Download - Waste Overview and Benefits
1
WASTE OVERVIEW AND BENEFITSBy: Romains Bos
2
TYPICAL SITUATION
75%
3
75%
KAIZEN IMPROVEMENTS ARE THE RESULT OF WASTE ELIMINATION
Sys
tem
Per
form
ance
Time
1
4
IMPROVING WORK MEANSREDUCING WASTE (MUDA)
Waste Is Any Activity For Which An All-knowing*, All Wise Customer Would Not Be Willing To Pay Because The Activity Does Not Significantly Improve The Probability Of Getting A More Reliable, Higher Performing Product Or Service Over The Long-term At The Best Possible Price
DEFINITION
* All Knowing = Perfectly understands every aspect of your business and how it should be operated to maximize long-term success for customers, employees and shareholders
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OHNO’S WASTES
PEOPLE
TYPESOF
WASTE
Processing
Motion
Waiting
FixingDefects
Inventory
QU
ALIT
Y
Making Too Much (WIP)
MovingThings
QUANTITY
75%
6
OHNO’S ORIGINAL SEVEN WASTES
Processing Waste Is Doing Things Inefficiently For Any Reason
Motion Waste Is All Walking or Reaching
Waiting Waste Is All Waiting For Parts, Data and So On
Making Too Much Waste Is All Work-in-process (WIP)
Movement Waste Is All Transport
Inventory Waste Is All Raw Goods and Finished Goods Inventory
Fixing Defects Waste Is All Rework and Repair
PE
OP
LEW
AS
TE
QU
AN
TIT
YW
AS
TE
QUALITYWASTE
7
Non-Essential
Non-value Added (Waste or “Muda”)
60s
Ne
ces
sar
y
Cri
tic
al
0.02% 0.020% 99.96%
ValueAdded
60s 345,600s (6d-12 shifts) 345,720s
TotalsMachining Test Lot Delays, Changeovers, Transport, Etc.
TYPICAL SITUATION - PLANT
8
60s 60s 345,600s (6d-12 shifts) 345,720s
Totals
Before
After $500K 30s 60s 345,600s (6d-12 shifts) 345,690s
Machining Test
Only 0.009% less in total processing time
Claim 50%Improvement!
Non-Essential
Non-value Added (Waste or “Muda”)
Ne
ces
sar
y
Cri
tic
al
0.020% 99.96%
ValueAdded
0.02%
0.01
%
Lot Delays, Changeovers, Transport, Etc.
Spend!!Spend!!Spend!!
TRADITIONAL RESPONSE - PLANT
9
Non-value Added (Waste or “Muda”)
ValueAdded
DANGER!
It Is Much MORE:• Dangerous• Risky• Time Consuming • High Tech• Expensive• Customer Impacting• Demanding Of
Management Time
It Is Much: • Safer• Less Risky• Faster• Lower Tech• Cheaper• Customer Friendly• Less Demanding Of
Management Oversight
To Speed Up Or Improve Value Added
Activity
To Speed Up Or Improve Non-value
Added Activity
10
A PROBLEM WITH PERCEPTION
The Executive Perception
The Middle Management Perception
The Informed Hands-on Performer Perception
11
THE TRADITIONAL EXECUTIVE RESPONSE
The Perception
The Reaction
THROW A LOT OF MONEY/TECHNOLOGY AT WHAT APPEARS TO BE THE VALUE ADDED WORK
The Result
12
THE TRADITIONAL MIDDLE MANAGEMENT RESPONSE
The Perception
The Result
THROW “SOME” MONEY/TECHNOLOGY AT VALUE ADDED WORK AND REMOVE “OBVIOUS” WASTES
The Perception “Rearranged”
The Reaction
13
THE INFORMED HANDS-ON PERFORMER RESPONSE
The Perception
The Result
ATTACK ALL NON-VALUE ADDED ACTIVITY AT THE MICRO-PROCESS LEVEL
The Perception “Rearranged”
The Reaction
“Easily” Recognized Non-value Added
Micro-processRecognizable
Non-valueAdded
True Value Added
14
EXTRA “BENEFITS (????)” - PLANT
• Reduction Of Machining Time Reduces “Standard Work” (Earned Hours)
• The Standard Pricing Model Then Drives Down The Sales Price Of The Part Even If There Is No Price Pressure
• The Efficiency Numbers Look Great And The Sales Department Is Happy (Anybody Can Sell Cheaper)
• Lot Size And Inventory Increase Because The Investment Has Be Justified By Making Earned Hours And Absorption Look Good
• We Lose Money And Can’t Ship Any Faster!
15
Non-Essential
Non-value Added (Waste)
Ne
ces
sar
y
Cri
tic
al
ValueAdded
Totals
Before
After $5K
75% faster in total processing time!
Machining Test
60s 60s 345,600s (6d-12 shifts) 345,720s
60s 60s 86,400s (1.5d-3 shifts) 86,520s
Lot Delays, Changeovers, Transport, Etc.
