July 28, 2021

Sustaining a Lean Supply Chain in 2021 and Beyond

Strategies for continuous improvement of supply chain agility and growth

Never before has so much attention been given to supply chain agility and resiliency. Today, everyone is talking and thinking about the supply chain.

Whether it’s the cost of lumber, the delays in deliveries of new home appliances, the slowdowns for automotive manufacturers due to chip shortages, or the limited selection of bicycles and other outdoor gear – everyone is feeling the impacts of supply chain interruptions.

The combined forces of Brexit, the semiconductor chip shortage, trade wars and tariffs, the boom in IoT, natural disasters, labor shortages, and the pandemic have exposed the fragility of the tenuous links keeping the supply chain afloat.

There is renewed debate and question marks around lean manufacturing principles, just in time (JIT) manufacturing, and the balance between efficiency and resiliency.

Source: goleansixsigma.com

Lean manufacturing and six sigma have reshaped thinking around supply chain management, encouraging companies to focus on reducing waste, streamlining efficiencies, and cultivating a culture of continuous improvement.

While some are blaming JIT and lean manufacturing for today’s shortages in products and parts, and the general chaos in moving goods from manufacturing/assembly to distribution, it’s important to look deeper than this.

The nature of buying and selling in both B2B and B2C markets has changed dramatically in the last two years. Consumer demand for personalization and same-day delivery, and the boom in automation and IoT devices bring to light gaps in supply chain management strategies. What worked before, wasn’t necessarily broken – it just didn’t keep up with the times.

Lean supply chain practices are the way forward. But what is needed is an adjustment to how companies adhere to the principles of lean and six sigma – molding them to meet their needs and the demands of their customers. At the core of this is the value and importance of continuous improvement, contingency planning, and change management.

As this quote from Ford Motor Company Chief Executive Officer Jim Farley underscores, future supply chain resiliency starts with change:

As the industry changes, we have to in-source now, just like we in-sourced powertrains in the ’20s and ’30s,” said Farley, who has shut down half his factories and seen his dealers’ lots emptying because of a dearth of chips.

We have learned a lot through this crisis that can be applied to many critical components,” Farley told analysts last month as he announced Ford would lose half its production in the second quarter and take a $2.5 billion hit to earnings this year, citing a lack of chips. “We’re also thinking about what this means for the world of batteries and silicon and all sorts of other components that are really mission critical for our company.” Financial Times

Lean Six Sigma Supply Chain Management for Today and Tomorrow

The key for companies is finding the common ground between lean, six sigma, and the customer-driven supply chain. This is not an easy task, nor is it one that companies have been ignoring.

Stimulating change amidst high pressure situations such as a pandemic, labor shortages, floods and fires, stuck container ships, and the forced shutdown of international parts suppliers and manufacturers is a very big ask.

The good news is the five principles of lean six sigma are inherently flexible, giving companies the structure, guidance, and freedom required to enable purposeful change that shifts with the times.

  • Always be working for the customer. In today’s customer-driven market, where personalization, customization, and competition have taken on new meaning, companies cannot afford to lose sight of customer wants, needs, and challenges.

    What represents quality and satisfaction for our customers? How are our customers driving the market? How can we adapt to meet their new demands? What do we know about the technologies and market forces reshaping our industry?
  • Acknowledge your barriers to success and quality. Do not get caught up in change for the sake of change. Keep your focus on identifying key problems, risk areas, and barriers that are preventing you from delivering consistent quality and satisfaction.

    What does our research and data tell us about our gaps and areas for improvement? What are our biggest barriers and risks? How does change ensure these are eliminated? Will this change bring improvements for our customers? How can automation improve efficiency and eliminate delays?
  • Remove the inefficiencies contributing to these barriers. You cannot and should not change everything. Focus on removing inefficiencies, waste, and processes that cost you and your customers money and time. Ensure that any change in process is truly value-added. Work with a proven team who understands the challenges that come with change and the best way to strategically remove inefficiencies.

