AS3.What is Lean Management

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Lean automated manufacturing: avoiding thepitfalls to embrace the opportunities

Hongyi Chen and Richard R. Lindeke

Department of Mechanical and Industrial Engineering, University of Minnesota Duluth, Duluth, Minnesota, USA, and

David A. Wyrick

Department of Industrial Engineering, Texas Tech University, Lubbock, Texas, USA

AbstractPurpose Over the last several months, the cries to become lean and low cost have echoed all the way from the halls of government to the smallestcompanys back room. In times of severe economic challenge, the natural reaction is to make decisions that can make an organization become as leanand focused as possible. This paper aims to address these issues.Design/methodology/approach This paper discusses the benefits and pitfalls associated with lean manufacturing management starting from thekernel idea that pleasing the customer should be at the root of all effort leading through the ravages of overzealous application of lean to the max.Elements of lean discussed in this paper address organizational waste, human resources, distributed design, supply chain management, customermanagement, and the financial system.Findings Potential solutions and recommendations are made to help organizations become lean yet remain committed to being centered on theultimate goal of customer satisfaction. These benefits and pitfalls may be seen as outcomes based on the degree to which lean is implemented.

Originality/value This paper reviews the popular lean manufacturing environment and makes practical recommendations to new adopters to avoidfailures due to the improper application of lean to their organization.

Keywords Lean production, Value chain, Management strategy

Paper type General review

1. Introduction

The benefits of lean enterprise management are well-

documented. More and more companies have embraced lean

as the only wayto manage their business. While the principles of

waste reduction, human optimization, distributed design, and

supply chain management has served many companies verywell, these benefits may alternatively lead to absolute failure.

The authors previously documented the ravages of lean

thinking taken to the limit and proposed the Temporal Think

Tank (T3e) (Lindeke et al., 2008) as a solution.

Lean management focuses on eliminating waste (non-value-

adding activities) throughout their systems. This leads

organizations to better understand their customers needs

and deliver what the customer wants exactly when they want

it (just-in-time). Lean has led to higher quality throughout the

production chain and design through evolution. Major

manufacturers concentrate their expertise and judiciously

outsource vital sub-components and sub-assemblies to

specialists who become critical to the supply of the final

product. By selective sharing of design/development, the lead(lean) organization can focus resources and competencies on

a limited set of innovative ideas and reduce their direct costs

for innovating many of the components in their products.

What, however, happens in the event of a sea-change as

described in Lindeke et al. (2008), or worse yet, the failure of

a vital supplier? Only by addressing various scenarios can the

high-level organization hope to succeed, or even survive.

This may require additional personnel from the lean

company to work more closely with supplier organizations as

they struggle to make their sea change. By shifting employees

throughout the workforce, and actually working within the

other organizations operations, many companies have learned

to survive and quickly adapt to change. This concept was, in

part the spark for the T3e. Lean management is not simply

cutting out the fat in an organization. Fundamentally, lean

requires taking personal responsibility for ones work and

pleasing ones customer, at whatever level that customer

specifies. Without distributing the work force in the value

chain, and attendant personification of the customer, all of the

lean benefits can be forfeited as a supplier worries more about

the bottom line costs and delivery schedule rather than the

receivers needs for quality product. This is particularly true

in difficult economic times when the extra people in the

suppliers or customers plants are brought home to addresslocal issues brought on by reducing the work force to the

leanest levels.

This paper explores the positive and negative aspects of a

lean philosophy. Providing this foundation exposes some

pitfalls in lean thinking. The current downward shift in the

marketplace poses important challenges to the lean paradigm.

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/0144-5154.htm

Assembly Automation

30/2 (2010) 117123

q Emerald Group Publishing Limited [ISSN 0144-5154]

[DOI 10.1108/01445151011029745]

This paper is an updated and revised version of an award winning paperpreviously presented at Flexible Automation and IntelligentManufacturing Conference (FAIM), University of Teesside,Middlesbrough, UK, July 6-8, 2009.

