bowen e z go shingo prize case study
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Company Confidential 1
E-Z-GO Shingo Prize Case Study
Westy BowenVice President of Quality and Six Sigma
October 15, 2009
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E-Z-GOs Beginning State
A plaque outside the E-Z-GO weld shop shows the transformation of the facility andcommemorates the shops embarking on a journey of continuous improvement.
It reads, In 2007 the weld-shop team began a journey of continuous improvement.
This ongoing journey will transform the shop into a benchmark of premier fabrication
performance. This spot has intentionally been left unimproved, not as a look
backward, but as a constant reminder of the importance of moving forward.
History of AutocraticLeadership
Top down - do as you are told
Firefighting Heroes
2001 Strategy to Outsource
Dungeon Facilities
Aging Equipment
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State of the Business
E-Z-GO was Losing Market Share and Less Profitablethan Main Competitor in an Oligopoly Market
1999 2000 2001 2002 2003 2004 2005 2006 2007F
Brand X Sales E-Z-GO Sales
1999 2000 2001 2002 2003 2004 2005 2006 2007F
Brand X NOP E-Z-GO NOP
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Textron VisionTo be the premier multi-industry company recognized forour network of powerful brands, world-class enterprise
processes and talented people
E-Z-GO MissionTo be the premier provider of light transportation vehicles
achieving global recognition as the benchmark forcustomer satisfaction and financial results
E-Z-GO Values StatementTo fulfill these goals, E-Z-GO will exemplify
Textrons values of integrity, trust, respect and the pursuitof excellence which will enable us to become the employer
of choice in the industry
Strategic Direction: Premier
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What is the Enterprise Shingo Prize?
Shingo Prize for Operational Excellence:
Established 1988;
Enterprise Level Prize Established 2008
Shingo Prize for Operational Excellence is named forJapanese industrial engineer Shigeo Shingo
Business Week stated that the Shingo Prize is theNobel prize of manufacturing
The Shingo Model Provides Engine for LeanTransformation
E-Z-GO Shingo Prize Video
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Textron Business System Assessment
Section 1:CulturalEnablers(20%)
Section 2:BusinessOperating
System(45%)
Section 3:EnterpriseThinking(10%)
Section 4: BusinessResults(25%)
1.1Leadershipand Ethics
1.2PeopleDevelopment
1.3Empowerment
and Involvement1.4 Environmental,Health & Safety
2.1BusinessManagement and LeanPrinciples
2.2 CustomerManagement
2.3Product/ServiceDevelopment
2.4 Operations
2.5SupplyManagement
3.1 LeanEnterprise Culture
3.2 PolicyDeployment
4.1 PeopleDevelopment
4.2Quality
4.3Delivery
4.4Cost
4.5Financial Impact
4.6CompetitiveImpact
TBSA Aligned with Shingo Prize Criteria
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Goal set in 2004: Shingo Gold in 08
Leadership Right People in Right Place
100% Turnover in Sr. Leadership Team (2002-2004)
Vision Established for Operational Excellence
Textron Challenge to Go for Gold
Textron Business System Assessment
Accelerator Pilot
Developed Roadmap
Lean Maturity Roadmap
Action Plans for Manufacturing and Functional Areas
Key is to Just Get Started and Include Everyone
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Implementation Evolution
2004-2005: Cell Improvement
Single Point Kaizen Events
Big Impact Kaizen Events
2005-2007: Value Stream Improvement
Material Flow; Process Flow
Information Flow; Communication
Cultures, Mindsets and Behaviors (CMB)
2007-2008: Business Level Improvements
Goal Deployment (GDP/Hoshin)
Performance Management
Pro ject Leader Name Maintenance
Manufacturing
Engineering
Operations
Quality
Purchasing
ProductionControl
DesignEngineering
Sales/Marketing
Finance
Warehouse
OperatorMixedModel
Line
FleetPowertrain
Operator(OtherShops)
GB-NGGCTeam(Former
Back-shopexpertise)
OperationServices
Project 1 Hegel
Eliminate schedule dispersion and
create pull process from Pedal Box
(accelerator only) Back Shops
John
Thomann
Debbie
Burton,
Tommy
G arne r A nn T ate
Barry
Lenart Lori Daly
Mary
Hampton,
Barry
Austin
Rick
Schieberl,
( 1) TBD TBD
Project 2 Stern Powertrain Rebalance/ Layout/5S TBD
Ricky
Criss
James
Gonella
Raju
Janardhan
Kim
Schleiff
Spanky,
Marvin
(Lee)
Sims
John
Whitehea
d
Donna
Glascock,
Shane
Holley,
Reco Grant
Project 3 Corradino
Feasibilitystudyof moving line
over to Bldg 3
Gary
Toole
Don
Bingham Janie Burnsed
Russell
Watts
Herbert
Fryer
TBD
(Backshop)
(Least 2)
Steve
Franks;
David
Jones
Pr oj ect 4 Ke ndi nger De vel op Mat er ial Pl an for MP T l ine
Jeff
Wall
Krystal
Mottel
John
Schmidt
Jason
Muterspaugh
Orlando
Mays
Mike
Smith
TBD(Backshop)
(Least 2)
Safety/Maintenance/Operation
Svcs/ Forklift Operator as Floaterwith exception of Powertrain
changes. Will need dedicated
Maintenance person involved.
