Being overwhelmed when looking for strategies to eliminate waste, increase efficiency, and create value is a common problem, especially for manufacturing procurement leaders. As a result, let’s begin with a simple concept: mastering the complex processes required to approach lean sourcing. One way to see the relationship between Kendo, the Japanese art of sword fighting, and Zen’s simplicity is to think of learning and mastering practise as cyclical. Accept that the first lesson is the same as the last, that the simplest and most difficult lessons are the Improving your Sourcing Process, and you will understand the key to lean thinking: continuous improvement.
Determine Critical Spending Areas
The first step in improving your strategic sourcing process is to identify the areas where money is being spent. That is the key to identifying specific areas that could easily result in cost reductions—or, at the very least, process improvements. By prioritising your various spend areas (based on company objectives) and collecting and analysing data, you can start categorising spend and better understanding where (and why) certain spending occurs. Investigate more than the lean approach to manufacturing staffing in general, and instead concentrate on how the lean approach can be precisely targeted and adapted to your strategic sourcing process. The first enables production to halt immediately when a problem arises, reducing waste. The second allows for the number of parts manufactured.
Using Lean Principles to Improve Sourcing
All lean processes begin with an evaluation of current processes to identify valueless steps that can be eliminated and then adjust the remaining necessary steps to save both time and money.Contracts with any vendors found to be providing low value should be cancelled on an external level, as fewer vendors mean less invoicing and paperwork, as well as fewer deliveries. Contracting with fewer vendors reduces the number of relationships you must manage, saving you time and effort. Internally, evaluation should also be focused on determining how to consolidate all similar activities and processes across the entire breadth of your business. Once you’ve determined how you’re going to eliminate waste and consolidate processes, the cost savings will be obvious.
Examine Your Current Sourcing Procedure
Investigate the products used by your suppliers and determine / comprehend why they are using said products when less expensive alternatives may be available. If you can cut costs without sacrificing quality, everyone wins. You can apply a similar process to your current suppliers when comparing them to overseas sources. Even if you do not intend to switch to an overseas supplier, having a global perspective can be advantageous and you may even end up finding a superior resource. The next step in implementing a lean strategy is to standardise all processes, policies, and practises that have been identified as being similar across all departments.
While implementation may take time and adjustment may be difficult, standardisation will save money on training and increase inter-departmental cooperation, synergizing operations in the long run.
Standardization across your entire facility, like interchangeable parts in a machine, will simplify operations and make future changes easier to implement more quickly as you repeat the entire lean process over and over. Standardization will also help with goal alignment across all departments, which is the next step in the lean process. When goals differ, competing goals waste time and individual departmental successes detract from overall success. Furthermore, competing goals, which can pit departments against one another, are frequently encountered.