VALUE STREAM MAP

Music Analogy• Operating a factory may be compared to

playing music in an orchestra.– Rhythm – Cycle Time

– Tone – Quality operation of each process

– Harmony – Line balance

– Music Score – Standard Work

• Standard work is a tool to achieve maximum performance with minimum waste.

Value Stream Because Value stream map gives a visual

representation of material and information flow for a product flow ,it is an indispensable tool for managing process improvements. The VSM will help in understanding

Wastes which inhibit the flow Information flow Material Flow Using VSM anyone should be able to discern

information on actual material and information flow

Value Stream Steps

1. Commit to lean

2. Choose the value stream

3. Learn about lean

4. Map the current state

5. Identify the lean metrics

Major steps in Value Stream

DEMAND FLOW LEVELING

TAKT time

Pitch

Buffer Inventory

Safety Inventory

Finished goods super market etc

Continuous flow

Work cells

Line balancing

QCO

KANBAN

FIFO lanes

Supermarkets etc

Paced withdrawal

Heijunka box

Runner etc

i

Date :

Champion:

Team

AAAAAAAA

Takt Time Cont. Flow

Pitch Work place Std. work

1

1

2

3

4

Prod.3

5

Lead Time Total Cy. time WIP On time delivery Ex.PPM rate UptimeBase Base Base Base Base BaseProposed Proposed Proposed Proposed Proposed Proposed

!. Commitment to lean 2 . Choose the value stream 3. Learn about lean 4. Map the current state

Current State Map

i

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istKaizen Proposal

1St 2nd 3rd 4th7

8

6

6 Takt time = Pitch =

5.Identify lean metrics, 6- Map the future state map, 7 Create Kaizen plans 8-Implement Kaizen plans

Future State Map

DEMAND STAGE

Selecting Value Stream

There are 2 reliable methods for deciding the value stream

• Product Quantity - Based on volume

• Product routing - Based on process routes

Selecting Value Stream

# Item QtyCumulative Qty

Cumulative%

1 W 29000 29000 41%2 R 26000 55,500 79%3 Y 3000 58,500 83%4 I 3000 61,500 87%5 P 2000 63,500 90%

Volume Product rc c m d od g I20000 W12000 R10000 Y3600 I3300 P

Product Routing

Product Volume

Metrics

Lean MetricsInventory turns

Days of Inventory on hand

Defective parts per million [DPPM] or six sigma

Total value stream WIP

Total Cycle time

Uptime

On time delivery

First time through capability

Health and Safety hazard [ OSHA]

Inventory turnover rate is a metric that measures how fast your company sells the products you make- that is, how efficient your marketing efforts are. It is given by the ratio of cost of goods sold to year end inventory

Most companies struggle with low, single-digit ITO rates. The goal of most lean organizations is to achieve at least a double-digit ITO rate.A few exceptional companies are able to achieve triple-digit ITO rates across all their product lines.

Lean Metrics

Cycle Time is the time elapses from the beginning of an operation until it’s completion

Total cycle time is the total of the cycle times for each individual operation in value stream. This is also called the value added time

[VAT]

Lean Metrics

Lead time is a metric that measures as to how long it takes for material to flow through the process once an order is released to the production floor

One other way to express total lead time [ LT] is the ratio of things in process [ TIP] to the average completion rate .Average completion rate can be found out from the no of jobs delivered to customer per day.One of the goals is to reduce TIP so that the work can be delivered fast

Lean MetricsAs an example in a particular department the no of quotes that were processed per day is 20 .Customer wanted quotes to be given within 3 days.

