M14 EKM FUTURE STATE MAP

Syed Shah Areeb Hussain - 5401198

SUMMARY

In the previous report, the current state map of RAC was produced and the problems within the

system were highlighted. In this report we have suggested the improvements to the RAC

manufacturing plant in the future state map. The suggested improvements can greatly reduce

the lead time of the operation by introducing flow between the processes. This will enable RAC

to meet the customer demand much faster through an efficient and lean process. The total lead

time was reduced by almost 10 times in our analysis. Moreover, it also helped reduce the space

and workload on operators.

TABLE OF CONTENTS

1. ..................................................................................................................................................... 4

2. INTRODUCTION ....................................................................................................................... 5

3. LITERATURE REVIEW ............................................................................................................... 6

3.1. VALUE STREAM MAPPING ................................................................................................ 6

3.1.1. Current State Map .................................................................................................... 6

3.1.2. Future State Map ...................................................................................................... 7

3.2. TOOLS AND TECHNIQUES FOR THE FUTURE STATE ......................................................... 7

3.2.1. Pareto Analysis .......................................................................................................... 7

3.2.2. Spaghetti Diagram..................................................................................................... 8

3.2.3. Heijunka Box ............................................................................................................. 8

3.2.4. Kanban ...................................................................................................................... 9

3.2.5. Pacemaker Process ................................................................................................. 10

3.2.6. Supermarkets .......................................................................................................... 10

3.2.7. FIFO Lanes ............................................................................................................... 10

4. REVIEW OF CURRENT STATE MAP ........................................................................................ 12

4.1. WIP IN DAYS ................................................................................................................... 12

4.2. PARETO ANALYSIS .......................................................................................................... 13

4.3. PERCENTAGE UTILIZATION ............................................................................................. 14

4.4. CURRENT STATE MAP (WITH KAIZEN BURST SUGGESTIONS) ........................................ 14

5. FUTURE STATE MAP .............................................................................................................. 16

6. DISCUSSION ........................................................................................................................... 17

6.1. SUPPLIER LOOP............................................................................................................... 17

6.2. PACEMAKER/CUSTOMER LOOP ..................................................................................... 17

6.3. PROCESS LOOP ............................................................................................................... 19

6.4. AZ LOOP .......................................................................................................................... 19

6.4.1. Press Blank .............................................................................................................. 20

SMED ................................................................................................................................. 20

6.4.2. Press Form .............................................................................................................. 21

SMED ................................................................................................................................. 21

6.4.3. Machining Cell ......................................................................................................... 21

Calculations ....................................................................................................................... 22

Yamazumi Board ............................................................................................................... 23

Standard Ops Sheet .......................................................................................................... 24

6.4.4. Automatic Paint ...................................................................................................... 24

6.5. BZ LOOP .......................................................................................................................... 25

6.5.1. Saw .......................................................................................................................... 25

6.5.2. BZ Cell ...................................................................................................................... 26

Calculations ....................................................................................................................... 26

Cell Layout ......................................................................................................................... 27

Walk Diagrams .................................................................................................................. 27

6.5.3. Heat Treatment ....................................................................................................... 28

6.6. ASSEMBLY LOOP ............................................................................................................. 28

6.6.1. Assembly 1 .............................................................................................................. 29

6.6.2. Assembly Cell .......................................................................................................... 29

Yamazumi board ............................................................................................................... 30

Standard Operations Sheet ............................................................................................... 30

6.7. FACTORY LAYOUT ........................................................................................................... 31

7. IMPLEMENTATION PLAN ...................................................................................................... 32

8. BENEFITS ............................................................................................................................... 34

9. REFERENCES .......................................................................................................................... 35

List of Figures

Figure 2-1 - Types of kanban signals - Source: (Nash & Poling, 2011) ............................................ 9

Figure 3-1: WIP in days after each process ................................................................................... 12

Table 3-1: Pareto Analysis of WIP in days ..................................................................................... 13

Figure 3-2: Percentage utilization with respect to the takt time ................................................. 14

(Note: Takt time for processes press blank to automatic paint is 150 sec whereas takt time of

process saw to assembly 3 is 300 sec) .......................................................................................... 14

Figure 5-1: Suppliers loop ............................................................................................................. 17

Figure 5-2: Pacemaker loop .......................................................................................................... 18

Table 5-1: Heijunka Box ................................................................................................................ 19

Figure 5-3: AZ Loop ....................................................................................................................... 19

Figure 5-4: Current state yamazumi board ................................................................................... 23

Figure 5-5: Yamazumi board Adjusted ....................................................................................... 23

Figure 5-6: Standard Operations Sheet (Manufacturing cell)....................................................... 24

Figure 5-7: BZ Loop ....................................................................................................................... 25

Figure 5-8: Cell Layout - BZ Cell .................................................................................................... 27

Figure 5-9: Walk Diagram ............................................................................................................. 27

Figure 5-10: Assembly loop ........................................................................................................... 29

Figure 5-11: Yamazumi Board - Assembly cell .............................................................................. 30

Figure 5-12: Spaghetti Diagram .................................................................................................... 31

1. INTRODUCTION

The roots of the lean manufacturing principles can be traced back to the Ford production

system developed by Henry Ford himself. It was the first instance in which the complete

production process was integrated into a single flow using the concept of moving assembly

lines. Special-purpose machines and go/no-go gauges were used to fabricate and assemble

different components within a few minutes. The problem with this system was that it greatly

reduced the worker span of control and was unable to provide any variety in the product.