0.07% 0.07%
99.96%
99.86%
75%Less
Waste
A FIRST PASS LEAN RESPONSE - PLANT
16
REAL BENEFITS
• Lots Are Smaller
• Inventory Is Dramatically Reduced
• Less Floor Space Is Required
• Capacity And Throughput Are Greater With No Capital Expense
• Flexibility To Order Demands Is Greater
• Lead Time Is Reduced
• Actual Costs Are Reduced
• Yet, Traditional Accounting Methods Make Things Look Bad Because Earned Hours And Absorption Decrease!!!!!!
17
PEOPLE
TYPESOF
WASTE
Processing
Motion
Waiting
FixingDefects
Inventory
QU
ALITY
Making Too Much
(WIP)
MovingThings
QUANTITY
“SPL
OR
K!”
TOOLS ATTACK BUT…
“GLU
BO
OR
K!”
ConsensusDecision Making
Tools
Team-OrientedProblem Solving
QFD
Balanced Scorecard
Constraint Management
Flow Charts
Process Reengineering
FMEA
One-By-OneFlow Strategy
Poka-Yoke
Value StreamMapping
Black Belts
QFD
SMED
SixSigma
ISO/QS
IntegratedProduct
Development
Gain Sharing
SPC
Kaizen Blitzes
Total Preventive Maintenance
Visual Displays
High Performance Teams
5 “S”
Shainin
Shift 7 2 Meetings
Primary Visual
Displays
Ho
shin
Kan
ri
DOE
EnterpriseSoftware
(EIS)Kanban
s
20 Keys
18
…DON’T USUALLY LAST
PEOPLE
TYPESOF
WASTE
Processing
Motion
Waiting
FixingDefects
Inventory
QU
ALIT
Y
Making Too Much (WIP)
MovingThings
QUANTITY
Pro
ces
s
Re
en
gin
eeri
ng
Value StreamMapping
QFD
Poka-
Yoke
Bla
ck B
elts
IntegratedProduct
Development
Kanbans Kaizen Blitzes
SMED
SPC
Sh
ainin
Boing!
I’M BACKTO EAT MORE
PROFITS!!!
19
TYPE OFWASTE
WASTE REDUCTIONAPPROACH
METHOD DESIREDRESULT
Standard Work
WorkplaceOrganization
Kaizen
WorkplaceManagement
Just-in-time
Error Proofing
Processing
Motion
Waiting
WhatYou Need,WhenYou
NeedIt
HighlyEfficient,
SafeWorkAreasWithHigh
Output
Good Quality
Inventory
MovingThings
Making Too
Much
Fixing Defects
Leveling
Kanban
Quick Setup
PreventiveMaintenance
Detection
Warning
Prediction
Prevention
CATEGORYOF WASTE
PEOPLE
QUANTITY
QUALITY
FOCUSPOINTS
Work BalanceWIPLocation/AmountKanban LocationKanban TypesLot SizesChangeover AnalysisPM Analysis
LayoutLabelingTools/PartsArrangementWork InstructionsEfficiencyTakt TimeSkills TrainingShift MeetingsCell/Area TeamsVisual Displays
Appropriate AutomatedAssistance
Fixture ModificationsSuccessive ChecksLimit Switches
Check SheetsPhotocells, Templates,
Etc.Cross Training
PRINCIPLEWORKSHEETS
Standard WorkSheet (SWS)
Time ObservationForm (TOF)
Standard WorkCombination
Sheet (SWCS)Work Load
Balancing Sheet(WLBS)
Kaizen TargetSheet (KTS)
Kaizen ActionSheet (KAS)
SWSSWCSWLBSKanbansTable of
ProductionCapacity ByProcess (TPCP)
PM SchedulingSheet (PMSS)
SWCS
Error ProofingAction Sheet(EPAS)
Error Proofing “ToDo” List (EPL)
Skill VersatilityVisual DisplayJidoka
Autonomation
WHY?NOT A WORD ABOUT HOW TOIMPLEMENT AND SUSTAIN!
Mas
ter
Jarg
on C
hart
Of
Lean
Ope
ratio
ns
20
75%
OFFICE KAIZEN WASTES
Processing
Han
d-o
ffV
aria
bil
ity
InventoryScheduling
TYPESOF SURFACE
WASTE
Information
21
TYPICAL SITUATION - OFFICE
Non-Essential
Non-value Added (Waste or “Muda”)
30m
Ne
ces
sar
y
Cri
tic
al
0.35% 0.17%99.48%
ValueAdded
15m 8,640m (6 days) 8,685m
TotalChecking Hand-offs, In-box waiting, Signatures, Mailing prep., etc.
QuotePreparation
22
TRADITIONAL RESPONSE - OFFICE
Only 0.17% less in total processing time
Claim 50%Improvement!
Non-Essential
Non-value Added (Waste or “Muda”)
Ne
ces
sar
y
Cri
tic
al
0.17% 99.96%
ValueAdded
0.17%
0.17%
Spend!Spend!Spend!
30m 15m 8,640m (6 days)
TotalChecking Hand-offs, In-box waiting,
Signatures, Mailing prep., etc.Quote
Preparation
Before
After 100K 15m 15m 8,640m (6 days)
8,685m
8,670m
23
EXTRA “BENEFITS (????)” - OFFICE
• More Opportunities For Errors With Additional Data Entry, Screens And Complexity
• More Software Means More Training Expense
• Cost Of Computers And Software Is Pure Profit Lost
• More Quotes (Including Additional “Marginal” Quotes) Are Prepared Because “We Can Quote Twice As Fast!”