    How long does it take to get from idea to design to production to the customer? How can this process be streamlined and tightened? Where are the weaknesses that could put us at risk? Does this change still have the best needs of the customer in mind?
  • Always be communicating with your employees. Change is hard. It is critical you’re always communicating with your employees. Learn from them about the inefficiencies and gaps they deal with on a daily basis. Encourage your employees to speak up and be involved in changes to process and strategy.

    What are our employees telling us about areas for improvement? What are our customer-facing employees telling us about customer satisfaction, wants, and needs? How can we train employees on new processes and strategies? Who are our internal leaders who can help foster a culture of continuous improvement?
  • Be flexible, agile, and responsive. There is not one way to do anything. What worked yesterday likely won’t work tomorrow. Remember the lessons from the last two years and use these to reinforce a culture that can be agile, flexible, and responsive. Take advantage of the people, processes, and technology available today so you can be ready for the next disruption.

    What are the market trends? How have customer demands shifted? What technologies are available that can help us eliminate waste and streamline our processes? How can we learn from what didn’t work and apply this to new strategies for resiliency and agility? How can technologies such as automated mobile robots (AMRs) and big data bring resiliency and agility to our processes?

Supply Chain Realities and Challenges

I’ve turned down a million dollars’ worth of work in the last two weeks. Doing that, it’s hard to go to bed at night when you put your head to the pillow. I have open capacity, but I need more people.” Matt Guse, owner of MRS Machining, Augusta, GA

We’re seeing gangbuster levels of orders. But the sector has a lot of challenges, like a rise in raw material costs, supply chain disruptions, logistics bottlenecks and worker shortages.” Chad Moutray, chief economist for the National Association of Manufacturers

It was a lot easier to turn the lights out than to ramp up. Manufacturers weren’t prepared for a surge of demand in goods. They’ve been caught a bit flat-footed.” Diane Swonk, chief economist at the accounting firm Grant Thornton, Chicago, IL

These three quotes from a recent New York Times article titled, As Economy Rebounds, Manufacturers Face New Hurdles, sum up the core supply chain challenges.

Across every sector – manufacturing, hospitality, travel, health care, education, and technology – companies are operating within a fine balance. Success and survival are directly linked to readily available people, products, knowledge, and demand.

Consider these three examples of disruption to people, products, knowledge, and demand:

Lean supply chains did not cause these disruptions, rather it was the accumulation of mounting pressures that ultimately caused the breakdowns and interruptions.

  • With an estimated 2.3 million women leaving the workforce due to the pandemic, the pre-pandemic labor shortage was exacerbated.
  • 5G, IoT, the surge in mobile technology in the automotive industry, and semiconductor chip manufacturing capacity operating at full capacity meant there was zero room to respond to increasing demands or to rebound quickly after forced plant closures.
  • Customer demands for personalization, same-day delivery and the rise in ecommerce triggered a change in what customers value most. The pandemic then caused a change in buying patterns – shortages of swimming pools, lumber, appliances, toilet paper, and hand sanitizer – and a lack of workers. These factors coupled with new health and safety requirements, and the grounding of distribution links, meant very few companies were able to respond quickly and efficiently to this surge in chaos. 

There is opportunity within these challenges. With a commitment to continuous improvement, focusing on the customer, eliminating barriers, streamlining efficiencies, and agility – companies can recover and be ready for the next disruption.

Five Strategies for Continuous Improvement

In the peak of the pandemic there were numerous articles and discussions about how JIT and lean manufacturing were the root of supply chain challenges. However, it is important to acknowledge that too many companies are attempting to utilize JIT and lean manufacturing within supply chains strategies that are too long, have too many dependencies, and are using outdated technologies.

Ultimately JIT and lean supply chain are about giving customers what they need.

Doing this effectively demands attention to the core principles of lean six sigma and building in continuous improvement strategies that take advantage of experience, technology, and people.

