Fundamentals of Lean
- 1. Basic Lean Training FUNDAMENTALS OF LEAN
- 2. HISTORY OF MANUFACTURING • Made to customer specifications • Single piece mfg… each product unique • Variable quality • Little inventory • High cost … made for the rich Craft Interchangeable parts Division of labor Assembly lines Labor strife Mass Production High variety Small batch sizes PPM quality Engaged workforce “Lean” Enterprise
- 3. WHY ARE WE HERE?? LONG-TERM “HEALTH” CUSTOMER SATISFACTION SALESAND PROFITS It’s About Performance!
- 4. KEY RESULTS TO BE EXPECTED Immediate 20%+ Productivity Improvement 30%+ Floor Space Reduction 25%+ Quality Improvements 75%+ WIP Inventory Reduction 35%+ Set-Up Time Reduction
- 5. KEY RESULTS TO BE EXPECTED Longer Term Lead times cut from weeks to hours Quality approaches zero defects Significant improvement in employee and customer satisfaction Continually reduced unit costs
- 6. 5 PRINCIPLES OF LEAN THINKING • Key principles of “Lean Thinking”: VALUE - what customers are willing to pay for VALUE STREAM - the steps that deliver value FLOW - organizing the Value Stream to be continuous PULL – triggering flow from customer needs PERFECTION - continuous improvement forever (culture) (from Lean Thinking, Womack and Jones, 1996)
- 7. VALUE STREAMS ARE FINANCIAL items in items out value added KEY ASSETS COSTS PROFIT items in items out value added KEY ASSETS COSTS PROFIT RETURN ON KEY ASSETS • Key Assets ̵ Inventory ̵ Receivables ̵ Fixed assets • equipment • facilities • Goals ̵ More profits ̵ With less assets
- 8. RAPID CONTINUOUS IMPROVEMENT (RCI) • A Rapid Continuous Improvement Event is ̵ An intense, focused activity (4.5 days) ̵ A team focused on a specific area • Specific Lean Tools used to identify waste ̵ Roots: Toyota Production System ̵ Applied wherever work is done • Lean is a Learn by Doing process ̵ Learn the tools by using them ̵ Measurable improvement expected
- 9. THE 7-WEEK CYCLE OF AN RCI EVENT • 3 weeks before – Value Stream review, Event Selection, Select Team Leader/Co-Leader … Financial Impact? • 1-2 weeks before – RCI Checklist, preparation .. Cell Communication day 1 - current conditions day 2 - big changes day 3 - run the cell day 4 - standard work day 5 - presentation 1st week after - Capture the savings 2nd week after – Update Standard Work 3rd week after – CFO validation •Step 1 “Identify” waste •Step 2 “Eliminate” waste
- 10. • “Value-Adding” changes the value of an item •Drilling •Assembling •Painting •Cutting •Welding VALUE ADDING
- 11. NON-VALUE ADDING • Consumes time and money • Does not change the value of an item •Sorting •Counting •Stacking •Expediting •Checking
- 12. VALUE-ADDING / NON-VALUE-ADDING • Value-adding: ̵ Any activity that contributes directly to satisfying the need of a customer, e.g., • Airline transportation service (actually flying) • Admin. process for hiring (interviewing a candidate) • Remodeling service (attaching drywall panels) • Admin. process for payables (reconciling Invoices with purchases)
- 13. VALUE-ADDING / NON-VALUE-ADDING • Non-value adding: ̵ Any activity that takes time or resources but does not contribute directly to satisfying the need of a customer, e.g., • Airline transportation service (lining up to check in) • Admin. hiring process (scheduling the interview) • Remodeling service (waiting for materials) • Admin. process for payables (finding and sorting purchase orders)
- 14. All value streams are a combination of value adding and non value adding Value added Lead Time
- 15. PROBLEM WITH TRADITIONAL IMPROVEMENTS Total Lead Time to Customer Un-changed 97.5 % NVA 95 % NVA V.A. Time 2.5% 5% Value Adding “Lets make improvements” (e.g. faster machines) Existing Batch Operations Order Order Ship Ship
- 16. Improvement will be easier and more likely to succeed by focusing on & removing the non-value added activities (waste) THE ‘BIG IDEA’ OF LEAN THINKING ? Total Lead Time to Customer 95 % NVA 5% Value Adding Order Ship
- 17. Profit = Price - Costs WHY LEAN THINKING ? The world has changed! We can no longer sell everything we make. Competition is everywhere!
- 18. Capacity = Work + Waste WHAT ARE THE BENEFITS?
- 19. TRADITIONAL FLOW VS. CELLULAR FLOW Traditional flow Cellular flowDept 1 Dept 2 Dept 4 OUT DONE OUT OUT OUT IN IN IN IN DONE IN •Natural Groups in each cell •Work sequence may be different from part flow sequence 4 3 1 2 Out In Dept 3
- 20. RCI IS ABOUT SEEING WASTE (8 WASTES) • Wasted Human Talent – Damage to people • Defects – Material that isn’t right & needs to be fixed • Inventory – Material waiting to be worked • Overproduction – Too much / too early • Waiting Time – People waiting for material to arrive • Motion – Unnecessary human movement • Transportation – Moving people & material • Processing Waste – Tasks we have to do that don’t add value to the material we are producing!
