1 employ improvement initiatives lean enterprise 101: a short course

1 Employ Improvement Initiatives

Lean Enterprise 101: A Short CourseLean Enterprise 101: A Short Course


Lean Enterprise OverviewLean Enterprise Overview

Lean Enterprise: An Integral component of Operational Excellence where the Lean Principles are applied to the entire company, and external value chain -- Customers and Suppliers

Why Lean and Why Now?

• Lean is not new, Toyota has been doing over 40 years

• Integral part of an Operational Excellence strategic plan

• Customers are asking for it, some are forcing it

Purpose of this Lean Module?

• Describe Lean Enterprise fundamentals & principles

• Understand basic Lean Enterprise tools

• Outline the elements of a Lean Enterprise system

• Provide a basis for Lean Enterprise implementation


History of Lean Thinking History of Lean Thinking

Toyota Production SystemOHNO

Craft

Eli WhitneyInter-changeable

Parts

Taylor / GilbrethScientific

Management

US Supermarkets

DemingQuality Management

System

ToyodaJidoka

Assembly Lines

Waste Elimination

Vertical Integration

Synchronization

Ford

SMED Shingo


• Improve Processes for:– Increased Market Share

– Profitability

– Cash Flow

– Competitive Advantage

– Future Growth in an Ever Changing Market

Lean Enterprise FundamentalsLean Enterprise Fundamentals

Why go “Lean”?Why go “Lean”?

Benefits of a Lean Enterprise: Bigger return on Participative Pay Program Easier completion of daily tasks Better communication Improved morale Easier to schedule work Less clutter in workplace Right parts available when you need them


The activity of creating processes which are highly responsive and flexible to customer demand requirements. The central concept of Lean is the identification and elimination of all forms of waste.

1) Specify value in the eyes of the customer

2) Identify value stream and eliminate waste

3) Make value flow at pull of the customer

4) Involve & empower employees

5) Continuously improve in pursuit of perfection

Lean Enterprise FundamentalsLean Enterprise Fundamentals

What is the essence of “Lean”?What is the essence of “Lean”?

Lean PrinciplesLean Principles


Changing Market RealityChanging Market Reality

Cost + Profit = Selling Price

Selling Price - Cost = Profit

We Made the We Made the Numbers!Numbers!

But at What Cost?But at What Cost?


A Powerful MarriageA Powerful Marriage

• Waste elimination• Flow, Flow, Flow• Pull of the customer

• Variation reduction• Scrap / rework elimination• Process control

SpeedSpeed AccuracyAccuracy++

Lean ExpertsLean Experts Black BeltsBlack Belts

Successful Integration and Deploymentwill Yield Dramatic Improvements


The Lean Enterprise HouseThe Lean Enterprise House

Customer• VOC• Takt• QFD

JustIn

Time

BuiltIn

QualityQuality Systems• Autonomation• Mistake-proofing

People• Policy Deployment• HP Teams

• Values• Org development

• Steering Committee• Design Teams

• Kaizen• Multi-process

• Safety• Process improvement• Ergonomics

Materials Systems• Production Smoothing• Flow / Pull

• Line Design• Kanban• SMED• P-O-U

Stability• Six Sigma• Visual Controls• Standard Work• DFM• TPM


Identify and Link the Value Chain Identify and Link the Value Chain

Engineering

Suppliers

Production

Test

Support

Customer

Administration

The pieces of the chain are already there.

Supplier Engineering Production Test

Administration Materials Support

Customer Customer

Make each process efficient and effective, linking those processes into an interdependent chain focused on flow and creating value for the customer.

Materials

F L O W


CUSTOMER

VALUE

Information Stream

Market& Sales

Design SuppliersManu-

facturingAssy Test

Material Flow

The Value StreamThe Value Stream


Value Added Activity An activity that Changes the size, shape, fit , form, or function of material or information (done right the 1st time) to meet customerrequirements.

Non-Value Added ActivityAll other activities that take time or resources or does not satisfy customer requirements

Defining ValueDefining Value

Value Added

Required Waste

Pure WasteIdle!


