javier garcia - verdugo sanchez - six sigma training - w4 lean intro

/4407 BB W4 Lean intro 06, D. Szemkus/H. Winkler

Lean Manufacturing Principles & Value Stream Mapping

Introduction

People

Customer

Just inTime

Quality

Stability

Foundations

Ergonomic

Week 4

Page 2/4407 BB W4 Lean intro 06, D. Szemkus/H. Winkler

Hand craft

Mass production

Lean Manufacturing

• Interchangeable parts (Withney)• Division of labor (Taylor)• Assembly lines (Ford)• Low variety (Ford)• Labor strife

• High variety• Small batch sizes• Focus on quality (ppm)• Employees engaged

1875 1900 1925 1950 1975 2000

• Made to customer requirements• Single piece manufacturing ... Each product unique• Variable quality• Low inventory• Expensive ... For rich made only

The History of Manufacturing


• A way of work organization, developed in Japan, which integrates the knowledge and performance potential of the employees into the production process.

• The rigid work sharing will be converted into group work. The employees will get a stronger insight to the problems and the process flows. They will be motivated to work on problem solutions.

• Process optimization will be developed and realized by the employees within the groups.

Lean Manufacturing


• The idea has been developed in Japan, the name is given in the US.

• Lean is the manufacturing system of the Japanese automotive industry. It needs less production factors than the traditional mass manufacturing.

• With other words, less than half of the development time and less than the half of inventories capacities are sufficient for the production. At the same time more product variety with higher quality levels can be offered.

The Idea Lean Manufacturing


• The success of the Lean Manufacturing idea is founded on the involvement of the employees with teamwork.

• Employees of all areas of the company can be integrated in teams, e.g. design, research, engineering, accounting, sales etc.. Depending on the project, the scope can be planning process, accounting, manufacturing or sales process.

• Every employee takes over responsibility for his task. Employee motivation and identification increases while the defect rate is decreasing.

The Success Factors


Create valuableCreate valuableProducts & Products &

PerformancePerformancefor the Customerfor the Customer

Efficient Efficient Processes withoutProcesses without

Waiting TimeWaiting Time

Eliminate DefectsEliminate Defects& reduce Variability & reduce Variability

Optimized Products and Solutions

LEANING

Price On time SIGMA / DPMO

DESIGNING

CapableValue Lean

MASTERING

The Six Sigma Elements

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Six Sigma and Lean Complement Each Other


Customer Oriented through Business Process Management Customer Oriented through Business Process Management

FinanceMfg LogisticsSalesMaterials

MgmtCustomerService

Strategy, Business Plan, ObjectivesStrategy, Business Plan, ObjectivesStrategy, Business Plan, Objectives

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Application (Product) Development

Order to Delivery

Produce Products

Credit and Collections

Financial Performance Measures Net Income, Productivity, Cash Flow

Financial Performance Measures Financial Performance Measures Net Income, Productivity, Cash FlowNet Income, Productivity, Cash Flow

Financial Success

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Financial Success and Customer Satisfaction are

crossing. Experience shows that there is friction in the

daily business

Business Processes vs. Organization


A Successful Way with DMAIC

MeasureAnalysis

Measurable

Success

DefineImprove

Control

Metrics

FinancesCustomer

Vision

Strategy

Analysis

Action

Control

Employees

Processes

Success through an integrated Approach… Larry Bossidy


The philosophy of lean manufacturing or of a production system is based on 5 Principles:

1) Define values in the eyes of the customer

2) Identify the value stream and eliminate waste

3) Make flow at the pull of the customer

4) Involve and empower the employees

5) Continuously improvement in pursuit of perfection

The Lean Principles


Define PhaseProject description and selection of the project leader

•Project selection in respect to product or service•Scorecard•Rating of customer needs•Value Chain Diagram; SIPOC •Portfolio analysis in respect to competences•Deficiency analysis to the competitors•Team building

Measure PhaseDetermination of the baseline

Value Stream Mapping (supported by other process maps) Cycle times / process timesInformation flowBaseline elements: cycle times, change over times, maintenance, equipment availability and reliability, number of product variants, theoretical work times, transport distances for products and personal material yield, first time yield (RTY), WIP, batch sizes, monuments, etc.

