Lean Manufacturing: A Pathway to Revive U.S. Manufacturing

Lean Manufacturing has been a game-changer for numerous manufacturing plants in the United States since its inception in the 1990s. These practices have led to remarkable improvements in both profitability and operational efficiency. However, the majority of manufacturers have yet to fully embrace Lean principles, missing out on substantial financial gains.

Lean Manufacturing has always been a fundamental element of the OpExChange, a collaborative community of peer manufacturers dedicated to continuous improvement. They have embodied this spirit of collaboration for over two decades. Recently, Mike Demos, the coordinator of OpExChange, invited Doug Berger, the founder and president of Industry Reimagined 2030, to share his mission and message in a virtual session. This virtual session garnered record-setting attendance, with over 120 participants from 59 organizations and representation from 23 counties in South Carolina.

The Decline in U.S. Manufacturing
Doug reported that manufacturing in the United States continues to decline. The share of the U.S. market held by domestic manufacturers has been dwindling over the past two decades, reaching a record low of 66% in 2022. Berger emphasized the need for a transformative shift in productivity and competitiveness at both the company and national levels.

While a shift is taking place, he stressed that the path to revitalizing U.S. manufacturing, especially the small to medium enterprises, lies in scaling Lean practices nationwide. Manufacturers leveraging Lean as a continuous improvement system are 40% more productive and 30-50% more profitable. These companies are strong global competitors. Unfortunately, these represent only 10-15% of all manufacturing companies.

Industry Reimagined Research
To gain a deeper understanding of the state of Lean Manufacturing, Industry Reimagined 2030 conducted extensive research involving more than 300 companies, primarily in the United States. The research aimed to identify the factors contributing to successful Lean implementation and the obstacles hindering others. The findings are not only eye-opening but also serve as a persuasive tool for organizations to recognize the immense opportunities that Lean practices can offer.

The research revealed several key insights:

  • Lean Works: 26% of companies reported significant gains averaging 80%, while 38% experienced high gains averaging 40%. Additionally, 36% achieved moderate gains averaging 20%. The research is the first of its kind to quantify Lean.
  • Leadership Matters: The long-term value derived from Lean implementation is directly proportional to leadership involvement. Companies led by executives demonstrated transformative results, whereas those led solely by Lean experts achieved the least impressive outcomes.
  • Executive Commitment: Surprisingly, the data shows that executive commitment is not an absolute requirement for attaining gains. Implementations led by mid-level managers still yield significant results, and executive buy-in can be earned through tangible accomplishments.
  • Early Gains: Within the first six months of Lean implementation, 48% of companies experienced operational gains, while 35% witnessed cultural improvements.
  • Maturity of Adoption: The value derived from Lean practices increases with the level of adoption maturity. Companies implementing specific tools led by Lean experts saw minimal gains, whereas those with a continuous improvement mindset achieved substantial and transformative outcomes.

Crossing the Chasm
Doug emphasized the importance of “Crossing the Chasm” to bring Lean Manufacturing to the mainstream manufacturing community. To achieve this, Lean must be made more relevant and friendly. Relevance entails achieving visible results within the initial six months and driving bottom-line improvements.  Relevance is both organizational and individual.  It is crucial for all employees to understand the WHY, WHAT and HOW of Lean and appreciate both the individual and organizational benefits it brings. Relevance is doing a better job of communicating the big picture then staging Lean in practical steps aiming at short-term progress.  The research shows that resistance to lean often comes from people misunderstanding Lean (25% of companies) or leaders unclear about specific ways to support Lean (22% of companies).

Furthermore, friendliness in Lean implementation involves introducing Lean concepts in a simple and understandable manner. Learning should occur through hands-on experience in small increments on the production floor. The focus should extend beyond technical aspects and jargon, emphasizing the social impact throughout the organization. Doug stressed that these are not revolutionary concepts but rather fundamental principles of employee engagement and change management.

Several OpExChange member companies have demonstrated the efficacy of Lean Manufacturing through significant improvements. For example, SixAxis in Andrews achieved transformational results by deploying Lean practices and involving their entire workforce. Sleep Number in Columbia experienced a 75% improvement by utilizing Value Stream Mapping, while Stoll Industries improved not only their shop floor operations but also their support functions through Lean implementation. In the spirit of collaboration, these companies shared their progress with the OpExChange in plant visits. [Reports from each of these events are available through these links: SixAxis, Sleep Number, Stoll Industries.]

The Call to Action – What can you do?
The call to action is clear: each manufacturing organization and individual must play its part in propagating Lean adoption to revive U.S. manufacturing. To contribute to this national imperative, there are several things that should be done:

  • Set Bold Targets: Challenge your organization to achieve ambitious, important Lean targets.
  • Organize Lean: Identify phases with specific milestones, people, and methods. Go deep, not wide.
  • Evangelize Lean: Spread the message of Lean within your organization, among your suppliers, and with your customers.
  • Foster Unprecedented Collaboration: Engage in collaborative efforts with peer manufacturers and industry partners to accelerate the adoption of Lean practices.
  • Celebrate and Engage: Create a culture of appreciation and engagement by celebrating Lean successes and involving all employees in the continuous improvement journey.
  • Utilize the Industry Reimagined Report/Data: The full survey results are available for anyone. Use the data from this report to help convince others of the real benefits of Lean Manufacturing. (download link)

By embracing these actions, manufacturers can drive the widespread adoption of Lean Manufacturing, revitalizing industry and positioning the United States as a global manufacturing leader in manufacturing excellence once again.

A resource available to all manufacturers in South Carolina is the South Carolina Manufacturing Extension Partnership (SCMEP). Not only did they found and sponsor the OpExChange, but they offer a no-charge competitiveness review that will provide recommended actions for your organization including lean manufacturing, leadership, sales, and industry 4.0.

The OpExChange has released the video of this session to the general public, aiming to foster unprecedented collaboration in South Carolina and the United States. The video is available at the following link:

About Industry Reimagined 2030

Industry Reimagined 2030 is a non-profit dedicated to revitalizing U.S. manufacturing.  They are a catalyst for associations, institutes and companies of all sizes to collaborate and shift the national narrative from decline to a future of vibrant opportunity.  They are working to scale existing and proven solutions to productivity and workforce skilling and have collaborative initiatives to Reimagine Lean and accelerate Industry 4.0 adoption.

Doug can be reached at doug.berger@ir2030.org or on LinkedIn

Lean research is on-going, and you can contribute by completing their nine-minute questionnaire.

About OpExChange
The OpExChange, sponsored by the South Carolina Manufacturing Extension Partnership, is a peer-to-peer network of manufacturers and distributors in South Carolina known for generating success for members through benchmarking and best practice sharing. Member companies host events and share practical examples of industrial automation, lean manufacturing improvements, and leadership development. It is an invaluable resource to South Carolina companies that provides access to others who are on similar improvement journeys. If your company is interested in participating in this collaborative effort to improve both the competitiveness of your operation and South Carolina, contact Mike Demos (Mike@OpExChange.com). More information and upcoming plant visits are available on the OpExChange website www.OpExChange.com.


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