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How Nike Does Lean Manufacturing

NIKE, Inc. is one of the premiere shoe manufacturers in the world. Its famous "swoosh" is worn by the greatest names in sports – from Michael Jordan to Lebron James, Kevin Durant to Tiger Woods and Maria Sharapova. There’s no doubt that NIKE, Inc. is a powerhouse when it comes to promotion; but did you know the company also leads the way in lean manufacturing best practices?

Due to an inheritance of immature management teams in emerging manufacturing markets, NIKE, Inc. has implemented a culture of empowerment that employs continuous improvement (CI) to deliver high-quality products, on time, at a low cost.

NIKE, Inc.'s Culture of Empowerment Model

NIKE, Inc.'s culture of empowerment model is three-pronged: attract, develop, and empower. Most importantly, the people of NIKE, Inc. are seen as its ultimate value stream. This model is not unique to NIKE, Inc.; it originated at Toyota and has been adapted at a multitude of companies striving for lean manufacturing and continuous improvement.

"Our work with manufacturers to promote lean manufacturing is part of our fundamental shift away from monitoring and toward building manufacturing capacity for self-management. We believe this will ultimately be a more successful and sustainable approach to stimulating systemic change and improving the lives of workers." – NikeBiz

Human Resource Management (HRM) is an important tool for lean manufacturing at NIKE, Inc. By surveying workers for insight into key issues and seeking out opportunities for positive change, NIKE, Inc. is utilizing continuous improvement best practices to become a leader in lean manufacturing practices.

According to an article in Industry Week , most organizations succeed at establishing some form of standardized CI. "The big differences shows up in how projects and initiatives are linked to strategy, competence development and auditing activities within organizations."

In the same article, Industry Week provided three types of standardized CI:

• Quality award programs: useful for providing a set of criteria and motivating employees for CI; focused on project-based quality.
• Institute improvement programs: training focused on lean and Six Sigma to provide employees with the skills they need to integrate continuous improvement.
• External benchmarking programs: provide an objective comparison for identifying improvement opportunities, pinpointing internal best practices, and establishing a performance-focused culture.

NIKE, Inc.'s Scoring Card

"No other capacity-building program in our industry integrates HR and support of lean manufacturing in this way, addressing both the needs of the factories and workers, as well as the business. This is a new standard of factory self-governance." - NikeBiz

NIKE, Inc. has more than 1 million workers manufacturing 500,000 different products around the world. To ensure everyone is performing at NIKE, Inc.'s standards, the company has developed a scoring system for their contract factories. The Manufacturing Index (MI) they utilize scores each factory in terms of lean, labor, health and safety, energy and carbon, and sustainability. This allows NIKE, Inc. to determine where they need to spend more attention and resources and where they can allow factories to operate autonomously. It also incentivizes factories to raise the bar in all areas of their manufacturing. NIKE, Inc. requires partners below the bronze level to pay for 3rd party audits. Partners above the bronze level are rewarded with audits paid by NIKE, Inc.

There’s no doubt; NIKE, Inc. is creative and strategic in developing lean manufacturing techniques. They utilize traditions, such as the culture of empowerment model, but they have also revolutionized how they interact with their global partners. These methods are what make NIKE, Inc. a company worth taking note.

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Nike Lean Manufacturing: An Example of Good Policy Deployment

By OpEx Learning Team , Last Updated May 29, 2014

I was invited to the Nike Headquarters several months ago, where I met with most of the leadership team of the Nike.com business unit, which is the business unit tasked with growing their direct-to-consumer business. I was very, very impressed to see their commitment to Lean and was pleasantly surprised at how far up and how deeply down the commitment to Lean is at Nike. This article will provide an overview of Nike Lean Manufacturing , the business units involved, their use of Hoshin Kanri , and how they are tracking progress thus far.

But, wait, real quick here’s a picture of my waiting in the lobby – that’s my water bottle and notebook on the table. . .and, as a side note, the day I was at the Nike Campus, Kobe Bryant was in the cafeteria hanging out. I didn’t get a picture with him, but I could have thrown my bowl of Thai Noodles at him – he was that close.

Reputation Management to Innovation Opportunity

Nike’s manufacturing footprint is huge. As of this writing, they have manufacturing contracts with over 785 factories, across India, Vietnam, Philippines, and South America. And, over the years Nike has been criticized for its lack of oversight of its manufacturers. Initially, they approached the problem as a way to manage reputation. But, now they are seeing their oversight and relationship with contract manufacturers as an opportunity to innovate.