• The System Clogs Up Even More (Hire More People?)
• The Result: We Waste Time And Money And Can’t Quote Any Faster!
24
A FIRST PASS LEAN RESPONSE - OFFICE
Non-Essential
Non-value Added (Waste or “Muda”)
30m
Ne
ces
sar
y
Cri
tic
al
0.35% 0.17%
99.48%
ValueAdded
15m 8,640m (6 days)
TotalChecking Hand-offs, In-box waiting, Signatures, Mailing prep., etc.
QuotePreparation
66.7% Faster in total processing time
After 10K 30m 15m 2,851m (<2 days) 2,896m
Before 8,685m
2/3 Reduction
25
Processing
Han
d-o
ffV
aria
bil
ity
InventoryScheduling
TYPESOF SURFACE
WASTE
Information “SPL
OR
K!”
TOOLS ARE GREAT, BUT…..
ConsensusDecision Making
Tools
Team-OrientedProblem Solving
QFD
Balanced Scorecard
Constraint Management
Flow Charts
Process Reengineering
FMEA
One-By-OneFlow Strategy
Poka-Yoke
Value StreamMapping
Black Belts
QFD
SMED
SixSigma
ISO/QS
IntegratedProduct
Development
Gain Sharing
SPC
Kaizen Blitzes
Total Preventive Maintenance
Visual Displays
High Performance Teams
5 “S”
Shainin
Shift 7 2 Meetings
Primary Visual
Displays
Ho
shin
Kan
ri
DOE
EnterpriseSoftware
(EIS)Kanban
s
20 Keys
“GLU
BO
OR
K!”
26
Processing
Han
d-o
ffV
aria
bil
ity
InventoryScheduling
TYPESOF SURFACE
WASTE
Information
Pro
ces
s
Re
en
gin
eeri
ng
Value StreamMapping
QFD
Poka-
Yoke
Bla
ck B
elts
IntegratedProduct
Development
Kanbans Kaizen Blitzes
SMED
SPC
…THERE’S MORE TO IT THAN TOOLSS
hain
in
Boing!
I’M BACKTO EAT MORE
PROFITS!!!
Implementation Specialists
KCG AGAIN, NOT A WORK ABOUT IMPLEMENTATION!
A Highly Productive,
Informed And Enthusiastic Workforce
Focused On Key
Processes That Are
Fast, Results- Driven,
Accurate, Repeatable,
Value-added, Aligned With Organization
Goals, Scrubbed Of Waste, And Supported &
Driven By Accurate,
Timely Metrics
Information Flow Studies
Technology Gap Analyses
Accuracy, Relevancy And Availability Studies
CATEGORY AND TYPE OF WASTE
WASTE REDUCTIONAPPROACHES
OFFICEKAIZENSM
OUTCOME
PR
OC
ES
SMETHODS AND TOOLS
DILO analysisValue stream MappingRACI assessmentKaizen work sheets Structured problem solvingWorkplace organization5S The 7 Quality Control ToolsLean Daily Management SystemFlow ChartingSkill versatility analysis/matricesFlow chartingWaste checklistStatistical process control chartsChange teamsOffice Kaizen blitzesWork instructionsSkills trainingProcess benchmarkingCore competency assessmentBrainstorming (e.g., Affinity diagramming)Cross trainingVisual displaysError proofingData integrity checklistRed-yellow-green analysisIN
FO
RM
A-
TIO
N
Project Management Methods
Balanced Scorecard
Error Proofing
Process Reengineering
Six Sigma Methods
ProcessingMotionWaitingAssignmentGoal AlignmentControlVariabilityTamperingStrategicReliabilityStandardizationSuboptimizationSchedulingWork-aroundUneven FlowCheckingErrorInventoryWork-in-processFixedMoving thingsTranslationMissingHand-offIrrelevancyInaccuracy
PE
OP
LE Kaizen
Job Descriptions
Workplace Organization
Work Standards
AS
SE
T Asset Optimization
Work Flow Analyses
Material Practices Analyses
Mas
ter
Jarg
on C
hart
Of
Lean
Off
ice/
Adm
in.
28
75%
INTEGRATED PRODUCT DEVELOPMENT WASTE
PEOPLE
Processing
Motion
Waiting
Composition
Standardization
Suboptimization
PROCESS
TEAM
Structure
Conflict
Goal
Alignm
ent
Focus
Boundary
Co-
loca
tion
Rep
ortin
g
Performance
Res
ourc
es
Alignm
ent
STRUCTURE
Assessment
TOOLSTECHNO
LOG
Y&
Knowled
ge
Inte
ract
ion
“Ility”
Par
amet
er
SurfaceWaste
29
ATTACKING SURFACE WASTESIS NOT ENOUGH
• It’s Easy To Eliminate Any One Instance Of Surface Waste (SW)• SW Is Only A Symptom Of An Underlying Problem, Not A Cause• “They’re Baaaaack!” (SW Is The Profit Killer That Keeps On
Giving Taking)• Removing One Instance Of SW Does Not:
– Put In New Measurements– Assure That The Root Cause Is Eliminated– Focus The Process Workers In The Correct Manner– Provide The Necessary Resources To Permanently Stop It
From Reoccurring
30
PEOPLE
TYPESOF
WASTE
Processing
Motion
Waiting
FixingDefects
Inventory
QU
ALITY
Making Too Much
(WIP)
MovingThings
QUANTITY
“SPL
OR
K!”