After World War II, the Japanese analyzed Fords Original thinking and introduced simple

innovations to provide both continuity and variability in the process flow. These innovations

were implemented within the Toyota Production System and were later named as the lean

production methodology.

The Lean production system, as introduced by Toyota, was composed of five basic principles

(Womack & Jones, 1996)

To identify the value that the customer desires

To identify the processes that add value to the product and eliminate all wastes (muda)

within the process

To make a continuous flow of product through the value-added processes

To introduce pull systems in place of push between steps where continuous flow is not

possible

Continuously improve to reduce the steps, time and information needed to meet the

customer demand

This philosophy helped Toyota become the largest automaker in terms of the overall sales and

poised it as the exemplar in efficient production systems (OICA, 2012). Today, lean has becomes

an industrial norm and more and more organizations are attempting to implement lean in both

the manufacturing and the service industry.

Over the years a number of different technologies and tools have progressed lean even further

and has ushered a new age in the lean production systems. However, switching from a mass

production to a lean manufacturing system is not an easy feat and hence several companies are

still hesitant in introducing lean technologies. One of the key problems faced is the difficulty in

identifying the wastes within the system and the changes to be made (Ludvig, 2011). To

facilitate a smooth transition from a mass production philosophy to lean manufacturing Mike

Rother and John Shook introduced the concept of value stream mapping in their book Learning

to See (Rother & Shook, 1999). The value stream map is a method of mapping the process flow

and the communications within the processes of an organization. Such a map enables almost

anyone to differentiate the value from the wastes and can be used to develop a picture of how

the process flow should be in the future.

The current report is a continuation of the previous report in which a current state map was

developed for the Reads Automotive Components. Upon analyses of the current state map,

several areas of improvement were identified. These will be introduced and implemented in the

future state map and presented in this report.

2. LITERATURE REVIEW

2.1. VALUE STREAM MAPPING

Value Stream Mapping is a tool used in the industry to understand the flow of material and

information as a product makes its way through the value stream (Rother & Shook, 1999).

There are several benefits to value stream mapping.

1) Firstly, it enables us to visualize the complete flow rather than a single process.

2) It also makes the wastes in the process more visible and easy to recognize.

3) Value Stream Mapping promotes a common language that can be used by everyone to

communicate about the manufacturing processes

4) It brings to light the different decisions within the flow enabling discussions over them

5) It makes the implementation easier by providing the basis for an implementation plan

6) It helps link the flow of information with the flow of material within the process.

7) Lastly, it provides a qualitative overview as opposed to a quantitative one and hence

describes in detail what is needed to create flow.

Value stream maps can be used throughout the implementation process to identify the areas

for improvement and then to develop the implementation plan. It involves the development of

a current state map and a future state map.

2.1.1. Current State Map

The current state map is a picture in time of the current processes involved in the production. It

provides a detailed view of the flow of information from the customer through the production

control and to the supplier as well as the flow of materials from the supplier through the

various processes and then to the customer.

The current state map brings to light the different wastes within the processes and hence

provides a starting point for the implementation of lean techniques. Combining the current

state map with other lean analysis tools such as the Yamazumi board, spaghetti charts and

pareto analysis can prove to be very powerful in determining the areas for improvement.

The current state map and the various analysis tools were described in detail and utilized in

coursework 1, wherein a current state map for Reads Automotive Components was produced.

2.1.2. Future State Map

The future state map is developed using the current state map such that its implementation

results in the elimination of the wastes discovered in the current state map. It provides the

goals to achieve so as to make the process completely efficient. This map provides the basis for

all the actions needed to create a continuous flow.

Though the future state map provides the goal that must be achieved, it is not always that the

value stream is modified exactly as the future state map. This is because while each of the

outcomes of the future state map are implemented, new problems and opportunities arise,

thereby greatly changing the value stream. Oft times some changes take too long or may be too

expensive to implement. Hence while the eventual outcome could be close to the map, it may

not be exactly the same. In this way the future state map provides the blueprint for the change

(Nash & Poling, 2011).

To create the future state map, the first step is to brainstorm on the current state map and

identify the areas of improvement and the possible solutions. These can be illustrated directly

on the current state map in the form of Kaizen bursts. Once all the potential solutions are

recorded, the most applicable and suitable solutions are selected and used to develop the

future state.

The future state map generally makes use of several lean tools such as the supermarket, FIFO

lanes, kanbans and the Heijunka box. These tools and techniques are discussed and described

in the subsequent sections.

2.2. TOOLS AND TECHNIQUES FOR THE FUTURE STATE

The value stream maps illustrate the bigger picture of the current processes and the future

changes. This big picture is then comprehended by several tools and techniques which provide

insight of how the processes work. Some of the key tools and techniques used to find the

wastes in a current state map have been described and used in coursework 1. In this report, the

tools and techniques for identifying the areas of improvement and implementing those

improvements will be used. These tools are

2.2.1. Pareto Analysis

The Pareto Principle was first used by Vilfredo Pareto, an Italian economist in the nineteenth

century, who determined that about 80% of the wealth in the state was in the hands of only

20% of the people. The Pareto Principle was found to be true in several other situations in the

industry and government. To put in general terms, the Pareto principle states that 80% of the

effects are caused by 20% of the causes (Fryman, 2002).