But innovation isn’t in a vacuum. Innovation at Nike must be within the context of (a) serving the athlete, (b) grows the company, and (c) delivers inspiration. While you won’t see Lean lingo, the context matters. This is effectively Nike’s “True North” if we were to speak in terms of Hoshin Kanri.

Nike has 2 overarching goals in their strategy:

• Make Today Better
• Design the Future

Pretty simple and can easily be remembered by all employees. Under these two main pillars in their strategy, Lean begins to take context.

Design the Future: Nike Lean Manufacturing

Nike has determined that their finished goods manufacturing is where they have the largest impact on people and the environment. Within that context, they want to be a catalyst for positive change. Consider these numbers:

• 785 Contract Manufacturers
• Over 1 Million factory workers
• More than 500,000 unique products

Those numbers are staggering and humbling at the same time.

Factory Sourcing

Quality begins at Factory Sourcing – that is, the process a contract manufacturer has to enter in order to be selected as a Nike manufacturing partner. The sourcing process is more rigorous than it was and Nike has improved the quality of the manufacturing partner and the time it takes to select a partner.

In terms of time it takes to become a partner, it now takes Nike 152 days versus 246 days. That means it takes Nike 38% less time evaluating a manufacturing partner. This is a massive improvement.

In terms of quality, Nike has increased its requirements but doesn’t leave the partner hanging dry – Nike actually spends time and energy and resources helping the contract manufacturing partner reach Nike’s new standards. As of this writing, Nike has 0 manufacturers in Gold, 1 manufacturer in Silver, 535 in Bronze, 156 manufacturers in Yellow, 77 contract manufacturers in Red. As you can see, Nike’s bar of excellence is high and Nike actively not only audits its manufacturing partners, but also helps them improve 1 .

Manufacturing Excellence

According to Nike, in order to design the future, Lean Manufacturing must be part of the solution for them. In their words,

Lean manufacturing has been a hallmark of our approach with factories and is the foundation of how we advance sustainable manufacturing. Lean manufacturing is a business system and continuous improvement philosophy that aims to deliver the highest-quality product while eliminating waste, including lost time and material. At Nike, we also believe lean can empower workers and teams. The success of the lean approach depends on the implementation of physical changes to production processes, increased leadership capabilities and the development of an empowered workforce. Lean manufacturing seeks to engage the minds of those closest to the work to solve the problems that prevent them from delivering quality product on time, every time.

As we all know, people are at the heart of any operation. Nike has spent a lot of energy in training and upskilling their contract manufacturers in Lean. From their perspective, Lean helps their people in the following ways:

• Leadership: factory leaders use Lean to drive business performance
• People: workers are engaged and enabled to drive business success through continuous improvement
• Process: factory processes are predictable and agile in response to customer demand

And, they believe that

The lean approach also seeks to engage the minds of those closest to the work to solve the problems that prevent them from delivering quality product on time, every time.

In fact, they use Jeffrey Liker’s model found in his book “Toyota Culture, the Heart and Soul of the Toyota Way” as an example of how they need to align people and strategy and lean in their training.

I have to say that this is the aspect of the Lean deployment that impresses me the most. Why? Most organizations will start Lean primarily in the Daily Management section of the model and it stays there. Most of us know this as Shop Floor Management, or even the Toyota Floor Management Development System as I know it.

But at Nike, they go deeper and higher and more broadly. In their words, this is how training is done in order to help their people – notice the level of Lean Six Sigma Training conducted 2 :

The curriculum contains 10 modules that each focus on a key area of the Culture of Empowerment Model. Each module is designed to share HRM best practices related to lean manufacturing, and contains interactive exercises that allow factory managers to assess their current state and identify improvement opportunities in areas including recruiting, selection, employee development, performance management, worker-management communication and retention. The curriculum also contains instruction and exercises on lean problem solving and planning tools including PDCA (plan, do, check, act) and A3 reports, which facilitates knowledge sharing and collaboration in a concise document. These tools are used throughout the capacity building to define follow-up projects that factory managers implement after completing the training.

And, they also take temperature checks with their people, to see if the Lean deployment is meeting their needs. In a survey conducted by an outside firm, the results seem promising and Nike has also take this data from survey results to help further improve their people operations:

And, as with most organizations that are focused on continually improving, Nike is doing that and hold themselves accountable. As of this writing, here is their assessment of their Lean journey so far:

In conclusion, I applaud Nike’s commitment to making Lean Manufacturing part of their strategy. Notice that Lean is not an end in itself, but is an aid to further progress toward meeting the Nike promise and achieving their goals  and strategy.