TOOL ATTACK AGAIN
“GLU
BO
OR
K!”
ConsensusDecision Making
Tools
Team-OrientedProblem Solving
QFD
Balanced Scorecard
Constraint Management
Flow Charts
Process Reengineering
FMEA
One-By-OneFlow Strategy
Poka-Yoke
Value StreamMapping
Black Belts
QFD
SMED
SixSigma
ISO/QS
IntegratedProduct
Development
Gain Sharing
SPC
Kaizen Blitzes
Total Preventive Maintenance
Visual Displays
High Performance Teams
5 “S”
Shainin
Shift 7 2 Meetings
Primary Visual
Displays
Ho
shin
Kan
ri
DOE
EnterpriseSoftware
(EIS)Kanban
s
20 Keys
31
LEAN APPROACHES AND TECHNIQUESTYPE OFWASTE
WASTE REDUCTIONAPPROACH
METHOD DESIREDRESULT
Standard Work
WorkplaceOrganization
Kaizen
WorkplaceManagement
Just-in-time
Error Proofing
Processing
Motion
Waiting
WhatYou Need,WhenYou
NeedIt
HighlyEfficient,
SafeWorkAreasWithHigh
Output
Good Quality
Inventory
MovingThings
Making Too
Much
Fixing Defects
Leveling
Kanban
Quick Setup
PreventiveMaintenance
Detection
Warning
Prediction
Prevention
CATEGORYOF WASTE
PEOPLE
QUANTITY
QUALITY
FOCUSPOINTS
Work BalanceWIPLocation/AmountKanban LocationKanban TypesLot SizesChangeover AnalysisPM Analysis
LayoutLabelingTools/PartsArrangementWork InstructionsEfficiencyTakt TimeSkills TrainingShift MeetingsCell/Area TeamsVisual Displays
Appropriate AutomatedAssistance
Fixture ModificationsSuccessive ChecksLimit Switches
Check SheetsPhotocells, Templates,
Etc.Cross Training
PRINCIPLEWORKSHEETS
Standard WorkSheet (SWS)
Time ObservationForm (TOF)
Standard WorkCombination
Sheet (SWCS)Work Load
Balancing Sheet(WLBS)
Kaizen TargetSheet (KTS)
Kaizen ActionSheet (KAS)
SWSSWCSWLBSKanbansTable of
ProductionCapacity ByProcess (TPCP)
PM SchedulingSheet (PMSS)
SWCS
Error ProofingAction Sheet(EPAS)
Error Proofing “ToDo” List (EPL)
Skill VersatilityVisual DisplayJidoka
Autonomation
32
Processing
Han
d-o
ffV
aria
bil
ity
InventoryScheduling
TYPESOF SURFACE
WASTE
Information “SPL
OR
K!”
TOOLS ARE GREAT, BUT…..
ConsensusDecision Making
Tools
Team-OrientedProblem Solving
QFD
Balanced Scorecard
Constraint Management
Flow Charts
Process Reengineering
FMEA
One-By-OneFlow Strategy
Poka-Yoke
Value StreamMapping
Black Belts
QFD
SMED
SixSigma
ISO/QS
IntegratedProduct
Development
Gain Sharing
SPC
Kaizen Blitzes
Total Preventive Maintenance
Visual Displays
High Performance Teams
5 “S”
Shainin
Shift 7 2 Meetings
Primary Visual
Displays
Ho
shin
Kan
ri
DOE
EnterpriseSoftware
(EIS)Kanban
s
20 Keys
“GLU
BO
OR
K!”
Implementation Specialists
KCG “TRADITIONAL” OFFICE WASTES AND TOOLS
A Highly Productive,
Informed And Enthusiastic Workforce
Focused On Key
Processes That Are
Fast, Results- Driven,
Accurate, Repeatable,
Value-added, Aligned With Organization
Goals, Scrubbed Of Waste, And Supported &
Driven By Accurate,
Timely Metrics
Information Flow Studies
Technology Gap Analyses
Accuracy, Relevancy And Availability Studies
TYPE OFWASTE
WASTE REDUCTIONAPPROACHES
OFFICEKAIZENSM
OUTCOME
CATEGORYOF WASTE
PR
OC
ES
SMETHODS AND TOOLS
DILO analysisValue stream MappingRACI assessmentKaizen work sheets Structured problem solvingWorkplace organization5S The 7 Quality Control ToolsLean Daily Management SystemFlow ChartingSkill versatility analysis/matricesFlow chartingWaste checklistStatistical process control chartsChange teamsOffice Kaizen blitzesWork instructionsSkills trainingProcess benchmarkingCore competency assessmentBrainstorming (e.g., Affinity diagramming)Cross trainingVisual displaysError proofingData integrity checklistRed-yellow-green analysisIN
FO
RM
A-
TIO
N
Project Management Methods
Balanced Scorecard
Error Proofing
Process Reengineering
Six Sigma Methods
ProcessingMotionWaitingAssignmentGoal AlignmentControlVariabilityTamperingStrategicReliabilityStandardizationSuboptimizationSchedulingWork-aroundUneven FlowCheckingErrorInventoryWork-in-processFixedMoving thingsTranslationMissingHand-offIrrelevancyInaccuracy
PE
OP
LE Kaizen
Job Descriptions
Workplace Organization
Work Standards
AS
SE
T Asset Optimization
Work Flow Analyses
Material Practices Analyses
SU
RF
AC
E
34
SOMETHING IS LURKING BENEATHSURFACE WASTE
And It Doesn’t Smell Too Good!
