1 lean thinking mgmt 511. 2 lean thinking a philosophy principles practices for the design,...
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Lean Thinking
MGMT 511
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Lean Thinking
• A philosophy
• Principles
• Practices
• For the design, operation, management, control and continuous improvement of a production system.
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Objectives of Lean
• Produce the …– Highest quality– At the lowest possible cost– Within a short cycle time
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Lean
• Pioneered and developed by Toyota
• TPS – Toyota Production System
• Womack and Jones invented the name Lean
• 3 important principles– Minimize waste– Continuous improvement– Respect for workers
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Lean
• Lean is a philosophy that recognizes waste as the primary driver of cycle time, cost, and quality
• and employs techniques to continually drive out waste in processes.
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Waste is ‘anything other than the minimum amount of equipment,
materials, parts, space, and worker’s time, which are absolutely essential to
add value to the product.’
— Shoichiro Toyoda President, Toyota
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Becoming lean is the process of eliminating waste with the goal of creating value.
It is not just about waste, it is also about value.
Lean
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ContrastTraditional Lean
• Producer “push”
• Movement of materials
• High volume
• Inspection
• Expert-driven
• Decomposition
• Periodic adjustment
• Large lot sizes
• Statistical Quality Control
• Customer “pull”
• Flow of value
• Flexible response
• Prevention
• Knowledge-driven
• Integration
• Continuous improvement
• Lot size of 1
• Quality at the source
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Statistical Quality Control
Traditional Lean
• Inspection is expensive
• Infer from samples to save costs
• Inspect quality into the product
• Why? Can’t anyone do it?
• Inference implies risk of errors. Why are defects acceptable?
• Build it into the product
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Historical Context• Selected elements of the TPS implemented
over 3 decades– Pull– Kanban (card) system– Production leveling– Reduced set-up time– Kaizen (continuous improvement)– Poka-yoke (error proofing)– Adnon (visual display)
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Example – Kanban
1950’s – First Kanban experiments
1960’s – Kanban introduced company-wide
1970’s – Kanban introduced to suppliers
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5 Principles of Lean
• Customer value: precisely specify value by product and service
• Value stream: identify the stream for each product or service
• Flow: no interruption• Pull: customer pulls value• Pursue Perfection: don’t compete
Source: Womak and Jones
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Value Definition
• Define customer needs
• Opposite of waste
• Use as metric
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Value Stream Analysis
• Value Stream Map
• Critically assess Value-Added at each step
• Eliminate or minimize Non-Value-Added activities.
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Value Added Activities
• Product or service is transformed into a state required for the customer.
• Activities for which the customer is willing to pay.
• VA
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Non-Value Added Activities
• Activities which consume resources but create no value in the eyes of the customer.
• Customer is not willing to pay for these.
• NVA
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Non-Value Added but Needed (or Necessary) Activities
• Activities causing no value added, but…
• Which cannot be eliminated based on current state of technology or thinking.
• NVA-N
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Flow
• Continuous flow through the value stream.
• Make each product, each day, in direct proportion to demand.
• Move from traditional batching to small lot (or 1 unit) flow.
• Stability through reliability, quality and standardized work
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Pull
• Pull the product through the value stream
• Authorize production – customer demand drives the process
• Cap WIP
• Kanban – signaling for required parts as they are needed
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Perfection
• Create a clear vision of perfection– Production ideals– Customer value
• Make waste visible and evident
• Problem solve
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What is Waste
• Any activity that is not adding value in the creation process of the product or service.
• Non-value added
• Non-value added but necessary
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7 Types of Waste
• Defects in outputs• Overproduction: not needed• Inventories: for consumption or processing• Unnecessary Processing• Unnecessary Movement of people• Unnecessary Conveyance of output.• Waiting – for information, people, equipment
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The Hidden Factory
• Stockrooms
• Material movers and moving equipment
• Expeditors
• Scrap
• Rework
• Obsolescence
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Commonly Used Tools
• 5 S
• The visual factory
• Kaizen
• Poka Yoke
• Total Productive Maintenance (TPM)
• Single minute exchange of die (SMED)
• Takt time
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5 S
• Simplify or Sort (seiri) – needed vs. unneeded items
• Straighten or Set (seiton) – keep in correct place• Scrub or Shine (seiso) – keep clean and tidy• Stabilize or Standardize (seiketsu) – use standard
methods• Sustain or Self-Discipline (shitsuke) – do not fall
back to old way of doing things
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The Visual Factory
• Make problems visible
• Charts to show performance
• Visual production and schedule boards
• Kanban (visible card signal)
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Kaizen
• Continuous Improvement
• Improvements may be small
• However, many small improvements over time add up to major improvement
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Common Poka-Yoke Examples (from John Grout’s Poka-Yoke Web Page)
“Mistake Proofing”
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Total Productive Maintenance (TPM)
• Impact on waste - breakdowns, setups, reduced speed
• TPM – Identify ways to maximize equipment effectiveness
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Single Minute Exchange of Dies(SMED)
• Original term now extended to all setup time reduction efforts
• Fast setup or change-over
• Allows flexible use of machines – smaller lot sizes, reduced inventory
• Cost reduction
• More effective use of machines
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Takt Time
• The rhythm of flow through a value stream
• Available weekly, daily or shift time– Divided by…
• Anticipated average weekly, daily or shift demand
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Factory Physics
• Increase the velocity of flow of material
• Increasing flow is accompanied by reduction in inventory
• As velocity increases, the cost of the hidden factory decreases
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Benefits of Lean
• Cost savings
• Revenue increases
• Investment savings
• Workforce improvements
• Uncovering problems
36Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 12S-13 © 1998 by Prentice Hall, Inc.
A Simon & Schuster CompanyUpper Saddle River, N.J. 07458
Push versus Pull
• Push system: material is pushed into downstream workstations regardless of whether resources are available
• Pull system: material is pulled to a workstation just as it is needed
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5 Tools for Improving Flow
• Process observation sheet
• Process flow diagram (we have done)
• Physical process map
• Time Value Map
• Takt Time (we have discussed)
38Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 12S-8 © 1998 by Prentice Hall, Inc.
A Simon & Schuster CompanyUpper Saddle River, N.J. 07458
• Management philosophy of continuous and forced problem solving
• Supplies and components are ‘pulled’ through system to arrive where they are needed when they are needed.
What is Just-in-Time?
39Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 12S-9 © 1998 by Prentice Hall, Inc.
A Simon & Schuster CompanyUpper Saddle River, N.J. 07458
• Attacks waste– Anything not adding value to the product
• Customer’s perspective
• Exposes problems and bottlenecks– Caused by variability
• Deviation from optimum
• Achieves streamlined production– By reducing inventory
What Does Just-in-Time Do?
40Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 12S-32 © 1998 by Prentice Hall, Inc.
A Simon & Schuster CompanyUpper Saddle River, N.J. 07458
• Traditional: inventory exists in case problems arise
• JIT objective: Eliminate inventory• JIT requires
– Small lot sizes– Low setup time– Containers for fixed number of parts
• JIT inventory: Minimum inventory to keep system running
Inventory
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Lean
• Continues from Just-in-time discussed in the text.
• Most recent approach to reducing waste and speeding the flow of product or service to the customer.
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What Lean is Not
• A quick fix.
• Easy to do.