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I agree with Mr. Mohammad Iqbal Abubaker
Lean System aims to eliminate wastes. A better routing and designing of ERP syatem can play its part towards achieving it. A good example of integration of these approaches can be seen as identification of wastes(there are7 types in Lean Management) by ERP like Material control through BOM defined in ERP, Identification of Bottleneck processes that hinders the flow of production(since in ERP systems process can not go further without preceeding activity completion), Identification of time delay through report generation and Rejection and Rework identification.
Thus, above wastes are identified directly through ERP and can be resolved through effective Strategy design (which is another chapter).
Right now I cannot give perfect answer to this.
But examples are not enough its practical implementation of both the aspects, again, it depends on customized needs
Introducing the principles of lean manufacturing principles to an organization means training employees as well as laying out production lines anew. And ERP has no role in these types of changes.
On the other hand, nearly all major ERP vendors have extended their applications to support the core lean principles of value definition and specification, value stream mapping, uninterrupted flow, customer pull and the pursuit of perfection. These systems support lean but they don’t necessarily drive it. A manufacturing firm will need to spend time studying business processes and implementing a lean environment before programming the ERP system and selecting modules to support a lean initiative.
The following are some examples of the integration between the two approaches.
• There’s a huge part of the business that has to go on, whether you’re lean or not. You still have to do general ledger and accounts payable, and you have to purchase and receive things and take customer orders.”
• ERP does have a vital role to play in analyzing existing business practices and potentially restructuring them to operate in a lean manufacturing environment. After all, the only way to find areas that need improvement and then make those improvements is by tracking and analyzing current manufacturing processes—which can be done in ERP.
• Beyond day-to-day business operations, lean principles such as continuous process improvement are also supported by ERP. ERP organizes the information you need about products, production, facilities, resources and demand. You need this [information] to implement lean, so having it organized in a single place of reference is very valuable.”
• A manufacturer’s ERP systems can provide the information needed about inventories for a lean manufacturing environment, including quantity required, the time at which inventory is required and lead-time to supplier delivery.
• Manufacturers that are embracing lean principles to reduce the amount of time they spend changing out their materials on their product lines. Reducing the setup time reduces the lot size, and product will flow through an operation much faster. Smaller lots reduce the amount of inventory on the floor. Because setup time is tracked within the ERP system, in this instance, the ERP system manages the lean implementation.Reducing setup time and coordinating lot sizes will reduce inventory, which is a major element of waste.
• Another example of ERP being integrated with lean manufacturing occurs when a bill of materials is analyzed withinthe ERP system. This would allow manufacturers to coordinate the lot sizing of components, which would in turn help them avoid producing more goods than needed to satisfy the order.
• Managers at firms incorporating lean manufacturing principles should simplify the ERP system by reducing the number of transactions on the system by
o Lean calls for unifying multiple work centers. Historically, these multiple work centers might encompass different machine processes or assembly processes. So instead of defining those multiple work centers within ERP, define them within one cell. The goal is to bring all of a manufacturer’s operations to this cellular system and to simplify ERP transactions accordingly.
o In a traditional manufacturing environment, work orders flow between each work center, which are individually defined in the ERP system. In an ERP system set up to run in a lean manufacturing environment, no more than one work order should be brought into a cell. Such steps will reduce the number of transactions in the ERP system.
• ERP bridges the manufacturing organization’s supply chain, scheduling and accounting activities. A manufacturer must study those business processes—and all business processes across the entire supply chain—before implementing or re-architecting their ERP system.
• ERP manages key data like cost accounting which is not addressed by lean. Management at most companies really wants to know what it costs to produce and develop products, ERPs capture all the costs associated with making those products like material issues, labor expended and machines used. The purists in lean would say I don’t need to track that stuff. That may be true if you focus on throughput—which is the main focus of lean—but that can lead to managers who don’t know the cost of individual products” (i.e., because they’re not tracking costs in a dedicated and automated system).
• Manufacturers also want to measure key performance indicators (KPIs) so they can compare those numbers before and after implementation. In the case of a lean implementation, those KPIs will reflect lean principles. For instance, if lot sizes were reduced for overall efficiency. If you’re spending time on set-up for those reduced lot sizes, you can get bottlenecks in the system. There’s a fine balancing act you need to play when looking for those efficiencies. But ERP can be used to track these processes—including set-up time—for continuous improvement, which is a lean goal.
Lean and ERP conflict is really famous in all organization. They are like in a war!
However we applied three Lean Transformation (each have more than1. employees) and integrated Lean and ERP.
One of our experience is in trailer manufacturing. There was a collapsed ERP Project which costed4 Million USD and all endeavors. The managers of IT with ERP Key-Users shooting Lean related managers.
The problem is easy to understand. Understanding problem correctly is equal to solving problem. The correct question was "What is ERP for?". Similarly for Lean related managers "What is Lean for?".
After some meetings we create an OBEYA approach customized for ERP Project to integrate Lean Transformation. We used all green-yellow-red cards in a special room for visualisation all required ERP data such as total trailer in park as finished good, WIP Chasis in dynamic understanding. Every morning, afternoon and the evening cards were moving to next process in a board.
This is a specific, unique method applied by me in Tirsan Trailer and DAF-Trucks Turkey companies. The story is long, but I gave sufficient clue for you.
The answer given by Iqbal defines each term seperately and is quite detailed. The question needs to be more specific and industry related to give an accurate answer
ERP and Lean have some fundamental conflict and to get the to work toegether through integration may require cutting corners here and there in the ERP software and/or Lean software.
The other possibility would be to use "middleware" and/or a "common API/message format" to interface the two systems and determine the necessary data flow between them per cutomer true needs.
agreed with status of arinjay,,, same position
IAM FULLY AGREE WITH MR. MOHAMMAD IQBAL
