Lean beacon: German industrial giant pioneers Toyota-style initiative; SAP integration to follow

Dr. Marcus Schnell, head of production systems for industrial vehicle maker MAN Nutzfahrzeuge, says the company sought group-wide lean adoption through careful study of lean systems in operation at plants at Steyr, Munich, and Salzgitter. The ultimate task—under way now—is to synthesize a standard production system that's viewed as superior to any one system presently in place.<br/>


At Munich, Germany-based MAN Nutzfahrzeuge —the 13-plant truck and bus manufacturing division of industrial giant MAN—two successful pilot implementations of lean manufacturing have seen lean techniques given the green light for group-wide rollout right across MAN.
Closely modeled on the well-known Toyota Production System (TPS), the development of the MAN Nutzfahrzeuge Produktionssystem—christened, inevitably, MNPS—was intended to standardize the adoption of lean thinking right across MAN, explains Dr. Marcus Schnell, head of production systems at MAN Nutzfahrzeuge.
While some MAN plants and divisions had not embraced lean at all, others—such as MAN’s plant in Steyr, Austria—first adopted lean as far back as 1999. But plant-led lean initiatives had resulted in inconsistencies in approach, with some plants placing greater emphasis on some lean tools and techniques than others.
“The intention was to have one common production system across the company, following a standardized process—even if plants had already adopted lean,” he notes. Lean systems in operation at MAN Nutzfahrzeuge plants at Steyr, Munich, and Salzgitter were carefully studied to synthesize a standard MAN Nutzfahrzeuge production system that was superior to any one system that was presently in place.
MAN Nutzfahrzeuge’s Nürnberg engine manufacture plant, employing 4,000 people, was selected as the test bed, with work starting in May 2007. The plan, explains Schnell, was to extend lean outwards—first within MAN Nutzfahrzeuge itself, and then elsewhere within the group—from proven pilot implementation "lighthouses" that would act as beacons to highlight the benefits of switching to lean techniques.
“The idea is to prove the concepts, develop the relevant best practices, realize all the benefits of the system, stabilize it, and then bring people from our plants right across Europe and the rest of the world to look at it,” says Schnell.
Two lighthouses served as initial test beds within the Nürnberg plant: a 100-employee component machining area producing cogwheels, and a 50-employee cylinder head assembly line, with implementation in each case taking three months.
The results, says Schnell, were excellent. In the cogwheel production area, for example, work-in-progress fell by 74 percent, lead time by 70 percent, and typical set-up times by about 30 percent. On the cylinder head assembly line, work-in-progress fell by 56 percent while productivity increased by 20 percent.
What’s more, he adds, careful consultation with employees and their representatives, as well as first-line supervisory management, meant that lean principles were thoroughly embedded in employees’ hearts and minds, with games and simulations during the training process showing how lean outperformed traditional manufacturing approaches. Now, says Stefan Meusert, director of the assembly division at the Nürnberg plant, “Things run more smoothly, and work is flowing more effectively.”
With the original two lighthouse pilot implementations now in stabilization mode, a second wave of implementations within the Nürnberg plant is taking place: Four production areas this time, each again with between 50 and 100 employees. Further waves of four production areas at a time should continue right through 2008, says Schnell, with the implementation program ending some time in 2009.
But while the Nürnberg rollout is under way, another related program will see lean thinking extended into other nonmanufacturing aspects of the business—notably purchasing and logistics, but also other administrative areas as well. It’s a development that will force the company to address the links between lean activities and the company’s SAP R/3 ERP system—links that are as yet unclear, says Schnell. “We’re aware that such integration is difficult, but we recognize that it has to be done,” he says. “During 2008, just how we are going to do it shouldbecome clearer.”
Already publicly acknowledged by SAP for use of Global Trade Services application, the betting has to be that the lean integration work with MAN’s SAP manufacturing modules will be just as thorough.

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