With allowances, it was decided to provide quotes within 2.4 days as target. The maximum no of Things in process [TIP]of quotes is

------------------

Lean Metrics

Machining De-burring Crimping Testing

5days 3days 7days

30 Min 10 Min 05 Min 90 Min

Lead time ----------- Total Cycle time -----------

Example

Lean Metrics

Uptime is a metric that measures as to how well an operation of a process uses it’s available time . It is given by the ratio of Actual operating time to the available production timeIn order to calculate actual operating time , every loss that diminishes the available time has to be taken into account . The common types of losses are-Change Over time -Idle time due to late delivery from an upstream process-Quality problems-Material Irregularities-Breakdowns

Lean Metrics

Machining De-burring Crimping Testing

Cumulative uptime ------------

Example

Avl time= 400 Min

C/O time =30 min

Av breakdown time=40 min

Avl time= 400 Min

C/O time =10 min

Av breakdown time=0 min

Avl time= 400 Min

C/O time =05 min

Av breakdown time=5 min

Avl time= 400 Min

C/O time =40 min

Av breakdown time=0 min

Uptime= ------- Uptime= -------Uptime= ------- Uptime= -------

Lean MetricsNo of days of WIP on hand between each operation is determined by ratio of actual quantity of parts to the total number of parts demanded by the customer daily

Machining De-burring testing Shipping

Customer

30000 Parts. month

Daily

I I I

1500 2500 250

Lead time based on WIP is --------------- days

Lean MetricsOverall equipment effectiveness (OEE) is a metric that measures the availability, performance efficiency, and quality rate of your equipment. It is especial1y important to calculate OEE for your constraint operation.

Equipment availability (EA) is given by the ratio of Operating time to the Net available time Performance Efficiency ( PE)time is the ratio of Standard cycle time to the operating time Quality Rate (QR) is the ratio no of good parts to the total no of parts producedOEE= EA x PE x QR

Lean MetricsAvailability Availability is the proportion of time equipment is actually available to do work out of when it should be available Suppose in an 8 hour shift, 45 minutes average is the planned downtime for preventive maintenance . Suppose also that non planned downtime includes 85 minutes for set up and 55 minutes for possible breakdowns and repairs , thenPlanned running time = 8(60)=435 MinutesActual running time = 435-(85+55)=295 minutesAvailability= Actual running time 295 ------------------------ = ----- = 0.678 Planned running time 435

Lean MetricsEfficiency Efficiency is the measure of how well a machine performs when it is running For example if the design cycle time is 35 sec per unit and the actual cycle time is 40 sec per unit The speed rate is = 35/40=0.875A machine may be running but not necessarily producing output for instance due to warming up or it is jammed etc. The measure of the operating time is computed asOperating rate=( Actual amount produced)( Actual cycle time) --------------------------------------------------------- (Actual running time) For example for 470 units , the actual running time is 295 minutes and the actual cycle time is 35 sec/ Unit The operating rate is = (470 X 35)/(295 X 60)= 0.929Now the measure of machine efficiency is a combination of the above rates and computed using E= Speed rate x Operating rate = 0.875 X 0.929= 0.8128

Lean MetricsQuality The third aspect of equipment effectiveness is rate of quality – the proportion of output from the equipment that is non defective and in conformance with requirements Actual units produced – Defective units produced Q= ------------------------------------------------------------ Actual units produced

For example if 4 units produced are defective then Q= 466/470=0.991

Overall Equipment Effectiveness [ OEE] is given by OEE= A x E x Q = 0.678 X 0.716 x 0.991 = 0.481

Lean Metrics

Machining De-burring Crimping Testing

Example

Uptime=0.95

Std time= 30 sec

Actual = 40 sec

Yield = 95%

Uptime=0.84

Std time = 50 sec

Actual =65 sec

Yield= 80%

Uptime = 0.99

Std time = 15 sec

Actual time= 30 sec

Yield =75%

Uptime=0.89

Std time = 30 minutes

Actual time = 65 minutes

Yield = 80%

OEE of Machining = ----------------

OEE of De- burring = ----------------

OEE of Crimping = ----------------

OEE of testing = ----------------

On-time delivery (OTD) is a metric that measures the percentage of units you produce that meet your customer's deadline. For this metric, a unit is defined as a line item on a sales order or delivery ticket.

customersthebyreceiveditemsordersaletotal

customersthebytimeonreceiveditemsordersaleofnumbertotalOTD

OTD provides a holistic measurement of whether you have met your customer's expectations for having the right product, at the right place, at the right time.