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Can companies apply lean in a shrinking economy, while

focusing on innovations needed for survival? In particular, this

paper suggests that organizations, to protect their value

streams, begin the effective use of business system- and

production-oriented T3es, develop more intelligent and

flexible manufacturing systems, redefine values to encourage

long-term, risk-taking innovation activities, and closely

support suppliers along their entire value chain.

2. Benefits and pitfalls of lean systems

While the benefits of lean practices are well-documented,

some of the negative effects of lean on employee outcomes,

work characteristics, product design, and an organizations

innovation capability have also been studied (Lindeke et al.,

2008; Lewis, 2000; Parker, 2003; Fucini and Fucini, 1990;

Mehri, 2006). To offer researchers and practitioners an

extensive list of the potential pitfalls in the lean thinking, we

present our analysis in this section. The analysis is based on a

thorough literature review in the fields of lean manufacturing,

new product development, technology and innovation

management, and human resource management. Case

studies are also employed in our research. Besides, thoseones identified in literature (Lindeke et al., 2008; Lewis,

2000; Parker, 2003; Fucini and Fucini, 1990; Mehri, 2006),

many more issues have come to our attention as we link the

lean philosophy to other management concepts. In the

following sections, we attempt to clearly spell out the key

concepts of lean and discuss the associated pitfalls.

2.1 Reducing waste

Waste reduction is the fundamental concept in the lean

philosophy. By focusing on value-adding activities, lean

enterprises actively work to identify and eliminate different

kinds of waste, called muda in Japanese, from the system. Any

activities that consume resources but do not create value will

be considered muda, and become the subject of Kaizen

(continuous improvement) events. Wastes can include

designing wrong products that no customer wants, making

mistakes in the manufacturing process that leads to defects,

employees being left idle or waiting for deliveries during work

hours, etc. The seven categories of waste summarized in Hale

and Kubiak (2007) have a good cover of all the wastes in lean

definition, and they are listed as:

1 overproducing more items than included in customer

orders;

2 inventory due to increases of finished goods and work-in-

process;

3 motion that does not add value to the final product;

4 waiting for any resource throughout the flow of design and

production;

5 transportation or the additional movement that is not ofvalue to the product;

6 over-processing or additional steps that do not increase

the overall value of the product; and

7 not being right the first time or the costs and time

associated with repairing and correcting a product.

Correct identification of muda and successful elimination of

them leads to reduced manufacturing cost, higher product

quality, improved customer satisfaction, and increased profits.

However, in reducing waste and focusing on value-adding

activities, a company may focus on obvious short-term benefits

and ignore long-term competitive advantages. Since the return

on investment for many innovations is very difficult to quantify

when the ideas first take shape, especially before the potential

markethas been clearly identified anddeveloped, it is verylikely

that those ideas, especially the ones offering particularly long-

term contributions, will be considered non-value-adding and

thus be cut-off.

Even before ideas get generated, the time and effort that are

necessary to spark innovation may also be eliminated as wastein a lean system. It should be noted that when the lean concepts

were first developed in Toyota Company by Taiichi Ohno, time

was set aside periodically for the worker teams to get together

and suggest ways to improve the system (Womack et al., 2007).

These creative times are highly valuable in keeping the

teams, and hence the organization, innovative and to

continuously improve the manufacturing process. However,

as lean practices reach the extreme, the shrinking size of the

workforce and the busy schedules of employees who have

multiple responsibilities will make it much harder to get

workers together for formal discussions, much less casual chats

that may spark innovative changes.