The strength of the Pareto principle lies in the fact that it can be used to identify the largest

contributors of process variations or other areas which provides valuable insight on where to

spend resources (Fryman, 2002).

The Pareto analysis is performed by arranging the different categories in a descending order

and finding the cumulative values at each level. Upon calculation of the percentages of the

cumulative values, the largest contributors can be identified easily.

2.2.2. Spaghetti Diagram

A spaghetti diagram is a visual layout of the flow of the process as it would appear as one walks

through it from the beginning to the end (Nash & Poling, 2011). The spaghetti diagram enables

the viewer to observe the movement of the operator. This brings to light the wastes of motion

and transportation and can be used to determine the optimal layout of the different

departments such that the distances travelled between processes is minimal. Reducing the

complexity of routes can be extremely advantageous as it reduces the wastes of motion and

transportation while also creates order within the factory floor (Kaplan, 2008).

2.2.3. Heijunka Box

Heijunka is the Japanese term for load leveling or balancing. The Heijunka box is a load

leveling system that enables the factory to make what is needed, when it is needed and in the

exact quantity that it is needed (Luyster & Tapping, 2006).

There are several advantages to such a system. Firstly, it accomplishes a standardized process

that makes any problem within the flow easily visible, allowing immediate corrective action.

Secondly, load leveling also creates a base for other effective kaizen to be implemented. Lastly,

the load leveling system enables quick response to variation in production planning and

scheduling (Luyster & Tapping, 2006).

The Heijunka is responsible for setting the pace of the flow for the product withdrawal and

hence the production process. The heijunka box simply implies that product is withdrawn from

the production line at established increments of time known as the pitch. It is preferable to

keep the pitch as low as possible (Luyster & Tapping, 2006). The pitch (pace of withdrawal) can

be calculated by multiplying the takt time with the no. of products that can fit in a single

container. For example if the takt time is 60 seconds and one container can be filled with 20

products, the pitch of the process will be 20 minutes ((60/60) min * 20). This means that every

20 minutes, a container containing 20 products is withdrawn from the production line. This

helps the production line to constantly measure their performance versus the standard

required.

One of the simplest heijunka systems is the SLMS heijunka developed by Standard Lean

Manufacturing Systems Inc. for the Toyota Production System (Luyster & Tapping, 2006). In this

system a heijunka box is used which has several sections based on the pitch intervals. The

production control places the orders in these boxes and they are withdrawn by the process at

selected intervals i.e. the pitch.

Andon signaling systems can be used if the production line is behind schedule. This notifies the

management that some problem exists within the flow and enables them to react in a timely

manner. To maintain the production while behind schedule, wait boxes can also be used

(Luyster & Tapping, 2006).

2.2.4. Kanban

Kanban in Japanese refers to a visual signal. Kanban is described as a material flow control

mechanism and determines the proper quantity and the proper time for the production of the

required products (Graves, et al., 1995). A Kanban system was initially developed to fulfill the

specific needs of the Toyota Production System and was later adopted into the general lean

manufacturing principles (Junior & Filho, 2010).

Within the setting of a lean manufacturing plant, several Kanban signals are used for relaying

information. Kanbans sent to the purchasing department are collected at the Kanban post

(Junior & Filho, 2010). Within a supermarket, two types of Kanbans are used the withdrawal

Kanban and the production Kanban. The withdrawal Kanban visually informs the workers when

replenishment is required. This informs the workers when raw materials, the work in process or

finished goods need to be withdrawn from the supermarket. On the other hand, the production

kanbans are replenishment signals from a super market to an upstream process and signals the

process to produce additional parts and products (Nash & Poling, 2011). The representation of

the different kanbans in the value stream maps is provided below:

Figure 2-1 - Types of kanban signals - Source: (Nash & Poling, 2011)

2.2.5. Pacemaker Process

While in a push system schedules are sent to each and every process, in a pull system the

schedule is provided to only one process known as the pacemaker process. The way the

production at this process is controlled determines the pace for all the upstream processes. The

pacemaker also determines the processes in the value stream that become part of the time

required to meet the customer demand. For this reason it is mostly preferable to set the most

downstream continuous flow process as the pacemaker (Rother & Shook, 1999).

2.2.6. Supermarkets

A supermarket is a controlled inventory system where kanbans are used to signal the need for

replenishment. These kanbans are generally in the form of visual aids, such as cards, bins, lights

or racks that inform the employees in the value stream that additional inventory or WIP is

required. Supermarkets are used in order to control the inventory in places where continuous

flow is not possible.

Supermarkets are used to control and manage several products in the value stream. The

upstream process connected to the supermarket sends a withdrawal Kanban signal to the

supermarket and receives the required amount of items. Based upon the amount withdrawn,

the supermarket then sends a production Kanban to the upstream process to which it is

connected. This signals the process to start production and supply the required amount of parts

to the supermarket. Supermarkets are represented in a value stream map as:

2.2.7. FIFO Lanes

A FIFO lane (first in, first out) is an inventory management system that ensures that the oldest

WIP that enters the area is the first to receive the value added activity. The amount of WIP that

stays at the FIFO lane is generally limited to a specific amount. When the limit of the WIP is

reached, the preceding process stops production.

