Lean Manufacturing Stanley Furniture Efficiency Program ...

Stanley Furniture shows reasonable results for the quarter and highlights its lean manufacturing efficiency program, which has resulted in better working capital performance and higher cash flows from inventory reductions. ...

... "We are very pleased with strong cash flow for the first half of 2006 and the progress we have made in our continuous improvement efforts using lean manufacturing principles. These efforts have already resulted in a significant decrease in inventories while improving customer service levels and we believe we are laying the ground work to further improve processes and efficiencies. " ...

Lean Manufacturing Stanley Furniture Efficiency Program: Via Stanley Furniture: Stanley Furniture Announces Second Quarter 2006 Operating Results ...

Stanley is committed to lean manufacturing as a means of continuous improvement, as shown in its first quarter earnings announcement. ...

Comments on Stanley's lean manufacturing program from its first quarter management discussion: "Recently, we began reinvigorating our continuous improvement efforts using lean manufacturing principles, to improve processes and efficiencies. Near term, as these efforts allow us to continue reducing inventories, we anticipate lower production levels and operating margins. How quickly and to what extent we are able to lower costs, improve quality and reduce inventories is difficult to project, but we are confident this will position the Company to better compete primarily as a domestic manufacturer, execute our strategy and deliver value, concluded Scheffer. "

Stanley has created a competitive advantage through its on-shore manufacturing capability. This flexible blend of manufacturing capabilities is discussed in the 2005 annual report. ...

Stanley's Blended Manufacturing Strategy: Cellular Lean Manufacturing: "Central to executing this blended strategy are our four U.S. factories – domestic manufacturing capabilities we regard not only as our core competency but also a competitive advantage. Very simply, the ability to manufacture an extensive product line – accounting for some two-thirds of our revenues – in close proximity to our U.S. customer base is critical. We don't believe supply chains, which begin on the other side of the world can match our average shipping rate: less than 14 days.

To provide our products and support this broad distribution network, we have implemented a blended operating strategy combining efficient and flexible manufacturing processes with offshore sourcing of component parts and finished goods. We incorporate selected imported component parts and finished items in our product line to lower costs, provide design flexibility and offer a better value to our customers. We emphasize continuous improvement in our manufacturing and sourcing processes to enable us to continue providing competitive advantages to our customers, such as quick delivery, reduced inventory investment, high quality and value.

These manufacturing processes produce smaller, more frequent and cost-effective runs. We focus on identifying and eliminating manufacturing bottlenecks and waste, employing statistical process control and, in turn, adjusting manufacturing schedules on a daily basis, using cellular manufacturing in the production of components and improving our relationships with suppliers by establishing primary supplier relationships. In addition, a key element of our manufacturing processes is to involve all Company personnel, from hourly associates to management, in the improvement of the manufacturing processes by encouraging and responding to ideas to improve quality and to reduce manufacturing lead times. Furthermore, each of our manufacturing facilities is focused on compatible products to improve quality and lower production costs. "