- 21. TPS – THE ROOTS OF “LEAN” TOYOTA PRODUCTION SYSTEM (“TPS”) JUST-IN-TIME - what’s needed - when needed - in the quantity needed LEVELING (of overall volume and of mix variation) AUTONOMATION (JIDOKA) - autonomous - defect-free - detects abnormal conditions INVOLVEMENT: Flexible, Motivated, team members always looking for a better way
- 22. T.P.S TAKT TIME TIME OBS. BARCHART 6S PROD. CONTROL SPAGHETTI STANDARD STD WIP BOARD DIAGRAM WORK SHEET KEY POINTS CAPACITY COMBINATION LOAD-LOAD SHEET SHEET PULL SYSTEM TPM POKA-YOKE ONE PIECE FLOW (KANBAN) SETUP LEVELING REDUCTION WASTE ELIMINATION TOOLS IMPROVEMENT TOOLS COME FROM TPS
- 23. 9 KEY TOOLS FOR SEEING WASTE • The key to eliminating waste is to first be able to see it • These 9 tools help us identify waste: Takt Time Time observation Bar chart Spaghetti diagram Flow diagram Standard work sheet Standard work combination sheet Production control board Standard WIP
- 24. TAKT TIME • Takt Time = (available time) / (customer demand) What is the Takt Time? Are we producing at Takt Time? Why not? Takt Time is the first tool which distinguishes between “faster is better” from “how many do I need”?
- 25. TAKT TIME CALCULATION 8 hour shift - 20 min breaks - 10 min c/u 450 min 27,000 257 105 Sec. total time available real demand per shift with backup data TAKT TIME convert to seconds for Takt Time calculation 8 hr. shift x 60 min/hr = 480 min (breaks) - 20 min (clean up) - 10 min 450 min 450 min x 60 sec/min = 27,000 sec. 426 63
- 26. TAKT TIME • Takt time tells you how much time you “get” Takt Time will be different in all areas of your plant Available time can vary by department or cell Takt Time can vary by day …. Or shift … Customer demand is based on actual demand Do you know your customer demand? Does your supervisor? Takt Time drives product cost! • Staffing (Productivity) • Size of cell (Floor Space) • Capital equipment (Burden) • Inventory (Turns/Cash Flow)
- 27. TIME OBSERVATION • The time observation determines how long it takes to do the task ̵ Time observations are not time studies ̵ The time observation is a tool to help you see waste ̵ Time observations help you see the non-value-adding steps in detail
- 28. TIME OBSERVATION • Time observations help you identify the waste • Look for opportunities to eliminate “work” when observing someone • Selecting the “lowest repeated” time, when observing someone, provides Step 1 in improvement ̵ Make every unit repeat in the “lowest repeated” time ̵ Break down the steps into Value-Added and Non-Value-Added steps ̵ Eliminate the Non-Value-Added tasks
- 29. BAR CHART • Bar Charts show time observation data: ̵ Place line showing Takt Time ̵ 1 bar for each person (1 time observation for each person) ̵ Look for waste Identified by the Bar Char ̵ How many people do we need?
- 30. SPAGHETTI DIAGRAM • Purpose: To help see movement of people • Makes motion and transportation waste obvious • Stand back and observe the operator ̵ Where do they go? ̵ Why? • 1 Spaghetti Diagram per person in the cell
- 31. FLOW DIAGRAM • Flow diagrams often help us see how “material” flows ̵ VA and NVA steps ̵ Total process … before and after your cell ̵ Use Value Stream Maps for detailed diagram • See the flow, see the waste, and develop a vision Weld Paint Cut Punch BendStore QC Store Cut Punch BendStore Store Store Store
- 32. FLOW DIAGRAM
- 33. STANDARD WORK SHEET • Standard Work Sheets show the “current best way” ̵ Layout of the cell ̵ How many people in the cell ̵ Work sequence of each person ̵ Standard WIP • quantity and locations
- 34. STANDARD WORK SHEET # peopleSafety Hazards Quality Checks Standard WIP
- 35. • Production Control boards help us achieve Takt Time ̵ Visually monitor Output vs. Takt Time ̵ Operators communicate problems/issues ̵ Supervisors responsible for resolution ̵ Problems/solutions are visible and documented PRODUCTION CONTROL BOARD
- 36. • Standard WIP is a calculated number • Standard WIP highlights where the problems are Where should the Standard WIP be located? Is it there now? If not, what has happened? Use the Standard WIP to make problems visible STANDARD WIP
- 37. • Standard WIP is a calculated number • Standard WIP is used to manage obstacles to “flow” ̵ Examples: • Glue drying • Yield • Heat treating (monuments) • Parts used as pairs or sets • Timing of complex flows STANDARD WIP
- 38. STANDARD WORK BOARD - TIME OBSERVATION SHEET (on file in the cell) - BAR CHART (1 per cell) - STANDARD WORK SHEET (1 per cell) - STANDARD WORK COMBINATION SHEET (1 per person in the cell) - KEY POINTS SHEET (1 per work station in the cell) - CAPACITY SHEET (1 per cell) AT T/T W HINE R.I. EVENT GOALS: INCREASE PRODUCTIVITY 30%
- 39. WHERE TO USE THESE TOOLS TAKT TIME TIME OBSERVATION BAR CHART SPAGHETTI DIAGRAM FLOW DIAGRAM COMBINATION SHEET STANDARD WORK SHEET PRODUCTION CONTROL BOARD STANDARD WIP documenting Standard Work RI Event current conditions Visual Management of a cell
- 40. MANAGEMENT DECISIONS • Managers/Supervisors make decisions that create results • Good decisions create good results (measurements) ̵ Key decisions • How many people do I need? • Who does what? ̵ Critical skills • Seeing problems (visual management) • Resolving problems
- 41. ADJUST FOR CHANGES • Cell managers maintain and update Standard Work • When Takt Time changes... ̵ Determine staffing ̵ Add or redeploy people … what happens if you overstaff? ̵ Standard Work documents should exist for different staffing • When the cell is improved ̵ Update all Standard Work documents Encourage Improvements!!!