The FIFO lanes are very easy to manage as they do not need much Kanban signaling (only the

first process needs to know when to produce). However, in certain situations it is unfavorable

to use a FIFO lane such as

When the two processes have very different cycle times

When lot sizes of each product is different

When parallel processes merge or a single flow splits

When high flexibility and reaction time is required

A general value stream contains a mix of FIFO lanes and supermarkets. Generally all the

processes upstream of the pacemaker process are connected by a FIFO lane. The FIFO lane is

represented on the future state map as

3. REVIEW OF CURRENT STATE MAP

The current state map for RAC was developed in coursework 1 and was analyzed with respect

to the lean manufacturing principles. The current state map along with the tools used to

analyze the map in coursework 1 are presented in Appendix A. Based on the analysis it was

found that at least 6 of the 7 deadly wastes of lean was present in the process stream. These

were the wastes of inventory, transportation, motion, waiting, overproduction and defects.

Before building the future state map, it is essential to identify the areas for improvement in the

current process and analyze which of these will be most applicable.

3.1. WIP IN DAYS

Based on the current state map, the WIP after each process is presented in Figure 3.1.

Figure 3-1: WIP in days after each process

Figure 3.1 provides a clear view of the WIP in days after each process and its impact on the

system. This can be used to perform the Pareto analysis and identify the greatest contributors

to the inventory in the process.

0

2

4

6

8

10

12

14

16

18

WIP

(d

ays)

Process

3.2. PARETO ANALYSIS

The Pareto analysis for the WIP in days is illustrated in Table 3.1. The major contributors to the

WIP in days have been highlighted in blue.

Table 3-1: Pareto Analysis of WIP in days

Process WIP (days) Cumulative WIP Cumulative WIP (%) Cumulative Range (%)

Press Blank 16.9 16.9 19.31 6.67

Dispatch 16 32.9 37.60 13.33

Grind 7.7 40.6 46.39 20.00

Heat Treatment 7.1 47.7 54.51 26.67

Raw Materials Store 5 52.7 60.22 33.33

Raw Materials Store (BZ111) 5 57.7 65.94 40.00

Press Form 4.8 62.5 71.42 46.67

Insert 4.7 67.2 76.79 53.33

Drill 3.9 71.1 81.25 60.00

Assembly 2 3.8 74.9 85.59 66.67

Automatic paint 3.6 78.5 89.70 73.33

Assembly 1 3.2 81.7 93.36 80.00

Saw 2.4 84.1 96.10 86.67

Assembly 3 2.3 86.4 98.73 93.33

CNC Turn 1.11 87.51 100.00 100.00

TOTAL 87.51

As evident from the analysis, 60% of the processes contribute to 81.25% of the WIP. This shows

that the 20/80 rule is not completely applicable and hence to produce a sizeable impact,

changes must be introduced in several processes. Inventory at Press blank, grind, press form,

insert and drill can be eliminated by introducing cells. Where continuous flow is not possible,

supermarkets and FIFO lanes can be used. Similarly inventory at the Dispatch and the two raw

material stores is reduced by the use of supermarkets and FIFO lanes. However, since the heat

treatment process is sub-contracted, it is not possible to reduce the turnaround time. In this

case we can only connect the preceding and the succeeding processes with a FIFO lane or

supermarket.

Often all the changes suggested in the Future State Map may not be implemented due to lack

of resources or long time for implementation. In such cases a Pareto analysis becomes

extremely useful in order to identify optimization of which processes will produce the greatest

impact. The Pareto analysis performed here shows that to effectively reduce the inventory, the

excess WIP at 6 of the processes have to be eliminated.

3.3. PERCENTAGE UTILIZATION

Another common area of improvement is the utilization of the machines. Often the workload

distributed between the workers is uneven. This results in greater stress at some process while

wastage due to waiting at other processes. Figure 3.2 provides a visual representation of the

utilization of the machines and their comparison to the takt time.

Figure 3-2: Percentage utilization with respect to the takt time (Note: Takt time for processes press blank to automatic paint is 150 sec whereas takt time of process saw to assembly 3 is 300 sec)

We can see from Figure 3.2 that there is great variability in the percentage utilization. While

some operators contribute to only 5% of the takt time, others contribute to almost 200% of the

takt time. This variability results in bottleneck and stress, which in turn reduces efficiency and

quality of products. Therefore, work balancing must be introduced to the value stream.

3.4. CURRENT STATE MAP (WITH KAIZEN BURST SUGGESTIONS)

In the preceding sections several areas for improvement were recognized in the current value

stream. Based on the literature review, all the suggestions are then noted on the current state

value stream map inside Kaizen bursts. These makes it easier to develop the future state map

based on the suggested changes. The current state map with the suggested changes is

illustrated in Figure 3.3.

0

20

40

60

80

100

120

140

160

180

200

Pe

rce

nta

ge U

tiliz

atio

n

Processes

Introduce

Cell

4. FUTURE STATE MAP

Figure 5-1: Suppliers loop

5. DISCUSSION

5.1. SUPPLIER LOOP

A closer look at the supplier loop in the future state map is provided

in Figure 5.1. As seen in the future state map, the inventory raw

materials store at the start of the AZ process stream and the BZ

process stream has been replaced by supermarkets. This ensures that

the inventory at the raw materials store is controlled.

