copyright ems consulting group, inc. 2008 using lean ideas to get jobs to production faster darren...
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Copyright EMS Consulting Group, Inc. 2008
Using Lean Ideas to Get Jobs to Production Faster
Darren Dolcemascolo
EMS Consulting Group, Inc.
Copyright EMS Consulting Group, Inc. 2008
Using Lean Ideas to Get Jobs to Production Faster
• You will learn:– Why It is Important to Apply Lean
Principles to the Pre-Production Value Stream
– How Lean Principles and Tools Apply to Such Processes
– How One Company Utilized These Principles
Copyright EMS Consulting Group, Inc. 2008
Presentation Agenda
1. Lean Administrative Principles and Benefits
2. Applying Lean Tools to Non-Manufacturing Processes
3. Case Study
4. Q&A
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What Is Lean?
“A systematic approach to identifying and eliminating waste (non-value-
added activities) through continuous improvement by flowing the product at the pull of the customer in pursuit
of perfection” – James Womack
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•Value - A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer. Features of the product or service, availability, cost and performance are dimensions of value.
Definitions
•Waste (“Muda”) - Any activity that consumes resources but creates no value.
Value - what your customers are willing to pay for.
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Definitions
–Value Stream - the set of all the actions required to bring a product to the customer. (material + information flow)
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Thinking Lean5 Principles of Lean
• Specify value – can only be defined by the ultimate customer
• Identify and Map the value stream – exposes the enormous amounts of waste
• Create flow – reduce batch size and WIP
• Let the customer pull product through the value stream – make only what the customer has ordered
• Seek perfection – continuously improve quality and eliminate waste
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“All we are doing is looking at the time line from the moment the customer gives us an order to the point when we collect the cash. And we are reducing that time line by removing non-value-added wastes.” – Taichi Ohno
Lean Thinking
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From Shop Floor to Office
• Lean should not be limited to the shop floor:– Support processes often cause delays in the
factory.– Support processes create delays in getting
existing product to the customer (lead time)– Support processes delay the product
development process.– Support processes delay the delivery of
materials.
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Eight Wastes
• Overproduction
• Waiting
• Transporting
• Inappropriate Processing
• Unnecessary Inventory (WIP)
• Unnecessary / Excess Motion
• Defects
• Underutilization of Employees’ Minds/Ideas
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Eight Wastes Revisited• Overproduction
– Printing paperwork out before it is needed
– Purchasing items before they are needed
– Processing paperwork before the next process is ready for it
• Waiting
– “System” downtime
– Paperwork/Approval queues (waiting in someone’s inbox)
– Waiting for information from outside sources (customer or supplier)
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Eight Wastes Revisited• Transportation (Paperwork or Electronic Info)
– Multiple hand-offs
– Too many approvals required
– Excessive email attachments
• Inappropriate Processing– Re-entering data or re-checking
– Making extra copies
– Too many reports distributed
– Excessive transactions
– Unnecessary details in expense reports, budgets, etc.
– Month-end closing activities
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Eight Wastes Revisited
• Unnecessary Inventory
– Filled in-boxes (electronic and paper)
– Office supplies
– Batch processing transactions/reports
– Sales literature
• Unnecessary / Excess Motion
– Walking to/from printer/copier/fax
– Walking to other cubicles/offices (or to find someone)
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Eight Wastes Revisited
• Defects
– Design errors
– Invoice, purchase order, or order entry mistakes
– Other paperwork errors
• Underutilization of Employees’ Minds/Ideas
– Limited authority and responsibility for basic tasks
– Management command and control
– Inadequate business tools provided
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Lean Principles for the Office
1. Understand Customer Needs2. Measure and Check Performance to
Customer Needs Often3. Eliminate steps that do not create value4. Find ways to eliminate
interruptions/handoffs.5. Control the flow of work between
interruptions.6. Balance the workload/Eliminate bottlenecks.
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Customer Needs/Requirements
• Who needs the output of the process?
• What is specifically required and how often?
• When do they need the output?
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Determine Performance Check Window
• How often will performance (status) to customer requirements (takt time) be measured?
• Wide range of answers can be appropriate: from hourly to several times daily (or in some cases, less frequently).
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Determine Performance Check Window
• Use a visual means of checking performance
• If orders are not processed in a timely manner, the team must identify root causes and take corrective actions to return to the desired service level.
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Determine Performance Check Window
• Lean Example– Printing company developed a goal of three-day
turnaround on orders with a one-day turnaround in the preproduction portion of the order.
– They set a 2 hour management time frame to review the preproduction process (customer service, artwork, and plate making).
– Every two hours reps from each area reviewed orders in process to determine if they were meeting the desired service levels.
• If not, they took proper action (redeploy resources, work o.t., etc.)
