Lean level of buffering (LLB) is a surplus of supplies, products or equipment that is just enough to meet demands. The type of surplus and actual amount of buffer is specific to each situation, depending on industry, company size, product type and many other factors.
Overview: What is lean level of buffering?
Buffering is a critical concept for maintaining efficient and good flow in many workplaces. Some types of companies, like stores, restaurants and lean manufacturing facilities, rely on buffering all the time. It creates a more seamless experience for customers, prevents loss of potential sales and mitigates shifts in market trends.
However, buffering is a tricky prospect for companies that want to adopt a leaner approach to internal management. An LLB is the minimal level of buffering, or the leanest, that will still protect the production or sales process from disruptions.
It’s typically calculated with this simple equation that includes several complex variables:
LB = N / (c*Tdown)
Where LB: Level of buffering
N: Buffer capacity
c: Maximum cycle time of all machines in the line
Tdown: Maximum average of all machines in the line
3 benefits of lean level of buffering
Lean buffering isn’t just about adapting your existing practices to a lean strategy. There are some tangible benefits from this process alone.
1. Find a data mine
Calculating a company’s lean level of buffering means collecting data about several key variables, which are all interesting and important to strategic development. This includes assessment of the entire production process to determine capacity and capacity of current buffers.
2. Cutting bloat and waste
Excess surplus isn’t always a bad thing, but it can be. Some types of companies waste valuable space or lose a substantial amount of money by gathering more supplies than they can use. This is particularly costly when perishable products or components are involved. Lean buffers are all about cutting this kind of waste.
3. Opportunity to improve
Researching and calculating a company’s LLB can reveal a lot of opportunities for improvement. There might not be time to address all of them right away, but leaders should note these details and come back to them.
Why is lean level of buffering important to understand?
Balance is a critical concept in business, even lean ones. Being too lean can be detrimental, that’s why it’s important to understand how to approach this issue.
Implications for risk management
At its core, buffering is a form of risk management. It may focus on preventing small losses on a longer time scale, but is no less valuable. That’s why investments into buffering should be considered alongside other features of ongoing risk management strategies.
The real costs
It’s easy to dismiss or underestimate the real cost of storage or supply expiration. It’s worth conducting thorough investigations into all sources of company expenses to find ways to minimize unnecessary loss.
Applying the LLB equation isn’t always easy because the variables don’t always fit neatly. Companies need to do some serious analysis to determine their real capacities and needs.
An industry example of lean level of buffering
A manufacturer of car parts relies on lots of different materials for most of their products. Disruption in any of these supplies halts the entire facility. To prevent losses from operational disruptions, the company maintains stockpiles of all crucial materials. However, some of these stockpiles are slowly growing and there’s no more space.
To address the surplus bloat, leadership applies lean management to their buffering strategy. They examine the availability of specific supplies and their usage in the facility to determine the minimum amount they can have to avoid disruptions. They adjust supply acquisition accordingly and schedule an assessment of the buffering revision for the following quarter.
3 best practices when thinking about lean level of buffering
The best way to establish a lean level of buffering is to be thorough, realistic and stick to hard data.
1. Prioritize processes
Companies that produce or sell a lot of different products need to be careful about their buffers. Not every item in their offering may be worth buffering, even if it’s lean. Part of buffering is recognizing the processes that have the most potential and least benefit from buffering.
2. Assess supply chains
Many products or services depend on several different kinds of resources that are acquired, handled and managed separately. Being in different markets means that these supplies aren’t always subject to the same fluctuations and shifts. Companies need to be conscious of this fact and assess surplus needs for these things independently.
3. Set a scope
Companies need to know their desired throughput for a specific time-frame before they can establish a buffer. A rough estimation for throughput can only muddy the waters. That’s why its worth doing a complete check of current equipment and processes to get current and accurate numbers.
Frequently Asked Questions (FAQ) about lean level of buffering
What’s the purpose of buffering in lean management?
Being lean doesn’t mean you shouldn’t be prepared. Buffering is a common practice for many companies and is essential to maintain efficiency.
What is a good buffer capacity?
This depends on your needs and goals. Grocery stores, for example, have to worry about products expiring at a certain date or going bad if they aren’t stored properly. This means more tangible and real losses for overstocking. Other companies are just wasting space with excess surplus, which means the potential of missing a sale is more serious than overstocking.
Is LLB worth it?
Lean practices are powerful and effective, but only if they are applied in the right context and manner. Usually they are most effective when they are part of a new strategic vision for the entire organization.
The lean buffer balance
Like any other lean management practice, you won’t always get it right the first time. That’s why you need to periodically pause, assess and improve as you move forward. Learn from your mistakes and get as much data as you can about supplies, market trends and internal operations.