lean enterprise product development ... - dspace@mit home

Lean Enterprise Product DevelopmentSimulation and Short Course - a summary

Presented ByHugh McManus and Eric Rebentisch

LAI and Metis Design

http://lean.mit.edu © 2006 Massachusetts Institute of Technology McManus/Rebentisch LEPD Overview 2

Top Level Learning Objectives

• Educate engineering leadership and change agents on principles of Lean product development (PD) and its role in the Lean enterprise

• Provide training and hands-on skill development opportunities for PD value stream mapping and related improvement techniques

• Illustrate and demonstrate, through hands-on learning, best practices of organizational design for lean PD

• Introduce concepts of organization, coordination and integration across the lean PD enterprise

• Provide training and hands-on skill development opportunities in the defining, managing, and facilitating PD improvement events

• Relate learning to ongoing improvement efforts at Host


What is Different about PD?

• Culture is generally not process-oriented• Information is flowing instead of material• Uncertainties are inevitable

• Product is generally incompletely defined • Process(es) not totally predictable

• Interdependencies are common• Process steps depend on each other for completion• Complex products with high performance requirements often

can’t avoid coupled functions and forms• Enterprise relationships are more complex

• PD organizations form a PD enterprise• PD serves the overall enterprise

Course teaches lean with these differences accommodated


Top Level Content Outline

• Basic principles of Lean applied to PD• Product Development Value Stream Mapping (PDVSM)• Organization design for Lean PD• Role of Lean PD in the Lean Enterprise• Transformations - Local: Identifying, prioritizing,

planning and executing lean improvement events• Host example for illustration and discussion

• Transformations - Global: Transformation of PD enterprises, and the role of PD in the greater Lean Enterprise• Host example for illustration and discussion

Most of this uses the Lean Enterprise Product Development (LEPD) Simulation as a teaching tool and practice field


Lean Enterprise Product Development (LEPD) Simulation

• A simulation of a complex aerospace product development enterprise

• Builds on the success and lessons learned of the Lean Enterprise Value simulation

• Philosophy draws heavily on LAI research and content and cases based on LAI member experience

• Created and distributed by Hugh McManus ([email protected]) and Eric Rebentisch ([email protected])


LEPD Architecture

• Participates take roles as program management and engineering group members

• Programs, issued by a facilitator, create paper “jobs” that must be processed by the engineers

• Jobs follow a Design-Analyze-Integrate-Verify process

• Variable process times (hourglasses)

• Reviews (dice)• Multiple rework

loops• Process is

complex and not initially visible

• Includes complete financial system


Day One: Basic Lean for Product Development: PDVSM

• Lectures cover:• Basic lean concepts• Application to PD• Basic VSM techniques applied

to PD

• Simulation exercises:• Familiarization with simulation• Basic local lean - 5S,

standardized processes, etc.• Value Stream Map of current

state• Data collection and analysis• Data-driven improvement


Basic Value Stream Map

• Inventories, decision points, rework loops

Design

Major

Review

Review

Job Release

Systems Integration

Systems Decomp

MajorAnalysis Review

Verifica- tion

Review Major

Log in

YES

YES

NO

NO

YES

NO

FAILPASS

FAIL

PASS

FAIL

PASS PASS

FAIL

x2


Adding Data - seeing issues

• Basic inventory, touch time, and rework % data clarify critical (burst) issues

Design

Major

Review

Review

Job Release

Systems Integration

Systems Decomp

MajorAnalysis Review

Verifica- tion

Review Major

Log in

YES

YES

NO

NO

YES

NO

FAILPASS

FAIL

PASS

FAIL

PASS PASS

FAIL

x2

14 pt/rd

33% 33%

33% ofMinor fail

50%

50%

10% of Major Fail

3 jobs

1 job

1 job

0

35 sec

70 sec

40 sec20 sec

40 sec

REWORK

TOO SLOW

REWORK


Analyzing Data

• Straightforward (but not simple!) analyses allow data- driven improvements:• Capacity of tasks in complex flows• Return on Invested Capitol (ROIC) or cost-per-unit (CPU)• Cost benefit for various improvement ideas enabled by lean calculator• Prioritization to maximize benefit for cost, meet quantitative targets

Design

Capacity in thePresence of Rework ?!


Implementing Change

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• Participants experience lean improvements:• simplified processes• smoother flows• increased throughput

• Data from simulation shows:• Decreased cycle time for

“programs”• Reduced cost/unit• Increased operating profit

(well, less losses…)• Improvements due to

basic lean:• Approx. 2x improvement

in program cycle time and throughput

• Approx. 30% improvement in engineering hours

PROFIT BY TABLE

COST PERUNIT

PROGRAMCYCLE TIME


Day Two: Designing Lean PD Organizations and Enterprises

QuickTime™ and aNone decompressor

are needed to see this picture.

