Adopting lean inventory management principles can help businesses change for the better. However, decision-makers must consider what implementing these practices means for the companies in question. These best practices are excellent starting points that can show executives what’s possible and encourage them to continue focusing on these initiatives.
1. Consider Customization When Possible
Waste reduction and value enhancement are two commonly discussed facets of the lean approach. Applying them to inventory management typically means examining cases of keeping too much stock or tasking workers with duties that don’t make the most of their time and capabilities. The value-enhancement side of things usually concerns understanding customers’ needs and responding to them in the most effective and efficient ways possible.
UC Riverside researchers explored how mass customization could make the fashion supply chain more sustainable. It has been in the spotlight lately, particularly as people point out the adverse environmental impacts of releasing so many articles of clothing per season and enticing people to buy apparel frequently.
The study showed manufacturers could tackle overproduction by urging people to wait longer for customized garments. Moreover, the researchers concluded that the approach was particularly beneficial when producers promoted sustainability.
The transition toward customization supports lean inventory management by making it doubtful companies will get stuck with too many items they can’t sell. Plus, offering personalization helps businesses differentiate and excel where others can’t.
2. Explore How Improved Tidiness Supports Inventory Management
The 5S method of workspace improvement requires following a specific framework:
● Sort: Categorizing items to eliminate those not necessary for current production
● Set in order: Keeping things in the correct places for easy and immediate access
● Shine: Cleaning the work area thoroughly, including daily maintenance
● Standardize: Creating best practices for the work area, achieving task consistency
● Sustain: Making the new standards habits, defining a new status quo
The Sustain aspect is often the most challenging to achieve because it breaks bad habits and makes new ones. However, research indicates the 5S method can significantly improve lean inventory management. One study focused on the spare part area associated with a cooking oil packaging plant. Disorganization made it difficult for people to find the necessary components, which slowed production.
However, researchers performed an audit, seeing how the company scored on each 5S component before any interventions occurred. The results provided a valuable baseline and showed which areas needed the most improvement.
Using a data-driven approach is a great way to get people motivated. It can also convince executives it’s time to act.
3. Achieve Continuous Improvement Through Better Communications
Excelling in lean inventory management means never settling for “good enough.” It centers on always looking for ways to improve. People often have different ideas on which parts of the business to target, but most can agree communicating better would bring numerous benefits.
Stock transfers optimize storage capacity, allowing people to efficiently handle inventory when needed. Imagine the convenience and value of knowing exactly where transferred goods are at any moment. Improving your communication strategy makes that possible. Automation, cloud computing and smart sensors are some of the many options to consider.
Choosing to automate processes also supports better quality control while reducing manual processes. Companies that automate parts of their recordkeeping improve communication because much of the data-capture process happens without human intervention.
Improved communications can also enhance the order-placing process for customers. People understandably become frustrated when buying something and later learn it’s unavailable. However, better lean inventory management can target and reduce those instances, giving shoppers the right information at the correct times.
4. Deploy Various Lean Inventory Management Best Practices
Getting optimal outcomes with the lean approach usually requires choosing several principles to focus on based on current inventory management weaknesses. That was what researchers did when studying processes at an Irish hospital to enhance inventory management in its operating rooms. Conducting process analyses, interviewing staff to identify improvement opportunities and reviewing stock quantities were some of the activities carried out at the health care facility.
However, the multifaceted efforts paid off. The results showed a 91.7% reduction in stock going out of date. There was also a 17.7% decrease in stock levels per operating room. That change minimizes waste by helping health care workers find what they need faster.
The time clinical staff members needed to prepare supplies for procedures also went down by 45%. That progress shows how lean inventory management can have ripple effects. Shorter preparation means patient procedures happen with fewer delays and surgeons make better use of their time.
It takes substantial planning and effort to determine which lean aspects are most appropriate to deploy within a given supply chain. However, the results are often impressive enough to prove those resources were well-spent.
How Will You Use Lean Principles for Inventory Management?
These four examples should spark your inspiration about starting or continuing your reliance on lean inventory management. Select your goals before starting and use those motivations to steer the organization’s efforts. It’s also valuable to get feedback from team members throughout the process. Their perspectives can help you identify areas for future development and improvement.
Emily Newton is the Editor-in-Chief of Revolutionized. She regularly covers trends in the industrial sector.