42 ISE Magazine | www.iise.org/ISEmagazine
Manufacturing is a complex business, and get-
ting more so as global competition increases,
customer expectations swell (raising the bar),
supply chain disruptions are more prevalent
than ever and new technologies (e.g., Industry
4.0) come into their own.
To compete in today’s complex business environment,
many companies are embracing a Lean management system.
The goal is to delight the customers and improve top and bot-
tom-line results through the relentless elimination of waste.
In reality, that’s much easier said than done. Few compa-
nies have achieved the kind of sustained success that Toyota
has from its legendary Lean production system. While many
companies have implemented “islands of Lean,” what’s often
lacking is a comprehensive system. In other words, you may
have an ace pitcher on your baseball squad, but if the rest of
your team and playbook is lackluster, it’s a challenge to win
games, let alone a championship.
So where do you get started if you want to take your Lean
program to that next level? The first step is to conduct an
added value Lean assessment of your plant to determine the
current status, performance gaps and relative “leanness” of
your operation. Once you have determined your current
state, you can devise a winning game plan. A successful strat-
egy prioritizes improvement opportunities that focus on “the
vital few rather than the trivial many” – the 80/20 rule – so
your targets are realized within the shortest lead time possible
(shown in Figure 1).
Whether youre starting a new Lean transformation or con-
FIGURE 1
The Pareto Principle
The 80/20 rule indicates that 80% of problems are caused by
20% of factors.
M
Added value assessment takes
Lean to the next level
Improvement tool measures, tracks and compares operational performance
By Jeffrey Miller
May 2021 | ISE Magazine 43
templating next steps on your journey, the added value Lean
assessment is one of the most cost effective and powerful tools
available for measuring your Lean index, tracking its prog-
ress, comparing operational performance to industry peers,
determining gaps that must be closed to improve your “lean-
ness,” and identifying improvement opportunities.
The assessment can also provide quick information on
strengths and weaknesses when evaluating a supplier and can
be used to establish benchmarks for performance improve-
ment.
Of all the potential benefits, perhaps the most valuable is
the ability to hit the ground running on your operations im-
provement journey. Theres no need for analysis paralysis or
a lengthy ramp-up. The assessment will highlight both long-
term opportunities and the low-hanging fruit.
How to determine if your factory is truly Lean
Because of the complex nature of manufacturing, it can be
difficult to unpack the root causes for various observable
symptoms occurring within a factorys four walls. The law of
unintended consequences may result as changes made within
one part of the system adversely affect other parts. Often,
these new complications are much worse than the original
problems. That’s why many performance improvement ini-
tiatives fail.
For example, I knew a Tier 1 automotive supplier whose
primary focus was on maximizing efficiency. That incentiv-
ized production to build large batches in order to amortize
lengthy setups, regardless of customer demand or the concept
of continuous flow. What do you think that did to lead times,
inventory, floor space requirements, quality
and return on working capital? It clearly re-
inforced the wrong behaviors.
The answer is to perform a comprehensive
assessment of the production system. When
you have a medical condition, a doctor will
rst conduct an exam and order tests before
placing you under the knife. The added value
Lean assessment is the equivalent of an exam
and tests.
There are many consultants and organi-
zations that provide Lean manufacturing
assessments. These assessments are equiva-
lent to conducting a physical exam without
ordering lab tests for the patient. They’re
qualitative reviews concentrating on Lean
principles and practices: How many princi-
ples and practices do you have, what are they
and how fully are they used? For instance,
are work teams trained, empowered and in-
volved in problem-solving and ongoing im-
provements?
Usually, the more principles and practices an organization
has that are considered the industry’s best practice, and the
greater the maturity level of those practices, the leaner the
organization or process is considered. An example of a quali-
tative assessment is the rapid plant assessment discussed below.
Similarly, numerous firms offer performance benchmark-
ing services. These studies are comparable to performing lab
tests without doing a physical exam on the patient. Quantita-
tive benchmarking centers on measurements of standard per-
formance indicators and comparisons among organizations.
For instance, how does your company stack up against the
competition in manufacturing cycle time and perfect order
fulllment metrics? Are you an industry leader (in the top
10%) or a laggard (below average)?