The Phases in a Lean Project


Analysis + Improve Phase

Value Stream Mapping (Analysis of the Baseline)

Value Stream Design (Definition of the desired process flow)Compilation of reasonable metricsDefinition of necessary stepsElimination of reworkOptimization of material flow

Pull vs. Push; KanBan; One Piece Flow; 5S; Poka Yoke, Autonomation, Production Smoothing, Waste reduction

Immediately implementation of improvements

Control Phase

Sustain improvementsRegular review of the metricsControl plan Visual controls

The Phases in a Lean Project


Lean Manufacturing Elements

Autonomation

Mistake Proofing

Six Sigma Visual ControlsStandard Work TPM

VOC, QFD, Takt

Material Systems

ProductionSmoothing

Flow / Pull

People

Customer

Just inTime

Quality

Stability

Foundations

Ergonomic


Elimination of Waste

7 types of waste (Taiichi Ohno)1. Due to overproduction

2. Due to waiting and idle

3. Due to transportation

4. Due to inefficient processes

5. Due to unnecessary inventory

6. Due to motion

7. Due to defects (rework)

Waste = Activities which are conducted in an organization but don’t add value to the final product (NVA = non value adding).

Waste = Activities which are conducted in an organization but don’t add value to the final product (NVA = non value adding).


After every process step the product will be stored and not transferred to

the next step until a certain quantity have been manufactured.

After every process step the product will be stored and not transferred to

the next step until a certain quantity have been manufactured.

„Batch“ Production

Terms in the Lean Environment


„Single Piece Flow“

A product will be consistently transferred, piece by piece, from one process step to the next.

A product will be consistently transferred, piece by piece, from one process step to the next.



„Just in Time“

Means:

At the right time

the right quantity

the right product, material, information

at the right location



• It is a method to control the material flow in the manufacturing area

• The needed stocks are close to the manufacturing

• The number of stocks will be continuously adjusted regarding the changing needs. Not too much, not too less.

„KanBan“KanBan means card signal



Available hours

Customer demand=Takt

„Takt Time“

Is the calculated time frame which is needed to process a product or a information in order to fulfill the customer

requirements

Calculation of Takt time:



„Cycle Time“Is the time which is need to perform a

work step / process

Load Chart

01234567

Arbeit

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ritt 1

Arbeit

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ritt 2

Arbeit

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ritt 3

Arbeit

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ritt 4

Arbeit

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ritt 5

Arbeit

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ritt 6

Arbeit

ssch

ritt 7

Arbeit

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ritt 8

Arbeit

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ritt 9

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Cycle

Takt

Cycle Time & Takt Time



Customer

Customer

„Pull“ from the customer

„Push“ to the customer

„Push - Pull“

Lean Principle 3:Make flow at the pull of the customer

Lean Principle 3:Make flow at the pull of the customer



„Visual Controls“

Techniques for a simple control of the production processes and tools to identify fast

process deviation

* 5S ... cleaning and organization

* Andon ... signals

* KanBan ... signals

* floor markings

* Information & metric boards

* Work instructions



„5 S “ A systematic method in five steps to organize the work place

1S = “Seiri” = Sorting, put not needed material away

2S = “Seiton” = Storage: a defined place for everything

3S = “Seiso” = Shining: dispose dirt, waste, oil etc.

4S = “Seketsu”= Standardizing: Al rooms and places equal

5S = “Shitsuke” = Sustaining: Regular reviews, control plans



•Work steps

•Safety

•Visual display

•Timing

•Takt time

•A tool for manufacturing of quality products

•Basis for continues process improvements

•Documentation of a standard for a work process

•Own responsibilities of work groups

„Standard Work“Standard Work means a standardized work

process which includes the following elements



Is a method for process optimization. A series of one after the other following activities for improvements in a predefined area. This kind of activities can be performed in a time limited workshop (e.g. 5 days) or over a longer time in several steps.

„Kaizen“

(KAI = change; ZEN = good)



„Poka Yoke“A method to design processes in that way, that

the occurrence of defects are not possible anymore.