2 3 4 5 6Month # 1

Draft A-Spec

Released Get Reuse & Process Marching Orders

Assemble Team

Draft SRS OutlineReview

SRS Outline

"Book Boss" Does First

Pass on All Sections

Estimate Section Needs

Sections Assigned

Obtain System H

SRS

Obtain System T SRS

Reuse Basis System Changed

Get Info About Each Section

Get Info From Other Sections and SRSs

Analyze & Update Most Recent Requirements

Work on Software Design Document

Integrate

Sections

Identify

Weaknesses

Wordsmith

& Format

Check

Traceability

A-Spec "Rev -"

Release

Section A

Section B

Section C

Section D

Section E

Section F

Section G

Unofficial

Peer

Reviews

Analyze Legacy

Requirements

for Reusability

Copy/ Generate/

Update

Requirements

Learn About

Section & its

Relation to Other

Sections

NVA

WBS Created

Project S: Software

Requirements Development

Value Stream Map

• Lectures cover:• Best practices and case studies in

tailored lean PD organizations• Advanced PDVSM methods for

concurrency, iteration

• Simulation exercises:• Specialization to meet various needs

and further increase effectiveness:• Support center

(simple, predictable work, at very high throughput)

• Design center (more complex, variable work)

• R&D center (maximum complexity and risk)

• Integration of specialized organizations


Designing PD Organizations: Simulation Exercises

• Improvements needed to attain these states again selected through data- based decisions

• Implementations illustrated success of concepts

Log in

Design

Analysis

VerificationReview

Work

Job Release

Design

Job Release

Systems Integration

Systems Upfront

work

Analysis

Verifica- tion

Review

FAIL

FAIL

PASS

x2PASS

Review

Log in

• Three different Future State Value streams created to meet challenges• Support center - highly parallel VS with

planned iterations• Design center - simplified, somewhat parallel

VS with emphasis on reducing variation and large rework loops

• R&D center - flexible organization with emphasis on reducing variation through additional iterations

INTEGRATED CONCURRENT SUPPORT ENG. CENTER

TEAM-BASED DESIGN CENTER


Evolution of Product Development Enterprise

© 2006 Massachusetts Institute of Technology

Table 1


Table 2


Table 3

EngineeringGroups

Chief Engineers

CEJobs

CE

CE

Programs

CustomerInfo

• Final Simulation Challenge: Integrate specialized groups to respond to complex customer needs

• Carrying out challenge gave participants an experience in integrating across boundaries to maximize global efficiencies

• Success tracked by output and financial metrics


Lean Enterprise Success

• Participants experience lean enterprise:• Specialized, highly efficient

processes• Communication and

coordination across the enterprise

• Increased process visibility• Standard work for routine

processes, energy focused on the exceptions

• Organization design and enterprise integration allows:• another ~2x improvement in

program cycle time and throughput

• additional 40% improvement in engineering hours

• significantly higher profit0

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LegacyLocal LeanGlobal Lean

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PROFIT BY TABLE

COST PERUNIT

PROGRAMCYCLE TIME


Day Three: Implementing Lean PD

• Lectures cover:• Lean PD Principles and

Tools• Implementing change at

the local level• Planning and managing

change at the enterprise level

• Host examples and discussion:• Host local lean example• Host enterprise lean

example


Lean PD System Principles

Reinterpreting the Lean PD system principles from Toyota:

• Minimize process variation to make inputs and outputs crossing functional boundaries predictable

• Coordinate activities across boundaries (visual, communication, shared understanding, etc.) to minimize disruptions to flow of work in PD system

• Develop and balance capacity with stabilized/managed demands

• Embed learning and knowledge sharing processes in the enterprise PD system for continuous improvement


Facilitating Lean Projects

• Facilitating Lean Change Events

• Project selection and prioritization

• Project Planning, Documentation and Tracking

• Discussion motivated by presentation of experience to date by host


Planning Lean Enterprise PD Transformation

• Frameworks for Understanding the Enterprise Transition to Lean• LAI Transition to Lean (TTL)• PD TTL• DoD Continuous Process

Improvement (CPI) Framework• Enterprise Value Stream

Mapping and Analysis (EVSMA)• Creating multiple data-driven

views of a complex enterprise• From views and future-state

vision, create transformation plan• Discussion motivated by

presentation of experience to date by host


Summary

• New LAI Product built to user pull for enterprise-level, PD-oriented lean transformation education and training

• Incorporates the latest in LAI research and field experience• Principles of Lean PD Enterprises• Organizational design and integration

• Includes training and practice in LAI methods:• PDVSM• Enterprise transformation

LAI KEE July 17-18 - two day, open enrollmentAvailable for implementation at your site


Backup - Nominal Agenda


Nominal Day One Agenda

8:30 Introduction 9:00 Host Introduction and Leadership Charge9:20 Overview of Lean and Lean PD Principles10:20 Break10:30 Simulation Segment 1

• Familiarization and simple lean tool application12:00 Lunch1:00 PDVSM talk and exercise2:30 Capacity, ROIC, and Change proposals

• Break included• Interwoven lectures and exercises

4:00 Simulation Segment 2 • Silo improvement

5:00 Conclude


Nominal Day Two Agenda

8:30 Enterprise challenge8:45 PD Organization Design

• Lecture and Exercise

10:00 Break10:15 PD Enterprise design exercise

• Includes Advanced PDVSM lecture

12:00 Lunch1:00 Simulation Segment 3

• Enterprise design• Enterprise planning exercise

3:30 Simulation Segment 4• Enterprise integration experience

3:30 Break3:45 Sim. Outbrief and Lean PD practices discussion5:00 Conclude


Nominal Day Three Agenda

8:30 Lean PD practices lecture and Discussion10:00 Break10:15 Managing Change Projects

• Host team presentation of change project• Interactive discussion• Lecture on Facilitation of change processes

12:00 Lunch1:00 PD VSM in Enterprise processes

• Transition to Lean and Enterprise Value Stream tools• Host team presentation

2:20 Break2:30 Managing PD Enterprise Transformation3:20 Concluding comments and review3:30 Finish

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