In addition, in order to identify non-value-adding activities,

value should be clearly understood and defined. In lean

thinking, it is emphasized that value can only be defined by

the end-users (Womack and Jones, 2003). Customers needs

and wants should be followed closely in product design and

manufacturing. Any products or features that the current

customers do not want will be considered muda since they do

not generate revenues in the current market. This approach is

expected to continuously and incrementally improve products

and increase customer satisfaction, especially in a market pull

situation. However, it may hinder radical innovations that

create technology push opportunities and cause companies to

stumble upon disruptive innovations. A disruptive technology

is a new technology or new application that usually

underperforms in area(s) most desired by the mainstream

customers, at least in the short-term, but with other valuable

features and great potential to develop, the technology caneventually better more established technologies and dominate

the market. As noted in Christensen (2006), blindly following

customers demand may lead a company to focus on

technology development that overshoots customers demand

and lose the market to disruptive technologies that had been

initially denied by the same group of customers. Therefore,

exclusively following customers definition of value and the

elimination of all non-value adding activities can lead a lean

company to failures because customers can be wrong, or at

least short-sighted.

2.2 Human resource management

The second keystone to the lean philosophy is to respect

the workers since they are the knowledge resources in the

system. As discussed above, slack in lean systems are

continuously identified and removed as muda. Slack on

the human resource side mean unused work time and excess

workers. Increasing worker utilization and reducing the size of

the workforce usually lead to reduced manufacturing costs.

However, stress is also created in the work environment from

crazy schedules and multiple responsibilities. In certain

situations, stress may drive creative tensions that stimulate

employees creativity (Oldham and Cummings, 1996).

However, too much stress is more likely to stifle employees

creative thinking. As noted in Silverthorne (2002), most

people cannot function effectively in a time crunch for long

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Hongyi Chen, Richard R. Lindeke and David A. Wyrick

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periods without burning out, even if they have a sense of being

on an important mission and being challenged. Therefore,

even though the jobs in a mature lean system are supposed to

make employees feel important and challenged and thus

greatly respected by the company, workers will not be able to

innovate when they have been under too much stress for too

long. Typically, when a company becomes leaner and leaner, a

naturally expected result is layoffs. Unlike workers in Japan,where lean manufacturing originated, workers in the West do

not have the luxury of a lifetime employment guarantee. As a

result, lack of job security constitutes another source of

employee stress in lean enterprises. For employees in Western

lean companies, a conflict exists between the fear of losing

jobs and the need to accomplish more with less people while

continuously eliminating excess workers. This probably

explains, why critics renamed lean manufacturing mean

manufacturing or management by stress (Parker, 2003).

Just because of being lean, the company runs the risk of

being fragile in situations when many workers call in sick or

choose to go on strike. In either case, not enough people will

be there to cover the jobs; work will be delayed dramatically

and quality may suffer. With just enough people who are

very much stressed and in many cases pushed to the limit,

a lean system can hardly respond to such emergencies.

Employees in a lean companyare trained andexpected to take

on multiple responsibilities. Since everyone can perform every

job to some degree, the flexibility of the system is increased.

During times when sales decrease, instead of waiting for orders

beside the assembly line, primary engineers, and assemblers are

expected to transform themselvesinto salespeople and go out to

talk to potential customers to create sales. However, as a

tradeoff, employees may lose special expertise as they change

roles frequently. In traditional organizations, the career ladder

is designed to allow employees to gain a depth of knowledge in

one special area first and then expand their expertise (Bennett,

1996). It is important to develop expertise in an area since it is

essential to have expertise in order to innovate in such an area,and broad understanding of different areas will be a plus that

sometimes stimulates innovations. In lean environments, if the

job responsibilities are shared too broadly and shifted too

often, the employees may never get a chance to deepen their

understanding and keep up with the development of

technologies in any area. This will eventually negatively affect

the capability of an organization to innovate and can even lead

to a regression in retained organizational knowledge.

One of thecases that theauthors considered when examining

the potential pitfalls of a lean workforce is a university

department that has been short of teaching resources for

several years. To survive increasing student enrollment with a

lean faculty group, many members have to take the

responsibility of continuously teaching new courses, some of

which are not in their direct or closely relatedareas of expertise.