MMMmmmm, Chateau de Lost Profits, two quarters old, I think…left side of the garbage can.
35
YOU SMELL LEADERSHIP WASTE
FOCUSWASTE
STRUCTUREWASTE
OWNERSHIPWASTE
DISCIPLINEWASTE
36
LEADERSHIP WASTES MUST BE ATTACKED SIMULTANEOUSLY WITH SURFACE WASTE
• The Long-term, Dramatic Reduction Of LW “Is” World-class Leadership
• Leadership Waste (LW) Drives Every Other Controllable Problem Or Deficit In An Organization
• If LW Is Significantly Reduced, The Organization Will Be Successful Regardless Of The Tools It Uses
• LW Cannot Be Seen Easily By Those Who Generate It
• LW Is Always Defended With Vigor By Those Create Most Of It
• Few “Tools” Or “Programs” Address The Reduction Of LW As A Significant Endeavor
37
LEADERSHIP MUST CREATE FOURCONDITIONS AT EVERY LEVEL
FOCUS
STRUCTURE
DISCIPLINE
OWNERSHIP
What Is Important?
How Will It Be Pursued?
Will We Stick To It?
Do Results Impact Our Pride?
38
LEADERSHIP WASTES
Focus Waste Is the Loss That Arises When Management and Employees at All Levels Are Not Consistently Aligned and Energized to Address Critical Issues
Structure Waste Is the Loss of Value That Arises When There Is Not a Formal System of Behaviors and Processes in Place to Require Focus on Improvement
Discipline Waste Is the Loss Caused by Failure to Maintain the Behaviors and Processes of the Structure
Ownership Waste Is the Loss That Occurs When Employees Are Not Inclined/permitted/allowed to View Their Work Areas As Direct Extensions of Themselves
Arise From a Failure of Leadership to Harness the Potential That Resides in All Work Groups
39
EXECUTIVE
MANAGEMENT
OTHERSS
TR
UC
TU
RE
DIS
CIP
LIN
E
OW
NER
SH
IP
FO
CU
S
THECHALLENGE:
GET 12 CHECKS
40
EXECUTIVE
MANAGEMENT
OTHERSS
TR
UC
TU
RE
DIS
CIP
LIN
E
ON
WER
SH
IP
FO
CU
S
PRE-LEAN APPROACHES
YES YES YES
YES ? ? YES
YES
? ? ? ?
41
EXECUTIVE
MANAGEMENT
OTHERSS
TR
UC
TU
RE
DIS
CIP
LIN
E
OW
NER
SH
IP
FO
CU
S
THEACHILLES
HEEL OF PRE-LEAN
APPROACHES
YES YES YES
YES YES
YES
THEPRE-LEAN
GAP
42
THE PRE-LEAN GAP ALLOWS THE “WASTE CAKE” TO EXIST
YES ? ? YES
? ? ? ?
YES ? ? YES
? ? ? ?
Processing
Motion
FixingDefects
Making Too
Much
MovingThings
Inventory
Waiting
ProcessStability &Reliability
TYPESOF SURACE
WASTE
43
IN THE OFFICE, TOOYES ? ? YES
? ? ? ?
YES ? ? YES
? ? ? ?
