Group 4 Week 1 Learning PointsNovember 10th, 2011
Lean (Toyota Production System), Lean (Toyota Production System),
a risk free way to execute a strategy
Yves MerelFCI Automotive
VP Industrial Development
Group 4 Week 1 Learning PointsThe visible part of Lean
(Lean)
(Not Lean)
Group 4 Week 1 Learning PointsThe system underneath
Just
In
Tim
e
Customer
Satisfaction
Delivery Quality .
Cost
Just
In
Tim
e
Jid
oka
Kaizen
Standardized Work
Hoshin Kanri
Immediate reaction
to any process issueWaste elimination
on process lead time
Problem Solving Workshops
Shop Floor Visual Control
Strategy Deployment
Improvement Suggestions
Management Routines
Progressive Targets
Group 4 Week 1 Learning PointsMy Lean Background
• I discovered Lean while working for , 10 years in France and
in the USA (Valeo is doing Lean with Toyota support since 1992)
• Then during 3 years I led the Lean transformation of (a British automotive components supplier)(a British automotive components supplier)
• And 3 years ago I joined to lead the Lean program from
Singapore
• For 6 years I’m coached by Freddy Balle (retired CEO, implemented Lean at
Valeo, Sommer Allibert, Faurecia and author of The Gold Mine and The Lean Manager)
• Pierre Vareille (Wagon CEO, FCI CEO) uses Lean to execute his strategies
Group 4 Week 1 Learning PointsFCI Group
Automotive
Division
ElectronicDivision
Is one of the largest connector manufacturers, owned by Bain Capital since 2005
Its 14,000 employees are achieving a turnover of 1.3 billion €
In communications
In your
credit card
In your car
In electric
vehicles
In trucks In your
Cell phone
In hospitals
In your
computer
In your TV
Microconnections
Division
Division
Group 4 Week 1 Learning Points24 Factories
EuropeBesancon, France
Mantes , France
Epernon , France
Nuremberg, Germany
Mattighofen, Austria
Tatabanya, Hungary
Turin, Italy
AmericasHuntingdon PA, USA
Huntingdon PA, USA
Juarez, Mexico
San Pedro Sula, Honduras
Sao Paulo, Brazil
AsiaBangalore, India
Cochin, India
Cochin, India
Cochin, India
Changi Singapore
Jurong Singapore
Senai, Malaysia
Nantong, China
Nantong, China
Dongguan, China
Namyang, Korea
Ishioka, Japan
Group 4 Week 1 Learning PointsLean System examples
Just
In
Tim
e
Customer
Satisfaction
Just
In
Tim
e
Jid
oka
Kaizen
Standardized Work
Hoshin Kanri
Immediate reaction
to any process issueWaste elimination
on process lead time
Group 4 Week 1 Learning PointsThe amazing Just In Time principle
Holding more inventory does not help to delivery on time
Group 4 Week 1 Learning PointsThe amazing Jidoka principle
Rejecting more products does not improve the quality
Group 4 Week 1 Learning PointsLean System examples
Just
In
Tim
e
Customer
Satisfaction
Just
In
Tim
e
Jid
oka
Kaizen
Standardized Work
Hoshin Kanri
Problem Solving Workshops
Shop Floor Visual Control
Improvement Suggestions
Management Routines
Group 4 Week 1 Learning Points
• With Anil Kannat (Global Business Service Director) we launched in June 2011 a Lean
system focused on labor efficiency improvement
• During 3 days with a team we analyzed, simulated ideas and implemented
many suggestions. We finally reduced the lead time from 43.5 to 23 hours
• G.Kumar (GBS Lean Manager) then continued by leading one workshop per week
Kaizen Workshop at Cochin
• G.Kumar (GBS Lean Manager) then continued by leading one workshop per week
• We expect to save by the end of the year 25% productivity on 130 people
Group 4 Week 1 Learning PointsVisual Control Routine at Ishioka
• With Takeuchi san (Ishioka Factory Director) in May 2009 we trained all his
managers to perform the Visual Control Routines