At the same time, theaverage teaching load and the service load

have also been increased. Time to perform research and

innovate, either with their classes or in departmental outlook

has been largely taken instead by developing course materials

and preparing for lectures. The innovation rate, measured by

publications in this context, can only be seen to decrease.

2.3 Distributed design

Distributed design characterizes, the product design and

manufacturing strategies in lean companies. In fact, Japanese

lean car producers design and provide detailed drawings of only

30percent of the partsin their cars,the rest are distributed to its

first-tier suppliers, who usually have expertise in process

engineering and plant operations (Womack et al., 2007). In this

way, the responsibilities of manufacturing are mostly shifted to

suppliers. The lean producers become focused on the overall

design of product and the final assembly of parts being

engineered and produced by different suppliers. This approach

agrees with the economic theory that distributing jobs to themost efficient parties increases overall social welfare. By

focusing on product design and final assembly while

aggressively outsourcing parts, lean companies are able to

steadily decreasethe unit costof products. However, since most

major parts are outsourced as a turnkey project to suppliers,

the lean producers are barely involved in manufacturing of

many, and often key, components of their products. As a result,

the companys own ability to design, debug, and improve

manufacturing systems, or even large segments of their

products will decrease.

For a company that wants to achieve product leadership, it is

critical to maintain and strengthen its manufacturing ability.

This is linked to a third cornerstone of lean: being agile where

this agility helps develop from the strength of design and

manufacturing knowledge and facilitates bringing innovative

products to market quickly. Designing high-quality products

and low-cost manufacturing is an important part. When

incremental changes to modules/parts no longer lead to overall

product improvement, the relationships among the product

components and core concepts may need to be reconfigured

(Henderson and Clark, 1990). In such a situation,

manufacturing processes for new designs will need to be

created, assessed, and improved. The Toyota Company in

Japan tries to maintain a long-term relationship with its

suppliers and helps them improve manufacturing by loaning/

switching its engineers through the supplier companies. This

approach promotes communication and knowledge sharing

between producers and suppliers to a great degree. However,

to solve the fundamental problem, a company will need astrong incentive and great commitment of time and efforts to

understand and be involved in major suppliers manufacturing

process.

Another tradeoff to distributed design when parts are

mostly outsourced is that the innovations from internal

product research and development (R&D) at a company may

flow out to competitors too quickly, even before the company

can benefit fully. Since most suppliers provide parts to

multiple customers, to reduce cost, suppliers are likely to

provide parts that are similar, if not the same, to each

customer. Even if there are agreements in place to keep trade

secrets, other customers of the same supplier may smell

innovations from the parts or assemblies they receive or

conversations with the suppliers representatives.

2.4 Supply chain management

In the lean supply chain, parts from suppliers arrive shortly

before they are needed since excess inventories were

eliminated as waste. This approach saves storage space and

costs, and improves efficiencies. However, with no reserve

stocks, the system will stop running if parts do not arrive on

time or a faulty shipment comes. This happened in the early

stage when General Motors (GM) tried to embrace the lean

philosophy in its Pontiac assembly plant in Pontiac, Michigan.

Since all the buffers and inventories had been removed, a

failure of a shipment from its supplier, in this case the Flint



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plant nearby, caused the entire plant in Pontiac to shut down

and they had to send the workforce home 4 h early with a loss

in production of product that was slated to flow to the

customer (Womack and Jones, 2003). Although this issue is

supposed to be solved by the supporting organizational

structures that are constructed, there is no guarantee that a

late or faulty shipment will not happen in a mature lean

system. Supply problems become more likely when financialcrises affect every component of the economy, as we find

today. Since large complex parts of the product are sole-

sourced in lean-supply systems, the failure of a supplier,

especially a first-tier supplier, can be fatal to the company.

Strikes at different levels of the supply chain will also have a

significant negative effect on production at the lean company.

