lean manufacturing's unexpected windfall: a lower carbon footprint
DESCRIPTION
Lean manufacturing, also known as the Toyota Production System, is more than just a way to make your company more profitable, meet competitive challenges, and achieve sustainable competitive advantage. It also lowers your company's carbon footprint. Presented at ABB's Automation and Power World 2013, this presentation describes the ways that Lean Manufacturing can make your company not only more efficient, but also a better corporate citizen.TRANSCRIPT
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Tuesday March 26, Session 10311
Lean Manufacturing's Unexpected
Windfall: A Lower Carbon Footprint
Charles M. Cohon, CEO
www.primedevices.com
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�Make my company more profitable.
�Help my company meet competitive threats.
�Achieve sustainablecompetitive advantage
Lean usually is a way to:
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�Make my company more profitable.
�Help my company meet competitive threats.
�Achieve sustainablecompetitive advantage
But not for today!
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Today Lean is a way to:
�Reduce my company’scarbon footprint.
�Reduce my industry’scarbon footprint.
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Page 129
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“Consider the waste of overproduction, for example. It is not an exaggeration to say that in a low-growth period such waste is
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“Consider the waste of overproduction, for example. It is not an exaggeration to say that in a low-growth period such waste is a crime against society more than a business loss.”
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Agenda
�FNGP Seal & Gasket recast from Lean Manufacturing to Green Manufacturing
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�Transition from Batch & Queue to Single Piece Flow
Agenda
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�Two examples from Lean Thinking
�Lantech
�Wiremold (power strips)
Agenda
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�Reduce my company’scarbon footprint?
�Reduce my industry’scarbon footprint?
What are the traditional ways to:
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�Commuting�HVAC systems�Industrial processes (ovens to fork lift trucks)
Atmospheric emissions
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�Duplicated servicesTwo airlines that fly halffull planes from O’Hareto Wichita may decide to code-share.
Atmospheric emissions
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�Sewage�Industrial processes�Underutilized plating operations may be consolidated.
Wastewater emissions
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�From lights and HVAC�From industrial processes
�A lean manufacturer can speed the exit of high-consuming operations.
Power Gen. Emissions
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FNGP (seal & gasket mfr.) Ligonier, Indiana
12002300Feet2 utilized
60055Units/worker/mo.
321Workers
Mo. 40
1,800Mo. 1
1,155
Source:Lean Thinking,Womack and Jones
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2300 230012002300Feet2
55 5560055Units/
wkr./mo.
21 21321Workers
Mo. 11,155
Mo. 401,155
Mo.401,800
Mo. 11,155
Not Green Company
Green Company
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Feet2
Units/wkr./mo.
213Workers
Mo. 40Mo.40
Not Green Company
Green Company
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How does this reduce the Lean Company’s
carbon footprint?
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�Commuting
Atmospheric emissions
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�Sewage
Wastewater emissions
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2300 230012002300Feet2
55 5560055Units/
wkr./mo.
21 21321Workers
Mo. 11,155
Mo. 401,155
Mo.401,800
Mo. 11,155
Not Green Company
Green Company
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23001200Feet2
Units/wkr./mo.
Workers
Not Green Company
Green Company
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How does this reduce the Lean Company’s
carbon footprint?
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�HVAC systems
Atmospheric emissions
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�From lights and HVAC
Power Gen. Emissions
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2300 230012002300Feet2
55 5560055Units/
wkr./mo.
21 21321Workers
Mo. 11,155
Mo. 401,155
Mo.401,800
Mo. 11,155
Not Green Company
Green Company
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Feet2
600Units/
wkr./mo.
+2Workers
Mo. 401,200
Not Green Company
Green Company
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2300 230012002300Feet2
55 5560055Units/
wkr./mo.
21 21321Workers
Mo. 11,155
Mo. 401,155
Mo.401,800
Mo. 11,155
Not Green Company
Green Company
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120030
Feet2
Units/wkr./mo.
Workers
Not Green Company
Green Company
2300 1200+800
33+2
2000
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Green Company
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23002000Feet2
55600Units/
wkr./mo.
213+2Workers
Mo. 401,155
Mo.401,800
Not Green Company
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How does this reduce the this industry’s
carbon footprint?