In the current state map the inventory at the raw goods store

accounts for five days in the lead time. The need for a high amount of

inventory is due to the fact that raw materials from lanchester steel

are received only once a week. Hence the raw goods store must

contain raw materials for the whole week, equivalent to 5 days. To

eliminate this, it is suggested to instead place a daily order to

Lanchester steel and therefore receive raw materials for each of the

process streams daily. Therefore, it would be only necessary to hold a

single days inventory at the raw goods store. In order to account for

delays or other risks, a safety stock of 0.5 days may be added,

therefore making the total inventory at the raw goods supermarket to

be 1.5 days.

When materials are withdrawn from the raw materials supermarkets,

a withdrawal Kanban post is issued which sends a signal to the

production control to place a daily order to Lanchester Steel. This

ensures that the order is placed based on the actual usage and not

based on the MRPs estimate of the future usage of the raw materials.

Though MRP may still be used to provide capacity-planning forecasts

for the supplier, the day to day orders must be based on pull. This

type of daily receipt of raw materials is called milk runs.

5.2. PACEMAKER/CUSTOMER LOOP

The pacemaker loop displays the material and information flow between the production

control, the customer and the pacemaker process of the value stream. Figure 5.2 presents a

closer look at the pacemaker loop of the future state map of RAC.

The customer demand is 2520 car sets per month, where each car set consists of the parts

AZ123, AZ124, AZ223 and AZ224. This equates to a daily demand of 504 units of each part per

day. The daily demand for BZ111 components that assemble to AZ123 and AZ124 will be 252

units per day.

3 shipments per day are carried out to the customer. Returnable carriers hold 15 assemblies

each.

The production control sets the pitch for the process stream. The pitch for RAC can be

calculated using the takt time and the packout quantity. The takt time for the assembly flow is

150 seconds as calculated in the current state map (Appendix ).

=

= 15 150

= 2,250 = .

Therefore, the daily order is divided based on the pitch and every 37.5 minutes production

control provides instructions for withdrawal of 15 assemblies from the supermarket, through

Kanban posts in the load levelling box. These assemblies are then transferred to the dispatch

for shipment. The withdrawal of parts from the supermarkets triggers signal Kanban that

notifies the preceding process for replenishment. The Heijunka box for the future state map of

RAC Automotive is displayed in table 5.1

Figure 5-2: Pacemaker loop

Table 5-1: Heijunka Box

8:00 8:37 9:15 9:30 10:08 10:46 11:24 11:54 12:32 13:09 13:47 14:02 14:40 15:18 15:56

AZ 123

Bre

ak 1

Lun

ch

Bre

ak 2

AZ 124

AZ 223

AZ 224

BZ 111

5.3. PROCESS LOOP

The process or the manufacturing loop represents the flow of information and materials

through the process stream. The process stream can be divided into three further loops,

namely the AZ Loop, The BZ Loop and the Assembly loop.

5.4. AZ LOOP

The AZ Loop contains the processes press blank, press form, machining cell and automatic

paint. A closer view of these processes is provided in figure 5.3.

Figure 5-3: AZ Loop

AZ 123

The processes press blank, press form, machining cell and auto paint are connected by a FIFO

lane. Upon withdrawal of items from the supermarket after Auto Paint, a batch signal is sent to

the very first process i.e. the press blank. The need of a batch signal arises from the fact that

press blank is a low cycle time shared resource, due to which it must be done in batches. There

are several reasons for using FIFO lanes in between the four processes. Firstly, FIFO lanes add

simplicity to the system as compared to supermarkets, which require much organization and

control. This simplicity ensures smooth flow within the process stream. Secondly, FIFO lanes

can often prove advantageous in batch processes, and since the first two processes in the AZ

loop are batch, it becomes ideal. After the process Auto Paint it is necessary to have a

supermarket. This is because after this process the stream splits into two, with 2 parts going to

assembly 2 and 2 parts going to assembly 1. In base of splitting or joining of process stream,

FIFO lanes become difficult to manage and hence supermarkets are preferable. Moreover, they

also provide a flow of information from the pacemaker process to the first process.

5.4.1. Press Blank

Press blank are high volume high value equipment and is consequently a shared resource at

RAC. Due to this it cannot be placed in a cell and must remain as a separate process. However,

the main issues with the press blank that has been highlighted in the current state map is the

extremely large batch size. Currently a batch size of 2500 is used which results in almost every

product every month. The reason for such high batch times is that even through the process

takes only 3 seconds, the changeover time takes 320 minute. Such high changeover times and

low cycle times result in the need for high batch sizes. In order to prevent accumulation of

inventory due to high batch size, it is necessary to therefore reduce the batch size.

SMED

The concept of SMED (Single Minute Exchange of Dyes) can be used to attain a production rate

of every product every shift for the Press Blank process. Currently the changeover takes 320

minutes, while carrying out the operation on a batch size of 2500 would take (2500 x 3) or 125

minutes. This would add up to be 445 minutes. However, the available time per shift is only 420

minutes. Therefore, the work will have to be carried over to the next shift. This does not

account for the other processes that need to be carried out on the press blank as it is a shared

resource.