One need only consider, the problems at GM when a supplier

of airbags went into bankruptcy and no longer provide

products to them, or would even release GMs tooling to

move it to a different supplier (Detroit News, 2008). The 1998

strikes in two of GMs part supplier factories in Flint,

Michigan, that caused 26 out of 29 North American assembly

plants to close down and lay off nearly half of GMs workforce

(Bradsher, 1998) is another good example that without

buffers, failure of any link on the lean supply chain will cause

the whole chain to fall like dominos.

One of the prime driving ideas that most companies adopt

when they begin their conversion to lean management is to

consolidate their vendor list. Since there is a cost associated

with keeping communication channels open to vendors, even

if they are not Tier 1 or even regular suppliers, most lean

companies view extra vendors as muda. Reduction in vendors

can save resources; however, it can also limit innovation. One

of the authors spent time with a lean manufacturer recently

and observed an unfortunate issue as the engineering staff

explored a new quality process. The engineers had identified a

promising new measuring device but they were unable to

purchase it for testing because the vendor was not on the

approved list! This led to a significant delay and additionalexpense for bringing innovation into the company. Surely, this

was an unexpected, but often observed, consequence of the

effect of vendor and supply chain control in lean enterprises.

2.5 Customer management

In the Japanese Toyota system, a large workforce is maintained

to deal with customer management. Japanese buyers usually

purchase a new car about everyfour years, due in large part to a

governmental policy that requires very expensive and very

demanding vehicle inspections as a car ages. In order to

maximize the total income from a customer over the long-term,

the sales department in Toyota devotes a significant, and costly,

effort to keep good long-term relationshipswith every customer

(Womack et al., 2007). Keeping every customers information

in a database and calling them frequently will instill customer

loyalty and makeit difficult for competitors togaina share inthe

Japanese market.

Compared with customers in Japan, people in other

countries do not have to purchase new cars as often in the

absence of strict government regulations dealing with the

inspection of aging vehicles. Therefore, maintaining a life-

time relationship with customers seems much less important

in those markets. A lean system would likely view a large

workforce dedicated to customer management as a waste,

thus, will train and expect the customer service personnel to

perform other jobs. As mentioned in Womack et al. (2007),

during a visit to the Toyota Company, the authors were told

that the external relationship manager was too busy to meet

with them since he was doing some assembling. In the same

way, the experts that used to analyze and communicate

customers needs may be moved to other jobs and become too

busy with more obvious or urgent work, including assembly.

By this action in the long-term, knowledge and expertise

needed to managing customer interaction will be lost.

2.6 Financial system

While the shadow pricing strategy is used in both lean and

mass production companies, lean companies tend to use it

more aggressively. Figure 1 shows an example: both lean and

mass production companies set the selling prices: at $20,000

and 30,000, respectively, lower than the actual initial

manufacturing and development cost ($50,000), expecting

the learning curve effect and economies of scale will drop the

average unit cost if the sales reach the projected five million

units volume. Both companies decrease the product price one

or a few times as their products enter into a later stage in the

life cycle to beat competitors and better penetrate the market.

The main difference is that the lean company tries to set the

selling price lower than the price of the mass product

company and much lower than its actual initial cost, hoping

that by applying lean practices, the unit manufacturing cost

will drop more quickly and dramatically as more customers

are attracted to purchase the product. It is reasoned that

profits gained later through expanded market share will soon

compensate for the losses incurred in the beginning of a

products life. Increasing sales to the point that early losses

can be compensated for therefore quickly and continuously

reducing costs by effective lean practices throughout the

process are critical for the survival of a lean company. While

the aggressive shadow pricing strategy encourages initial

purchases and can succeed in an expanding market, applying

it in a shrinking market, without being able to differentiateones product through superior features and quality from its

competitors will, likely, only expedite the fall of the company.

Simply being cheap is not the answer to sustaining success:

innovation and technological advancements are the ultimate

driving forces of product leadership.