Here’s an older video of their fulfillment and distribution operations – a part of their supply chain. Keep in mind, this is before they started their Lean Journey. It’s interesting nonetheless.

• http://www.nikeresponsibility.com/report/content/chapter/targets-and-performance ↩
• http://www.nikebiz.com/crreport/content/workers-and-factories/3-9-1-our-approach.php?cat=hr ↩

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Nike: From Child Labor To Social Responsible Lean Innovation

March 21, 2017

From poster child for lack of responsibility to catalyst of positive change

In the 1990s, Nike, one of the premiere shoe manufacturers in the world, worn by the greatest names in sports from Michael Jordan to Tiger Woods or Maria Sharapova, became a poster child for lack of corporate responsibility. The Nike product has become a synonym for slave wages, forced overtime, arbitrary abuse and was facing weak demand and unrelenting criticism. In the beginning, the brand denied responsibility for any malpractice that might have taken place in its contract factories. However, at the end of the 1990s, the global boycott campaign of Nike was so impactful that the “swoosh” brand didn’t have any other choice than to recognize doubtful child labour issues and offered to visit the contract factories in Southeast Asia.

To achieve this, it developed a partnership with the International Youth Foundation in order to conduct an anonymous survey among the 67,000 female workers in Nike contract factories. The relationship with the International Youth Foundation was very helpful. As a result, Nike benefited from a huge body of data and was able to identify a number of ways in which the working conditions at the factories could be improved. Amongst concerns, the pain points were delivery time, product quality, working conditions, and manager-worker relationships. Nike began to secure commitments from longstanding suppliers to implement a Lean innovation-based transformation .

At Nike, people are the ultimate value stream

The term “Lean” was first coined to describe The Toyota Way management system, which is built on two pillars: Respect for People and Continuous Improvement . Based on this, NIKE’s culture of empowerment model is three-pronged: attract, develop, and empower. Most importantly, the people of NIKE, Inc. are seen as its ultimate value stream. By implementing a culture of empowerment that employs continuous improvement (CI) to deliver high-quality products, on time, at a low cost, Nike could incentivize its contract factories to improve the working conditions, reduce waste and inefficiencies, and safeguard employee satisfaction.

Nike further developed a partnership with the Fair Labor Association to create performance indicators and launched the Sustainable Apparel Coalition with the US Environmental Protection Agency and other manufacturers. No other capacity-building program in the textile industry integrates as such HR and support of lean manufacturing, addressing both the needs of factories and workers, as well as the business. The transformation to Lean innovation and manufacturing was a huge commitment for the contract factories and  resulted in a new standard of factory self-governance .

How to measure the environmental and social footprint of a complex supply chain?

From an environmental stance also, Nike determined that their finished goods manufacturing was where they had the largest impact on both people and the environment. Just consider these numbers:

• Nike has manufacturing contracts with over 785 factories, across India, Vietnam, Philippines, and South America
• NIKE, Inc. has more than 1 million workers around the world
• 500,000 different products
• More than 500,000 unique products

To ensure everyone is performing at NIKE ‘s standards, the company developed a scoring system for their contract factories ranking them from gold to silver, bronze, yellow or red levels . The Manufacturing Index (MI) in use assesses each factory in terms of lean, labour, health and safety, energy and carbon, and sustainability. This system gives environmental and human resource management performance equal weight alongside business metrics.

Nike’s goal is to bring all factories to a bronze rating – their lowest acceptable level – or above. A bronze rating reflects factory compliance with Nike’s Code of Conduct and Code Leadership Standards, which are designed to protect the rights of workers and create a safe working environment. Any factory that reaches silver or gold demonstrates an additional commitment to progressively embed Lean innovation and performance management systems.

[Source: shmula.com]

Nike : the new world leader in Lean innovation?

Nike aimed at creating an optimized production process that reduces impacts, eliminates waste, enables skilled and engaged workers to drive quality and productivity, and that is strategically led by managers who see value in an empowered workforce. In targeting these high requirements, Nike doesn’t leave the partner hanging dry. It actually spends time, energy and resources helping the contract manufacturing partner raise the bar in all areas of their manufacturing and reach new standards through various incentives. For example, the brand requires partners below the bronze level to pay for 3rd party audits, while partners above the bronze level are rewarded with audits paid by NIKE. So far, factories are making progress in meeting compliance with the new supplier standards and 86% of contract factories rated bronze or better at the end of 2015 :

• 0 manufacturer in Gold
• 1 manufacturer in Silver
• 535 in Bronze
• 156 in Yellow

On top of this, just two years after certifying their first Lean manufacturing line, the factories improved their score by more than a half grade on their audits compared to those who had yet to adopt a Lean line. This accounted for a 15% reduction in noncompliance with labour standards such as wages, benefits, and time off.

