1. What evidence does the case offer regarding Esterline's success?

What factors appear

to have contributed to Esterline's performance?
Evidence that case offers regarding success of Esterline are:
They sold 12 non-aligned companies. This allowed them to
reduce their industrial mix from 10 markets down to two:
commercial aerospace and defence. Also their thirty new
acquisitions made between 1999 and 2005 strengthened
Esterlines targeted market-product position.
Esterline closed the year 2005 with revenues of $835 million and
income from continuing operations of $51 million; compared to
2004 with revenues of $614 million and income from continuing
operations of $29 million. By the end of 2005, Esterline had 34
business units and employed 7,500 people. Their 2006 revenues
were likely to exceed $1 billion.
In 2005, the company achieved Tier-1 supplier status with two of
its important customers: Boeing to produce the 787 overhead
panel control cockpit system, and Airbus to produce the sensor
suite for the TP 400M turboprop.
Esterline could accomplished this by stressing internal new
product development, supplemented with targeted acquisitions.
Their implementation of lean production were key for the
success
Few lean initiatives implemented by Esterline were
Series of training programs on lean techniques for employees
Switch from Jumbled Flow with Batch-and-Queue Scheduling to
Linear flow for product families.
Time based material delivery system - water spider.
Improvement in ordering system.
White board scheduled display.
Inspection work brought into flow of the cell.

2. How does lean manufacturing differ from more traditional

approaches to production? What outcomes can a company
expect from an effectively implemented lean manufacturing
initiative?
Lean manufacturing is a scientific and systematic approach to a
production system rather than blind following by traditional
approaches.
Lean approach
Driven by customer orders,
basically pull
Problems viewed as opportunities
for improvement by using tools
like RCA
WIP,
other
inventories
and
defects leading to rework viewed
as wastes, that need to be
eliminated
Every employee is empowered to
make decisions and trained to
improve the processes Both
top-down and bottom-up type of
organisation
Processes are continuously tried
to be improved and new better
benchmarks (SOPs) are made

Traditional approach
Driven
by
sales
forecast,
basically push
Problems viewed as something to
cover up and not as an
improvement opportunity
WIP,
other
inventories
and
defects leading to rework are
viewed as unavoidable
Decisions made mostly by upper
management.
Top-down
approach is followed.

Existing SOPs are tried to be

followed by all, without looking
for
improvement
unless
a
process breaks down
Focusses on building processes Focusses on training people not
that are error-proofed
to make any mistakes

Outcomes that a company can expect from an effectively implemented

lean manufacturing initiative are:

Cost reduction and improvement of productivity through elimination of

wastes such as excessive inventory and excessive workforce.

Lower lead times, higher quality and better customer focus

Elimination of overproduction through demand-supply matching using

lean tools such as Kanban system , Heijunka , reduction of waste and
excessive inventory, JIT etc.

Production smoothing: Production in Accordance with Market Demand

Elimination of wastes, defects and an easy flow of value