  1. Always be looking for opportunity: Supply chain management is not a static process. Continuous improvement means you’re constantly looking for the barriers to success, ways to speed time-to-market, increasing flexibility and agility, sticking to a zero-errors culture, standardizing processes to ensure safety and quality, and building a supportive employee environment.
  2. Take advantage of Industry 4.0: Technologies such as IoT, 5G and 6G, automation, artificial intelligence, additive manufacturing, and 24/7 connectivity give companies the tools and insight to be responsive and agile.
  3. Streamline warehousing and distribution: Co-locating warehousing and distribution, using automation such as robots to move goods safely and securely, and redefining JIT inventory level benchmarks are just some of the ways companies can fix one of the largest bottlenecks in modern supply chains.
  4. Eliminate waste: Core to lean manufacturing is reducing waste within the supply chain. Look for ways to eliminate defects, under-utilized employees, transportation slowdowns, excess inventory, inefficient processes in moving goods, and delays.
  5. Focus on the customer: Your goal is to provide value to the customer, and the best way to do this is by optimizing quality and reducing cost. For example, use big data to understand and predict customer patterns. Use automation and machine learning to improve product quality and speed time-to-market. Technologies such as AI, analytics, robotics, and more deliver real insight into what your customers want and why they want it. Use big data to define, measure, analyze, design, and verify new products, services, and processes.

The Toyota Product System (TPS) was developed in response to the production and delivery issues Ford experienced in the 1930s and post-World War II.

And now as we emerge from a global pandemic, we are on the cusp of the next wave of change within lean manufacturing and the application of lean six sigma to supply chain management.

This is an exciting time – never before has there been the experience, people, processes, and technology available to build truly resilient and optimized supply chains. Contact us to learn more about our approach to lean supply chain management and how automation can be a key partner in your lean manufacturing strategies.

January 18, 2021

Ready to Bring AMRs into Your Operation? Make Sure You Know These Five Keys to Success

Questions to ask and features to look for in your AMR solution

You know your operation could run more efficiently. You know autonomous mobile robots (AMRs) are the future. But how do you take the next step and successfully automate your operation?

It all comes down to knowing the challenges you need you to solve, the benefits AMRs can bring, and what you should expect from them. And it can be difficult to know where and how to start integrating AMRs into your operation.

The key to a successful transition to AMRs starts with identifying aspects of your operation that can benefit the most from automation and focusing on incremental changes that set you up for future growth.

To successfully move forward with AMRs, you need to know the five keys to AMR success:

  1. Costs, savings, and return on investment
  2. Right tool for the job
  3. Infrastructure matters
  4. Integrating software for long-term success
  5. Growth, flexibility, and adaptability

With this knowledge you can understand how AMRs, when deployed in the right way, can transform your operation – delivering cost savings, improving safety, allowing you to better utilize employees, and ultimately increasing efficiency.

Watch The Five Things You Must Know Before Bringing AMRs Into Your Operation webinar to learn from our experts about how to bring AMRs into your organization.

1. Know Your Numbers

The number one reason to introduce AMRs into your organization is to improve efficiency. With AMRs you are able to grow your revenue with fewer resources.

For example, your warehouse currently operates two shifts a day with a fleet of forklifts that requires a driver per vehicle. With an autonomous solution, an entire fleet of AMRs could run autonomously with only a single person overseeing the entire operation. This makes improving efficiencies and growing revenue a reality.

The best way to understand how AMRs can improve operational efficiencies is with a return on investment (ROI) calculation. This ROI calculation details your fully burdened labor costs, where you’re spending money, and lets you understand how AMRs can deliver cost reductions and improve your operational efficiency.

View the webinar to see a complete ROI calculation

In our webinar, The Five Things You Must Know Before Bringing AMRs Into Your Operation, we provide a detailed ROI model to help you quantify the savings offered by AMRs for your operation.

When you understand the ROI of bringing AMRs into your operations, you can realize these four key savings opportunities:

  1. Increased throughput efficiency: eliminating delays in replenishing raw materials, preventing costly bottlenecks, and increasing operational efficiency are just a few examples of the productivity benefits of AMRs.
  2. Reduced operating costs: with AMRs working for you, you can allocate labor to value-added tasks and further improve efficiencies.
  3. Reduced liability costs: manually-driven machinery is a huge safety liability. AMRs mean fewer vehicles, predictable paths and robust safety features that ultimately result in fewer accidents.
  4. Improved product quality: AMRs eliminate the human errors that cause damaged goods, unnecessary waste, and misplaced inventory.