Circular economy according to Nike

As part of its efforts to promote Lean sustainability and disruptive innovation, Nike is fully behind the so-called “circular economy” concept, which focuses on re-use and sustainability management across the full product lifecycle . Nike envisions a transition from linear to circular business models and a world that demands closed-loop products, designed with better materials, made with fewer resources and assembled to allow easy reuse in new products.

This involves up-front product design, with materials reclaimed throughout the manufacturing process and at the end of a product’s life. Nike is re-imagining waste streams as value streams, and already its  designers have access to a palette of more than 29 high-performance materials made from its manufacturing waste . Already, materials left over from producing Nike shoes are being reborn as tennis courts, athletic tracks and new shoes.

With its strategy based on 2 principles, “Make Today Better” and “Design the Future”, Nike sets the following goals for sustainability improvement by 2020:

• To source 100% of products from contract factories meeting the company’s definition of sustainable.
• To have zero waste from contracted footwear manufacturer sent to landfill or incineration without energy recovery.
• To create products that deliver maximum performance with minimum environmental impact, seeking a 10% reduction in the average environmental footprint and an increased use of more sustainable materials overall.
• To reach 100% renewable energy in owned or operated facilities by the end of 2025.

It is not enough to adapt to what the future may bring. We are creating the future we want to see through sustainable innovation. Mark Park, CEO of Nike CEO

Sustainability: the new Lean 2.0?

Through being creative and strategic in developing Lean innovation and transformation techniques, Nike pursued systemic change to improve corporate social responsibility and the results speak for themselves. In less than a decade, the brand went from being the primary target of an anti-sweatshop campaign to becoming an industry leader in sustainability and corporate social responsibility. Nike did not only make use of traditions, such as the culture of empowerment model, but also revolutionized how it interacts with their global partners to become today’s one of the most Lean manufacturers in the world. As for the previsions for 2017 and beyond, there is no doubt that sustainability will become the new Lean.

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9 Real-Life Lean Manufacturing Examples

Lean manufacturing allows companies to better optimize processes, reduce waste, and speed up production times through different methods, tools, and philosophies. If you're wondering how to implement lean manufacturing techniques in your operations, you need to consider which lean production tools you use and what you want to accomplish.

How Does Lean Manufacturing Work?

Lean manufacturing is a systematic approach to improving efficiency and reducing waste in manufacturing processes. It focuses on creating more value for customers while using fewer resources. This is achieved by identifying and eliminating all types of waste, including defects, overproduction, waiting, unnecessary motion, excess inventory, overprocessing, and unused talent. Lean manufacturing also emphasizes continuous improvement, involving all employees in the process of identifying and solving problems. By applying lean principles, companies can reduce lead times, improve quality, increase productivity, and lower costs.

Why Is Lean Manufacturing Important and How Can It Help?

Lean manufacturing is important because it helps companies stay competitive in today's fast-paced and ever-changing business environment. By improving efficiency and reducing waste, companies can offer better products and services at lower costs, which can attract and retain customers. Lean manufacturing can also help companies reduce their environmental impact by minimizing resource consumption and waste generation. Moreover, lean manufacturing can improve employee morale and engagement by empowering them to participate in continuous improvement activities and take ownership of their work. Overall, lean manufacturing can help companies achieve long-term success by creating value for customers, employees, and stakeholders.

Getting Started with Lean Manufacturing Methods

A great way to start considering methods is by exploring real-life examples of lean manufacturing and lean management. This can provide a deeper level of understanding and help you build up the confidence to implement the same lean thinking philosophies. We've compiled a list of nine examples for you to start with.

9 Lean Manufacturing Examples in the Real World

Kaizen is a Japanese term that means "continuous improvement." In the context of lean manufacturing, it refers to the idea of involving all employees in identifying and implementing small, incremental improvements in processes, products, or services. Kaizen encourages continuous learning and innovation , as well as a sense of ownership and engagement among employees.  Some examples of kaizen activities include participating in quality circles, conducting 5S audits, or attending training sessions to learn new skills or techniques.