Lean Metrics

TAKT time is the rate at which a company may produce a product to satisfy customer demand

TAKT time = Available production time/ Total daily Qty required = Time/ Volume

Ex:Available production time/Day = 25,200 sec

Parts required per day = 420

TAKT time = 60 sec

TAKT time is the vision of an ideal state in which you have eliminated waste and improved the performance of the value stream to the point that you have achieved one piece flow

Lean Metrics

Another concept is operational TAKT time . This is a time which is faster than TAKT time to accommodate chronic system failure such as equipment failure, customer demand changes etc

Pitch is amount of time required to complete a pre determined pack out

quantity

Pitch= TAKT time x pack out quantity

Lean Metrics

Buffer inventory is the finished goods to meet the customer demand when customer ordering pattern changes or production can’t match the faster TAKT time .

Safety Inventory is the finished goods available to customer demand due to internal constraints such as breakdowns etc

Finished Goods Supermarket

Finished goods super market items are not replaced until they are removed . They are removed when customer orders them. This system is used when it is not possible to establish pure and continuous flow

Finished goods super market is a storage place to store a set level of finished goods and replenish them as they are pulled to fulfill customer orders .

1. Time: Process time,lead time, and value-added time.

2. Changeover time.

3. Typical batch sizes or practices.

4. Demand rate.

5. Percent complete and accurate.

6. Reliability.

7. Number of people.

8. Inventory.

9. Information technology used.

10. Available time.

Typical Office Metrics

FLOW STAGE

Flow Continuous flow is simply “ Move one and make one

” or “Move one small lot and make one small lot ”.This is Just in time philosophy of ensuring that upstream operation never makes more than required by a downstream process.

Continuous flow processing means - Only when needed - Just when it is needed - In exact amount needed

In process Supermarket

Where Obstacles to continuous flow exist,supermarket of work –in-process may be necessary . As the flow improves the requirement for supermarkets reduces. Supermarkets are suited when there is a commonality among the parts

Continuous Flow

Process A Process B Process CSupplier Customer

Move and Make One

CONTINUOUS FLOW

Process A(1 min.)

Process A(1 min.)

Process B(1 min.)

Process B(1 min.)

Process C(1 min.)

Process C(1 min.)

Process B(1 min.)

Process C(1 min.)

Batch Processing

Continuous Flow Processing

Lead time = First part out =

Lead time = First part out =

Push Push

- Shorter lead time - Drastic reduction of work process Inventory - Ability to identify problems and fix them earlier - Makes traditional production scheduling obsolete

Advantages of continuous Flow

However the cumulative effect would be affected for a continuous flow if the operations have some problems related to Lead time, Down time and Changeover time . So it may be necessary to have safety inventory

The Principles of work cells are

Arrange Processes sequentiallySet the cell up for continuous counterclockwise flow [ Promotes the use of Right hand for activities]Position machine close together , while taking safety into consideration for material and hand movement within a small areaPlace the last operation close to the firstCreate U , C or L shaped work cells

Work cells

Line balancingTypically some operations take more time than others leaving operators with nothing to do while they wait for the part.Line balancing is a process through which you evenly distribute the work elements within a value stream to meet TAKT time. It balances the work load of the personnel. If TAKT time changes we may have to rebalance the line.

A B EC D

CT = 50 s 10 s 47 s 30 s 65 s Total CT = 202 s, TAKT time = 60 s

Operators required = Total CT / TAKT Time = 202/60 = 3.36

To ensure continuous flow for progressing Piece by Piece or in small batches the processes are grouped in way for achieving minimum transport waste

To achieve this, a work cell is formed where the equipments and personnel are arranged in a process sequence and includes all operations to complete a product or a major production process

Work cells

Line balancing

Total CT = 202 s

50

10

47

30

65

0

10

20

30

40

50

60

70

A B C D E

Operator

CT

Takt time

(1) (1) (1) (1)

