Yesterday, my colleague Daryl Powell successfully defended his PhD thesis titled “Investigating ERP Support for Lean Production” at the Department of Production and Quality Engineering at NTNU, Trondheim, Norway. Over the last three years, Powell’s research has received much interest from the international Operations Management research community and from industrial companies struggling with the mismatch between lean production and ERP (Enterprise Resource Planning systems). Is lean production and ERP solutions for pull production mutually exclusive?
I have visited three former Nissan Diesel factories in Japan this week (today owned by a foreign multinational). The plants operate according to the Nissan Diesel Production System—a bi-product of the famous Nissan Production Way (NPW). I believe that too many lean-lovers focus too heavily on the Toyota Production System (TPS), and know too little about alternative approaches to world-class production. The core idea of an XPS is exactly that the X should be tailored to the company, and not be a TPS-blueprint. In fact, the NPW might provide a better benchmark for many Western manufacturers than the TPS…
Harley-Davidson! …no need for more introduction. This week, I toured the assembly plant in York—the biggest of four H-D manufacturing plants in the US. Together with H-D tattooed bikers with close-fit leather vests, I had the great opportunity of seeing the factory from inside. Harley is well-known for the feelings it evokes in its customer base, and the H-D culture is an unavoidable teaching case in any marketing course. Few other products better symbolize the American dream. Therefore, my question when visiting the York plant was naturally: is it an American dream factory?
The Renewable Energy Corporation (REC) has recently closed its second of two factories in its home country Norway. All the state-of-the-art technology and lean improvement initiatives in the world could not save the Norwegian factories from shutting down this year. The REC case is a good example of how benefits of process improvement programmes can be far outweighed by global politics. A natural question to raise is then; under such conditions – is an XPS programme insignificant?
In a recent article, The Economist explains how the electronic giant Honeywell International transformed “from bitter to sweet” over the last eight years following an XPS strategy. In my research I search for evidence for how and why corporate production systems (XPS) succeed and/or fail. The Honeywell article paints a picture of how the Honeywell Operating System (HOS) literally saved the company from bankruptcy and turned it into a multi-billion profit machine. Although the evidence is anecdotal, the managers interviewed in the article provide convincing statements of XPS success:
It has become extremely popular for companies in any business to pursue the principles of lean production, Six Sigma, TQM, TPM etc. A new development in recent years is that multinational companies develop global and group-wide systems for process improvement based on all these concepts: The XPS. Then, what are the top XPS/lean principles in use?
[This post is an excerpt from my article “People at the wheel – Volvo’s lean journey” co-authored with Ebly Sanchez at Volvo, and freshly published in the Lean Management Journal.]
Yes, I gladly admit; I enjoy a good whiskey. That’s also why it was such a great pleasure to get a first-hand insight into whiskey production at the small family-driven Copper Fox Distillary in Sperryville, Virginia, yesterday. This distillary is the result of a man following his dream and capitalising on its hometowns strength in quality apple trees. His small-batch, hand-made whiskey differs from others as the first applewood chip-aged whiskey in the world. I’ve been to large distillaries and breweires earlier, but for us who know whiskey largely as end-consumers, a micro distillery offer the opportunity to study and learn the processes far better than the giants.
Watching the Chinese New Year Parade and Festival in Washington DC today, I left with a positive experience and the following learning point:
Lean has become the most popular production paradigm in the 21st century. While some giant companies boldly claim to have reached the “Lean nirvana”, many smaller companies have a much tougher road to the goal. Small- and medium-sized enterprises (SMEs) often lack the competence, the resources, and the stability to sufficiently set out on the lean journey. On the other hand, because of their size, SMEs might be much quicker to shift perspectives and march together in new directions. The challenge is to succeed in doing so. Here follows a promising roadmap for SMEs that want to become lean.
During the two last decades, and especially in the turbulent times we have today, cost reduction has been on top of any board-room agenda. Companies are obsessed with the cost focus, but not because they want to be; they know its wrong!
The last 3 years we have seen a renewed explosion in the industrial interest on lean. Ignited by the two waves of economic downturns since 2008 and fueled by consultancy and lean missionaries, literally every business are now going lean. The shared aim is reducing costs and improving customer service by “working smarter not harder”. Today we have “lean services”, “lean construction”, “lean in the office”, “lean healthcare”, “lean ship-building”, “lean logistics, “lean management” and lean this and that… As lean disseminates from its origin in the automobile industry to services and the public sector, I see the word “lean” growing far beyond its roots and often even intentions. For me the term is losing it’s mojo.
High-tech products are foreseen to build the future competitiveness of the Western economies’ manufacturing sectors. However – what probably will become the most important manufacturing paradigm for the Western economies – lacks proper theoretical concepts and frameworks for industrialisation. Lean & co are simply not suitable enough for high-tech, customized, knowledge-intensive and lower-volume production. In order to remain competitive there has been a need to develop new production concepts with belonging methods, systems and tools for modern high-tech and mass-customised production systems. A good thing then that someone has made an effort to close this gap…
Have you seen any coupons lately? Of course, you have. They are everywhere. In the US we live in a Coupon Society. I undertook a brief investigation into the amount of coupons in our daily lives by counting the number of coupons in today’s Washington Post. Here is why we should end this paradigm.
XPS stands for “Company-specific Production System” , and describes a corporate-wide system that aims to improve and maintain a competitive operations system. Many multinational companies have implemented an XPS today: Examples are the Bosch Production System, Boeing Production System, Audi Production System, Lego Production System, John Deere Quality and Production System, Alcoa Business System, REC Production System, Electrolux Manufacturing System, and so on and so on…
Example of a typical XPS: the Electrolux Manufacturing System 
This weekend I had the pleasure of personally getting to know Simon L. Dolan in a work shop at the Georgetown University in Washington D.C. Prof. Dolan is known for numerous articles and books on value management and cultural re-engineering. For the last ten years he has been based at the ESADE Business School in Barcelona, Spain. I have self been teaching students the theory of value management using Prof. Dolan’s writings as curriculum, and was naturally eager to hear some gems of wisdom from Dolan himself…