Develop the Ability:

• To Recognize and Identify Waste

• To Have the Courage to Call It Waste

• To Have the Desire to Eliminate It

• Eliminate the Waste

• Understand That Waste Simply – Raises CostRaises Cost

– Produces No Corresponding BenefitProduces No Corresponding Benefit

– Threatens All of Our JobsThreatens All of Our Jobs

Lean Mission StatementLean Mission Statement

You can’t Eliminate What You Can’t FindYou can’t Eliminate What You Can’t Find


Waste Of:• Defects• Overproduction• Transportation• Waiting• Inspection (mass) • Motion• Processing (Too Much)

Ask “Why?” Five Times to Fix it so it never comes back!

The Seven WastesThe Seven Wastes

The largest and most difficult waste to find is

time... and one can never get it back ... - Henry Ford

If we eliminate these wastes…If we eliminate these wastes…We can increase output and shrink lead timeWe can increase output and shrink lead time

D.O.T. W.I.M.P.


“Conceptual Grasp” of Lean“Conceptual Grasp” of Lean

CADENCE:

The measure or beat of movement.

SYNCHRONIZE:To cause to operate with exact coincidence in time and rate.

BALANCE:Arrange so that one set of elements exactly equals another.

FLOW:A smooth uninterrupted movement.

FLEXIBILITY: Ready capability to adapt to new, different or changing requirements.


Takt TimeTakt Time

Available Time Customer Demand

TAKT Time =

Example - Product demand = 2000 units per month or 100 units per day

Available work time per day = 6.5 hours or 390 min’s per day

TAKT time = 390 min’s100 units

= 3.9 min’s/unit


Shingo ModelShingo Model

Operations

Operations

Proc

esse

s

Proc

esse

s

Space & Time

Analyze Separately, Solve Together


THE ACTIVITY OF THE PRODUCT:– As a percent of total product thru-put time, what is the measure of actual value added

time?

THE ACTIVITY OF THE OPERATOR:– As a percent of the total available work time, what is the measure of actual value added

time?

THE FLEXIBILITY OF THE OPERATION:– What is the time “required to change-over”

-Machine Setup -Level of Cross Training

-Process Changeover -Ease of Operation

THE METHOD OF MEASURING PERFORMANCE:– What are the current set of problems?– What are the vital operating statistic of the operation?

CONCENTRATE ON THE FUNDAMENTALS!CONCENTRATE ON THE FUNDAMENTALS!

Dissect the Current ConditionDissect the Current Condition


Total Thru-put Time

What are the four things the PRODUCT can be doing?What are the four things the PRODUCT can be doing?

50 - 80% of the Gain in Lean is WASTE elimination!

Activity Of The ProductActivity Of The Product

Storage

Transport

Inspect

Process

Which Element(s) Adds Value?Which Element(s) Adds Value?


Example - Activity of the Product

Distribution of Total Time

Value added processeing time

29%

Inspection/Test1%

Non value added processeing time

15% Transportation22%

Storage 33%


Full Work Analysis

The Key to Sustaining the Gains

Building Blocks of Standard Work

Activity of the PeopleActivity of the People

Pure Waste

Required Waste

Value Added

Which Element(s) Adds Value?Which Element(s) Adds Value?


Which Activities Add Value?Which Activities Add Value?

Adding ValueAdding Value

If not value-added, then what type of waste is it?If not value-added, then what type of waste is it?

• Work waiting for other work to be batch processed

• Work in the in-basket / stockroom

• Company specified testing / sign off

• Loading work in a test fixture or chamber to be processed

• Moving from one operation to another operation

• Customer specified testing

• Cleaning parts before processing

• Waiting for previous parts to finish

• Inspecting a part after an operation

Value Added: Customer Cares Changes the thing CORRECT THE FIRST TIME!


Will Lean Help You? Will Lean Help You? S

tore

s Value Added Steps

Non Value Added Steps

DAY 0 DAY 76

Elapsed Time =76 Days

Value Added2 Days

Total Activity = 4.5 Days

Non-Value Added2.5 Days

Wait or Queue Steps(“White Space”)

How do I get rid of the

white space?