Total CT = 180 s

60 60 60

0

10

20

30

40

50

60

70

AB CD E

Operator

CT

Takt time

(1) (1) (1)

Operator Balance Chart

Current Proposed

Use standardized work

KANBANS

KANBANS

2. A Withdrawal KANBAN- Is a printed card which indicates the no of parts to be removed from a supermarket and to be supplied downstream

3. A Signal KANBAN – Is a printed card indicating the number of parts to be produced to replenish what has been pulled from the supermarket This KANBAN is used whenever the inventory level in the supermarket between the two processes drops to a trigger or minimum point. When the signal KANBAN arrives at a supplying process , it signals the change over and authorizes to produce a predetermined quantity .

KANBAN Sequence Board

R14 R19 R20 S 5 S 6 S 9 S 10 S 54

Often Jobs ( Cards ) are processed in the sequence they arrive at producer stage . When cards of different items arrive at once . In order to give priority , the cards which read the red region are given priority

Green

Yellow

Red

KANBANS

KANBAN Rules1.Downstream operations or cells withdraw items from

upstream operations or cells

2. Upstream operations or cells produce and convey only if KANBAN card is present

3. Upstream operations send only 100% defect products downstream

4. KANBAN cards move with material to provide visual control

5. Continue to try to reduce KANBAN cards in circulation to force improvements

An operator from downstream process brings a withdrawal KANBAN from withdrawal post box placed near the process to the Super market

The operator will pull the parts from the supermarket

The Production KANBAN is detached from the pallet of materials and in it’s place withdrawal KANBAN is attached

When the work begins at the down stream process , withdrawal KANBAN is placed in the withdrawal KANBAN post box

The operator will place production KANBAN in the KANBAN post box placed near the upstream process

KANBAN steps

At Each process both withdrawal and production KANBAN post boxes are placed

KANBAN Exercise

20

W

20

P

20

P

20

W

SHIPPING

Customer

Cell 2Cell 1

Customer

20

W

S

1

2345

Kanban Exercise

Customer orders ------------ Units by ------------------------- transaction

20 units are withdrawn from the ----------------------- by the customer

1

2

After shipper withdraws 20 units from the supermarket, He/She takes ------------------Kanban and drops at post box of ------------

3

4 Cell 2 operator takes -------------- KANBAN from the Cell 2 Post Box and --------------- 20 units from the ---------------- of ---------------

4 Cell 2 operator in turn takes out -------------- KANBAN from the pallet and replaces with ---------------- KANBAN before taking it to cell 2

5 Based on the above,Cell 1 operator takes ------------- KANBAN from the cell 1 Post Box to collect 20 units from the supermarket of ----------------

4 Cell 2 operator places the -------------- KANBAN in the post Box of -------------

FIFO lanes

Assembly II

Customized Part making

FIFO lane Icon

FIFO lane has the following characteristics

Holds a designated number of parts between the processes and sequentially loaded

Is created in such a way that it is difficult to draw anything other than the oldest inventory first

Uses signal to notify the upstream process to stop producing when the lane is full preventing over production

FIFO Exercise

When upstream process is having chronic failure ,FIFO method is useful since multiple value stream meet

Yes No

When upstream process is having good QCO methods ,FIFO lane method is useful

Yes No

FIFO method is useful for maintaining TAKT time

Yes No

Using FIFO lane method the space required will be more

Yes No

Leveling Stage

Heijunka• Heijunka is a tool for scheduling production quantity and product mix

based on customer’s long-term demand. Thus factory will produce at the rate of customer demand, making what the customer wants when the customer wants it.

• It is most counterintuitive principle of TPS.

• It involves process of stabilizing the system and creating evenness – a true balanced lean flow of work.

• It is important to eliminate Mura first, which is fundamental to eliminating Muri and Muda

Benefits of Leveling the Schedule

• Flexibility to make what the customer wants, when they want it.• Reduce the risk of unsold goods.• Balanced use of labor and machines.• Smoothed demand on upstream processes and the plant’s suppliers.

