Making Lean work in FMCG

This blog is the fifth in a series written by Jeremy Praud, Head of UK & Europe. (To start at the beginning, click here.)

Lean-and-Green-webinar-Video15 years ago, Lauras developed an approach to making Lean work in FMCG.  It was entirely results focussed – the founders had and unstinting belief that if you followed the process, you would achieve rapid and sustained improvement. 

Those of you who have come across driver tree based problem solving will know what a wonderfully logical and concise approach it is.  That’s why 15 years ago, we applied our own problem solving method to the factors that drive sustainable improvement in a factory.   The result was the SIM – the Sustainable Improvement Model.

We’ve been putting this to use in the intervening period, and as with all good driver trees, as we get new knowledge and understanding, we can refine it time and again, to evolving it to ensure nothing is missed, and the relative importance of each of the elements is understood.  After a few years, and having tested it across many different sectors, we realised that as much as the structure was common across all sectors, each sector needed its own refinement.

In particular, we noticed that the asset value against operating cost has a significant impact on the rapidity and value that certain improvement techniques bring – thus to truly ensure we could get as close to the maximum rate of improvement possible, we needed a bespoke approach for FMCG v high asset intensity sectors.

A decade down the line, with instances where clients have used the SIM to drive their improvement and in so doing have won multiple awards, the precise understanding of ‘what to do, when’ to ensure rapid and sustained manufacturing profit improvement is better understood than ever.

Since every factory is starting from a different place, the one size fits all approach just isn’t going to deliver the maximum rate of improvement for a given site.   The SIM rates each element across a 5 point scale:

  1. Not Engaged
  2. Experimenting
  3. Effective
  4. Good Practice
  5. Best Practice.

An early learning was that it is vastly more important to identify the elements that have no or little focus, and are rated as Not Engaged or Experimenting, and turn them Effective.  Where there is a lot to do, there is clear path that can be mapped out as what to prioritise in year 1, and what can wait until year 2 or 3.  The rate of improvement of a site that has merely achieved “Effective” at every level of the SIM is impressive – and this doesn’t take anything more than doing the basics well.

The M&S Plan A audit framework has become the first retailer supplier audit to review against a Lean Framework.  The first version of this framework, developed in association with the people who coined the term Lean from an academic analysis (the reasons behind Toyota’s success) is true to Classic Lean, and has yet to be tailored for FMCG.

The purpose of a Lean Audit is simple – to drive improved value, and ultimately reduced manufacturing cost.  The Manufacturers who remember this when following a retailer Lean Framework will do best and maximise the value from lean auditing.

For more discussion on making Lean work in FMCG – register for  Food Manufacture’s Lean Audit webinar (11am, Tuesday 26th April).

 

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