2. Just-in-time

Just-in-time (JIT) is a manufacturing philosophy that aims to produce only what is needed, when it is needed, and in the exact quantity needed. JIT helps companies minimize inventory and reduce waste, while also improving efficiency and responsiveness to customer demand. Some examples of JIT in action include using pull production systems, where production is triggered by customer orders rather than a forecast, or establishing close relationships with suppliers to ensure the timely delivery of materials.

Kanban is a visual tool that helps companies manage inventory and production by signaling when it is time to replenish supplies or move materials to the next stage of production.  Kanban can take many forms, such as colored cards, electronic displays, or physical containers. By using kanban, companies can improve communication and coordination between different departments or functions, as well as reduce lead times and minimize waste.

4. Standardization

Standardization refers to the process of creating and implementing standard operating procedures (SOPs) for a given process or task. SOPs help ensure consistency and quality in products or services, as well as reduce variability and errors. Standardized work instructions can include visual aids, such as diagrams and photos, to help workers understand the process, and they can be updated as improvements are made. For example, standardization can be applied to the layout and design of the factory floor. The location of tools and equipment can be standardized so that workers can quickly find what they need, reducing wasted time and motion. The use of color-coded labels and markings can also help ensure that workers can quickly identify different parts and materials, reducing the risk of errors and accidents.

5. Value stream mapping

Value stream mapping is a tool used to visualize and analyze the flow of materials, information, and activities required to deliver a product or service to a customer. Value stream mapping helps companies identify and eliminate waste, as well as optimize the entire value stream from end to end. Value stream mapping can also reveal opportunities for improvement and innovation, such as reducing lead times, improving quality, or increasing flexibility.

6. Pull production

Pull production is a manufacturing approach where production is triggered by customer demand, rather than a forecast or a push from upstream processes. Pull production helps companies reduce inventory, improve responsiveness to customer demand, and minimize waste. Pull production can take many forms, such as kanban systems, supermarkets, or direct customer orders.

5S is a workplace organization and cleanliness system that helps companies improve safety, efficiency, and quality. The five S's stand for Sort, Straighten, Sweep, Standardize, and Sustain.

Sort refers to the process of separating necessary items from unnecessary ones and disposing of the latter. Straighten refers to the process of organizing the workplace and arranging items in a logical and efficient manner. Sweep refers to the process of cleaning and maintaining the workplace to ensure safety and hygiene. Standardize refers to the process of establishing and maintaining standards for workplace organization and cleanliness. Sustain refers to the process of continuously improving and refining the 5S system.

One of the most powerful lean manufacturing tools available to manufacturers is the SMED event . In a nutshell, SMED events enable manufacturers to identify—and remove—the waste in their changeover processes. All manufacturers, regardless of size, can benefit from SMED. Typically, SMED events reduce changeover times by 30-50%!

Steps include mapping your current changeover process; analyzing, extracting, and streamlining steps; and documenting the whole process to present to your organization.

9. Continuous flow

Continuous flow is a manufacturing approach that aims to produce products in a continuous and uninterrupted flow, rather than in batches. This approach helps companies minimize inventory, reduce lead times, and improve efficiency by eliminating waiting times and reducing the need for transportation and handling. Continuous flow is often used in industries such as food processing, pharmaceuticals, and electronics, where high levels of quality and consistency are required, and where the cost of errors or defects is high.  Some examples of continuous flow in action include assembly line production, where each worker performs a specific task in a sequential manner, or cellular manufacturing, where groups of machines and workers are organized in a flow line to produce a family of related products.

Major Companies That Exemplify Lean Management Practices

You can’t talk about lean manufacturing without talking about Toyota. This Japanese auto manufacturer is credited with the birth of the Toyota Production System (TPS) . Created by Sakichi Toyoda, the goal of TPS was to eliminate waste from the manufacturing process. Nowadays, TPS is known as a fundamental lean manufacturing methodology. But Toyota didn’t stop at TPS. They also used a methodology called jidoka to minimize faulty products, and kaizen to pursue continuous improvement. They focused on automating several processes to lower human error and recheck product quality. Then, they implemented the just-in-time (JIT) model, so that they would only begin working on a product when there was a demand for it. This helped them to better control inventory levels and prevented overproduction.

FedEx Express

In response to the 2008 recession, FedEx began implementing lean manufacturing strategies to reduce costs. One of the ways they changed their operations was by introducing milestones in their C-check process for aircraft maintenance. The team identified 68 milestones crucial to the C-check and defined each segment in 4-hour increments.  Identifying milestones enabled a smoother workflow, which greatly reduced wasted time. The FedEx Express crew at LAX went from performing 14 C-checks a year to performing 30 a year. The crew also went from needing 32,715 man-hours for a C-check to 21,535 (and decreasing). Eliminating wasted time like this leads to huge cost savings, especially in an industry like aircraft maintenance, where specialized mechanics and technicians are quite costly.