Traditional Batch & Push Production

Triangle Line

Circle Line

Square Line

Dispatch Line

Customer Order:

100 Squares

100 Circles

100 Triangles

Level Smooth Production

Triangle Line

Circle Line

Square Line

Dispatch Line

Customer Order:

100 Squares

100 Circles

100 Triangles

Production Temp & Takt Time

• Lean Factory sets pace of production to the rate of customer demand. Takt time is used to set the production tempo.

• Takt Time = Available Work Time/Customer Demand

• Takt time is the German musical term meaning time, musical measure, or bar.

Takt time – An example• Customer Demand

– 840 Squares– 420 Circles– 1260 Triangles

• Available Time– 2 Shifts × 7 Hours/Shift 3600 Seconds/Hour = 50400 Seconds/Day

• Takt Times– Squares: 50400/840 = 60 Seconds/Square– Circles: 50400/420 = 120 Seconds/Circle– Triangles: 50400/1260 = 40 Seconds/Triangle– Overall: 50400/2520 = 20 Seconds/Part

Leveled mixed-product production – takt time =120 seconds

Leveling• Customers do not order in a stable, predictable way. Yet the

foundations of Lean is a stable, leveled schedule.

• The leveled schedule for the first flow loop is created by production control even when the customer in not level.

• Heijunka is not true customer demand.

• Heijunka, is a self-imposed leveling for internal benefit of the value system.

Leveled Schedule• Heijunka schedule is achieved with a steady pitch

multiple times in the day.– Pitch is the time increment between when orders are

delivered and picked up, and the quantity to produce during the pitch.

• This is a mechanism that supports the leveling process. The pacesetter has a clear understanding about the schedule adherence – ahead or behind.

• In addition to pitch, three aspects of leveled production are:– Production volume– Product mix– Product sequence

Load levelingHeijunka uses paced withdrawal based on pitch

to handle variations in customer demandConsider five products A to E

Instead of producing each product serially they are produced in the ratio 12: 8: 8: 2: 2 . Reduced to smallest terms 3:2:2:0.5:0.5 . In other words for every 3 containers of A, 2 Containers of B, 2 containers of C. 0.5 containers of D and E are produced to level the production . This is illustrated in the next slide

Product A B C D EDaily Requirement 300 200 200 50 50Batch Qty 25 25 25 25 25No of batches 12 8 8 2 2

Heijunka BoxProduct 1 2 3 4 5 6 7 8 9 10 11 12 13 14

A 1 1 1 1 1 1B 1 1 1 1C 1 1D 1E

Heijunka Box is a physical device used to manage leveled production by volume and variety over a specified period of time. In the box having slots as shown above KANBAN cards are posted

1 to 14 refers to Pitch where Pitch is given by =Batch Qty x Takt time

Takt time = Available time/ Total Daily requirement = 52,800/800=66 sec

Pitch = 25 x 66 sec= 27.50 minutes

This means every 27.50 minutes, 25 units to be released as per the above product mix

Value Stream Mapping

Cycle Time Reduction• Define Process boundaries

– Select appropriate metrics, such as time,cost, resources etc.

• Observe and describe process steps and flow– Use process analysis work sheet and process flow diagram.

• Collect process-related data– Record time taken be each activity over several cycles.

• Analyze collected data– Use graphical tools, such as Pareto to summarize the data.

• Identify improvement areas– Prioritize the improvement opportunities.

• Develop improvements– Eliminate, Minimize or Combine steps.

• Implement and monitor improvements– Test the ideas through pilot runs and involve people.

Lean Tools• 5S

– Seiri, Seiton, Seison, Seiketsu & Shitsuke.

• Visual Factory – Andon boards and performance charts.

• Kanban– Kanban is a system of using cards as visual signals for triggering or

controlling the flow of materials or parts during the production process.

• Poka-Yoka– General Inspection, 100% Inspection, Error-Proofing Devises, and

Immediate Feedback.

• Standard Work• Single-Minute Exchange of Dies (SMED)