What is Lean?

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What is Lean?
Dave Adsit
Architect @ Pluralsight
@davidadsit
dave@pluralsight.com
codeobsession.blogspot.com

Efficiency
the ability to do something or produce something without
wasting materials, time, or energy

Resource Efficiency
Focus on the value adding resource in the organization
Keep people busy
Key Metric: How much is a resource utilized in a period of time?

Flow Efficiency
Focus on the unit processed by the organization
Keep adding value to the flow unit
Key Metric: How much is a flow unit processed during time period?

Maximal Resource Utilization
Gratuitous Traffic Jam Photo

Lean is...
...prioritizing flow efficiency
over
resource efficiency.

Why can’t we just have both?
● Little’s Law
● Law of Bottlenecks
● Law of the Effects of Variation

Little’s Law
average queue size = arrival rate x cycle time
Queue Formation
Pros
Level out workload
Maximize resource utilization
Cons
Increase throughput time
Decreases flow efficiency

Why is Cycle Time so confusing?
Lead Time
How much time one has to wait to get a thing
This is the time the customer sees and cares about
Takt Time
The average time between successive deliveries
Hours in operation / Units completed
Order Lead Time
The clock starts when the customer makes the request and ends once
delivered
Production Lead Time
The clock starts when work begins on the request and ends when the item is
delivered
http://itsadeliverything.com/lead-time-versus-cycle-time-untangling-the-confusion

Law of Bottlenecks
● There is always a bottleneck
● Immediately prior to a bottleneck, there is always a queue
● Throughput time in a process is primarily affected by the
stage of the process that has the longest cycle time
● Stages after the bottleneck must wait for a flow unit to add
value to, so are not fully utilized

Law of the Effects of Variation
Cycle time increases with utilization;
variability exacerbates the effect.
Kingman's approximation
τ is the mean service time
λ is the mean arrival rate
ρ = λ/μ is the utilization
ca is the coefficient of variation for arrivals
cs is the coefficient of variation for service times

Variation is Unavoidable
● Common cause variation
○ Manpower
○ Mother nature
○ Materials
○ Method
○ Measurements
○ Machine
● Special cause variation
○ Luck
○ Black swan events

The Impossible Choice
Would you rather:
● Be really busy?
● Get a lot done?

The Efficiency Paradox
Focus on utilizing resources efficiently
tends to increase the amount of work
there is to do without adding value.

Secondary Needs
● Secondary needs arise as a
consequence of the failure to
meet the primary need of a
customer
● Secondary needs often cause
other secondary needs
● Superfluous work is a very
sophisticated form of waste,
since we often fail to realize
that it is waste at all.

Improving Flow
● Work faster
● Add more capacity to the system
● Reduce variation in flow units
● Reduce the flow units in process

Resolving the Efficiency Paradox
By focusing on flow efficiency, an organization can eliminate
many of the secondary needs that arise as a consequence of
low flow efficiency.
More specifically, any decision that decreases throughput time,
the amount of flow units in process, and/ or the amount of
restarts will eliminate superfluous work.
Paradoxically, not focusing on utilizing resources makes it
possible to deliver value more effectively.
- This is Lean

First Delivery
Large Batch
1. Write "Code Camp 2016" on all 10
papers
2. Pass batch to next station
3. Fold all 10 papers
5. Stuff all 10 envelopes
7. Seal all 10 envelopes
9. Write "Utah Geek Events" on the
outside of all 10 envelopes
10.All stations stand up! You’re done!
Single Piece Flow
Repeat 10 times:
{
1. Write "Code Camp 2016" on 1 piece
of paper
2. Pass the paper to the next station
3. Fold the paper
4. Pass the paper to the next station
5. Stuff it in the envelope
6. Pass the envelope to the next station
7. Seal the envelope
8. Pass the envelope to the next station
outside of the envelope
}

First Delivery
Small Batch
Repeat 2 times:
{
1. Write "Code Camp 2016" on 5 pieces
of paper
2. Pass the papers to the next station
3. Fold all 5 papers
4. Pass the papers to the next station
5. Stuff 5 envelopes
6. Pass envelopes to the next station
7. Seal 5 envelopes
8. Pass envelopes to the next station
outside of the envelopes
}
WIP Limit of 1 per Station
1. Write "Code Camp 2016" on 1 piece of
paper
2. Hold the paper until the folder takes it
3. Take the paper and fold it
4. Hold the paper until the stuffer takes it
5. Take the paper and stuff it in the
envelope
6. Hold the envelope until the sealer takes
it
7. Take the envelope and seal it
8. Hold the envelope until the addresser
takes it
9. Take the envelope and write "Utah
Geek Events" on the outside of the
envelope
10.Repeat until all 10 are complete then
stand up!

First Delivery
WIP Limit of 1 per Station
1. Write "Code Camp 2016" on 1 piece of
paper
2. Hold the paper until the folder takes it
3. Take the paper and fold it
4. Hold the paper until the stuffer takes it
5. Take the paper and stuff it in the
envelope
6. Hold the envelope until the sealer takes
it
7. Take the envelope and seal it
8. Hold the envelope until the addresser
takes it
9. Take the envelope and write "Utah
Geek Events" on the outside of the
envelope
10.Repeat until all 10 are complete then
stand up!
Queues Between Stations
1. Write "Code Camp 2016" on 1 piece
of paper
2. Stack the paper for the next station
3. Fold the paper
4. Stack the paper for the next station
5. Stuff the envelope
6. Stack the envelope for the next
station
7. Seal the envelope
8. Stack the envelope for the next
station
outside of the envelopes
10.Stand up when you complete your
station

Reflect
What did you notice about the different ways of working?

What is Lean?

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