This applies to production as well for administration.

• Equipment can be designed in a way that no defect parts will be accepted in the process

• Another example, form sheets for creditors and debtors have different colors

Already during the design phase it has to be evaluated what can go wrong and what kind of devices are necessary to avoid that!

Already during the design phase it has to be evaluated what can go wrong and what kind of devices are necessary to avoid that!



„Monument“

Under monument we understand large and not moveable equipments or work processes. The organizational and / or technical effort for a simplification or change would be not

acceptable.

Example:• Large cleaning systems• Storage equipment• Production equipment

In a lean environment monuments are undesired, but depending on the manufacturing process they can be economical reasonable.

In a lean environment monuments are undesired, but depending on the manufacturing process they can be economical reasonable.



„Spaghetti Chart“

Spaghetti Charts displays the material and information flow between buildings and areas on the site. A more detailed

illustration of the process is the method Value Stream Mapping

Spaghetti Charts displays the material and information flow between buildings and areas on the site. A more detailed

illustration of the process is the method Value Stream Mapping

Bldg. A

Area C

Bldg. 2

Bldg. 1

Area B

in

out



Value Stream Mapping, What is it?

Value Stream Mapping is a method for process analysis and optimization in production and administration:

- Identification/Definition of a process and/or a product group

- Mapping of the current state process (as-is flow)

- Development of a future (desired) process flow

- Development and implementation of change actions

Value Stream Mapping gives you an overview of the entire values stream from the supplier to the customer in a simple and fast way. Mainly lead times and process interfaces will be drawn. In combination with the actual process cycle times the potential improvement opportunities are linked due to reduction of waiting times. Further potentials will be identified due to the observation of transport, storage, WIP, defect rates, etc..


Origin of the Method

Value Stream Mapping is a central part of the Toyota Production System (TPS).

Within the introduction of Lean Production (Lean Manufacturing) this is an important element for process understanding.

The process description is for the Six Sigma strategy an essential need to recognize the critical input factors. Value Stream Mapping can be also included in Six Sigma projects.

Mike Rother researched the value stream methodology and published it in his book „Learning to See“ (German version „Sehenlernen“).


D

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X bar + Stdev.„7 cycle Analysis“

Actual data!

Definition:•Process & Borders

•Product Groups

As-Is Processmapping

Metric definitionBaseline

•Value stream Responsible

•Employee Support +Training Lean/GB

As-Is ProcessValue added / non

value added

Desired Process -without

waste & over production

Communication &

Implementation

Presentation & Approval by the

Management

Comparison As-Is and New Process

Improvements statistically significant?

Continuous Process

Improvement

Additional projects Lean/6S

For example:•Lead times•Change over times•Machine available•Store quantities•Customer requirements:

•Order quantity•Lot sizes•Order cycles

•Cycle times•Waiting times•Capacities (Employees per step)•Transport (Distances + Times)•WIP•Quality

•Scrap•Packaging•Transport, etc.

Material +Information

The consistent Strategy


The first Steps…

The complete value chain from the supplier through the customer will be analyzed. Depending on the company or for simplification certainprocess borders (start / end) can be defined.

A segment or a group of products which follow similar process steps will be analyzed. A product can be also a service!

The material and the information flow will be mapped .

Value stream mapping is a task across functional borders, therefore a responsible person is needed for this task. This person is responsible for the understanding and the subsequent implementation of the process changes. It is beneficial for this task, if the responsible person belongs to a higher management level.


Mapping the Current State Process (Baseline)

After the definition of the process, the border, a segment or product group, the achievable goals and a responsible person the currentprocess will be mapped and analyzed from “ramp to ramp”.

It is recommended, that the process will be followed “upstream” that means starting at shipping or store. All important information will be collected and documented.

The actual process metrics will be stored. Depending on the process steps itself or the type of data, it is may be necessary to measure some metrics several times „7 cycle analysis“. The advantage is, that we receive beside the average values also information about the variation. Helpful for the development of optimized solutions, especial at competing (oppositional) targets.

The first mapping of the value stream should be sketched by hand with paper and pencil.


