Lean Material Management

Lean in material handling and control, from the shop floor and out into the extended supply chain, needs to be reexamined for two reasons. First, the majority of lean efforts to date have been based on tools and their deployment. Instead, lean should be about principles, or thinking, including the constant progress toward an image of the ideal state of the process. Many companies state this in training but in practice, the focus is still on the tools.

Traditional material handling

In a traditional material handling system, large quantities of purchased parts arrive at the receiving dock, typically on pallets or in boxes, and are delivered directly to the production floor by fork truck in an unorganized manner. Therefore, the shop floor becomes a mini-warehouse with multiple storage locations and that is when material control is jeopardized.

Develop a plan for every part (PFEP

This spreadsheet or database fosters accurate and controlled inventory reduction and is the foundation for the continuous improvement of the material-handling system. This is the first step because you will use this data in other steps, such as setting up the purchased parts market and establishing pull signals. To create the PFEP, you’ll need to gather essential information on every part number entering the plant, such as the part’s specifications, supplier, location of the supplier, rate of usage, storage locations, point of use, container size, as well as other key data.

Build the purchased-parts market

The market maintains controlled levels of purchased parts in a central location instead of storing them in scattered locations throughout the facility. Key pieces of information needed for creating the market include determining the maximum level of inventory to hold, the minimum inventory level, and how much space to provide in the market for racks or pallets, depending on the volume and size of parts. You should also establish rules for operating the market, such as an address system, procedures for reacting to overshipments from suppliers.