Focu
sS
truc
ture
Ow
ners
hip
Dis
cipl
ine
LEADERSHIP WASTES
Processing
Han
d-o
ffV
aria
bil
ity
Work-aroundInventory
SchedulingTYPES
OF SURFACEWASTE
Information
44Focus
StructureStructure
OwnershipOwnership
THE WASTE CAKE
DisciplineDiscipline
45
EXECUTIVE
MANAGEMENT
OTHERSS
TR
UC
TU
RE
DIS
CIP
LIN
E
OW
NER
SH
IP
FO
CU
S
WIN-LEAN FILLS IN THE
GAPYES YES YES
YES YES YES
YES
YES YESYES YES
YES
46
TYPESOF SURFACE
WASTE
Information
Decision MakingTools
Team-OrientedProblem Solving
QFD
Balanced Constraint
Management
Flow Charts
Process Reengineering
FMEA
One-By-OneFlow Strategy
Poka-yoke-Yoke
Value Stream
Mapping
Six Sigma
QFD
SMED
SixSigma
ISO/QS
BalancedScorecard
SPC
Kaizen Blitzes
Visual Systems
5 “S”
Shainin
Primary Visual
Displays
DOE
Kanban
s
TPS Worksheets
SLMI-IT
FOCUS
STRUCTURE
DISCIPLINE
OWNERSHIP
Stream
F
47
Structure
Structure
Mentoring
Metrics
LeanDaily Management System
SLM2T3 = “SLIM-IT”SM
Tools Technology
Teamwork
48
THE SLIM-IT LEAN OPERATIONS CUBE
Ownership
Structure
Discipline
Focus LEADERSHIP WASTES
PEOPLE
Processing
Motion
FixingDefects
Making Too
Much
MovingThings
Inventory
QUANTITYQUALITY
Waiting
ProcessStability &Reliability
TYPESOF SURACE
WASTE
StructureLean Daily
Management SystemMentoringMetrics
Teamwork
Technology
Tools
49
THE SLIM-IT LEAN OFFICE CUBE
People
Processing
Motion
Waiting
Han
d-o
ff
StandardizationStra
tegi
c
Assignment
Tran
slat
ion
Uneven Flow
Mis
sin
g
Alignment
Irrelevancy
Checking
Var
iab
ility
Tam
per
ingC
on
trol
Suboptimization
Work-aroundWork-in-process
Inaccuracy
Inventory
Fixed
Moving T
hings
Reliabilit
y
Error
Scheduling
Process
AssetInformation
TYPESOF SURFACE
WASTE
Ownership
Structure
Discipline
Focus
StructureLean Daily
Management SystemMentoringMetrics
Teamwork
Technology
Tools
LEADERSHIP WASTES
50
THE FULL OPERATIONS CUBE
• “Value Stream Mapping (“as is” & “To be”)
• Box and wire diagram dynamic analysis
• Waste checklist• 7 Management Tools• Advanced statistical
process control methods• Office Kaizen
reengineering blitzes• Asset optimization• DILO analysis • RACI analyses• Kaizen work sheets • 5 “S”• Kanban• Error proofing• Structured problem
solving• Work loading analysis
• Key Goals Visual Focus ChartSM
• 7 Quality Control Tools• Value chain analysis• Workplace organization• Scheduling analyses• Benchmarking analysis• Work leveling studies• Core competency
analyses• Skill versatility matrices• Data integrity checklist• Red-yellow-green
analysis• Exposition participation• Financial
decomposition/analysis• Visual displays• Unsafe behavior analysis• Autonomation /jidoka
SURFACE WASTE REDUCTION METHODS
Ownership
Structure
Discipline
Focus LEADERSHIP WASTES
PEOPLE
Processing
Motion
FixingDefects
Making Too
Much
MovingThings
Inventory
QUANTITYQUALITY
Waiting
ProcessStability &Reliability
TYPESOF SURACE
WASTE
StructureLean Daily
Management SystemMentoringMetrics
Teamwork
Technology
Tools
51
THE FULL OFFICE CUBE
• “Value Stream Mapping (“as is” & “To be”)
• Box and wire diagram dynamic analysis
• Waste checklist• 7 Management Tools• Advanced statistical
process control methods• Office Kaizen
reengineering blitzes• Asset optimization• DILO analysis • RACI analyses• Kaizen work sheets • 5 “S”• Kanban• Error proofing• Structured problem
solving• Work loading analysis
• Key Goals Visual Focus ChartSM
• 7 Quality Control Tools• Value chain analysis• Workplace organization• Scheduling analyses• Benchmarking analysis• Work leveling studies• Core competency
analyses• Skill versatility matrices• Data integrity checklist• Red-yellow-green
analysis• Exposition participation• Financial
decomposition/analysis• Visual displays• Unsafe behavior analysis• Autonomation /jidoka
SURFACE WASTE REDUCTION METHODS
People
Processing
Motion
Waiting
Ha
nd-
off
Standardization
Stra
tegi
c
Assignment
Tran
slat
ion
Uneven Flow
Mis
sin
g
Alignment
Irrelevancy
Checking
Va
riab
ilit
yT
amp
erin
gCo
ntro
l
Suboptimization
Work-aroundWork-in-process
Inaccuracy
Inventory
Fixed
Moving T
hings
Reliabilit
y
Error
Scheduling
Process
AssetInformation
TYPESOF SURFACE
WASTE
Ownership
Structure
Discipline
Focus
StructureLean Daily
Management SystemMentoringMetrics
Teamwork
Technology
Tools
LEADERSHIP WASTES
52
WHY TRANSFORMATION EFFORTS FAIL
Error #1 Not Establishing A Sufficient Sense Of UrgencyError #2 Not Creating A Powerful Enough Leadership
CoalitionError #3 Not Creating A VisionError #4 Undercommunicating By A Factor Of 10Error #5 Not Removing Obstacles To The VisionError #6 Not Systematically Planning For And Creating
Short-term WinsError #7 Declaring Victory Too SoonError #8 Not Anchoring Changes In The Culture
From “Why Transformation Efforts Fail”, John P. Kotter, Harvard Business Review
53
EMPLOYEES’ INFORMATION NEEDS
What Employees WantA
mo
unt
of I
nfo
rma
tion
Re
quir
ed
Type of Information
CO
RP
OR
AT
ION
DIV
ISIO
N
SIT
E
DE
PA
RT
ME
NT
WO
RK
GR
OU
P
PE
RS
ON
AL
SIT
UA
TIO
N
What Employees Get
54
HOW ARE WE DOING SO FAR?