Shingijutsu Led Kaizen Event
Cross Functional Teams
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Initial TBSA February 2005
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2006 High Level Lean Maturity Road Map
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What is an Accelerator ?
How to build:
A lean Operating SystemSupporting InfrastructureAligned mindset and capabilities
Skilled practitionersTeam of ~ 20 full-time; 10 part-time
Proven in multiple environmentsStandard, but tailored to a specificsituation
On what matters most, asidentified by the TBSA
Relevantknowledge
Skilledpeople
Provenprocess
Focus
Reach outcontinuous
improvementmindset
2-5x faster
A proven process to achieve customer satisfaction, operational andfinancial improvement in a significantly accelerated sustainable way
A capability engine that builds the skills of management, supervisors andfront line workers so they will be able to drive continuous improvement
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Accelerator Composed of 4 Teams
Process Flow
Physical Layout; Line Balancing
Material Flow
Line Side Inventory; Warehouse Mgt.
Right Part at Right Place at Right Time
Information Flow
Systems (MIS); MRP; Production Control
Cultures/Mindsets/Behaviors
Operator Involvement; Training
Order of Physical Activity and ChangesReverse Order of Impact to Sustain Improvements
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Meeting Cadence
Workingteamsupdate
Content of meeting
Impactreview withALT
Staffupdates
Required
participation Frequency Duration
Accomplishments of dayProgress Value Stream. planmilestones
All Team LeadersFull time teammembers & ProcessOwners (as often
as possible)
Daily at4:30
30 min
Impact and ProgressFuture milestonesCountermeasures
Weekly 4-Blocker Review
ALT membersProject ManagerAll Process Owners
Weekly onThursdaysat 1PM
60 min
Impact to dateBarriers/roadblocksRoll-out plan to other value streams
ELTProject Manager
Monthly onspecific Staff
meetings
15 min
Impact to date
Lessons learnedLearn from Cessna and Bell
Project Managers Weekly 30 min
Workingteamsupdate
Content of meeting
Impactreview withALT
Staffupdates
Required
participation Frequency Duration
Accomplishments of dayProgress Value Stream. planmilestones
All Team LeadersFull time teammembers & ProcessOwners (as often
as possible)
Daily at4:30
30 min
Impact and ProgressFuture milestonesCountermeasures
Weekly 4-Blocker Review
ALT membersProject ManagerAll Process Owners
Weekly onThursdaysat 1PM
60 min
Impact to dateBarriers/roadblocksRoll-out plan to other value streams
ELTProject Manager
Monthly onspecific Staff
meetings
15 min
Impact to date
Lessons learnedLearn from Cessna and Bell
Project Managers Weekly 30 min
Daily, weekly, monthly touch points Established
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Current State Value Stream Map
30% productivity lossDue to imbalanced line
70% of FTQ issues areFrom material shortage issues
50% of parts have a lead timeGreater than the order visibility; parts
are ordered from forecast
Excess inventoryin the yard
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Future State Value Stream Map
Customer
Ship
Assembly
(Paced)
Custom CarsSMRs
Include Reconfigs
OE withTFC Tie
SIOP
SchedulingMPS, Traffic,
Sales, Load Seq
MRP
Suppliers
Receiving
InternalFabrication
Cars
Accy
Internal& Purchased
Internal
CommonParts
Drop-off
Warehouse
E-Z-GO3PL
RBW
Trailers
Raw Materials
FIFO
ECR/ECN
FIFO
Crate Cars
Line balanced acrossmodels
Order and forecastingClosely linked
Standard workFor incomingMaterial flow
Match orders withFG inventory
