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Implementing Lean Manufacturing by Third Party Logistics Outsourcing
Lean manufacturing is likely one of the business philosophies these days that have been embraced by most corporations across the world. While it was initially intended for the improvement of producing systems and processes, it made its mark throughout the rest of the enterprise as well.
Lean manufacturing originated further from business policies of 1 of Japan’s top automobile maker Toyota. This is very obvious since a number of the vocabulary used in the lean manufacturing processes or systems are Japanese words like kaizen, kanban and andon.
Lean manufacturing has since been area of the business system and is frequently observed by most companies across the world.
Lately, lean manufacturing continues to be implemented by companies by hiring 3rd party logistics. Lean manufacturing by alternative logistics is feasible by outsourcing.
Lean Manufacturing By Third Party Logistics
Outsourcing is currently the trend in most businesses today. In fact, General Motors of North America has been using outsourcing as part of its competitive advantage strategies. This company has plenty of experience when it comes to the study of an outsourcing company’s capabilities and solutions.
Lean manufacturing by 3rd party logistics has been utilized by the majority of the companies today including General Motors. General Motors identified the Powertrain Warren plant where General Motors can implement lean manufacturing they usually used alternative logistics to do this.
It embraced lean manufacturing principles by third party logistics and utilized the plant to effectively manufacture engines. Additionally it used lean manufacturing by third party logistics to resolve transportation issues.
Later general Motors made a decision to further use lean manufacturing by 3rd party logistics for the whole group. Greater benefits are evident a little distance from economies of scale. Clearly, the teachings of lean manufacturing are to add value and resolve waste simplifying the manufacturing process.
Steps Done In Choosing Lean Manufacturing By Third Party Logistics
General Motors made its choice on what potential supplier or alternative logistics to select from a number of factors enumerated below:
1. The quality whatever the lean manufacturing by third party logistics.
2. The renderer whatever the lean manufacturing by third party logistics.
3. The available technology or innovation whatever the lean manufacturing by third party logistics.
4. The price no matter what the lean manufacturing by alternative logistics.
The Benefits From Lean Manufacturing By Third Party Logistics
In line with the principles of lean manufacturing, the outsourcing party must be capable of it all whatsoever costly and essentially the most relaxed manner.
Understand it of General Motors to outsource its transportation function has been as a great tool and is very working well. The alternative logistics to get a ninety nine percent record for on-time performance and actually has met its objective to realize significant savings for General Motors.
The lean manufacturing by alternative logistics has actually been implemented rather well in the case of General Motors. The available visibility of the gadgets and data information using the supply chain pipeline of General Motors has been a value or a unexpected.
Furthermore, the lean manufacturing by alternative logistics strategy covered scanning of all of the General Motor’s freight and updated the advance shipping notifications of General Motors.
To make sure that both parties will combine their efforts to continuously improve processes according to principles of lean manufacturing, the outsourcing arrangement will incorporate a gain sharing component.
Lessons Available From The Outsourcing Journal
The lean manufacturing by alternative logistics strategy is worthwhile since outsourcing a few of the company’s functions for example the transportation functions will allow a buyer to possibly leverage the strength of the supplier in the economies of scale if you would like to achieve numerous objectives that provide on-time performance and cost reduction.
From the view whatever the third-party logistics supplier, it’ll manage the transportation function. It may also choose using subcontract arrangements for some portions of the path, or otherwise perform and deliver the transportation services along with management decisive component.
Lean manufacturing by third party logistics have a gain sharing mechanism indicated within the outsourcing contract which is a impressive solution for an incentive and also for continuous reduction of cost and the advance of services.
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