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
Creating A Vision
Over-communicating By A Factor Of 10
Creating A SenseOf Urgency
Establishing A Leadership Coalition
55
HOW ARE WE DOING SO FAR?
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
Removing Obstacles To The Vision
Creating Short-term Wins
Not Apt To Declare Victory Too Soon
Anchoring Changes In The Culture
56
RESULTS FROM OTHERS
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
Establishing A Leadership Coalition
Creating A Vision
Over-communicating By A Factor Of 10
Non-management employees (4,459)Middle management/supervisors (1,454)
Upper management & executives (1,233)
Creating A SenseOf Urgency
57
RESULTS FROM OTHERS
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
None Almost A Some Fair A Completelynone little amount Lot
Removing Obstacles To The Vision
Creating Short-term Wins
Not Apt To Declare Victory Too Soon
Anchoring Changes In The Culture
Non-management employees (4,459)Middle management/supervisors (1,454)
Upper management & executives (1,233)
58
THE OBJECTIVE
N o n e A lm o s t A S o m e F a i r A C o m p le t e l yn o n e l i t t l e a m o u n t L o t
N o n e A lm o s t A S o m e F a ir A C o m p le t e lyn o n e l i t t le a m o u n t L o t
N one A lm os t A S om e F a ir A C om p le te lynon e litt le am o un t Lo t
N o n e A lm o s t A S o m e F a ir A C o m p le t e lyn o n e l i t t le a m o u n t L o t
N one A lm ost A Som e Fair A C om plete lynone little am ount Lot
N o n e A lm o s t A S o m e F a ir A C o m p le t e lyn o n e l i t t le a m o u n t L o t
N o n e A lm o s t A S o m e F a ir A C o m p le te lyn o n e lit t le a m o u n t L o t
N o n e A lm o s t A S o m e F a ir A C o m p le te lyn o n e lit t le a m o u n t L o t
Creating a sense of urgency
Establishing a leadership coalition
Creating A vision
Over-communicating by 10X
Removing obstacles to the vision
Creating short-term wins
Not apt to Declare victory too soon
Anchoring changes in the culture
59
THE BENEFITS OF LEAN
• The Benefits Are There For The Taking
• The Benefits Always Include Increased Market Share, Lowered Cost (And Price), Higher Profits And Happier Customers (And Shareholders)
• Lean Is The Only Answer Known That Provides These Benefits: YOU HAVE NO OTHER CHOICE THAT IS KNOWN ON THIS PLANET!
• Lean Never Fails If You Do It
• Saying Lean Is Not Doing Lean
• Every Successful Business That Competes In An Over-capacity Or Price-sensitive Market Is Doing Lean Whether It Knows It Or Not
60
RESULTS OF THE "NEW WAY"
Labor Hours Per Car 31.0 16.0 19.0
Defects Per Car 135.0 45.0 45.0
Space Per Car 8.1 4.8 7.0
Average Inventory (Hrs.) 80.0 2.0 16.0
G.M. TOYOTA NUMMI
1 G.M. (FRAMINGHAM, MASS, USA )-CLOSED 1989
KEY QUALITY PARAMETER1 2 3
2 TOYOTA (TAKAOKA, JAPAN)
3 NUMMI (FREMONT, CA, USA)
From The Machine That Changed The World, Womack, Jones, Roos, Rawson Associates, 1990.
61
AEROPQUIP CORPORATION, NEW HAVEN PLANT
An Industry Week Magazine Plant Of The Year - 1997
• Return On Net Assets 39% In 1996• $417,000 Savings From Redesign Of Flow Control
Distributor Assembly• 505 Work-In-Process Inventory Turns Per Year• Work-In-Process Inventory Loss Less Than 0.1%• Worker Developed Human Resource Policies• $1M In Labor Costs Eliminated By Work-Cell Redesigns In
1995 & 1996 With No Layoffs• Cut F67 Valve Manufacturing Cycle By 98%• On-Time-Or-Free Delivery Guarantee• On-Site Engineers At Customer Locations
Products: Valves, Coupling And Flow Controls
62
AEROQUIP-INOAC CO.,LIVINGSTON, TENN An Industry Week Magazine Plant Of The Year -
2000
• No Lost-time Accidents in Last Four Years • Warranty Costs As Percentage of Sales: 0.2% • Plant-level Profitability Increased 234% in Last Five Years• In 1999 Employees Generated an Average of 8.5 Suggestions
Each • The Employee Suggestion Program and Continuous-improvement
Work Teams Generated $741,761 in Cost Savings Last Year • An Average of Three Kaizen Events Are Held Each Month• Share of the Rear-deck-spoiler Market Is Now 60% • On-time Delivery of 99.997% • Current Annual Labor Turnover Rate 1.6%; Never a Layoff
Products: Automotive Exterior Trim
63
BAE SYSTEMS CONTROLS, FORT WAYNE, IN
An Industry Week Magazine Plant Of The Year - 2000
• Order-to-shipment Lead Time Cut 90% in a Low-volume/high-mix Environment