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Themes
Impact
FTQInventoryaccuracy
High impact
Med impact
Visual management Practical problem solving
Strong performance dialogs Shared leadership vision Leadership standard work
Culture, Mind-sets, Behaviors
Performancemanagement
Process flow
Low impact
Production scheduling automated and streamlined Orders and quotations integrated material Effective control procedures that ensure accurate inventory parameters
InformationFlow
Balance line to takt and build capability Redesign line layout Design and document safer, more ergonomic and more efficient operations
Execution of PFEP across all MML parts Improvement of material flow via sequencing Standard work for all conveyance and material management
Material flow
Keys to drivingsustained impactacross MixedModel valuestream and E-Z-GO
Productivity
Design Principles - Metrics
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Future state manningrequirements are~30% less:
Total work content per2+2G* = 2 hr 15 min
Cars per day = 85
Work content per day= 191 hr 15 min
Number of operatorsrequired** = 21(current = 31)
Some stations very close or over takt (when
walking time included) limiting production
capacity and causing waiting elsewhere
Red = walking
Orange = sub-assemblies
Yellow = variation
Green/blue = 2+2G work elements
On average, station cycle time is
30% lower than takt to meet 85
vehicles/daythere is significant
opportunity to rebalance to fewer
stations Takt = 85vehicles/day
Process Flow: Manage to Takt
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Business Level Metrics Cascaded throughoutOrganization
Safety, Quality, Delivery, Cost (SQDC)
COUNTER MEASURES COUNTER MEASURES COUNTER MEASURES COUNTER MEASURESISSUE ACTION WHO DUE STATUS ISSUE ACTION WHO DUE STATUS ISSUE ACTION WHO DUE STATUS ISSUE (P/N) ACTION WHO DUE STATUS
# of Safety/Ergo Improvements Implemented TSS Survey Results # Projects Closed $ Cash Improvement
DELIVERY
Key Performance Indicators - Textron Six Sigma
CloseTSSProjects that generateCash$(reducedinventory, usedcars,
receivables; increaseNOP)Numberof distinct safetyand ergonomic improvements implementedi nall
Black Belt and GreenBelt projects closedduringthemonth
SatisfactionSurveyof overallexperiencewithTSSfrompartic ipants
(Process Owners, Champions, Teammembers)onBBproject. Numberof GreenBelt andBlack Belt projects closedduringthemonth
COST/ PRODUCTIVITY5s / SAFETY QUALITY
0
1
2
3
4
5
6
7
8
9
10
0
1
2
3
4
5
6
7
0
2
4
6
8
10
12
14
16
18
20
0.0
100,000.0
200,000.0
300,000.0
400,000.0
500,000.0
0
200
400
600
800
1,000
1,200
1,400
J
M
M
A
D
F
A
J
J
S
O
N
J
F
A
M
J
J
A
O
N
S
D
M
J
F
A
M
J
J
A
O
N
D
M
J
F
A
M
J
M
J
A
O
S
N
D
J F M A M J SAJ O N D J F M A M J SAJ O N D J F M A M J SAJ O N D J F M A M J SAJ O N D
MonthlyObjectiveAchived MontlhyObjectiveNot Achived
MonthlyObjectiveAchived MontlhyObjectiveNot Achived
MonthlyObjectiveAchived MontlhyObjectiveNot Achived
MonthlyObjectiveAchived MontlhyObjectiveNot Achived
MonthlyObjective MontlhyActual MonthlyObjective MontlhyActual MonthlyObjective MontlhyActual MonthlyObjective MontlhyActual
S
0
50
100
150
200
250
300
350
400
450
500 MonthlyObjective MontlhyActual
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Material Flow: Sequence Center to Assembly
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Control Block
SEQ - STEP (What) -
2
On Option line of main screen, Type in
the part number, buyer number, the
warehouse, and the delivery date
SYM -
3 Type "F-8" to update
Send e-mail or call applicable supplier
to determine shipping schedule
4
1Log onto the 36/PMR session on AS400
system.
