Flevy Management Insights Q&A
How can Lean Manufacturing principles be applied to reduce waste in high-variety, low-volume production environments?
     Joseph Robinson    |    Waste Identification


This article provides a detailed response to: How can Lean Manufacturing principles be applied to reduce waste in high-variety, low-volume production environments? For a comprehensive understanding of Waste Identification, we also include relevant case studies for further reading and links to Waste Identification best practice resources.

TLDR Applying Lean Manufacturing to high-variety, low-volume production focuses on minimizing waste through Value Stream Mapping, continuous improvement, and customizing tools like JIT and Kanban for flexibility and efficiency.

Reading time: 4 minutes

Before we begin, let's review some important management concepts, as they related to this question.

What does Lean Manufacturing mean?
What does Value Stream Mapping mean?
What does Continuous Improvement mean?
What does Just-In-Time mean?


Lean Manufacturing principles, originally developed to streamline mass production processes, can be effectively adapted to high-variety, low-volume (HV/LV) production environments. These principles focus on maximizing value for the customer while minimizing waste, or "Muda" in Japanese. Applying Lean in HV/LV settings involves unique challenges, such as managing complexity and flexibility, but with strategic adjustments, organizations can significantly reduce waste and enhance efficiency.

Understanding Waste in HV/LV Environments

In HV/LV production environments, waste often manifests differently than in high-volume settings. Traditional Lean identifies seven types of waste: overproduction, waiting, transporting, inappropriate processing, unnecessary inventory, unnecessary motion, and defects. In HV/LV environments, the complexity of managing numerous small-batch products can exacerbate these wastes, particularly in overproduction, inventory, and processing. For instance, producing more of a product than is immediately needed can tie up resources and space, leading to increased inventory costs and potential obsolescence. Similarly, the frequent switching between tasks and setups can lead to inefficiencies and increased opportunities for defects.

To address these challenges, organizations must adapt Lean tools and principles to their specific context. Value Stream Mapping (VSM) is one such tool that can be particularly effective. By mapping out the entire production process, from raw material to finished product, organizations can identify where delays, excess inventory, and unnecessary steps occur. This holistic view allows for targeted improvements that reduce waste and streamline operations.

Another critical aspect is the focus on continuous improvement, or "Kaizen." In HV/LV environments, where production processes can be complex and varied, fostering a culture of continuous improvement encourages employees at all levels to identify inefficiencies and suggest improvements. This can lead to incremental changes that cumulatively have a significant impact on reducing waste and enhancing productivity.

Are you familiar with Flevy? We are you shortcut to immediate value.
Flevy provides business best practices—the same as those produced by top-tier consulting firms and used by Fortune 100 companies. Our best practice business frameworks, financial models, and templates are of the same caliber as those produced by top-tier management consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture. Most were developed by seasoned executives and consultants with 20+ years of experience.

Trusted by over 10,000+ Client Organizations
Since 2012, we have provided best practices to over 10,000 businesses and organizations of all sizes, from startups and small businesses to the Fortune 100, in over 130 countries.
AT&T GE Cisco Intel IBM Coke Dell Toyota HP Nike Samsung Microsoft Astrazeneca JP Morgan KPMG Walgreens Walmart 3M Kaiser Oracle SAP Google E&Y Volvo Bosch Merck Fedex Shell Amgen Eli Lilly Roche AIG Abbott Amazon PwC T-Mobile Broadcom Bayer Pearson Titleist ConEd Pfizer NTT Data Schwab

Customizing Lean Tools for HV/LV Production

While many Lean tools are designed with high-volume production in mind, they can be customized for HV/LV environments. For example, the Just-In-Time (JIT) principle, which aims to reduce inventory and increase efficiency, can be adapted through more flexible scheduling and smaller batch sizes. This requires a more dynamic approach to production planning and control, leveraging technology to enhance visibility and responsiveness.

Kanban systems can also be adapted to manage the flow of materials and information in HV/LV settings. Instead of using standard Kanban cards for large batches, organizations can implement electronic Kanban systems or use cards tailored to smaller, more varied production runs. This helps maintain the flow of work and reduces the risk of overproduction and excess inventory.

Similarly, Total Productive Maintenance (TPM) is crucial in ensuring equipment reliability and efficiency in HV/LV environments. Given the frequent changes in production setups, maintaining equipment in optimal condition can prevent downtime and defects. Implementing TPM involves not only regular maintenance but also training operators to identify and address potential issues before they lead to significant problems.

Real-World Examples and Results

Several leading organizations have successfully applied Lean principles to HV/LV environments, demonstrating the potential for significant improvements. For instance, a report by McKinsey highlighted how a manufacturer of custom-engineered products reduced its lead times by 50% and inventory levels by 25% through the implementation of Lean techniques tailored to its HV/LV context. This was achieved by applying VSM to identify bottlenecks and implementing a customized Kanban system to better manage workflow and materials.

