficient. Tools that can be use such as minitab to perform a prediction of the issue,weibull distribution analysis or Through R which is more on mathematical and statistical approach that are able to prevent the issue from occur.

In a nutshell, VSM (Value Stream Mapping) identifies and improves workflow bottlenecks, reducing waste and enhancing productivity.

VSM will help create a business process map. This process map remains the bible till there is big change in process. Another benefit it that every time we go wrong in output, we can go back &pinpoint the place where we got wrong. the documented chart can help the new /less experienced team to adapt scientific temperament to address issues. helps them build repeated thinking in structured manner. more than one person automatically knows complete process, reducing the learning curve for team. These are added benefits apart from the waste reduction on the line or process. social impact with in the organisation is huge. Creates more scientific temperament people and less fire fighters. Creates better leaders who can insist better way of working

Value Stream Mapping is an effective method to analyze the flow of materials, cycle times, changeover times, and inventory levels at each process step. It also allows identifying value-added and non-value-added activities. And, one of the main KPIs, which takes time, is also derived from VSM. Takt time = (Available production time / Customer demand). This means each process step should be designed to complete its activity within the take time to meet the customer demand. If the actual process takes time longer than takes time, it creates bottlenecks.

A excelência em Supply Chain busca melhorar o fluxo através da redu??o dos elos na cadeia. Quando reduzimos o número de elos, temos menos logística, menos custo e menos leadtime. Para empresas que trabalham com terceiriza??o, buscar a internaliza??o de alguns processos ou a logística direta entre fornecedores pode ser uma saída interessante. No caso de fábricas horizontalizadas, além de nivelar as capacidades de cada etapa produtiva, evitando o famoso funil, é essencial reduzir as rupturas para evitar gargalos inesperados no processo. As vezes, a fonte disso está na falta de um bom MPS ou de um MRP, ou seja, o sucesso também depende de planejamento, tanto operacional quanto de materiais.

Implement "Plan for Every Part"(or PFEP), the meticulous planning and management of every individual component or part that goes into the production of a final product. The main objective is to ensure a smooth and efficient flow of materials through the entire supply chain, from suppliers to manufacturers to customers. In order to implement PFEP it's imperative that an owner is assigned to create and maintain each part plan as data/ information changes. Creating flow path maps as well will provide visibility of different flows. If these are created from the start and continually updated, it will mean that when new part numbers are sourced and added, they can be assigned to an existing flow path and avoid another having to be created.

The best way to handle inventory and respond to lead time is by using a pull system and understanding customer demand. However, for a Lean Manufacturing Startup, it's crucial to focus on improving to 'reduce timing' and maintain a minimal inventory. Otherwise, it might only remain a strategic approach without achieving the intended efficiency gains.

Implementing a just-in-time (JIT) inventory system, optimizing supply chain processes, utilizing technology for real-time tracking, fostering strong supplier relationships, and continuously improving processes through lean principles can effectively manage inventory and reduce lead times in a lean manufacturing startup.

Inventory management is the entire process of managing inventories from raw materials to finished products. Inventory management tries to efficiently streamline inventories to avoid both gluts and shortages. Four major inventory management methods include just-in-time management (JIT), materials requirement planning (MRP), economic order quantity (EOQ) , and days sales of inventory (DSI). If the above systems are in place then it's likely easy to improve your inventory management.

O foco da melhoria contínua vai além da eficiência operacional, também contribuindo para o gerenciamento de estoque e a redu??o dos prazos de entrega. O objetivo é otimizar continuamente os processos, permitindo a adapta??o às condi??es em constante mudan?a do ambiente de negócios.

To achieve continuous improvement, you must know where you are starting from, so if effectively managed inventory is the target, Key Performance Indicators are a necessity. In my experience, inventory value (by type such as raw, WIP or finished), inventory quantities (by weight, volume or units) or inventory turns are your typical lagging indicators. Depending on the importance of accurate inventory records, you might also want to create leading process KPI's that provide visibility of how well inventory in reality is matching what your inventory stock records say you have. Inventory record counts, stock location audits or incoming receipt checks need a process to execute them and a process for how the results are reported as a KPI.

Working with the customer is critical to meet their requirements. Must analyze the risk reward concept. How sure are you not to build inventory and agree with that decision with your customer. The focus must be on the customer’s satisfaction.

define a certain value and make sure it is in the contract, then measure it regularly! implement the right KPIs based on the type of stocks; nonetheless, keep an eye on customer operations and health of it's business, nothing will save you if the customer cannot afford to pay for the stock

Customer segmentation is a great place to start as it helps identify the different value streams as MTS or MTO. Depending on the type of market and customer the inventory levels can be established and the product lines can be setup as a combination of make to stock, make to order or assemble to order (pull finished product but push components).

Implementation of Pull System :- A pull system is a way of organizing your production flow based on the actual demand from your customers, rather than the expected demand from your forecasts. This means that you only produce what is needed, when it is needed, and in the quantity that is needed. A pull system helps you avoid overproduction, excess inventory, and wasted resources. It also allows you to respond quickly to changes in demand and reduce lead times. You can implement a pull system using techniques such as Kanban, which is a visual system that uses cards or signals to indicate the status and availability of work items.

Localization Localization As an organization, Fastenal has always believe in "decentralization". In the past we used to pull inventories from our US based hubs and vendors in the states on weekly basis. Products cost wise - cheaper. Efficiency - no, emergency - no, post Covid freight? - worst. We started to localize as much as possible. The advantage? Shorter lead-time, competitive cost (through products standardization & demand consolidation) and the best part of it, we develop our a local supply chain with local partners. They understand the local market better. They need business, we get strong support. Emergency request? no problem - within couple of hours they are at your doorstep!