2. Right Tool for the Job

When you know what to look for in an AMR system, you know you’re choosing the right tool for the job from the beginning. Forklifts, tuggers, autonomous storage and retrieval systems, and other specialty robots each have a distinct role to play in your operation – make sure you’re deploying the right tool for the job.

If you’re new to AMRs and aren’t sure how to get started, consider these four steps to guide you in your initial deployment:

  1. Keep it simple. Identify small inefficiencies in your system and choose an AMR system that lets you solve them quickly.
  2. Start with a pilot. A pilot allows you to learn what does and doesn’t work for your operation and makes it easier to prove the value of AMRs to colleagues.
  3. Easy wins first. Look for efficiencies that can be solved with minimal AMR investment and integration.
  4. Strategically expand and grow. Choose an AMR system with the flexibility to grow and adapt to your evolving business needs and challenges.

3. It All Comes Down to Infrastructure

Implementing an AMR system should not be complicated. If it is complicated, you need to step back and make sure you’re choosing the right AMR solution.

When you know why you need AMRs and the challenges they will solve, you can put your energy into evaluating AMR solutions based on the requirements they place on your infrastructure. A truly autonomous solution shouldn’t require a lot of changes to your existing facility. An AMR solution should only need:

  • Natural features for navigation, such as existing walls, doorways, and columns
  • Battery charging location, which can even be implemented as opportunity charging that allows robots to be charged while being loaded or queuing for work.
  • IT computing and network resources so the system can manage day-to-day operations for you. SurePath, our fleet control software, integrates seamlessly with your IT infrastructure.
  • Small maintenance area to complete preventive and general maintenance tasks.

During the AMR assessment and discovery process, make sure you know exactly what your AMR manufacturer needs from your infrastructure. Look for an AMR solution that has the capabilities to integrate with your existing infrastructure.

4. Software Integration for Long-term AMR Success

The right software can make or break your AMR experience. As important as the autonomous robots you choose is the software used to manage and control them.

As part of your research, ask questions about the fleet control software and how it integrates into your existing systems. Remember, your robots are only as smart as the software powering them.

Ask these questions about the fleet control software and integration:

  • What does the software do? Is it capable of managing all AMR traffic, coordinating activities, and managing orders?
  • How does the software prevent collisions, accidents, injury, and damage to goods?
  • Does the fleet control software really help me save money and cut costs? Is it possible to use this software for inventory management and optimal traffic routing?
  • I’m already using a warehouse management system (WMS)/manufacturing execution system (MES). How do I integrate your software with my existing tools and infrastructure?
  • What type of device does the software run on? How and where is our data stored?
  • What kind of data can I pull from the software? Is there a way to create custom reports?
  • Do you offer training and support for your fleet control software?
  • When my infrastructure changes, how hard is it to adjust the robot’s paths? Is this something I can do on my own or do I have to call you to do it for me?

Watch our webinar The Five Things You Must Know Before Bringing AMRs Into Your Operation to learn from Dave Levasseur, Head of Software, about how SurePath, our fleet control software, integrates with your existing system.

5. Grow, Adapt and Stay Flexible Always

Your operational needs and goals today will not be the same six months or five years from now. And this demands an AMR system designed to grow, flex and adapt with you. Your AMR solution must be capable of giving you what you need when you need it.

For us flexibility means designing a system that meets your needs today and enables you to expand the use of AMRs in your future operations. With a modular platform that supports a range of different adapters there are no limits on what AMRs can do for you.

For example, your needs may change based on the season or holiday period. Know that you can easily change adapters to meet operational demands, for example converting tuggers to pallet stackers as needed.

You need an AMR system that is: modular, flexible, scalable, adjustable, accurate, reliable, safe and deploys easily when, where, and how you need it. You get this when you choose an AMR system that is designed from the ground up to meet your needs, goals, and challenges.

Be Future-ready with the Right AMR Solution

Do not get left behind. AMRs are not just the future of assembly, manufacturing, warehousing, and distribution – they are making huge impacts now.

Contact us to learn how AMRs can help you. From productivity improvements, cost-savings, a safer workplace through to more efficient operations – AMRs can make a difference.