2.7 Summary of lean pitfalls

Table I summarizes the lean concepts and the potential

failures that they may lead to, as discussed in the previous

sections.

Figure 1 Shadow pricing strategy as employed by lean organizations

$30K

$20K

$50K

Manufacturingunitcost

30K 50K

Mass production

Manufacturing volume

Manufacturing cost

Product price

Lean production

1M 5M

SellingPrice



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3. Solutions to maximize the benefits of lean

For a company to maximize the benefits of its lean practices,

special attention must be paid to the pitfalls discussed above.

While it is not the purpose of this paper to offer an exclusive

list of solutions, a few are suggested.

When one reviews a company that has a strong survival

instinct, often we find that they have embraced the ability to be

agile and flexible in their product design and manufacturing

environment. This agility is linked to their innovative spirit and

is vested into the establishment of independent organizations,

like those espoused by the authors in the T3e (Lindeke et al.,2008). When economic conditions become difficult, as in the

current worldwide economic crisis, it is the companies who

have agile philosophies that can succeed. Thus, at least as it

views the future, an organization must drop strict adherence to

the Lean mantra of its muda to carve out its future by finding

time to reflect and study for products that will allow it to

flourish in the recovery period that is ahead. Creating an

independent organization, like T3e (Lindeke et al., 2008),

with a cost structure not honed to achieve high-profit margin in

the current market is also a solution for companies to harness

disruptive innovations without affecting the lean nature of the

parent company.

To cultivate an innovation-encouraging culture in a lean

company, it is important to define value in the way that

innovation-driving activities are viewed so as not to be

considered muda. Setting aside some creative times not only

helps reduce job anxiety and get employees re-energized, but

also provides opportunities for the employees to interact and

stimulate out-of-the-box thinking. Defining value effectively

also calls for a positive attitude toward risk taking. As

emphasized in an interview by Jeff Immelt, CEO of General

Electric (GE), it is important for an organization to make it

ok to take risks and devote time and efforts to certain

activities that do not produce results in a short-term (Business

Week, 2005). An R&D portfolio that builds both short- and

long-term competitiveness will better prepare a lean company

to stand out in fierce competition. As an essential part of the

lean system, workers should be respected and involved as

much as possible in the decision-making process. In this way,

a sense of importance, enjoyment, and satisfaction will be

provided to motivate employees creativities.

Given the advantage of being flexible, a lean company

should be able to respond to changes more effectively if

contingency plans are developed ahead of their absolute need.

Therefore, besides ensuring competitiveness through

continuous innovations, the company also wants to closely

monitor and forecast the market demand and technology

trends, assess its own competitive advantages, conductsensitivity analysis, and generate scenario analyses. A variety

of decision analysis tools are available to facilitate such

activities and sharpen decision-makers judgment (Chen et al.,

2009; Gerdsri and Kocaoglu, 2007; Millett and Honton,

1991; Yoon and Park, 2007). What the companies need to do

is to select and adopt suitable ones to maximize their benefits.

In addition, to better cope with uncertainties and disruptions

in the dynamic market environment, more intelligent and

flexible manufacturing systems are needed, especially for the

companies in which tooling and equipment require large

capital investment. Flexible product platforms can be

designed to effectively share common components and

deliberately project uncertainties into flexible elements that

are carryover-modified in different product families or

product generations. In this way, the need of redesign as

well as changes in manufacturing tooling and equipment will

be minimized in an event of new product introduction.

Details about the systematic process of flexible product

platform design can be found in Suh et al. (2007).