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�Commuting�HVAC systems�Industrial processes (ovens to fork lift trucks)
Atmospheric emissions
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�Sewage�Industrial processes
Wastewater emissions
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�From lights and HVAC�From industrial processes
Power Gen. Emissions
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The Lean Manufacturer accelerated the exit of a
high-consuming operation
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Batch & Queue
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V C W P
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V C W P
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V C W P
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V C W P
Productive Work
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Raw Material Work In Process (WIP) Finished
Goods
Excess Carbon Footprint
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Excess Carbon Footprint
�Early/unneeded emissions
�Damage to inventory
�Repair & scrap costs
�Complex mfg. requires MRP and/or ERP
�Bar codes and/or RFID
�Data center costs
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�Obsolescence
�Rust and dust
�Warehouse, racks, warehouse personnel, fork lift trucks, etc.
Excess Carbon Footprint
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�Intermittently defective work can be hidden by excess inventory.
Excess Carbon Footprint
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V C W P
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V C W P
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�Defects repeated across an entire batch.
Excess Carbon Footprint
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V C W P
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V C W P
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Single Piece Flow
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V C W P
Single Piece Flow
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V C W P
Single Piece Flow
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V C W
Single Piece Flow
P
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V C
Single Piece Flow
PW
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V
Single Piece Flow
PWC
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Single Piece Flow
PWCV
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PWCV
Preventing Defective Batches
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PWCV
Preventing Defective Batches
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WCV P
Preventing Defective Batches
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CV PW
Preventing Defective Batches
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V PW
Preventing Defective Batches
C
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We never have the time to do it ________ but we always find time to do it ________
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We never have the time to do it rightbut we always find time to do it ________
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We never have the time to do it rightbut we always find time to do it over.
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“We have a large salvage department, which apparently earns us twenty or more million dollars a year…
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“We have a large salvage department, which apparently earns us twenty or more million dollars a year…But as that department grew and became more important and more strikingly valuable, we began to ask ourselves:
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“We have a large salvage department, which apparently earns us twenty or more million dollars a year…But as that department grew and became more important and more strikingly valuable, we began to ask ourselves:‘Why should we have so much to salvage? Are we not giving more attention to reclaiming than not wasting?…’ ”
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“…Our studies and investigations to date have resulted in the savings of 80,000,000 pounds of steel a year that formerly went into scrap and had to be reworked with the expenditure of labor…of upward of two thousand men.”
1926
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Henry FordToday and Tomorrow, 1926
page 98
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Lantech Stretch Wrapping Machinery
�Disaggregate cutting, welding and painting departments
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LantechManufacturing Cells
V C W P
V C W P
V C W P
V C W P
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Lantech (4 Years)
�Defects/machine from 8 to 0.8
�Lead time went from 16 weeks to 14 hours.
�End to expediting
�End to MRP/ERP
�Mfg. space cut in half
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Wiremold (power strips)
�Inventory substituted for machine maintenance
�Inventory substituted for planning.
�Massive back orders tied up Customer Service
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�Guaranteed no lean-related firings in exchange for union cooperation.
�Co-location on factory floor
Wiremold (power strips)
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�Make cord sets as needed.
�Customer service only touches an order to enter it.
�Shipping quickly and completely, so no backordering and no expediting.
Wiremold (power strips)
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Wiremold (5 years)
�Customer service department:
�Smaller
�Cut order entry from 1 week to less than 1 day
�Errors from 10% to under 1%
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Wiremold (5 years)
�Manufacturing
�Manufacturing space cut in half
�Annual Productivity Growth 20%
�Inventory turns 3.4 to 15.0
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The Drill vs. The Hole
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The Hole: Lower Carbon Footprint
The Drill: Lean Thinking
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81
2300 230012002300Feet2
55 5560055Units/
wkr./mo.
21 21321Workers
Mo. 11,155
Mo. 401,155
Mo.401,800
Mo. 11,155
Not Green Company
Green Company
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Tuesday March 26, Session 10311
Lean Manufacturing's Unexpected
Windfall: A Lower Carbon Footprint
Charles M. Cohon, CEO
Prime Devices Corporation