ird~l journal of

production
economics
ELSEVIER Int. J. Production Economics 41 (1995) 211 216

Customer focused lean production development

K. Kosonen*, P. Buhanist
Laboratory o["Industrial Psychology, Helsinki University q[' Technology, Otakaaari 4A, SF 02150 Espoo, Finland
Accepted for publication 13 June 1994

Abstract
This research concerns changing a factory into a lean organization. The main issues treated are as follows: what are the
features of the solution, how the change is conducted, what it requires and what is the role of the researcher/consultant in
the change process. The research was conducted in a Finnish elevator factory. It was started in the fall of 1991 and lasted
till the end of 1992.
The aim of the project was to increase productivity by means of decreasing total lead time and increasing flexibility in
processes. One part of the project was to develop a production system for a new product group. This pilot unit operates
now without control from the management and takes the responsibility for producing one product group. Similar
changes are now being implemented into other units of the factory.
In the discussion, we focus on three issues: (1) What kind of lean enterprise solution was achieved; (2) While making
a succesful change, you have to consider all the system parts (e.g. organization, products, production technology,
production control and planning, leadership and management); and (3) the planning process can be crucial to the
solution's nature (traditionally organized planning process would probably result only in traditional solutionsL

Keywords: Lean production development; Lean organization; Change process

1. Introduction The main part of work and responsibility has been

m o v e d to these groups. It is not enough just to
1.1. Efficient and flexible production unit create such groups in current formal organization,
but responsibility and power have to be m o v e d to
By a "lean" organization (or enterprise) we mean those groups also in practice, manifesting support
a c o m p a n y which uses in its entire action principles and trust. Schonberger [2] states that these groups
of leanness and flexibility. The basic idea is to do all are new responsibility centers. These groups have
the organization's activities as "lean" as possible. responsibility for m a n y activities which, before, were
Implications for leadership, m a n a g e m e n t systems, divided to a large amount of white-collar workers.
production planning and control, a m o n g other According to Helling [3], the second success
things, are profound. factor for manufacturing enterprises after leader-
According to W o m a c k et al. [1], the basis of ship is the product and especially its manufactur-
a lean enterprise are dynamic, multiskilled groups. ability. W o m a c k et al. [-1] state that the degree of
a u t o m a t i o n of production process has no straight
* Corresponding author. effect on productivity. Poorly organized highly

0925-5273/95/$09.50 © 1995 Elsevier Science B.V. All rights reserved

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212 K. Kosonen, P. Buhanist/lnt. J. Production Economics 41 (1995) 211-216

automatized factories face the increase in indirect control "department" and with only a few represen-
technical and service workers as they remove un- tatives of shop floor workers, purchasing, foremen
skilled direct workers from manual assembly tasks etc. In order to make the planning more efficient,
[1]. In addition to the growing need for indirect direct participation with goal-oriented develop-
work, the reliability of the equipment can be a ment work are emphasized [3].
problem. Development projects involve often an outside
Schonberger [-2] states that when using robots, researcher or consultant. There are good reasons
the unit costs may be low if all the variations can be for this, because the members of organizations have
produced flexibly. If the work is done by workers difficulties in evaluating or analyzing their own
who can analyze and solve problems, they can action objectively enough. New visions, action pat-
easily be moved to other duties if the demand of the terns and new motivation needed for change are
original product declines. With this in mind, we can thus hard to facilitate. Patterns and ways of think-
assume that the total costs in the end would be ing and acting, which are hindrances for develop-
lower without robots. A human being is always ment, do not usually surface without outside help.
more flexible than a robot. According to Schein [4], in process consultation
The products should be organized in product the consultant tries to help the client to percieve
families, each of which is then produced by a work and understand the problems and processes of the
group or a team. This idea has also been called organization. The consultant helps the client to
group technology or cellular manufacturing [2]. influence these events so that the organizational
The critics of lean production have asked practice changes towards the stated goals. More-
whether lean production is merely an evolution of over, he states that the process consultant has to be
Fordism. Is the assembly line now only larger con- capable of acting in two roles, depending on the
sisting of more sidelines and more operations? situation. He has to give advice and ready-made
Some of the critics have argued that the lean philos- instructions to the client's problems and at the
ophy is suitable only in Japanese organization same time he has to help the client itself to find
culture. When answering these critics one should these solutions. The consultant has to help the
consider that the solutions and realism behind the client to learn to solve these problems just by him-
same slogans can differ from each other a lot in self. Thus the consultant's problem is, when there is
different enterprises and in different cultures. More- a good reason to bring forth his own views and
over, the basic ideas like short lead times, punctual- when he has to keep his thoughts in his own head,
ity and continuous development can be realized in even though they would seem to square very well
different ways (e.g. emphasis on organizational with the situation.
structure, responsibility rearrangements and leader- It can be useful, if the consultant brings also his
ship activities vs. emphasis on a more technological own solutions into discussion. The ideas the con-
approach like new FMS solutions and information sultant has observed to be good, on the basis of his
systems etc. with no other major changes). experience, would be in use already in the early
phases of the development. Thus, time would not
be wasted only because the consultant "must not
1.2. The planning pr6cess bring forth his own solutions" as it has been argued
in the organization development literature [5], and
The planning and development process should the wheel would not be invented over and over again.
be more efficient than it usually is. The planning is
often conducted by a project organization which is
based on the functional reality of the present orga- 2. The case
nization. The participation is mainly representa-
tive. For example, production control and planning Elevator production typically has a large vari-
systems for the future are developed by a planning ation in products. To meet the customers' require-
group consisting of engineers from planning and ments is crucial to the manufacturers. The research
 K. Kosonen, P. Buhanist/lnt. J. Production Economics 41 (1995) 211-216 213