A Textron Company
1
Improvements Made
Short-Term MPS Tool
Expanded MRP visibility to
configured quotes
Reduced PAR volume
SIOP impact tool for what-if analysis
Standard work for
Buyer/Planners
Standard work for ChangeNotice Implementations
Piloting A2 Kanban processfor windshields
Information Flow: Scheduling
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The work has been very hard butin the end has been very
rewarding.We know that there are still some
things that need to be checkedand worked out
You can movearound the areas
a lot easier
With the new waythe line moves, it
give me more timeto get done what I
need to do
Parts are
stocked up all ofthe time now
Now we run bythe schedule,
unless wehappen to be
out of aparticular part
Now it is not ascluttered and
things are wellorganized, so
we have plentyof room
Before the changes on the assembly manypeople were weary of it and didnt think
actually that it would work.So far it has worked out extremely well.
I think the process has been beneficial toeveryone on the line as well as to E-Z-GO.
Partspresentationis a MAJOR
change
The big differenceI see is how the
line runs now itlooks like the lineis running slower
Communicationboards help usknow what is
going on and whatwe have to face
for the day
Now it is a lotSAFER to
work
CMB Team: Employee Engagement
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Cultures Mindsets and Behaviors
Most Important Link
Begin to See Shift in Lean Capabilities
John Ward Lean Team Video
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Evolution to Business Level Improvement Goal Deployment Process (Hoshin Planning)
Targets to Improve (TTIs)
Key Process Improvement Metrics (KPIVs)
Rigorous Reviews with Countermeasuresl Operations - Key Operational Improvements l l l l m l m m l
l Growth - Develop and Execute Growth Agenda l m u m m m m m l m
l Customer - Develop and Execute Action Plans l l l l u l m
GrowRevenue
X%byYYear
ImproveCustom
erSatisfactionbyX%
ImproveCustom
erOnTimeDeliveryfromX%toY%by(date)
ImproveDPMO
fromXtoYby(date)
ImproveFillRatefromXtoYby(date)
ReduceNewProductIntroductionCycleTimebyX%by(date)
ReduceFreight
CostbyX%by(date)
ImproveWarran
tyas%SalesbyX%by(date)
ReduceSG&AExpensebyXby(date)
VicePresident,
GlobalSales
VicePresident,
BusinessDevelopment
VicePresident,
HumanResources
VicePresident,
Quality
VicePresident,
Operations
ChiefFinancialOfficer
ChiefInformatio
nOfficer
VicePresident,
Engineering
VicePresidentCommunicationsandBrandManagement
l l World Class Customer Satisfaction
l l Engaged Employees u
l l Achieve Shingo Prize for Enterprise Level l
l l Grow Business m Enabling Resource
Action Plan Owner
Primary IP Owner
Top LevelPriorities/Actions
2009 AnnualPremier Objectives
4 Year Premier
Objectives
Targets toIm rove
KPI Owner 2008 JOP2009 YTD
ACTJUN JUL AUG SEP OCT NOV DEC Full Year
Talent0.90 KPI Stretch 0.90 0.90 0.90 0.90 0.90 0.90 0.90 0.901.35 Act. / Fore. 1.15 1.26 1.09 0.97 0.99 0.90 0.85 0.85
30.1% KPI Stretch 30.1% 30.1% 30.1% 30.1% 30.1% 30.1% 30.1% 30.1%32.6% Act. / Fore. 32.6% 32.6% 32.6% 32.6% 32.6% 32.6% 32.6% 32.6%