Where a qualitative assessment is used to gauge maturity,
quantitative benchmarking is used to assess where there are
gaps in performance. For instance, a company may be in the
bottom half of its class with manufacturing cycle time perfor-
mance. Perhaps it needs to reduce lead time by two weeks to
reach parity, 4½ weeks to fall into the top 25% and six weeks
to achieve the top 10% ranking.
Quantitative benchmarking focuses on “what has hap-
pened” whereas qualitative assessments tell us “why this hap-
pened” (See Figure 2).
To obtain a holistic view of your factory’s overall health,
you need both. An added value Lean assessment provides the
best of both worlds – the physical exam and lab tests for the
patient. It’s accomplished by integrating the widely recog-
nized tools and techniques of rapid plant assessment, perfor-
mance benchmarking and Lean principles and practices into
FIGURE 2
Added value Lean assessment
Measuring both qualitative and quantitative methods leads to the right remedy.
44 ISE Magazine | www.iise.org/ISEmagazine
Added value assessment takes Lean to the next level
a unified framework, creating an extraordinary synergy. Us-
ing this mixed methods approach is key to gaining a deeper
understanding of your operation along a Lean transformation
path. Furthermore, youll acquire real evidence and profound
insights that lead to identifying and prioritizing those im-
provement opportunities that generate the best bang for your
buck (i.e., the vital few).
Rapid plant assessment
The rapid plant assessment (RPA) is for quickly evaluating
production facilities and identifying improvement opportu-
nities during a plant tour. To the trained eye, a plant tour can
reveal a great deal about a company – e.g., Lean operations
look Lean and non-Lean operations dont.
For example, are processes laid out where similar equip-
ment or machines are grouped together, such as all the mill-
ing machines in one area, all drill presses in another area and
grinding machines in yet another, and so on? Or are processes
laid out in a production line or cell consisting of a number
of machines or workstations dedi-
cated to produce a family of parts
or products that require similar
processing? Because one of the
key principles of Lean is to “make
processes flow, achieving this
with a “traditional” process layout
is virtually impossible.
I once visited a plant that had
recently rearranged its equip-
ment from a traditional process
type layout into U-shaped flow
cell congurations. However, I
noticed there was significant in-
ventory accumulating between
stations within the U-modules.
The individual stations and opera-
tors were still working as isolated
islands. The flow was very inter-
mittent and erratic. They might as
well have kept their original layout because it didnt make
them any leaner.
RPA is based on lessons learned from numerous successful
applications of Lean manufacturing in North America and
European operations and it has been shown to be a reliable
indicator of a plant’s strengths and weaknesses.
The RPA process includes two tools for performing the
assessment: the RPA rating sheet, which groups more than
200 lean operations attributes into 11 categories for assess-
ing the “leanness” of a plant; and the RPA questionnaire,
which provides a series of associated yes-or-no questions to
determine if the plant uses Lean principles and best practices
in these categories.
Listed below are the 11 categories of Lean assessment from
the rating sheet:
1) Customer satisfaction.
2) Safety, environment, cleanliness and order.
3) Visual management system.
4) Scheduling system.
5) Space use, material movement and product flow.
6) Inventory and WIP levels.
7) Teamwork and motivation.
8) Condition and maintenance of tools and equipment.
9) Management of complexity and variability.
10) Supply chain integration.
11) Commitment to quality.
Performance benchmarking
I believe that Lean, like other performance improvement
programs, is a means to achieving a goal, not the end goal
itself. At the end of the day, the proof is in the performance.
FIGURE 3
Performance benchmarking assessment
A measurement of on-time delivery performance shows that a 90% on-time delivery rate falls
between companies ranking in the 50th and 75th percentiles. The percentile represents a company’s
relative position in a peer group.
The added value Lean assessment is one
of the most cost effective and powerful tools
available for measuring your Lean index,
tracking its progress, comparing operational
performance to industry peers, determining
gaps that must be closed to improve
your “leanness,” and identifying
improvement opportunities.
May 2021 | ISE Magazine 45
The question is: How will you keep score to know whether
or not youre winning?
Effective benchmarking against industry peers is critical to
understand performance gaps. The performance benchmark-
ing assessment (PBA) compares where your company stands
relative to organizations in the same, or a similar, industry for
key metrics that are aligned to the 11 RPA lean assessment
categories. These benchmark metrics will include perfor-
mance levels of cost, quality, delivery, productivity and safety.