started when the company needed help in its devel-

opment project. The aim of the project was to
increase productivity by means of decreasing total
Coordination Group 1
lead time and increasing flexibility in processes. The
production of a new product group (Novel) was
chosen to be a pilot in the project. The goal of the
pilot was to develop a lean-production solution
and thus to provide information for the develop-
Fig. 1. T h e planning organization.
ment of the rest of the factory.
The research was conducted in two phases: In the
first, the present state, e.g. the production and con-
trol systems, was described and evaluated. In the Elevator Car factory
second, the pilot was developed. HHC

2.1. The planning process

Custo/mlrfoo.Js~/
sp~at supo~- mooua suama
The evaluation of the present state concerned /'e~ln~lt ~4~ooa
pro~'~on a ~ t m ~ m t
both the technical and the human issues of the Ot~
groups J~oo~t ~ t
production. The evaluation methods were team Ii I
interviews, interviews, observations and question-
naires. As a result, it was found that major changes Fig. 2. The new factory organization.
were needed in the production control and plan-
ning system and the factory organization. The fac-
tory layout was also to be reorganized due to the The idea of the planning groups was to give the
new solutions in the production. On the basis of the production groups to be the possibility to rethink
evaluation phase, the pilot project was started. In and design the whole process (concerning their
parallel to the pilot project, the planning of a new product) from customer's order to delivery. Every-
layout of the factory as a whole was also started. thing was under discussion and was designed from
The aim of the pilot project was to develop a new the basis "what really has to be done" rather than
production and control system for the new product "we have always done it this way". Actually, the old
group. The development work was conducted in idea of organizing product families and product
group meetings. The group consisted of the devel- groups was now used in the planning process too.
opment engineer, voluntary workers of the pilot
cell and the researcher. The development work
took about half a year. The first part of the develop- 2.2. The solution
ment work concerned production control prin-
ciples and layout solutions, and the second part The factory organization is based on indepen-
concerned implementation and training. dent production groups (see Fig. 2). Each group has
The organization of the development project of the responsibility of one product group or the
the factory was changed. It appeared that the responsibility to serve the other groups as a sub-
planning needed to be more participative and effec- contractor for, e.g. sheet metal parts.
tive. Thus it was organized in the same kind of The production support group acts as a support-
teams as in the pilot, each team having its own ive function to the other groups. The idea was that
product group (Fig. 1). The work of these teams the support group takes care of those necessary
was then coordinated by a coordination group tasks, which have to be done but which were either
which consisted of the team leaders, the development too expensive or too difficult to be made by the
engineer, the researcher and the factory manager. production groups separately. These tasks include,
214 K. Kosonen, P. Buhanist/lnt. J. Production Economics 41 (1995) 211-216

The production work of the pilot group starts

Customer's order from the customer's order and ends at the point
where the finished product is sent to the customer.
T In a way it is a small company inside a large
Order lumd~ing enterprise [6]. The idea of the production control
-ocder verification
-rough cut prod. planning system is that the production group takes care of all
-order conf'wmation tasks concerning their product group. They plan
their production schedule according to the cus-
I tomer's orders and order the needed parts from
outside or inside suppliers. In fact, a chain of cus-
tomers [7] is built. The products are divided into
Call for defivery to
A- and B-processes. All parts in the A-process
the suppliers. products are visually controlled and always in
Mate.rialchec.king hand. The volume products form the A-process.
(quality/quanUty)
B-process parts have to be ordered per product.
Otherwise the A- and B-processes are alike. The
boundary between the A- and the B-processes can
Production scheduling

I easily be moved if changes in the demand occur.