With almost 800 contracted factories involved in their manufacturing processes, it’s no surprise that Nike places a heavy emphasis on consistency and waste reduction. To do so, Nike adopted continuous improvement practices and developed the Manufacturing Index in 2011: a framework with key benchmarks and performance indicators to reduce miscommunications, waste, and inconsistency across manufacturers.  The index contains lean elements like “just-in-time” and a continuous improvement mindset. Just-in-time (JIT) production is a simple inventory system where you only produce if there is a demand for your production. This is the pillar of the TPS principles. By not having excess inventory lying around, you reduce waste and save space.

Harley-Davidson

Harley-Davidson  used Total Productive Maintenance (TPM) along with the 5S system and Standard Work as the main foundations of their strategy to keep their techniques stable. Then, they added other lean tools—such as kaizen and Six Sigma—to help improve operations and problem-solve issues. The company also adopted just-in-time inventory management and value stream mapping. The result? Having exactly the right inventory levels at the right times, avoiding waste and providing value to their customers. With these tools, Harley-Davidson automated processes to increase productivity, improve lead times, and reduce their transportation expenses.

John Deere Production System

John Deere started their lean thinking with production processes before moving on to improving their logistics and their supply chain. For John Deere, adopting continuous improvement processes took the form of automated quality control mechanisms. These mechanisms could check more products in less time, allowing for workers to spot defects — and subsequently fix them — more quickly. They were also able to get more products out the door and into customers' hands.

Kimberly-Clark

Kimberly-Clark felt that they were overspending on their transportation management system (TMS). Kimberly-Clark sought continuous improvement to further automate the system, which freed up more time for analysts to perform proactive work that benefited the company. The automation also allowed them to perform more processes with less clicks and fewer steps within the application.

Intel’s components have to be produced with the highest quality—and meet extremely high customer demand. With such demand, Intel could have lowered their cycle time to increase output, but that would have resulted in poorer quality and increased the chance of product defects. Instead, the semiconductor company turned to lean techniques to reduce works-in-process (WIP) and get rid of process waste without hindering workflow. Then, they implemented quality control methods. These lean tools helped to boost productivity without sacrificing quality for their products.

The Ford Motor Company has always aimed to produce the highest quality products and innovations in the industry. Knowing that its operational strength lay in its assembly line, Ford adopted kaizen, lean manufacturing methodologies , Six Sigma, and Total Quality Management (TQM) to implement the concept of continuous improvement in their processes.  Adopting automation and standardization allowed the company to create production lines that flowed efficiently as products moved through each workstation. Using these methods, Ford improved product quality, reduced costs, and decreased waste.

Bank of America

Bank of America is one of many financial institutions that apply a hybrid of lean manufacturing principles and Six Sigma to their operations. Before employing these principles, the organization was experiencing low customer satisfaction rates due to their process quality. They had many issues with customers' statements including encoding errors, late posting transactions, and omissions.  With lean Six Sigma, they improved operational efficiency while meeting the customer needs. They also managed to continuously assess performance using the right performance data metrics to ensure optimized processes.

General Electric

General Electric (GE) recently took on lean management t with the arrival of their new CEO and chairman in 2018. When the company first adopted lean techniques in their project management operations, their innovations actually created bottlenecks in other processes. This led to too much downtime and inventory, which in turn created more waste.  To correct this, GE’s management team turned to Genba. Genba is a lean manufacturing too l used to evaluate the processes on the work floor and learn more about the issues. They sent work operators and support team members to obtain lean training, then performed value stream mapping to identify process value and potential areas of waste. After changing tactics, they were able to correct their first pass at employing lean strategies.

Improve Your Factory with Lean Manufacturing Tools Like Amper

Implementing lean manufacturing principles and lean tools often requires the help of software. Trying to manually track, monitor, and organize the different steps of a lean process is overwhelming and can easily lead to errors and slowdowns. However, with the help of technology like production monitoring, machine monitoring, and IoT and cloud computing, you can track the waste and value in all of your manufacturing systems and develop better ways to reduce waste and increase profitability.