Another example is provided by Toyota, the pioneer of Lean Manufacturing, which has effectively applied these principles in its low-volume luxury vehicle lines. Toyota's approach includes using flexible manufacturing systems that can quickly switch between different vehicle models, reducing setup times and allowing for more efficient production runs. This adaptability is supported by a strong emphasis on quality and continuous improvement, ensuring high standards are maintained even in low-volume production.

These examples underscore the importance of adapting Lean principles to the specific challenges and opportunities of HV/LV production environments. By focusing on reducing waste, enhancing flexibility, and fostering a culture of continuous improvement, organizations can achieve significant gains in efficiency, quality, and customer satisfaction.

Best Practices in Waste Identification

Here are best practices relevant to Waste Identification from the Flevy Marketplace. View all our Waste Identification materials here.

Did you know?
The average daily rate of a McKinsey consultant is $6,625 (not including expenses). The average price of a Flevy document is $65.

Explore all of our best practices in: Waste Identification

Waste Identification Case Studies

For a practical understanding of Waste Identification, take a look at these case studies.

Logistics Waste Reduction Initiative for High-Volume Distributor

Scenario: The organization operates within the logistics industry, specializing in high-volume distribution across North America.

Read Full Case Study

Lean Waste Reduction for E-commerce in Sustainable Products

Scenario: The organization, a mid-sized e-commerce platform specializing in sustainable building materials, is struggling with operational waste leading to margin erosion.

Read Full Case Study

Lean Waste Elimination for Forestry & Paper Products Firm

Scenario: A forestry and paper products firm in the Pacific Northwest is grappling with excess operational waste, leading to inflated costs and decreased competitiveness.

Read Full Case Study

Lean Waste Reduction for Infrastructure Firm in Competitive Landscape

Scenario: An established infrastructure firm in North America is grappling with the challenge of identifying and eliminating waste across its operations.

Read Full Case Study

Waste Elimination in Telecom Operations

Scenario: The organization is a mid-sized telecom operator in North America struggling with the escalation of operational waste tied to outdated processes and legacy systems.

Read Full Case Study

E-commerce Packaging Waste Reduction Initiative

Scenario: The organization is a rapidly expanding e-commerce platform specializing in consumer electronics, facing significant environmental and cost-related challenges associated with packaging waste.

Read Full Case Study




Flevy is the world's largest knowledge base of best practices.


Leverage the Experience of Experts.

Find documents of the same caliber as those used by top-tier consulting firms, like McKinsey, BCG, Bain, Deloitte, Accenture.

Download Immediately and Use.

Our PowerPoint presentations, Excel workbooks, and Word documents are completely customizable, including rebrandable.

Save Time, Effort, and Money.

Save yourself and your employees countless hours. Use that time to work on more value-added and fulfilling activities.




Read Customer Testimonials

  •  
    "I like your product. I'm frequently designing PowerPoint presentations for my company and your product has given me so many great ideas on the use of charts, layouts, tools, and frameworks. I really think the templates are a valuable asset to the job."

    – Roberto Fuentes Martinez, Senior Executive Director at Technology Transformation Advisory
  •  
    "As a small business owner, the resource material available from FlevyPro has proven to be invaluable. The ability to search for material on demand based our project events and client requirements was great for me and proved very beneficial to my clients. Importantly, being able to easily edit and tailor "

    – Michael Duff, Managing Director at Change Strategy (UK)
  •  
    "If you are looking for great resources to save time with your business presentations, Flevy is truly a value-added resource. Flevy has done all the work for you and we will continue to utilize Flevy as a source to extract up-to-date information and data for our virtual and onsite presentations!"

    – Debbi Saffo, President at The NiKhar Group
  •  
    "FlevyPro provides business frameworks from many of the global giants in management consulting that allow you to provide best in class solutions for your clients."

    – David Harris, Managing Director at Futures Strategy
  •  
    "My FlevyPro subscription provides me with the most popular frameworks and decks in demand in today’s market. They not only augment my existing consulting and coaching offerings and delivery, but also keep me abreast of the latest trends, inspire new products and service offerings for my practice, and educate me "

    – Bill Branson, Founder at Strategic Business Architects
  •  
    "As an Independent Management Consultant, I find Flevy to add great value as a source of best practices, templates and information on new trends. Flevy has matured and the quality and quantity of the library is excellent. Lastly the price charged is reasonable, creating a win-win value for "

    – Jim Schoen, Principal at FRC Group
  •  
    "The wide selection of frameworks is very useful to me as an independent consultant. In fact, it rivals what I had at my disposal at Big 4 Consulting firms in terms of efficacy and organization."

    – Julia T., Consulting Firm Owner (Former Manager at Deloitte and Capgemini)
  •  
    "Last Sunday morning, I was diligently working on an important presentation for a client and found myself in need of additional content and suitable templates for various types of graphics. Flevy.com proved to be a treasure trove for both content and design at a reasonable price, considering the time I "

    – M. E., Chief Commercial Officer, International Logistics Service Provider



Download our FREE Strategy & Transformation Framework Templates

Download our free compilation of 50+ Strategy & Transformation slides and templates. Frameworks include McKinsey 7-S Strategy Model, Balanced Scorecard, Disruptive Innovation, BCG Experience Curve, and many more.