Figure 3 shows a benchmark of on-time delivery per-
formance. A 90% on-time delivery rate falls approximately
within the 65% percentile ranking. The percentile represents
the relative position in a peer group. For example, if your
percentile is 65%, you perform better than 65% of the other
companies in the comparison group. Conversely, you per-
form more poorly than 35% of the other companies in your
comparison group.
Leveraging this quantitative benchmarking data will help
paint a more complete picture of your plant’s “leanness” by
shedding light on critical financial and operational performance.
In addition, some leading companies successfully use this
information as a sales tool to improve contract win rates by
showing prospective customers how they’re better than their
competitors.
The added value Lean assessment process is divided into
three phases: 1. pre-assessment and benchmarking; 2. on-site
assessment; and 3. post-assessment. Figure 4 displays a high-
level flowchart that illustrates the process.
The study culminates in a presentation to management that
includes the completed scorecard and charts indicating the
current “leanness” of the plant. Shown in Figure 5 on Page
46 is a sample radar chart to visually display a summary of
the results. Also included are the competitive benchmarking
results showing how your organization stacks up against other
relevant industry players for key performance indicators. The
presentation also contains major improvement opportunities
and best practices needed to further integrate Lean into the
organization and move the needle toward performance im-
provement.
By using this approach, you will not only set the stage for
enhancing your Lean production system, but also pave the
way for improving your top and bottom lines.
FIGURE 4
Added value Lean assessment process
The process is divided into three phases: pre-assessment and benchmarking; on-site assessment; and post-assessment.
IISE fall conference puts
Lean in spotlight
You’ll find a wide sampling of Lean ideas and processes to
take back to your business at the IISE Lean Six Sigma & Data
Science Conference Sept. 20-22 at the Grand Hyatt Buckhead
in Atlanta. For updated program information and registration,
visit iise.org/leansixsigma.
46 ISE Magazine | www.iise.org/ISEmagazine
To obtain the maximum benefit, it’s best to engage an
independent, third-party expert to conduct the assessment.
An experienced professional will bring to bear an impartial
perspective with no personal turf to protect. Most of us
develop a syndrome of “cant see the forest for the trees” be-
fore long after working at a company. Sometimes if youre
too close to the problem, you need a fresh pair of eyes to
objectively analyze and evaluate the situation. A good con-
sultant will play the role of a “best friend” and sometimes
tell you things you dont want to hear, speaking truth to
power. Furthermore, an external consultant will use the
principle of experience transfer,
drawing on situations and best
practices from other similar en-
counters in various industries.
If your goal is to save a few
bucks in the short run, then a
DIY approach is the answer.
However, if your objective is
to maximize the value contri-
bution to your company, then
an outside professional with no
hidden agendas is the way to go.
In the spirit of continuous
improvement, it’s vitally im-
portant to periodically reassess
the leanness of your factory and
track its progress. As improve-
ments are made and targets
achieved, new priorities will
emerge for the subsequent im-
provement cycle. Consider fol-
lowing an annual cadence to
maintain momentum and keep
your program on track.
Although the added value
lean assessment is no substitute
for an in-depth analysis (Fig-
ure 6), it is an affordable way to
quickly understand your orga-
nizations strengths, weaknesses
and opportunities for improve-
ment.
Jeffrey Miller, PE, CPIM, SCOR-
P, CS&OP, is an IISE senior
member and founder and managing
principal of Productivity Engineer-
ing Services LLC (www.PESsolu-
tions.com), a professional industrial
engineering and operations manage-
ment consultancy driving business
performance improvement for clients. He has more than 30 years of
experience helping manufacturing companies of all sizes in a variety
of industries – including automotive, outdoor power products, bi-
cycle, industrial machinery, heavy equipment, helicopter, consumer
goods, distribution/logistics and general manufacturing/industrial
products – make their operations leaner and more productive. He
earned master’s and bachelor’s degrees in industrial and systems en-
gineering from the University of Michigan and is certified in Lean
Manufacturing by the University of Michigan College of Engineer-
ing Center for Professional Development. Contact him at jmiller@
PESsolutions.com.
Added value assessment takes Lean to the next level
FIGURE 5
RPA Radar Chart
A visual display includes competitive benchmarking results showing how your organization stacks up
against other relevant industry players for key performance indicators.
FIGURE 6
Checks all the boxes
An added value Lean assessment scorecard.