You can apply lean manufacturing to your operations in a vast number of ways. The nine case studies above show that with the right lean tools and techniques, it’s possible to overhaul systems, equipment, production lines, and worker output to continually improve operations. These are just a few success stories  within their industries that can inspire other manufacturers to pursue similar tactics. Here at Amper, we offer OEE and machine monitoring to further automate and enhance lean manufacturing system strategies that you adopt within your operations. Contact us to learn more about our tools and resources, or schedule a demo today!

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Nike Reports Lean Production Success

ONLINE EXCLUSIVE: Nike Reports Lean Production Success

Nike Inc. highlighted its lean manufacturing milestones in the recently released “FY10-11 Sustainable Business Performance Summary.”

The Beaverton, OR-based company unveiled its new factory rating system, the Manufacturing Index, which looks comprehensively at a contract factory’s total performance and includes a deeper look at how a factory approaches sustainability, This index elevates labor and environmental performance alongside traditional supply chain measures of quality, cost and on-time delivery.

Within its overall Manufacturing Index, Nike’s Sourcing & Manufacturing Sustainability Index (SMSI) assesses contract factory performance on sustainability measures, including measures of lean, environment performance (e.g., water, energy, carbon, waste), health and safety, and labor management factors, according to the report. Following two years of development and piloting the program, the company has rolled the SMSI out across its global supply chain.

By adopting a “better manufacturing” or lean approach as part of the sustainability initiative, Nike has reduced material waste and production time, allowing the company’s supply chain to operate more efficiently.

The report stated that contracted factories that adopted Nike’s lean approach experienced defect rates 50 percent lower than facilities that didn’t. Delivery lead times from lean factories were about 40 percent shorter. Lean factory productivity increased 10 percent to 20 percent; and the time to introduce a new product to a factory was reduced by 30 percent. 

“Sustainability at Nike means being laser-focused on evolving our business model to deliver profitable growth while leveraging the efficiencies of lean manufacturing, minimizing our environmental effect and using the tools available to us to bring about positive change across our entire supply chain,” Nike CEO and President Mark Parker said in a statement.

In some areas, including the reduction of excessive overtime at contract factories, progress was slower than expected. Nike also changed its approach to some targets, including carbon emissions, based on a deeper understanding of the challenges and to improve alignment with business strategy, according to the report. Incremental progress against several targets was a key driver for the company to redesign its factory evaluation and sourcing criteria to improve performance in the long-term.

Nike worked with Business for Social Responsibility to engage a panel of external reviewers with expertise across broad areas, including representatives from non-governmental organizations and academia to business, students and open-data advocates. The group assessed the company’s reporting and discussed the sustainability targets. Massachusetts Institute of Technology Professor Richard Locke, whose current research focuses on improving labor and environmental conditions in global supply chains, was one reviewer who said the process was well organized, rigorous and transparent.

“I have been impressed by Nike’s willingness to engage in constructive debate about what is feasible and what is aspirational,” Locke said. “This is a company that takes a leadership position and has clearly learned the value of partnership and that collaboration is a business opportunity, not a risk.”

In conjunction with the release of its report, Nike launched an interactive web experience at www.nikeinc.com enabling users to explore the company’s value chain and learn more about its progress and commitments against each impact area.

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Nike is one of many apparel manufacturers that sends attendees to our Lean Six Sigma training programs. Headquartered in Oregon, Nike is the market leader in athletic apparel, footwear, and accessories. In addition to the brand’s widespread television and print advertising, its marketing strategy also includes sponsorship of many high-profile athletes. 

Nike has adopted many Lean principles for its manufacturing operations, reducing both wasted materials and time, and resulting in improved lead and production times. Companies like Nike have relied on the Lean and Six Sigma training provided by 6Sigma.us.

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Nike Strikes Gold with Lean Manufacturing

The manufacturing operations at sportswear company Nike have been under frequent scrutiny for decades after allegations that it utilized sweatshops to manufacture its products in the 1970s.

This negative publicity prompted a response from Nike to the allegations. In 1992 it established a code of conduct for suppliers, whilst in 1996 they helped create the Apparel Industry Partnership , which drew up a code of conduct for factories, and in 1999 evolved into the Fair Labor Association .

Their manufacturing has been in the news for an altogether more positive reason this week. Their FY10/11 Sustainable Business Performance Summary document outlines the tremendous results the company has seen from the adoption of lean manufacturing throughout its factories.

The document outlines how applying a lean approach has produced better manufacturing that reduced both wasted materials and wasted time, therefore ensuring their supply chain has operated more efficiently.

The report explained the company had worked to eliminate waste, lost time and lost material from its processes as part of its sustainability agenda .

