Lean Manufacturing Concepts

Lean manufacturing is all about minimizing costs. “Lean” refers to the relatively small amount of money invested in raw materials, work-in-process and finished-goods inventory at any given time. Lean organizations minimize inventory costs through efficient purchasing and distribution systems that request inputs just as they are needed and ship finished goods just as they are ordered. Lean manufacturers also focus on their core competencies while outsourcing a range of other productive activities to contracted specialists, creating additional cost efficiencies. For example, a lean manufacturing business may outsource its outbound logistics in order to focus on and invest exclusively in production. The concept of continuous quality improvement and waste reduction as a source of cost control factors heavily into lean manufacturing, as well.

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