Supplier AG Final assembly

18400 pieces./month-12000"L"-6400"R"

Container = 20 pieces

2 Shifts

Raw material5,2 days

4800 "L"2400 "R"

1000 "L"500 "R"

850 "L"460 "R"

700 "L"340 "R"

1200 "L"580 "R"

CT = 2 sec CT = 35 sec CT = 40 sec CT = 62 sec CT = 35 sec

CO = 1 h CO = 10 Min CO = 10 Min CO = Ø CO = ØMachine availability =

82 %Machine availability =




100 %

27.600 sec. available 27.600 sec. available 27.600 sec. available 27.600 sec. available 27.600 sec. available

1 Shift 2 Shifts 2 Shifts 2 Shifts 2 Shifts

5,2 days 7,83 days 1,63 days 1,42 days 1,13 days 1,93 days

2 sec 35 sec 40 sec 62 sec 35 sec

Efficiency = 0,0165%

Total CT= 174 sec.

Lead time = 19,14 days

Process 1

1

Process 2a

1

Process 2b

1

Process 3a

1

Process 3b

1

Shipping

Provision

dailydelivery plan

Production Planning

PPS

90/60/30 daysForecast

weekly planning

Orders daily

6 weeksForecast

One Fax perWeek

Tu. and Th.

1300 mRaw material

1 per day

Example: Current State Process (Baseline)



4800 "L"2400 "R"

CT = 2 sec

CO = 1 hMachine availability =

82 %

27.600 sec. available

1 Shift

5,2 days 7,83 days

2 sec

Process 1

1

Process 1

1

Process 2a

14800 pieces „L“2400 pieces „R“

Process Step 1This process is producing several parts for different products.•E.g. automatic press with automatic coating•Stock quantity today:

• 4800 finished parts „Left“• 2400 finished parts „Right“• 5,2 days raw material

•One worker•Cycle time: 2 seconds•Change over time: 1 hour•Machine availability: 82%

Pusch-System

Explanation of the Metrics


Calculation of the Lead Time

5,2 days lead time results from the information„ 5,2 days raw material“

2 seconds out of the cycle time for the process step

The cycle time of each process step should be in line with the takt time..

Estimation of the inventory lead time based on the takt time.

The Takt Time is the calculated time which is needed to process a product or a information to meet the customer demand.


4800 "L"2400 "R"

CT = 2 sec


82 %


1 Shift

5,2 days 7,83 days

2 sec

Process 1

1


Available Working Time

Customer Demand=Takt Time

Working time:20 days per month2 shifts in all production areas8 hours per shift, if necessary overtimeTwo 10 minutes break per shiftDuring the breaks manually process are stopped

Customer demand:18.400 pieces per month12.000 pieces per month „Left“6.400 pieces pro month „Right“Customer works with 2 shiftsShipping container with 20 finished parts per containerThe customer orders are based on container quantity (several container per order) Delivery to customer on daily basis per truck

Takt time =(8 h) – (2 x 10 min) / shift

18.400 pieces / 20 days / month / 2shifts/ day / shift

460 min / shift460 pieces / shift

27.600 sec / shift460 pieces / shift

Takt time = 60 sec / piece

Takt time =

Takt time =

Calculation of the Takt Time


Estimation of the Inventory Lead Time

Takt time = 60 sec/piece -> 60 pieces per hour2 shifts/day with 40 minutes break -> 15,3 hours/day for production

Therefore: 920 pieces can be produced per day!

Inventory lead time =4.600 pieces + 2.400 pieces

920 pieces/day

The inventory lead time can be calculated based on the takt time. It is also possible to measure the actual inventory lead times during the Baseline which will be used for the calculation of the total lead time. (depends on the process, e.g. single piece manufacturing)

Inventory lead time = 7,83 days


4800 "L"2400 "R"

CT = 2 sec


82 %


1 Shift

5,2 days 7,83 days

2 sec

Process 1

1


Efficiency = 0,0165%

Total CT= 174 sec.