One way the changeover time can be reduced is by changing the layout. As shown in the

spaghetti chart, the tool storage and the tooling area are separated from the main factory floor

by three other rooms. Hence a majority of the time is taken in walking between the two areas

and unnecessary motion. To eliminate this waste, the tools required for Press blank must be

available next to the machine. Using 5S principles to create a clean and organized workplace

can further reduce the changeover time. Finally, it would require an analysis of the external and

the internal work elements to appropriately distribute the work while the machine is operating

and when it is stopped. It is assumed that upon performing the aforementioned techniques, the

changeover time has been reduced to less than 10 minutes.

Once the change over time has been reduced, we can create continuous flow by sizing the

batch such that it is completed within the takt time. From the current state map, we know that

the takt time for the process is 150 seconds and the cycle time is 3 seconds. Therefore the

appropriate batch size would be 50. Using this method we can now produce every product

every shift.

5.4.2. Press Form

Similar changes can be introduced to the press form process. As with the press blank process,

this is a high change over low cycle time process that operates in batches of 2500 units.

SMED

The cycle time of press form is 5 seconds while its changeover time is 290 seconds. As with the

press blank, the major causes of high changeover times are the wasteful motion. By eliminating

long walks, applying 5S techniques and appropriately converting internal work elements to

external, we can assume that the changeover time has been reduced to less than 10 minutes. In

order to match the total time with the takt time, we can use a batch of 30 units which would be

produced in 150 seconds.

Note: It may seem that the press blank and the press form processes are producing much faster

than needed, since they produce in batches of 50 and 30 every takt instead of just one product

every takt. However, in practical the machines are not operated continuously as they are a

shared resource and will be used for other processes as well. Therefore, whenever needed they

produce in batches and transfer it to the FIFO lanes. The maximum capacity of the FIFO lane

can be calculated by adding the batch sizes of the two processes and the safety stock.

Max. no. of units (FIFO1) = 50 + 30 + 20 = 100

Where 20 is assumed the safety stock.

5.4.3. Machining Cell

The machining cell consists of the processes insert and drill. Since the cell does not contain any

automatic process, it is a standard cell.

Calculations

Firstly it is necessary to decide the number of operators for the cell. This can be calculated using

the formula:

. =

=38 + 60

150

= 0.65 = 1 operator

Next, we need to calculate the target takt time and verify is the operation time is less than the

target takt time. To do these we need to calculate the overall equipment efficiency. Assuming

an equipment efficiency 95% we have

=

() = 0.95 0.99

() = 94.05%

() = 0.95 0.95

() = 90.25%

() = 92.15

=

= 150 0.9215

= .

The Total operation time is 98 seconds which is well below the target takt time.

Yamazumi Board

Figure 5-4: Current state yamazumi board

Figure 5.4. shows the current work distribution of the two processes and its relation to the takt

time. It is clear from the yamazumi board that the two operators are underutilized and work for

less than half the takt time. Therefore, in the future state machining cell, the two operations

are clubbed together and performed by a single operator.

Figure 5-5: Yamazumi board Adjusted

Figure 5.5 shows the yamazumi board that has been adjusted for the machining cell. A single

operator performs both the two operations. The total cycle time for the cell is 98 seconds which

is still well below the takt time of 150 seconds. However, it is not possible to combine either the

preceding or the succeeding process with the cell and hence the subsequent FIFO lane size is

adjusted to prevent overproduction from the machining cell.

0

50

100

150

200

Operator 1 Operator 2Insert Drill Takt

0

50

100

150

Operator 1

Chart Title

Insert Drill

Takt Time

Takt Time

Standard Ops Sheet

The standard Operations sheet provides the general layout of the cell. As seen in the standard

operations sheet, a general L shaped plan will be used wherein the operator retrieves raw

materials from the raw goods store, performs Insert operation, switches to Drill operation and

then places the units in the finished goods store.

5.4.4. Automatic Paint

The cycle time for the automatic paint is 280 seconds. This is well above the takt time of 159

seconds. Moreover, it is not possible to accommodate the automatic paint in the

manufacturing cell as the complete walks, manual operation times, and load unload times

would exceed the target takt time.

Though the cycle time of the automatic paint is 280 seconds, it produces 2 units in that time as

it can hold two parts at a time. Moreover, the twin pallet system allows for efficiently loading

Insert Drill

Gan

gway

Figure 5-6: Standard Operations Sheet (Manufacturing cell)

1

2

Raw Materials

Store

Finished

Goods

Store

2 1 2

Operator route Standard WIP

Safety alert Operator Quality check

and unloading while the operation is continuing, i.e. loading and unloading becomes and

external process. Due to this even though the cycle time of the machine is higher, it will be able

to meet the demand within the pitch and does not require a purchase of an extra machine.

However, to ensure that there is no waiting, the inventory before and after the automatic paint

must be appropriately managed.

The automatic paint is connected to the preceding process by a FIFO lane. The FIFO lane has a

maximum size of 100 units and it ensures that enough WIP is always available to the automatic

paint.

The succeeding process is connected by a supermarket. Therefore, we must ensure that the

supermarket has enough WIP to meet the needs of the succeeding processes. For this reason, a

WIP of 50 units for each product is selected. Moreover, the reorder point is set to 20 units. This

ensures that there is no shortage of parts to the processes after the automatic paint.

5.5. BZ LOOP

The BZ loop contains the saw, BZ cell and the heat treatment. It is responsible for producing the

BZ 111 parts which then attach to the AZ 223 and AZ 224 parts in Assembly 1. A summary of all

the operations and cells within the BZ loop are presented below.