DefinitionsDefinitions

Lead Time

It is the total elapsed time from when a customer places an order to the time the customer receives that order.

Throughput Time

The total amount of time it takes for a process to complete one product or service.

Cycle Time

The total amount of clock time required to complete one part - including walking, load/unload, inspect, etc. and return to start.


Spaghetti ChartSpaghetti ChartO

ut

to S

tam

pin

g/st

ores

Widgets: Line 3

Balance

HandFinish

J&L

Lathe

SlantNC Lathe

Hone

Puma NC Lathe MazakHand Lathe

Kellenberger Shaudt ODGrind Monarch

HandLathe

ID Grinder

Out toCurvics

In fromCurvics

InspPre-Assy

Out to Processes In From Processes

In From Processes

Start HereIn fromZeiss (Loop 2)

Out to Processes

Loop 3 FlowOutside Processes

Spaghetti Chart Instructions Obtain current layout of area Draw sequence of the process as the product

travels through the process Note WIP quantities at each process step Note loopbacks and lack of sequential flow

1

16

24

0

15

1

4

8

0

164

4

8


Lean Cell Design - Product FlowLean Cell Design - Product Flow

New Layout for Parts and Tools

RM Raw Material Deliveredvia Kanban Signal

FGUse Cell Pulls

via Kanban Signal

P-O-UHardware

MaterialFlow

P-O-USupermarket

P-O-UTooling

Test FGMach 4

RawMach 1

Mach 3

Mach 2

Product Flow

Cell Example - Product Flow

Flow fits product familyAll processes within cell

Point-of-use details Only specialty tools in crib Tools/equipment point-of-use

Cell Design Enables Product Flow.


1. Identify Work Content as Internal and External Activity

2. Convert Internal to External Activity

3. Eliminate or Reduce all Remaining Activity

Ext Int Ext

Ext Int Ext

Ext Int

Shingo’s SMED (Single Minute Exchange of Dies)

Quick Set-up = FlexibilityQuick Set-up = Flexibility


• Preparation and Organization

• Mounting and removing tools, dies, fixtures, components, load programs

• Centering, locating, dimensioning, alignment

• Trial runs, tweaking, tuning, and adjustments

Elements of SetupElements of Setup


• It is a proactive, team approach for maintenance

• It is the responsibility of everyone, not just the

maintenance department

• Ensures safety and effective operation of equipment

• Keeps equipment from breaking down

• Planned repairs rather planned failure

• Prevents deterioration and prolongs the life cycle of the

equipment

How Does TPM Differ FromRegular Maintenance?


The goal is to get to Scheduled Maintenance

Stages of Maintenance


Purpose

Create a consistent method to measure how

safely and efficiently high quality low cost

products can be manufactured

Goal

Arrange people, materials, and capital within a

facility so that waste is eliminated

Standardized OperationsStandardized Operations


Build in a Quality PlanBuild in a Quality Plan

Will SPC be used on line and where?

Has a FMEA been performed on Process?

Are Countermeasures in place for line stops?

Is the quality system linked through the value stream?

Does the Process conform to all governing procedures?

Have all Documentation Updates to change process been performed?


Lean Material ReplenishmentLean Material Replenishment

All the activity associated with the replenishment system is non-value added (waste) since it does not physically transform, convert or change the shape or functionality of the product to meet customer requirements.

Target for improvement should be to eliminate or streamline each activity associated with the replenishment system, while retaining or developing the ability to obtain what is needed, when needed, in the amount needed.


Hybrid Material SolutionsHybrid Material Solutions

MRP without Kanban

•All push no Pull

• all system planning assumes execution as planned

• the only consumption-based pull in for unplanned usage

Kanban without MRP

•All Pull no Push

• hard to pull from long lead time suppliers or batch processes

• hard to manage calculations of Kanban when demand changes

• System designed with historical data may not fit unknown future


Kanban / MRP IntegrationKanban / MRP Integration

Forecast

Ship

Production Planning

DemandManagement

Master Scheduling

On OrderPurchasing

BOM’s

Routings

Suppliers

Warehouse POU Stores

Final Assy

POU Stores

Sub Assy

Rough Cut Capacity Planning

Current Inventory MRP

MRP Planning

Kanban Pull

Pull Signal

Pull Signal

Pull Signal


Do you ever . . .Do you ever . . .