Process stepInventory

(days)Cycle time(seconds)

Lead time(days)

1 5,2 5,22 2 0,0000363 7,83 7,834 35 0,0006345 1,63 1,636 40 0,0007247 1,42 1,428 62 0,0011239 1,13 1,1310 35 0,00063411 1,93 1,93

Sum: 19,140 174 19,143Lead time (LT): 19,1

Cycle time in days: 0,003151

Efficiency (Cycle time / LT) 0,0001646

Efficiency in % 0,0165%

Total cycle time

(process time) = 174 sec.


Efficiency = 0,0165

5,2 days 7,83 days 1,63 days 1,42 days 1,13 days 1,93 days

2 sec 35 sec 40 sec 62 sec 35 sec

Calculation of the Total Lead Time


Conclusion out of the Current State Analysis

The process works with a push principle. Parts are produced which the customer don’t need at this time

Between the process steps we generate a so called WIP (Work in Process) which needs to be stored!

For this “between” inventory we need space between the machines.

Each process step in the value stream can be considered as an island.

If a process step produces defective parts you may recognize them in the following process step.

The total cycle time (process time) is 174 seconds, the total lead time about 19 days.

The time between purchasing/payment of the raw material and the payment of the final product is depending on the lead time high.


Guidelines for the creation of a future process

1. Produce according the takt time

2. Establish, where ever possible, a continuous production flow, in the ideal situation a „Single Piece Flow“

3. Where there continuous flow is interrupted you can use a Supermarket-Pull System for production control.

4. The production control should be applied only at one process step in the value stream.

5. If you produce different products, try to distribute these products equally over the time (planed product mix). The balance will be controlled by the production control at the “pacesetter” process.

6. Define in your process small and even work portions. This “start pull” will be controlled by the production control in the “pacesetter”process.

7. Form the process in a way, that it is possible to produce “every part every day” (EPE), later every shift, etc..

Based on the 5 Lean principles the following guidelines will help to change the current process


Example: Possible Future Process

Supplier AG Final assembly

18400 pieces./month-12000"L"-6400"R"

Container = 20 pieces

2 Shifts

CT= 2 sec Takt 60 sec 2 days

CO < 10 Min. CT = 55 sec

CO = ØMachine availability =

100 %

2 Shifts

1,5 days 1,5 days 2 days

2 sec 165 sec Total Cycle Time = 167 sec

Lead Time = 5 days

Process 1

Process 2a - 3b

Shipping

Provision

Production Planning90/60/30 days

Forecast

weekly planning

Daily order

6 weeksForecas

Dailyorder

1 per day

Rawmaterial

R

O X O X

20

20

20

20

20

LL

Process 2 Change Over Amount of work =

165 sec

Process 2b Machine

availability

Raw material

Lot SizeBoxes

Ra

w m

ater

ialDaily


Overall, production and manufacturing processes in accordance to lean principles are an industrial

revolution, which are not limited to the automotive production or to Japan.

The consequences should be similar like the change in spring 1914. At that time in Detroit, Henry Ford

replaced the hand craft production by an assembly line. Within some months the time effort for the

assembly of major parts of a car were reduced from 750 to 90 minutes.

Summary


ModellModell PP ModellModell FF

PI

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PI PI

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PI PIPI PI PI

Work in process

PI PI PI PI Bld. 0

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DisassyDisassy

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DisassyDisassy

ReceivingReceiving



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DisassyDisassy


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Cleaning

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Example: Push System


Receiving

Strip/Split

GB LC

Power Sect.

UnpackUnpack

Modell S

Strip/ Split

Receiving

Strip/Split

GB LC

Power Sect.

UnpackUnpack

Modell L 1

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Receiving

Strip/Split

GB LC

Power Sect.

UnpackUnpack

Modell L 2

Strip/ Split

Receiving

Strip/Split

NC LC

Power Sect.

UnpackUnpack

Modell P

UnpackUnpack

Modell F

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PIPI PIPI

stagingstaging StagingStagingStagingStaging

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StagingStaging

PIPI PIPIPIPI PIPI PIPI

Kanban Buffer

Work in process

Receiving

M2

M3 M4

M1StripSplit

Cleaning

PIPI PIPI

Example: Pull System

javier garcia - verdugo sanchez - six sigma training - w4 lean intro

Engineering