• Value-added Productivity Soared 112% in Five Years • Work in Process Reduced by 70% • Product Reliability Improved by 300%, Based on Mean
Time Between Unscheduled Removals of Equipment in Service
• Zero Lost Workdays in 1999• Sales Per Employee Is up 97%
Products: Aircraft Controls
64
COMPAQ'S AMERICAS' SOFTWARE, NASHUA, NH
An Industry Week Magazine Plant Of The Year - 2000
• 99.5% On-time Shipment Rate• 99.99% Absolute Inventory Accuracy Rate• Less Than 1% Attrition Rate• 95% of Production Workers in Self-directed Work Teams • Machine Uptime 99.87%• 99.8% First-pass Yield• In 1999, 124 Continuous-improvement Events Cut $2 Million in
Labor, Material, and Other Costs• 54 Hours of Training Annually• Shipped More Than 500,000 Orders in 1999, Compared With
292,000 in 1995
Products: Software Manufacturing and Packaging
65
CONTINENTAL TEVES, MORGANTON, NC An Industry Week Magazine Plant Of The Year - 2000
• In-plant Defects Cut 70% Over Last Five Years • Warranty Costs Associated With Defects Cut 71% • Units Per Day Per Person Increased From 11 to 18 in Last
Three Years• Unit Volume Increased 200% Over Last Five Years While Total
Inventory Dropped 35%• 1.4 Million Work Hours Without a Lost-time Accident• Since 1996, Productivity Increased From 8,500 Units Per Day to
13,000 Units Per Day, Without Additional Manpower or Manufacturing Lines
• At the Same Time, In-plant Rejects Have Dropped From Over 5% to 0.5%
• Customer Rejects Down Over the Last 18 Months to 25 PPM
Products: Electronic Brake Systems
66
DELPHI RIMIR MATAMOROS, TAMAULIPAS, MEXICO
An Industry Week Magazine Plant Of The Year - 2000
• 99.7% First-pass Yield• 100% On-time Delivery Rate • Customer Reject Rate on Shipped Products: 10 PPM,
Down From 3,000 PPM Five Years Ago. • 78.3% Reduction in Finished-goods Inventory in the Last
Five Years • 95% Reduction in Lot Size in the Last Five Years • 80% Decrease in OSHA-reportable Lost Workday Rate in
Last Five Years• Customer Return Rate of Less Than 10 PPM Since 1997
Products: Automotive airbags
67
VALEO KLIMASYSTEME GmbH BAD RODACH, GERMANY
An Industry Week Magazine Plant Of The Year - 2000
• Lead Time Cut From 11.8 to 5.2 Days in Last One and a Half Years
• From 1995 to 1999 Injection-molding-machine Changeover Time Reduced From Three Hours to 15 Minutes on Average
• First-pass Yield of 99.6% Within Injection-molding Autonomous Production Unit
• All Walls and Machines Are Painted White; White Also Is the Standard Dress Code
• The Plant Currently Has 106 Suppliers, Compared With 177 Three Years Ago
Products: automotive heating, cooling, and ventilation systems
68
PAC INTERNATIONAL LTD.,STOCKPORT, ENGLAND
An Industry Week Magazine Plant Of The Year - 2000
• 92% Improvement in First-pass Yield Over Last Five Years for Major Component
• 95.7% of Purchased Materials No Longer Requiring Incoming Inspection
• 90.6% Reduction in Manufacturing Cycle Time in Last Five Years • 80% Reduction in Lead-time in Last Five Years • Sales Rose From Breakeven of US$4.44 Million in 1992 to Over $17
Million in 1999 and Profits Have Soared• All Production Workers Get Twice-yearly Assessments in Which
They Meet One-to-one With Managers• 70% of Workers Are Competent in Multiple Skills and That Number
Is Rising
Products: Electronic access controls
69
SOLECTRON CORP. - Milpitas, CA An Industry Week Magazine Plant Of The Year -
1998• On-time Delivery Rate Of 99.9%• Order To Shipment Lead Time Is One Day For Desktop
CPUs (Industry Average Of 5 Days)• Cycle Time For Engineering Start-up Reduced By A
Factor Of Five In Last Three Years• 23% Annual Growth Rate• 7 PPM In-Plant Defect Rate On Manufactured
Components And Finished Products; 63% Reduction In Defect Rate Since 1995
• Only 3% Labor Turnover• 100% Of Plant Workforce On Customer Focus Teams• Two-year Productivity Increase Of 22.3% (Sales Per
Employee)
70
OOPS!COOPER AUTOMOTIVE - WAGNER LIGHTING An Industry Week Magazine Plant Of The Year -
1997
• Order To Shipment Lead-times Cut By 83%• 140 Work-In-Process Inventory Turns (Up From 58)• In Last Five Years:
– 88% Reduction In In-Plant Defects – 99.3% Reduction In Customer Reject Rate– 56% Productivity Increase– 100% Customer Retention Rate
• Warranty Costs Just 0.36% Of Sales• 99.6% On-Time Delivery Rate• 0.4 Lost-Workday Rate Per 100 Employees• Sales Increase Of 750% Since 1990
Products:Automotive Lighting