- 42. WALK, STOP AND LOOK • Management succeeds or fails at the cell level first • Spend at least 30 minutes, 2 times per day • Take the time to stop and observe: ̵ Production Control Boards ̵ Standard WIP ̵ Standard Work sequence • 10 second rule!! • Is anyone capturing the “Golden Nuggets”? • What’s being done to resolve them? • Is anyone Identifying waste? • Is anyone eliminating waste?
- 43. CELLS • Cells are the building block of Lean • To establish a cell you need: ̵ One Piece Flow ̵ Standard work ̵ 6S ̵ Pull Systems
- 44. ONE-PIECE FLOW (CELLS) • Natural groups of parts or steps • One piece flow inside the cell • One operator may run the cell • No birdcages or barriers • U-shaped design • Multi-skilled people • Layout based on flow steps Work sequence based on output required! DONE IN 4 3 1 2 5
- 45. Batch size of 300 vs. Batch size of 1 A B C 1 minute 2 minutes 3 minutes • First Piece Done - 3 Minutes (can move on to next step) • 300th Piece Done - 302 Minutes • WIP = 3 Pieces A B C 300 minutes 600 minutes 900 minutes • First Piece Done - 601 Minutes (but waits for other 299 pieces) • 300 Pieces Done - 900 Minutes • WIP = 900 Pieces Reduced Batch Sizes
- 46. • Standard Work is a management system ̵ TAKT TIME (available time / customer demand) ̵ WORK SEQUENCE (assign one Takt Time to each person) ̵ STANDARD WIP (minimum amount needed to run the cell) • Standard Work has a standardized documentation • Standard Work enables Visual Management ̵ Production Control Boards ̵ Standard WIP Levels ̵ Standard Work Board STANDARD WORK see and resolve problems
- 47. 6S 1. SAFETY (see and fix unsafe conditions) 2. SORT OUT (get rid of what’s not needed) 3. STRAIGHTEN (organize what belongs) 4. SCRUB (clean up, see and solve problems) 5. STANDARDIZE (who does what to keep it up) 6. SUSTAIN (be disciplined… keep it orderly) 6S is the foundation for all future improvements
- 48. VISUAL MANAGEMENT (SUPPORTS ALL TOOLS) APPLY VISUAL TOOLS VISUAL WIP INDICATORS STATUS UNITS VS PLAN ALARMS LOCATIONS CORRECTIVE ACTION / 6-SIGMA OWNED BY THE PEOPLE WHO WORK IN THE AREA SEE AT-A-GLANCE (5 seconds) NORMAL ABNORMAL
- 49. VISUAL MANAGEMENT (SUPPORTS ALL TOOLS)
- 50. PULL SYSTEMS • Pull Systems link cells together ̵ Only when a single cell is not possible • All Pull Systems have three elements: ̵ Upstream “ready” - pulled when needed ̵ Downstream “in use” - being consumed "now" ̵ Trigger - a signal (what, where, when, how many)
- 51. PULL SYSTEMS
- 52. BASICS OF LEAN FOR MANUFACTURING On-Demand, Defect-Free, One-By-One at the Lowest Cost
- 53. Philosophy (Long Term Thinking) Process (Eliminate Waste) People & Partners (Respect, Challenge and Grow Them) Problem Solving (Continuous Improvement and Learning) •Continual Organizational Learning •Go see For Yourself To Fully Understand The Situation •Make Decisions Slowly By Consensus, Thoroughly Considering All Options; Implement Rapidly •Grow Leaders Who Live The Philosophy •Respect, Challenge, And Grow Your People And Teams •Respect, Challenge, and Help Your Suppliers •Base Management Decisions On Long-Term Philosophy, 4P Model Of The Toyota Way •Create Process Flow to Surface Problems •Use Pull Systems To Avoid Overproduction •Level Out The Workload •Stop When There Is A Quality Problem •Standardize Tasks For Continual Improvement •Use Visual Controls So No Problems Are Hidden •Use Only Reliable, Thoroughly Tested Technology