Why Automakers Are Turning To Resilient Lean

Jim Davis

Risk management is at the heart of every production process and supply chain. Companies are realizing that it can take one little problem to completely stop manufacturing operations, often leading to unexpected downtime and missed deadlines. The automotive industry is no exception to this issue.

Most automotive manufacturers want to have greater control of their production lines. Many technology companies, material suppliers, and OEM parts builders help make vehicles that will satisfy customer demand. If even one of these companies experiences an issue, production runs can come to a complete stop. This scenario can create lost time and profits that affect the automotive manufacturer’s bottom line.

To further enhance their processes, manufacturers are turning to resilient lean methodologies. These principals provide better control over several factors of the production process and supply chain.

What is resilient lean?

When talking about resilient lean, you have to look at the concept as two separate entities working together for the good of the factory. Lean manufacturing means that the automaker is looking into ways that help lower product waste while maximizing productivity. Resilient manufacturing is when a company aims to create a sustainable supply chain system that can recover from any type of disruption. These disruptions could be natural disasters, brand negativity, quality issues, or even customer demand loss.

Resilient lean principals seek to offer continual improvement to production processes. The concept makes processes cost-efficient and stable while reducing material and energy waste. Then, processes can weather any unpredictability. This factor helps manufacturers with their risk management initiatives.

Key areas to apply resilient lean

There are many ways to apply resilient lean to the production process and supply chain. For automakers, some key areas can include production management, scheduling, and materials optimization.

Production management flexibility

One issue in managing production processes and supply chains is relying on a multitude of plants to complete vehicles. Parts are being sent from one factory to the next. They are being refined and built out before the final product is shipped to its destination. When adopting resilient lean, an automotive manufacturer seeks to integrate processes in a single plant. It can better use available assets in a more cost-effective way. This approach lowers shipping expenses and fuel costs while increasing productivity.

The automakers also can gain more transparency in their processes as well as improve factory locations by using the Internet of Things (IoT) and real-time data connectivity. These technologies analyze user demand so that automakers can determine the best locations to create new plants that are closer to their customers.

In addition, sensors on equipment can analyze every step of the production process to search for equipment issues. Automakers can improve machinery output levels and manufacturing cycles for more resilient operations.

Real-time scheduling

Creating vehicles can become a long and arduous process. Automotive manufacturers rely on time-to-market scheduling to determine the amount of time it will take for a vehicle to be designed, developed, tested, redesigned, completed, and shipped. Any issue that crops up in the time-to-market schedule can slow down the entire process. Unfortunately, customer demand may wane to the point where, once the vehicle is ready, nobody wants to buy it.

Real-time data information technologies can create faster time-to-market schedules for production lines. Computers, robots, and systems can communicate with each other using real-time data to improve workflow. They can also communicate with workers over quality issues to reduce downtimes, as workers can immediately address problems in a timely manner. These technologies help companies reach resilient lean initiatives for optimized operations.

Materials optimization

Another key factor that can benefit from resilient lean methodologies is material waste. Automakers always want to be able to create enough vehicles to satisfy demand without overburdening the current market. Since new models roll off production lines on a yearly basis, dealers can get stuck with too many vehicles that are not able to be sold, which in turn creates excessive inventory in factories since there are no requests for vehicle shipments.

Resilient lean can focus on improving the supply chain by providing accurate and timely analysis regarding customer demand. By using IoT, automakers can gain important customer feedback and move production processes to focus on other vehicle designs at the appropriate time. This method reduces excess materials, saving more working capital for the automaker.

Creating robust supply chains with resilient lean

Seeking improved manufacturing processes and supply chains using resilient lean principals can seem like a daunting process. Yet with the new technologies that are available, automotive manufacturers can create smart factories that help lead to faster production lines and lower material waste for a more robust and efficient factory environment. Investing in these digital technologies at the optimal time can provide transformative solutions to the automaker’s processes so they can stay competitive in their industry market to please their customers.

Learn how to bring new technologies and services together to power digital transformation by downloading The IoT Imperative for Discrete Manufacturers: Automotive, Aerospace and Defense, High Tech, and Industrial Machinery.

Jim Davis

About Jim Davis

Jim Davis is Director Americas for the Automotive Industry Business Unit at SAP.