Figure 5-7: BZ Loop

5.5.1. Saw

The first operation in the BZ loop is saw. However, this is a shared resource and hence cannot

be introduced in a flow. Therefore it has to be kept as a separate process. To introduce smooth

flow, a supermarket is used after the Saw operation.

Raw materials are withdrawn from the raw materials supermarket and then undergo the saw

operation which has a cycle time of 15 seconds. To meet with the takt time of the flow it is

suggested to carry out the saw operation in matches of 20 units. Therefore the total time of the

operation will be 300 seconds which corresponds to the takt time. Moreover, there is no

changeover time and hence no modifications are needed.

The saw operation is followed by a supermarket with a maximum capacity of 50 units. The

reorder point of the supermarket is 10 units since the replenishment time of the previous

operation is small.

5.5.2. BZ Cell

The BZ Cell contains the operations CNC Turn and Grind. Since it contains both automatic and

manual times, the cell is a nagare cell. Based on the high cycle time, a new CNC turn machine

will be needed to complete a single walk within the takt time.

Calculations

The first step is to calculate the number of operators for the nagare cell. For this it is necassry

to present a clear view of the manual and the automatic operations.

Operation Manual Time Automatic Time

CNC 10s 535s

Grind 250s -

Therefore the total manual time for the operation is 260 seconds.

Calculating the no. of operators = 260/300

= 0.8667 = 1 operator

Therefore only a single operator is required.

Next we need to calculate the target takt time of the cell. We assume the performance of the

equipment to be 95%

OEE (CNC) = 0.95 x 0.9 = 85.5%

OEE (Grind) = 0.95 x 0.92 = 87.45%

OEE (Avg) = 86.48%

Target takt time = 0.8648 x 300 = 259.43 seconds

Cell Layout

A standard U shape layout is selected for the BZ cell. It is assumed that walks between the

machines takes 3 seconds.

Walk Diagrams

Figure 5-9: Walk Diagram

The operator first takes raw materials from the raw materials store and loads them in CNC 1.

Then he moves on to the Grind and performs manual work for 250 seconds. After completing

his work he places the units in the finished goods store and starts the second cycle. In the

seconds cycle the operator uses the CNC 2 machine while the automatic process in CNC 1 still

RMS CNC

Grind FGS

Figure 5-8: Cell Layout - BZ Cell

continues. By the end of the second cycle the CNC 1 has completed the automatic work and is

used in the third cycle.

The total time for the operator assuming 3 second walks will be

3 + 10 + 3 + 250 + 3 + 3 = 272 seconds

Therefore the operator has a lag time of 18 seconds. However, this is higher than the target

takt time of 259 seconds. Therefore, steps must be taken to improve the performance and

quality pass rate of the machine so that the target takt time is higher. This would require better

maintenance or replacement with a new machine in the long term.

It is to be noted that the CNC Turn machine has a very high changeover time of 120 minutes.

However, since the BZ loop is dedicated to only a single type of product, changeovers within

the loop will not be required and hence there is no need to apply SMED principles to the CNC

Turn. However, 5S principles may still be applied to promote a more well organized layout.

5.5.3. Heat Treatment

The final process in the BZ Loop is the Heat treatment. The heat treatment is a subcontracted

process and hence it cannot be optimized to reduce cycle times or inventory. Currently the heat

treatment takes 120 minutes and has a turnaround time of 3 days. This turnaround time is non

value added but cannot be changed as the process is subcontracted.

It is not possible to connect subcontracted systems with a supermarkets as the subcontractors

may not agree to use the Kanban signals for providing replenishment. Moreover, due to a high

turnaround time it is also needed to have some amount of WIP as a safety stock. Hence the

best option to connect subcontracted processes is through a FIFO lane. This ensures that there

is always enough WIP to meet the demands of the processes further down the stream.

5.6. ASSEMBLY LOOP

The assembly loop consists of Assembly 1 and the Assembly cell.

Figure 5-10: Assembly loop

5.6.1. Assembly 1

Assembly 1 is responsible for the assembling of AZ 123 and AZ 123 parts with the BZ 111 parts.

This process cannot be introduced in a cell. This is due to the splitting of the process streams

before and after the cell, which would make it extremely difficult to manage if put in a cell.

The takt time for Assembly 1 is 300 seconds, while is cycle time is 290 seconds. Therefore the

operation is within the takt time and has 10 seconds of lag time. This is ideal and hence does

not require any optimization.

Assembly 1 receives AZ 123 and AZ 124 units from the automatic paint through a supermarket

and received BZ 11 parts from the heat treatment subcontractor through a FIFO lane. Since

there a split in the process stream before the process and convergence after the process, it is

necessary to keep Assembly 1 separate from the other assemblies. This is done also due to the

fact that its takt time is different than the takt time of Assembly 2 and Assembly 3.

5.6.2. Assembly Cell

Assembly 2 and Assembly 3 have been grouped together to form and assembly cell. This is

because the two processes have a very low cycle time and hence are well below the takt time

even after grouping the two together. This is the pacemaker process as the supermarket

succeeding the cell receives the order every pitch from the production control.

The Assembly cell withdraws AZ 123 and AZ 124 parts from the supermarket after assembly 1,

and withdraws AZ 223 and AZ 224 parts from the supermarket after Automatic paint.