• Help somebody find or return a tool?

• Wonder which document is the latest?

• Lose your pen on your desk or bench?

• Spend time looking for something just filed?

• Wonder how others do this process?

• Fill in for peers and wonder how they set up tests?

• Wonder how you are doing on group goals?

• Wonder what your priorities are?


The use of signs, measurements, pacing devices, real-time visual / audible feedback via counters, signals, cards (KANBAN), color-coding, speakers, alarms, clean and orderly, downtime clocks, facilities and other aids to allow for...

The easy difference between…

Normal (LEAN & GOOD) conditions

AND Abnormal (WASTEFUL & HARMFUL) conditions

Abnormalities are made obvious and ugly so as to compel correction through effective counter measures

Good Visual Control Allows Problems No Place To HideGood Visual Control Allows Problems No Place To Hide

Visual Management SystemVisual Management System


The Five S’sThe Five S’s

PurposeMethodology for creating and maintaining an organized, clean high performance workplace.

ComponentsSort

Get rid of what is not needed.

Storage Arrange and Identify for ease of use.

Shine Clean Daily. Clean up what’s left

Standardize Eliminate cause, Standard methods.

Sustain Set discipline, plan, schedule

Areas of Concern Operators Materials Machines Methods Information


Five S Scoring Criteria


Displays and ControlsDisplays and Controls

Visual Displays:Communicate important information, but do not control what people or machines do.

Make up the first two levels of the pyramid.

Visual Controls:Communicate information so that activities are performed according to standards.

Make up the top four levels of the pyramid.

Visual displays and controls create a common visual language in the workplace


Levels of the Visual BusinessLevels of the Visual Business

WORKPLACE ORGANIZATION

Share Information

Share Standards at the Site

Build Standards into the Workplace

Warn about Abnormalities (Build in alarms)

Stop Abnormalities (Prevent defects from moving on)

Prevent Abnormalities (Error-Proof)

1

2

3

4

5

6

Sort, Store, Shine, Standardize, and Sustain5S Workplace Organization

Visua

l Con

trol

Visua

l Dis

play

Safety


Top Management

Middle Management

Supervisors

Workers

Tactical

Strategic

LeanLean

By Involving People…By Involving People…

We Empower People to Grow the BusinessWe Empower People to Grow the Business

NEW REALITY WITH TEI

Total Employee InvolvementTotal Employee Involvement


Lean PrinciplesLean Principles

1) Specify value in the eyes of the customer

2) Identify value stream and eliminate waste

3) Make value flow at pull of the customer

4) Involve & empower employees

5) Continuously improve in pursuit of perfection


Identify the source of current problem set

- Parts - Process

- People - Design

Develop a rolling “top 10” action list:– Segregate and classify identified problems

• easy, moderate, difficult• we control, we do not control• low, medium, and high cost• low, medium, and high benefit

– Identify 10 problems that must be corrected in the next 90 days

Sustaining PerformanceSustaining Performance

Monitoring the vital statistics– Daily and hourly scheduled quantities– Daily and hourly output quantities– Daily assigned direct and indirect labor– Daily attend direct and indirect labor– Daily overtime hours allowed– Average labor content per unit– Daily planned and actual cycle time– Planned and actual throughput time– Daily line stop minutes– Daily % defect free pieces

How do we create a Management System that Sustains How do we create a Management System that Sustains Continuous Improvement? (Refer to “SQS”…)Continuous Improvement? (Refer to “SQS”…)


Video: Look At Things In A New WayVideo: Look At Things In A New Way

Joel Barker Video here

1 employ improvement initiatives lean enterprise 101: a short course

Documents

lean principles

lean enterprise system

essence of lean

lean module

basic lean enterprise

central concept of lean

value flow

short course slide