Owing to the strong dependencies of a lean company on its

suppliers, it is critical for the lean company to support those

suppliers. This calls for more transparent financial systems

and cash flows along the chain, since the system is only as

strong as the weakest component of the whole chain. In the

unfortunate incident stated above, with the failure of a key

supplier, one can only wonder if cost control tactics by GM

Table I Summary of lean pitfalls

Lean concepts in Pitfalls

Eliminate all wastes Companies may:

Eliminate the creative times that are necessary to innovations

Focus on short-term value-adding activities and lose long-term competitive capability through radical innovations

Miss technology-push opportunities

Stumble over disruptive innovationsCreate more stresses in the work environment and make employees lose the feeling of job security

Multiple job responsibilities Employees may lose expertise in their special areas

Distributed design Companies may lose the ability to design, debug, and improve the manufacturing system of the parts

Parts designed and manufactured in different places may not match

Opportunities to develop radical and architectural innovations will be eliminated

Internal innovations may flow out too fast before the company can benefit from its R&D

Lean supply chain Late and faulty shipment of parts will stop the system

The failure of a first-tier suppliers are fatal

Effects of strikes on different levels of the supply chain will be amplified

Customer management Customer satisfaction may be lost in the long-term as a result of the busy schedules and multiple responsibilities

of customer analyst

Financial management The use of shadow pricing strategy may lead to total failure in a shrinking economy

Cross-ownership and interlocking equity with each other in the lean group may expedite the fall of the whole group

in a crisis



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were not ultimately to blame in the failure. Surely, squeezing a

few more cents out of the cost of the product each year for the

last few years, as its market share shrank, did little to improve

the sales picture for GM but could have sealed the collapse of

this supplier. With better foresight this cash strapped supplier,

who was likely unable to support innovation, could have been

saved and could have begun to deliver even better products to

GM in the future. GM could have provided assistance,perhaps by increasing its prices by a few dollars per vehicle

and passing the added revenue directly back to its struggling

supply chain with a very small impact of its number of sales

over the short-term. This would be clearly seen as a shadow

pricing initiative that would have reaped huge benefit into

the future.

Any organization, regardless of where it lies along the road

to lean, can open itself to clearly explain its financial condition

to its partners. It can share difficulties and build long-term

trust, strength, and a healthful and supportive relationship, as

suggested by the Japanese Lean Manufacturers, rather than

creating legal adversaries as has happened here.

Closely working with the suppliers also helps the lean

company to keep up with the most recent developments in

manufacturing technologies. This may require additional

personnel from the lean company to work in supplier

companies; however, it is critical for the company to maintain

its ability in designing and debugging the manufacturing

system, and to optimize the whole value chain. By shifting

employees throughout the workforce, and actually working

within the other organizations operations, many companies

have learned to survive. This concept was, in part the spark for

the T3e introduced by the authors in an earlier paper (Lindeke

et al., 2008). The fundamental and controlling underpinnings

of lean management are based on taking personal responsibility

for ones work and pleasing ones customer, at whatever level

that customer has specified. Without having a work force that is

distributed along the value chain, and this attendant

personification of the customer, all of the benefits of lean canend at the shipping dock with a supplier worrying about the

bottom line costs and delivery schedule rather than the

receivers needs for quality product. Therefore, in difficult

economic times when the companys initial reaction would be

to bring the extra people in the suppliers or customers plants

back home to address local needs as the work force is whittled

down to the leanest levels, this is often the worst means to

address the problems posed by hard economic times.

4. Conclusion

Lean enterprise management aims to eliminate waste,

effectively manage personnel, distribute design among

entities that are best at each stage, work with the supply

cha in, manage customers, a nd wisely manage the

organizations finances. In each activity, the focus is to

eliminate muda, or waste.

For each of these elements of lean, examples have been

provided in this paper to warn against the zealous over-

application of lean. Taken beyond a moderate, reasonable level,

lean will actually decrease the organizations ability to compete.

In times of great economic stress, implementing lean

management as much as possible is an understandable

reaction, but it may ultimately insure the failure of the

organization rather than save it. The authors have offered

advice to the newly lean organization to avoid many of the

pitfalls of overzealous lean to become a stronger competitor

for having survived the on going, or in fact any, financial crisis.

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Corresponding author

Richard R. Lindeke can be contacted at: [email protected].

edu



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