0.9% KPI Stretch 1.1% 1.2% 1.4% 1.5% 1.7% 1.8% 2.0% 2.0%0.6% Act. / Fore. 0.6% 0.6% 0.6% 0.6% 0.6% 0.6% 0.6% 0.6%
Cash11,375$ KPI Stretch 11,325$ 11,275$ 11,225$ 11,175$ 11,125$ 11,075$ 11,075$ 11,075$
$10,754 Act. / Fore. $11,200 $10,600 $10,200 $9,800 $9,500 $9,000 $9,000 9,000$
9,188$ KPI Stretch 8,267$ 7,992$ 8,128$ 8,324$ 8,332$ 8,002$ 7,786$ 7,786$$8,118 Act. / Fore. $7,500 $ 9, 30 0 $ 8, 72 6 $8,274 $ 8, 78 6 $ 8, 82 3 $7,586 7,586$
2,400$ KPI Stretch 2,600$ 2,600$ 2,100$ 2,000$ 1,900$ 1,800$ 1,700$ 1,700$2,521$ Act. / Fore. 1,715$ 1,635$ 1,555$ 1,475$ 1,395$ 1,315$ 1,300$ 1,300$
1,629 KPI Stretch 233 300 638 500 700 700 700 5,4001,865 Act. / Fore. 233 225 130 403 306 419 460 4,041
2,399$ KPI Stretch 2,356$ 2,313$ 2,269$ 2,226$ 2,183$ 2,139$ 2,096$ 2,096$7,135$ Act. / Fore. 3,584$ 4,244$ 4,803$ 5,103$ 7,003$ 4,149$ 2,095$ 2,095$
23,809 KPI Stretch 5,753 3,060 5,451 5,559 8,502 5,858 4,677 65,22324,139 Act. / Fore. 5,004 3,060 5,451 5,559 8,502 5,858 4,677 62,250
8,396 KPI Stretch 1,599 1,679 2,162 1,819 2,349 1,981 1,453 24,700
8,038 Act. / Fore. 2,000 1,679 2,162 1,835 2,535 1,981 1,453 21,68319,205 KPI Stretch 6,424 6,240 6,240 6,240 6,224 6,214 6,214 63,00024,113 Act. / Fore. 4,800 5,860 5,860 5,860 5,900 5,900 5,907 64,200
31,930$ KPI Stretch 30,954$ 29,853$ 28,942$ 27,774$ 26,952$ 25,995$ 25,559$ 25,559$32,225$ Act. / Fore. 33,255$ 29,559$ 28,635$ 27,972$ 31,723$ 31,410$ 29,759$ 29,171$
40,358$ KPI Stretch 39,450$ 38,542$ 37,633$ 36,725$ 35,817$ 34,908$ 34,000$ 34,000$34,800$ Act. / Fore. 39,450$ 38,542$ 37,633$ 36,725$ 35,817$ 34,908$ 34,000$ 34,000$
5,167$ KPI Stretch 5,000$ 4,833$ 4,667$ 4,500$ 4,333$ 4,167$ 4,000$ 4,000$4,859$ Act. / Fore. 3,639$ 3,840$ 3,622$ 3,750$ 3,421$ 3,053$ 2,644$ 2,644$
NOP$56,286 KPI Stretch 10,493$ 12,346$ 12,787$ 12,052$ 11,503$ 11,399$ 7,880$ 134,748$$43,218 Act. / Fore. $9,668 $9,071 $11,589 $9,894 $13,489 $10,486 $7,888 115,302$
16,622$ KPI Stretch 3,397$ 4,921$ 3,910$ 2,860$ 4,749$ 2,403$ 1,181$ 40,043$14,357$ Act. / Fore. 2,792$ 4,520$ 4,123$ 3,758$ 4,362$ 2,770$ 1,177$ 37,859$
3,807$ KPI Stretch 497$ 693$ 516$ 476$ 525$ 671$ 1,071$ 8,256$4,753$ Act. / Fore. 497$ 693$ 516$ 476$ 508$ 577$ 821$ 8,842$
(1,053)$ KPI Stretch 266$ 931$ (270)$ (538)$ (505)$ (607)$ 298$ (1,479)$(2,511)$ Act. / Fore. 574$ 1,060$ (211)$ (904)$ (1,138)$ (184)$ 1,148$ (2,167)$
9.0 KPI Stretch 9.3 10.7 7.1 7.6 7.5 7.5 7.4 8.47.2 Act. / Fore. 9.3 10.7 7.1 7.6 7.5 7.5 7.4 8.4
Process98% KPI Stretch 98% 98% 98% 98% 98% 98% 98% 98%98% Act. / Fore. 98% 98% 98% 98% 99% 99% 99% 98%
157 KPI Stretch 147 138 128 119 109 100 90 90145 Act. / Fore. 147 138 128 119 109 100 90 90
$8.9M
Collins $12.3M
Collins
Moinikunta
$9.3M
$38.8M
141
Specialty SIOP demand forecast accuracy of 95% Miller
Total Net Warranty from $9.3M to $8.3M by 12/31/09 Younger
60,958
Decrease Branch Stock Specialty inv by $1.3M by
12/31/09 ($5.3M to $4M / Units - 1,511 to 1,000)5.3M
Miller
Miller
Reduce Specialty floorplan from $44.9m to $34m
by 12/31/09 (Units 8,600 to 6,515)Miller
Decrease Used Car Inventory by $5.8M (to 17,379
units) by 12/31/09 ($1,473 per unit)
Jhant/Miller $2.6M
Decrease Branch Parts Inventory from $2.2M to
$1.7M by 12/31/09Jhant $2.2M