The group makes the products, and evaluates
and reports its performance to the management.
The customer's order comes (via a salesman) in
a standardized paper which has all the needed
information from the product. The production con-
t
Raporting
trol and planning operates visually in a wall table
stock
using the same paper again. The production sched-
-defiveries ule is always in sight. The same paper is finally
-performance measurements attached to the package.
-billing
The pilot has now worked in this new way for
about a year. Similar changes are now being imple-
I1
mented in other units of the factory.
Quality devel~ment
-visits to the ins~llin8
-continuous improvement
-quality eonu'ollin8 3. Discussion

3.1. The solution

Fig. 3. Novel p r o d u c t i o n process.
The pilot group operates without any control
from the management and takes the responsibility
for example, planning of the new products as well for one product group. This organization model
as making the yearly contracts with the subcontrac- requires, however, punctuality and quality from the
tors, and the development work with the suppliers. suppliers. In this solution, only the necessary op-
This group also gives technical support to the pro- erations are made and they are made by those who
duction groups when problems rise. The HCE and are responsible also for the production itself. Thus
H C T groups have their own role in the organiza- the necessary decisions are made by the same per-
tion and are not included in this study. sons and in the same place where they are needed.
The work process in the independent production The increase in productivity is thus achieved by
groups is illustrated in Fig. 3. It presents the process doing only the necessary tasks, being punctual and
in the pilot group. fast with total quality. Furthermore, this solution
 K. Kosonen, P. Buhanist/lnt. J. Production Economics 41 (1995) 211-216 215

gives possibilities to enrich work and to improve

job motivation. The factory has now a new orga-
nization which is based on product groups with
corresponding production groups. Responsibility
of production control and planning, purchasing
and the production itself is given to the production
groups.
We see this solution in many ways in accordance
with the visions proposed by Helling I-3] and
Schonberger [2, 7]. However, in this solution we
have elements of autonomy and self management
to a higher degree than in the above visions. We Fig. 4. Areas to be consideredwhen developinglean enterprise
believe that this makes the solution more suitable solutions.
with the western values, culture and context.

Production control systems must of course then

3.2. You have to consider all the system parts allow this kind of "control-free" production.
Changing the system from push controlled "Mater-
In order to succeed, the project needed focus and ial resource planning" - guided one to a controlless,
changes in organization, products, production "automatically" operating system, needs a totally
technology, production control, leadership and new way of thinking. This thinking must be created
management and finally, training and education. It from the questions like the ones stated above,
seems obvious that it is necessary to develop the otherwise the solution is more or less only a small
production organization as a whole, in order development of the old system.
to achieve major changes in the work practice Leadership is also crucial to the solution. If we
(Fig. 4). are able to create a control-free system, but still
Fig. 4 shows the areas, which had an important control it by traditional leadership behavior, the
effect on the solution. The product itself gives the practice is never really changed. Leaders must
frame for the whole development. How easily can really give the decision making to the production
we produce a large amount of variable products groups.
from the minimum amount of different parts. If we Training and multiskilled personnel are of course
can determine the product group and develop stan- necessary for the solution, in order to create a team
dard procedures for the workers to take care of the which is capable of flexibly taking care of both the
"paper-process", we can build a "lean solution" for production and the control. Multiskilled personnel
this product group. The more difficult and less can also replace and assist one another if need be.
standardized the product gets, the more "paper- Last, the organization must accept the solutions,
work" and expert planning the solution needs. there must be an agreement about the new ways of
The available and required technology sets the thinking and the new work practice. Especially, if
limits for the solution's4ayout and work flow. It is the vision of the future is not clear and widely
necessary to be able to produce the whole product accepted and if the change is done gradually, team
in the same team, in order to do it in a lean way. by team, the pressure from old fashioned organiza-
Otherwise, more traditional production planning tion can be too much.
and control is again needed, especially with re-
sources common to various teams. The question is:
What parts are made with common resources or 3.3. The planning process
bought outside, and how easily (with kanban-sys-
tems or other visual ordering systems) can this The moment, when the pilot project planning
material be controlled and ordered? started and the change in project organization for
216 K. Kosonen, P. Buhanist/lnt. J. Production Economics 41 (1995) 211-216

the entire factory was made, can be seen as the strongly action oriented and assumes active partici-
turning point o f the change. pation for a period of several months up to a couple
Before the turning point, the planning process of years [8].
was traditional and it seemed that it was very By being a change agent, the consultant can also
difficult to create new solutions. Lack of vision, and help the client with his or her experience and pos-
consequently, lack of direction where to go and sibly can give new ideas to the development work.
how to proceed, was also apparent. However, there It can also be very instructive for the researcher to
was a growing amount of articulating and ar- experience the change from the inside. It is also
gumenting by the consultant-researcher and the stated that active participation in the chain of
development engineer about the need for major events will give the researcher/consultant privileged
change and on behalf of the lean vision for the access to the organization, which will facilitate the
factory. The factory manager gave general support development of both theory and practise [8].
for the new ideas. The supervisors and line manage-
ment did not see, or did not want to see the core of
the new ideas. Hence, they acted in the planning References
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that Changed the World. Macmillian, New York.
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progress. Rethinking and designing the process holm.
from the basis "what really has to be done" rather [4] Schein, E., 1987. Process Consultation. Addison-Wesley,
Reading, MA.
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[7] Schonberger,R., 1990. Building a Chain of Customers, Free
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