The document describes the journey of Lantech, a manufacturing company, in adopting lean principles. It discusses how Lantech initially struggled with long lead times and batch production. It then implemented lean techniques like value stream mapping, continuous flow, visual management and dedicated teams. This transformed Lantech's production system and significantly reduced lead times and inventories while improving quality and increasing market share. The document emphasizes that lean is a continuous improvement journey towards perfection.

1. Anjali Raj
Nidhi Upadhyay
Vasundhra Agarwal
Nimisha Karnani
Priyanka Das
Anirudh Chaudhari

2.  Managers across the world professing that their
company is adopting lean techniques.
 Claims are all just wishful thinking.
 The main problem is that though many managers
have got the individual lean techniques right ,
they are not able to put it together into a
coherent business system.
 More than 50 companies across the world have
been studied and 5 steps have been discovered
which will be useful to managers everywhere.

3.  Define value precisely from the perspective of an end
customer in terms of a specific product with specific
capabilities offered at a specific price and time.
 Identify the entire value stream for each product or
product family and eliminate waste.
 Make the remaining value creating steps flow.
 Design and provide what the customer wants only when
the customer wants it.
 Pursue perfection

4. HISTORY:
 Pat Lancaster grew up in the family workshop, convinced
from his early age that he could be an inventor.
 In 1972, he had his big idea: a new way for manufacturers
to wrap their products for shipment.
 With a small investment of $300, went to work under the
corporate name of Lantech.
 Lancaster‟s idea was a device that would stretch-wrap
pellets of goods with plastic film in place of the traditional
shrink wrapping so that they could be shipped easily from
one place to another

5.  Like all startups, Lantech was born lean, but as the
company scaled up maintaining lean production did
not seem practical.
 Lancaster appointed an operations manager, an
engineering director and a sales director. Lantech
was organized into a series of departments.
 In pursuit of efficiency, Lantech built its four basic
types of machines in batches.10 to 15 machines of
one type were assembled at a time.
 As customers bought only one machine at a time, the
company had to store most of the machines in the
warehouse.

6.  Complexity increased exponentially as Lantech tried to
move the orders gathered by the independent sales force
through the office and the plant.
 Proposals were sent for cost analysis to the engineering
department which then sent the acceptable price back to
the sales force.
 Once the order is accepted, the order traveled from the
sales staff through engineering aplications, design and
credit checking before returning to design, which
generated a bill of materials.

7.  The order with the bill of materials then went to the
production operation‟s scheduling department.
 There were usually delays as there was a queue of orders.
 As a result, orders generally took 12 to 14 workdays to
travel from the sales staff to the scheduling department,
even though the actual processing time was less than 2.

8.  Since the movement of products through the
plant was so erratic, the company created a
separate order management department within
the sales force to communicate with the plant
about where the machine was in the production
process and to expedite the order if the
customer was getting restless.
 This system was fine in theory but always a mess
in practice because of the conflict between
customers‟ changing desires and the logic driving
the production system.

9.  Severe communication issues within the
company which increased with increase in
staff numbers.
 Each engineer had a stack of projects on his
desk.
 Moststeps added no value and managers
focused on minimizing variations in
operations rather than on pursuing
perfection.

10.  On June 26 1989, Lantech lost a patent-
infringement suit against a competitor that
was offering lower-priced clones of Lantech
machines.
 By the end of 1989 clones with roughly
comparable performance started to appear
everywhere.
 Itwas like “ Lantech was walking dead”.
Change was necessary.

11.  Firstapproach was to reorganize the
company into separate profit centers for „
standard products‟ and „ special products‟.
 TQM was introduced.
 The talk about „ good enough‟ changed to
talk about „ perfection‟.

12.  To create an empowered organization and to
build trust between management and the
workforce and among different departments.
 Autocratic managers were replaced with
managers focused on team work.
 Company conducted extensive training in team
processes, team leadership and individual
interaction.
 Even after all this the factory was still a mess.

13.  New production method called Max-Flex was
introduced.
 Theidea was to slash lead time by building
inventories of major components in advance,
then assembling machines to customer‟s
specifications very quickly when an order
was confirmed.
 Leadtime fell from 16weeks to 4, but costs
were very high.

14.  Introduction of better information technology.
 The new system was wildly inaccurate because
many times items did not get entered into the
system.
 Also, the magnitude of inputs and changes made
the computer run very slowly.
 By end of 1991, Lantech‟s orders were falling
despite price reductions and the factory was
unable to accommodate the continual shifts in
demand.

15.  Ron Hicks joined Lantech in March 1992 as Vice
President- Operations.
 To transform into a lean organization, a company
needs three types of leaders:
 Someone who is committed to the business and can
be the anchor that provides the stability and
continuity
 Someone with deep knowledge of lean techniques
 Someone who can smash the organizational barriers
that inevitably arise when dramatic change is
proposed.
 Lancaster filled the first role, Hicks the second and
Zabaneh the third

16.  Lantech would immediately form teams to
rethink the value stream and the flow of
value for every product and every process.
 Lantechwould identify necessary activities
and eliminate the rest.
 Perform activities in rapid sequence.
 Batches,
queues , backflows would be
banished.

17.  Dedicated production processes was established for each
product family.
 Throughput time was reduced.
 Lantech needed standardizing their work.
 Establishing takt time was critical.
 Lantech also needed to figure out how to perform equipment
changeovers quickly.
 By 1992 lantech had converted its entire production system
from departmentalized batch methods to continuous flow in
cells.

18.  Visual control was established. It is one of the principles of
lean thinking. Its says that if every employee can see the
status of an activity, he or she will be able to take
appropriate action.
 Lantech started a new system of dedicated teams led by a
„directly responsible individual‟ who would be charged for
the success of the product during its lifetime.

19.  Once the employees were totally involved in the design
and production process , the outcome was that good
products were produced. The demand went high and
production was based on customer demand unlike before.
 Lantech‟s share of stretch wrapping market zoomed from
38% in 1991 to 50% in 1995.

20.  Lantech as an organization is steadily striving
for perfection- a state in which every action
in the organization creates value for the
customer.
 Despitethe performance leap that Lantech
has made, it can identify as many
opportunities for improvement today as it
could then.

21.  By making continuous incremental improvements
in pursuit of perfection, companies can double
productivity within two to three years and halve
inventories , errors and lead time.
 The problem today is that technology is present
but it is misapplied and hence perfection not
attained.
 There is shortage of managers with the
knowledge and capability to apply
comprehensive lean techniques.