Page 54 - FoodFocusThailand No.154 January 2019

SOURCE OF ENGINEER
Lean Supply Chain

in Food Industry

When I was an acting manager in Japanese industrial plant,
I faced serious losses approximately about 1 million Baht
per month and faced an accumulate loss of over 40 million
Baht. Absolutely yes!…because I would like to prove my
knowledge, I decided to help manage the company amidst
the heavy loss. I found the way of lean as the situation Moreover, we must think in advance in case we want to increase sale,
made me find out the best solution to survive the company whether it will affect the supplier. The supplier needs to increase their
and make a profit again. Therefore, I searched what kind ability to provide more products as we need. Each factor should be
optimized on each procedure.
of management that can be used in the Thai organization. For the production and processing of raw material, internal factory
management including the sourcing for a perfect location (the far we
From a nearly collapsed motor factory, Toyota has climbed up to the stay away the customer, the more we need to pay for a delivery cost).
world’s fourth leading car manufacturers during the year 2005. Yet, what’s The sourcing of an appropriate production platform, a continuous
even more interesting is its profitability since its profit was much larger than production system for a product emphasizing on quantity, cellular
a combined profit of the top three leading motor companies including GM, manufacturing line which have a variety of products and uncertainty
Ford, and Chrysler, which earned just 1.9%, 2.4%, and 0.3% respectively production volume is better.
(The Economist, 2005). Previously, the major problem in Toyota, which most A manufacturing process from a setting up of equipment; how to set
organizations also faced, was it could not identify the value that the customer up the machine swiftly? Think about a changing of Formula 1 (F1) rubber
needs, while it created huge wastes that were implicit costs. The problems tires that change the tires and accessories in only 2 seconds. A
made the company’s loss their competitiveness against their competitors. manufacturing of handicraft products or machine to get quality products
Consequence, Toyota developed the Toyota Production System (TPS) to according to the standard of inspection and wait for testing result. How
solve the problem until it has become the leader in the automobile industry to reduce the waste during each process? Please take a look.
at present. This is the origin of Lean Thinking method. Any activity which customers do not want does not create value for
Let’s see how the lean concept can adopt in the food industry along the goods. For example, a good that not meet the spec, or a product that is
supply chain. We must begin from Farm to Fork (F2F), and completely look more than the customer’s demand, a waiting on each process, or an
around the whole forest, not just a single tree. The figure shows how the employee do not have creativity, a moving inside and outside the
members of the supply chain, from the ingredient suppliers of the second organization, an excessive inventory of raw materials and processes,
and the first tier, producers or service providers, distributors, and customers. finished goods, moves in all activities and finally unnecessary redundancy.
Firstly, we should identify the value of our products from the perspective of Delivery has changed to unsuitable transport modes such as airplane
the customer who pays for the product. After that, we should consider on to car, boat to car, car to boat, size of vehicle, an engine’s horsepower
each procedure relatively including planning group (Plan: P), sourcing is heavily than the weight or cargo volume, as well as a lifting of the shaft
(Source: S), making (Make: M), delivering (Deliver: D), returning (Return: when no freight to reduce the friction and load of the engine. Eco-driving
R), and enabling (Enable: E). We should plan for a suitable demand and chauffeur, a starting of the car with gear 2, a parking while starting an
supply. (So that the price will not fall down and farmers do not need to pour engine, an often accelerating of an engine, a sudden break.
their production on the road as there is a balance between customer demand A type of rubber tire, which should use an energy saving tire that
and the production). Then, we must plan for material sourcing, including treads can be retracted several times, so that the car can run to the
seeking for a raw material, planting for agricultural products that are plants, maximum mileage. Whereas if a tire pressure is too weak, it will consume
vegetables, livestock including chicken, swine, beef, and fish etc. And, we large amount of fuel. The tire pressure must be added according to the
should sign a contract with a production source in order to control and divide maximum pressure specified on the tire sidewall in order to prevent
benefits for farmers, and producers, which have quality product as demand damage to the tire structure.
and get the controllable price. To find and purchase raw materials in Moreover, a tire center must be set to run on the same direction, not
accordance to the plan, we must have various source of raw materials to against each other. A load of goods that not meet the maximum load of
compare on the quality, quantity, amount, and divide orders whether which cubic quantity leads to a loss of the transportation cost as it loads of air
suppliers we will buy for a product to respond to the production capacity. inside. We will often find in drinking water plants, or a backhauling. We
I used to give a consult to a grass jelly manufacturer. I asked the owner must be carried out Milk Run transportation by delivering multiple products
how much of the sale value they want each year? The answer is they want and drop off on many places instead of a single way delivery and come
to achieve 300 million Baht. So, we know the amount of the production that back with empty truck.
we need to produce each day, as well as exact amount of various raw In conclusion, “Lean” means “an emphasizing on value and an
materials such as how many tons of grass jelly, how many sack of sugar, eliminating of wastes by continuous improvement (CI) throughout the
how many sack of flour, how many box of glucose syrup, how many plastic supply chain.” Many businesses should adopt this principle for their own
bags, glasses, and bottles according to the amount of the product in each business. We see that lean is close to use, but we often do not notice
category. Moreover, we need to compare which supplier we should use, and pay attention. If you begin to adopt the above description for the
and how many amounts, we should buy from them as we need to divide development and take action, it will help you reduce the cost for a
which supplier we should use, with how many amounts, as price of each business, finish task rapidly, and definitely get more profit.
supplier is different, while delivery time, and quality are also different.
54 FOOD FOCUS THAILAND JAN 2019

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