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Determine which steps in the process create value and which generate waste
• Ask questions to determine this:– What does the customer really need?– Why are the current steps being performed?– What can the company do differently or not at all while still
meeting customer needs?– Is the order of steps creating waste? At what steps should
decisions be made?– What assumptions underlie the design of the current
process?– Are current controls and administrative guidelines
appropriate?– What knowledge and skills are truly required to perform the
steps?
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Create a work flow with fewer interruptions
• Create flow (one-piece or small batch size)• Ask the following questions:
– Can standardizing work improve flow?– Would it be beneficial to dedicate resources to
specific tasks?– Can one person be cross-trained to perform
several sequential tasks?– Would moving people and tasks together into a
“cell” help?– What would be the benefits and issues of a flow
approach?
Copyright EMS Consulting Group, Inc. 2008
Create a work flow with fewer interruptions
Paperwork Processing
Monday: 40A
Tuesday 10A, 30B
Wednesday: 20B, 20C
Thursday: 40C
Friday: 20C, 20A
Monday: 14A, 10B, 16C
8:00AM: 3A, 2B, 3C
9:00AM: 4A, 2B, 2C
Each type processed once weekly
Each type processed once daily
Each type processed once hourly
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Determine how to control work from step to step (between interruptions)
• Usually two possible solutions– FIFO lane - limits the amount of work that
can be pushed from step to step and ensures proper prioritization.
– Pull system - work is pulled from the supplying process to the customer process. (Example: printing information only upon demand.)
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Determine how to control work from step to step (between interruptions)
• Lean Example – Problem– Job shops use job packets throughout production
to make sure that the product is made correctly.– At one company, the office released job packets to
the floor ASAP, creating overproduction.– Production began work on many of these released
packages and spent a lot of time reacting to customer changes.
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Determine how to control work from step to step (between interruptions)
• Lean Example - Solution– The company implemented a simple pull
system for job packets by having production tell the office when it needed the next job packet.
– Company reduced the # of job packets by 50%, and the number of time-consuming changes to job packets by 80%.
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Balancing the Activities/Workload
• Two issues– Process Level – people who overproduce
in big batches, creating queues at the next step.
– System Level – lopsided transactions and activities that require different amounts of resources at different points in time (month-end).
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Balancing the Activities/Workload
• Process Level– Balance by using shorter performance
check windows, cross-training, and FIFO lanes.
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Balancing the Activities/Workload
• System Level– Level work and mix- Distribute transactions and
work over a longer period to reduce system chaos and overtime.
– Creates a predictable enterprise and improves the visibility and responsiveness to problems and/or shifts in customer demand.
– Leveling mix of transactions to improve the ability of the system to flow or respond to particular steps (e.g., ideal # of rush orders to standard orders).
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Case Example: Value Stream Mapping
• Original State: 5 weeks average pre-production lead-time; 6 week average total lead-time (1 week in production)
• Project Objective: To reduce pre-production lead time to < 4 weeks
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Case Example: Current State
Pre-Production Current State
Customer
P/T: 10m
Sales D-base
Log into Sales “System”Tech
Support
P/T: 10m avg
Enter into MRP System and
spdshtProd Mgr.
P/T: 10m
Create a kit in MRP
Prod. Mgr
MRP System
P/T: 60 min
Run MRP
Daily
Phone Queue
IN
Fax
IN
IN
IN
MS Excel
L/T = 5 DaysL/T = 1 Day
MRP System
L/T = 1 Day L/T = 1 Day
P/T: 60 min
Order Parts
Buyer
Daily
L/T = 15 Days
P/T: 10 min
Cut Work Order
Planner
Daily
L/T = 1 Day
P/T: 0 min
Start Work
Production
Daily
L/T = 1 Day
P/T = 150 min
L/T = 24 Days
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Case Example: Current State Issues
• Redundant data entry of customer orders/reliance on e-mail
• Multiple shop orders per customer order• No control of release of orders to shop
floor• Requirement for shop floor personnel to
prioritize work based on MS Excel spreadsheet
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Case Example: Improvements
• Customer order entry system becomes part of the ERP/MRP system– Customer service person completes transaction- no
handoff to production manager (make continuous flow)
• MRP system notifies purchasing to order “non-stock” parts for each customer order same day.
• Shop Orders are cut after parts arrive and delivered to production based on “kanban.”– Priority spreadsheet eliminated
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Case Example: Future State
Pre-Production Future State
Customer
P/T: 10m
MRP System
Enter into MRP SystemTech
Support
Auto-GenerateCustomer Order
Phone Queue
IN
Fax
IN
IN
L/T = 1 Day
P/T: 0 min
Start Work
Production
Daily
L/T = 0 Days
Auto-Notfify Purchasing
P/T: 60 min
Order Parts
Daily
L/T = 15 Days
P/T: 10 min
Cut Work Order
Planner
Daily
L/T = 1 DayP/T = 80 min
L/T = 17 Days
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Case Example: Results
• Pre-production lead-time cut from 25 business days to 17 business days
• Processing time cut from 250 minutes to 80 minutes
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Questions?