Amongst the improvements seen at Nike are:

• A 50% reduction in defect rates .
• 40% faster lead times .
• 20% improvement in productivity .
• 30% reduction in time taken to introduce a new model .

Mark Parker, CEO and President at Nike, said in a statement: "Sustainability at Nike means being laser-focused on evolving our business model to deliver profitable growth while leveraging the efficiencies of lean manufacturing , minimizing our environmental impact and using the tools available to us to bring about positive change across our entire supply chain."

Whilst the ethical spotlight will undoubtedly remain on Nike's manufacturing , it is nice to see it hitting the headlines in a slightly more positive way. Long may it continue.

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Lean Six Sigma Project Examples | 17 Full Case Studies

Ready to begin your first Lean Six Sigma project? Looking for examples for inspiration or reference to get you started? Here are some project storyboards from different industries and from home. Remember, Lean Six Sigma can help you with more than just work!

• Reducing Underwriting Resubmits by Over 20%  

Governments

• A Call to Change: Pioneering Lean Six Sigma at Los Angeles County  
• Can Lean Six Sigma Be Applied in County Government?  
• How the City of San Antonio Increased Payments for Street Maintenance Using Lean Six Sigma  
• Reducing Bid Tab Creation Cycle Time by 22%  
• Reducing Cycle Time for Natural Disaster Response by 50%  

Manufacturing

• Increasing First Run Parts From 60% to 90% With Lean Six Sigma  
• Reducing Bent/Scratched/Damaged (BSD) Scrap for Building Envelopes  
• Reducing Lead Time in Customer Replacement Part Orders by 41%  
• Reducing Learning Curve Ramp for Temp Employees by 2 Weeks  
• Reducing Purchase Order Lead Time by 33% Using Lean Six Sigma  
• Herding Cats Using Lean Six Sigma: How to Plan for and Manage the Chaos of Parallel Processes  
• Lean Six Sigma Increases Daily Meat Production by 25%  
• Lean Six Sigma Helps Feed People In Need 45% Faster  
• Accelerating Lean Productivity With Immersive Collaboration  
• Reducing Incorrect Router Installations by 60% for Call One  
• Reducing Software Bug Fix Lead Time From 25 to 15 Days  

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Nike Gears Up for a 'Manufacturing Revolution'

In the midst of rising labour and logistical costs and the speed of innovation across all manufacturing fields, sporting goods behemoth Nike has set out a raft of measures in what it terms a ‘manufacturing revolution’.

The supply, or value chain has already witnessed streamlining of around 15 percent over the last two years by cutting factories used from 910 to 785, though despite this production and sales is improving.

But rather than continue this promising trend at the same pace, the company is ramping up its efforts to reduce waste and use what it has more effectively, generating yet more profitable growth at the same time.

Nike’s Sustainable Business Performance Summer for the 2013 financial year outlines this refreshed mantra, and indicates that workers are a key source of innovation and improvement. The report states Nike’s intention to become a catalyst for positive change across the whole industry.

Three major pillars underline the new revolutionary approach. First is ‘manufacturing excellence’, which involves waste reduction and more efficient use of water. ‘Manufacturing innovation’ focuses on entirely new ways of making products and ‘manufacturing modernisation’ looks at the value added process, making it more effective through things like automated cutting.

What this means for workers is a shift to those with higher skills and able to adopt newer techniques with more complex tools.

The sportswear giant is now demanding a commitment to lean principles from all of its source factories, with an eventual goal of using companies achieving bronze or higher in its own Sourcing and Manufacturing Sustainability Index (SMSI).

Two pilot studies in Indonesia have already shown positive results, with Nike looking to roll this out. 

See the infographic below to find out more about Nike's SMSI. 

• Nike & LEGO Group Partner To Manufacture Co-Branded Products Production & Operations
• COVID-19: SME manufacturers will ensure UK emerges wiser Smart Manufacturing
• Top four enablers for digital and analytics transformation Lean Manufacturing
• Overprocessing is often hidden in manufacturing Lean Manufacturing

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Lean Six Sigma Case Studies

Welcome to the Lean Six Sigma Academy’s Case Studies section! Here, you will find a collection of real-world examples of how companies have successfully implemented the Lean Six Sigma methodology to improve their business operations. Each case study includes an overview of the business challenge that was faced, the approach that was taken, the results that were achieved and feedback from the client on their experience. These case studies showcase the wide range of industries and organizations that have benefited from Lean Six Sigma, and serve as inspiration and guidance for those looking to implement the methodology in their own business. 

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