Sell 5,400 additional used golf cars to fleet channel
by 12/31/09Jhant 0
Exceed AOP targets for Raw/WIP inventory by
$1.3m by 12/31/09
Reduce Labor Hours Per Vehicle from 8.9 to 8.4 for
2009
Decrease Augusta Finished Goods Inventory from
$2.6M to $2.1 by 12/31/09
Miller
Achieve Used car sales of 63,000 by 12/31/09
(includes used cars to the fleet channel)
Fleet SIOP demand forecast accuracy of 95% Jhant
Decrease Parts inventory by $3.3M by 12/31/09
Achieve AOP Specialty sales of $134.7M
Improve FTQ from 96% to 98% by 12/31//09
Miller
Achieve AOP Parts sales of $40M Kopay
Neely
Safety - Achieve TRIR of .90 by 12/31/09 Johnson
Reduce Regretted Turnover from 4% to 2% by
12/31/09
Improve CR/CN Cycle Time from 141 days to 90
days by 12/31/09
K. Reeves
Sustain Inclusive Workforce at 30.1% by 12/31/09 K. Reeves
Achieve AOP targets for total manufacturing
variancesDraper
Heffline
30.1%
0.69
$3.5M
134.7M
$44.9M
$31M
NA
4.0%
NA
8.9 est
96%
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Driving CI Responsibility to Operator
Developed Curriculum and Schedule to Train 80%Workforce in Lean Techniques
Attend 24 Hours of Training
Complete 2 projects (team or individual) in 12 Month Period
Certify as an E-Z-GO Lean Technician
Promotes Kaizen as Way of Life: Everyone EmpoweredSession Course Location Instuctor
Time
allotment in
minutes
Session 1Material Movement Kanban Simulation Bldg III T/Room Deb Smith/Eric Ethington 110
What is World Class Bldg III Plant Renee Stern 55
Finance Bldg III Plant Jason Alford 55
Session 3 Standard Work Bldg III Plant Rick McCoy / Allen Evans 110
Visual Management Bldg III Plant Scott Seigler 55
Poka Yoke Bldg III Plant Chris Furman 55
Session 5 5S Bldg III Plant Eric Safford 110
Question & Answer with Plant Manager QA T/Room Darryl Heffline 45
Team Building QA T/Room Vito Corradino 65
Session 7 7 Wastes Bldg II plant Jay Johnson/Mike Rouse 110
Quality Bldg II plant Vivek Moinikunta 55Supply Chain Bldg II plant John Collins 55
Intro to Rack Building Bldg II plant Shawn Flanagan/Marlon Bray 55
Total Productive Maintenance (TPM) Bldg II plant Mark Thrasher 55
Session 10One Piece Flow (Lego race cars) LeanSimulation
Bldg I T/Room Goran Rajkovic/Poppie Blue 110
Practical Problem Solving (PPS-5whys/
Bldg II plant Brad Hanson 55
SQDC - Metrics (Safety, Quality,Delivery, Cost)
Bldg II plant John Thomann 55
"Jeopardy" Reinforcement Questions This will be conducted in the lastclass of the day by all instructors
All Instructors 55
Session 2
Session 4
Session 6
Session 8
Session 11
Session 9
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Accelerator is Results Driven:
Metric Before After
Operator Load Efficiency 54% 98%
First Time Quality 51% 98%
Inventory Accuracy 82% 97%
Schedule Adherence 62% 95%
Be Patient: Likely to Get Worse BeforeImprovement is Realized
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What is Next?
Sustain is more important than ever
Continuous improvement is part of everyones job
Other recognition for best in class (Industry Week)
Benchmarking tours
Pushing Continuous Improvement to Suppliers andCustomers
The Journey Continues
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