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Article Excerpt
MANY, IF NOT THE MAJORITY, of the companies that service centers supply utilize lean manufacturing principles to one degree or another. To be truly effective as a source of steel, aluminum or copper, distributors need to understand and advocate--and preferably practice--the same cost-saving philosophy.
"Entering that environment without going lean yourself can get very expensive," says Richard Kallage, partner of KDC & Associates Ltd., Barrington, Ill.
Lean manufacturing helps producers reduce inventories, lower labor costs and increase overall efficiencies. For distributors who follow the same concepts, one of the most obvious potential benefits is leaner inventory.
What distributors can do to match the needs of lean customers while still holding inventories low--beyond such services as just-in-time deliveries and kitting orders--is make their operations more efficient, says Kallage, whose firm consults on the applications of lean principles.
Lean principles already apply directly to the processing operations of most metal centers. For example, most shops that cut plate now have a plasma machine that nests shapes in order to reduce scrap. The goal is to apply similar concepts everywhere in the organization, from order taking to shipping.
Many manufacturers use the Six Sigma quality improvement methodology (see "What Is Lean, Six Sigma?" on page 33), but service centers can get started with a simpler approach. Kallage says that "practical lean" can be boiled down to five basic practices designed to organize the workplace and eliminate waste. Think of them in terms of the letter "S":
* The first S is for sorting: "Sort things that you need vs. those you don't need, which get in the way...
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