~ LEAN and ERP ~

Can LEAN do it all?  YES, to a point.  It is possible to run a factory without an ERP system.  Before the age of the computer, many large and lean factories were operated very efficiently without an ERP system.  Can ERP do it all?  YES, it is possible to run a factory on ERP, without any LEAN methods.  In most cases, the exclusive use of either approach is likely to be sub-optimal.  Ulitmately, the goal of a production operation is to meet or exceed the customer expectations while minimizing the consumption of resources.

Today, the likely scenario is that a factory will already be operating on an MRPII or ERP system.  Thus, implementation of LEAN methods must acknowledge the presence of the ERP system.  LEAN and ERP must co-exist in the manufacturing environment.

Lean vs. ERP
Most articles published in the last 10 years view Lean and ERP as contenders for the same space, encouraging the operations manager to select one over the other as the control primary system.  Most articles reflect the bias of the authors, who are often consultants or software providers.  An MRP/ERP system is a push system, while Lean is a pull system.  Lean is an operational philosophy, while ERP is a production management tool.

Lean and ERP
At SMI, we advocate the use of both LEAN and ERP.  The challenge is the harmonious integration of the tools and practices from both LEAN and ERP to optimize operational efficiencies.  This requires a clear definition of the roles of each, and also a clear definition of the interface(s) between the two systems. The guiding principle in the use of Lean and ERP tools is to minimize waste by making invisible things visible.  If properly implemented, an ERP system can be the information flow management system in a lean environment, bringing visibility to long range planning and long lead time orders and raw materials. Lean can handle flow control on the factory floor, adjusting the daily workload to slight fluctuations in demand.