• We practiced these daily routines on the shop floor with each manager
• In one hour maximum they have to go around all production cells and check if
any delay may impact the customers deliveriesany delay may impact the customers deliveries
• Then encourage the operators to make improvement suggestions on it
Group 4 Week 1 Learning PointsLean System examples
Just
In
Tim
e
Customer
Satisfaction
Just
In
Tim
e
Jid
oka
Kaizen
Standardized Work
Hoshin KanriStrategy Deployment Progressive Targets
Group 4 Week 1 Learning PointsD
ire
ct L
ab
or
He
ad
cou
nt
Sa
ve
dHoshin Kanri at Wagon
Since we had labor intensive operations in high cost counties,
we chose in May 2005 to target: Direct Labor – 1 %/month
Dir
ect
La
bo
r H
ea
dco
un
t S
av
ed
Over 3 years 915 saved out of 3081
Group 4 Week 1 Learning PointsHoshin Kanri at FCI
2
3
4
5
6
7
8
9
10
11
12
Nu
mb
er
of A
cc
ide
nts
40
60
80
100
120
140
160
180
200
Qu
ality
Co
mpla
ints
Safety - 3 %/month Quality - 2 %/month
Since we wanted to grow our sales, we chose in Sept.2008 to target:
0
1
2
Group target Group 6MRA Group actual
0
10
20
30
40
50
60
70
80
90
Pla
nt
Flo
w tim
e in
day
s
Group target Group 6MRA Group actual
0
20
40
Group target Group 6MRA Group actual
0 000
50 000
100 000
150 000
200 000
250 000
300 000
350 000
400 000
MP
M
Group target Group 6MRA Group actual
Inventory - 2 %/month Delivery - 2 %/month
Group 4 Week 1 Learning PointsA toolbox full of Lean solutions
• Kanban
• Flow Rack
• Leveling
• Small Train
• Milk Run
• Single Piece Flow
• Flexible Manpower Line
• Externalized Changeover
• Minimum Technical Solution
• Andon Light• Milk Run
• Cross Dock
• Zoning
• Red Bin
• Poka Yoke
• First Defect Stop
• Andon Light
• Kamishibai
• Concept Paper
• Set Based
• Design Checklist
• Autonomous Team
But copying Lean solutions only provides local improvement, rarely sustainable
Group 4 Week 1 Learning PointsOur way to lead the changes
• A set of Strategic KPI tracking the continuous improvement speed (at all levels of the hierarchy from the entire group to every single operating team)
• A Lean Manager assigned in each site, leading workshops and
implementing visual control (trained on Lean tools and leadership techniques)
• A small team of Lean Experts leading workshops, training people
and auditing processes (Quality, Supply Chain , HR, Manufacturing Engineering)
• A quarterly Lean Review for managers to meet their peers, visit a
factory, share good practices and learn about Lean management
• A structured Communication (feedback emails, news letter, seminars, awards)
• A yearly CEO Visit at each factory to review, challenge and
recognize the continuous improvement
Group 4 Week 1 Learning PointsLean Pros and Cons
Advantages:
• It is less risky than massive breakthrough
• It is free of investment
• It is applicable on any type of process
• It is a structured way to execute a strategy
Requirements:
• It needs a mid term strategy
• It needs a boss leading it 15% of his time
• It needs an expert implementing the system
• It needs one manager per site implementing the solutions
Group 4 Week 1 Learning PointsFinancial Impact
2008 2009 2010 Evolution
Missed Delivery 6MRA % 35 25 20 -43%
Quality Complaints 6MRA 149 104 59 -60%
Sales M€ 1 096 935 1 298 18%
Active Suppliers Number 1 083 1 018 888 -18%Active Suppliers Number 1 083 1 018 888 -18%
Material / Sales 38% 37% 40% 6%
Safety Accidents 6MRA 8.3 2.3 1.7 -80%
Labor / Sales 31% 32% 27% -12%
EBITDA / Sales 13% 12% 14% 8%
Inventory Flow Time 6MRA Days 60 48 36 -40%
Cost of Investments Capex / Sales 6% 5% 3% -49%