Therefore, the use of supermarkets in the previous processes helps create a smooth continuous

flow. A FIFO lane in place of the supermarkets would have been possible but would be

extremely difficult to manage. The Assembly cell is followed by a supermarket. When units are

withdrawn from the supermarket for dispatch, a signal is sent to the Assembly cell for

replenishment. The reorder point of the super market is selected to be 10 units.

Yamazumi board

Figure 5-11: Yamazumi Board - Assembly cell

Figure 5.10 shows the comparison of the workloads before and after. Initially, the two

operators have a very low work load which results in much waste. When both the operations

are clubbed together to be performed by a single operator, the work load is still below the takt

time with 5 seconds of lag time.

Standard Operations Sheet

Since the cell consists of only a single operator performing both assembly 2 and assembly 3, the

layout of the cell is extremely simple with a single desk with raw materials and finished goods

store on either side.

0

20

40

60

80

100

120

140

160

Operator 1 Operator 2

Assembly 2 Assembly 3 Takt

0

20

40

60

80

100

120

140

160

Operator 1

Assembly 1 Assembly 2

Takt Time

5.7. FACTORY LAYOUT

In order to accommodate the cells and implement the different parts discussed above, the

factory layout must be changed to be better suited for cellular manufacturing.

The spaghetti diagram shows the flow of products through the layout of the factory floor. Based

on the future state map, a change in the factory floor layout has been proposed. The suggested

layout ensures a smooth flow of units through the factory floor. The use of 5S principles and

well organized work space with tooling present right at the point of use has eliminated the

need for a separate tool room, tool store and a guage room. Moreover, the use of a

supermarket at the start has also eliminated the need of a raw materials store. Due to this the

overall space taken has been greatly reduced. The flow of products through the factory flow is

in a single line and is therefore ideal. Assembly 1 has been placed at one end of the factory

floor which enables it to be efficiently connected to another part where the BZ 111 units will be

produced.

Press Shop Machining Cell Automatic Paint

Assembly 1 Assembly Cell Dispatch

NDT X-Ray

Go

od

s

Go

od

s

Ou

t

I

n

Inspection

Figure 5-12: Spaghetti Diagram

6. IMPLEMENTATION PLAN

VSM Loop Objectives Measures and targets Person Implementation Schedule () Completed

On 1 2 3 4 5 6 7 8 9 10 11 12

Pacemaker loop Minimize inventory at dispatch Use Supermarket before dispatch

Supplier loop Minimize inventory at raw materials store

Establish milk runs, Use supermakret in place of raw materials store

Assembly loop Create continuous flow Place Assembly 1 and Assembly 2 in Assembly cell

Assembly loop Establish pull system Use a supermarket before and after assembly cell

AZ loop Create continuous flow Establish cellular manufacturing. Place Insert and drill in a cell

AZ loop Reduce batch size Perform SMED optimizations for press blank and press form

AZ loop Establish pull system Connect Press blank, form, machining cell and automatic paint through FIFO.

BZ loop Create continuous flow Place CNC and Grind in BZ Cell

BZ loop Establish pull system Uses supermarkets to connect saw and BZ sell. Use FIFO to connect to subcontrated heat treatment

Process loop Manage parallel flow Establish supermarkets between AZ loop, BZ loop and Assembly loop

Pacemaker loop Production levelling Introduce Heijunka box with a pitch of 37.5 minutes.

Implementation Plan Review Scheduled Date Person in Charge

7. BENEFITS

The Future state map shows several benefits as compared to the current process. These

benefits are described below:

Lead Time Reduction Initially the total lead time of the process was 64.2 days. This was

extremely high and was the cause for the need of large inventories. However, the lead time in

the future state map is only 6.6 days which shows that the lead time has been greatly reduced.

Low inventory The future state map has eliminated the need for separate areas for inventory.

This therefore greatly reduces the costs, as a dedicated area for inventory is not required.

Change over Times The changeover times for 3 equipment have also been greatly reduced by

using 5S and SMED principles. This therefore has enabled the production rate of every product

every shift and has greatly reduced the time to meet customer demand.

Bottlenecks By making sure that every product is produced to takt time, the bottlenecks in

the process have been eliminated and hence has this has reduced the stress on workers as well

as waiting times. This can result in better quality of the products and lesser reworks as the

operator is not too stressed.

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Junior, M. L. & Filho, M. G., 2010. Variations of the kanban system: Literature review and

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Kaplan, G. S., 2008. Advanced Lean Thinking: Proven Methods to Reduce Waste and Improve

Quality in Health Care. 1 ed. s.l.:Joint Commission Resources.

Ludvig, A., 2011. Challenges of implementing lean principles in product development - the case

of Visual planning. Cambridge, 18th EurOMA Conference.

Luyster, T. & Tapping, D., 2006. Creating You Lean Future State: How to move from Seeing to

Doing. 1 ed. s.l.:Productivity Press.

Nash, M. A. & Poling, S. R., 2011. Mapping the Total Value Stream. s.l.:CRC Press.

OICA, 2012. World motor vehicle production: OICA correspondents survey, World Ranking of

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[Accessed 22 Dec 2014].

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Womack, J. P. & Jones, D. T., 1996. Lean Thinking. Michigan: Simon & Schuster.