IMPLEMENTING LEAN MANUFACTURING

LEAN SIX SIGMA PART…. 7 MARATHON STUDY

In my last article, I talked about THE LEAN MANUFACRURING”

Please read along as we attain another height in PART..7..

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IMPLEMENTING LEAN MANUFACTURING

Analyze each step in the original process before making change

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Lean manufacturing main focuses is on cost reduction and increases in turnover and eliminating activities that do not add value to the manufacturing process. Basically what lean manufacturing does is help companies to achieve targeted production, as well as other things, by introducing tools and techniques that are easy to apply and maintain. What these tools and techniques are doing is reducing and eliminating waste, things that are not needed in the manufacturing process.

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Manufacturing engineers set out to use the six-sigma DMAIC (Design, Measure, Analyze, Improve, Control) methodology—in conjunction with lean manufacturing to meet customer requirements related to the production of tubes.

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Manufacturing engineers were charged with designing a new process layout of the tube production line. The objectives for project included:

???????? Improved quality

???????? Decreased scrap

???????? Delivery to the point of use

???????? Smaller lot sizes

???????? Implementation of a pull system

???????? Better feedback

???????? Increased production

???????? Individual Responsibility

???????? Decreased WIP

???????? Dine flexibility

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Before making changes, the team analyze each step in the original layout of the tube production line process.

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1. They try to understand the original state process, identify the problem area, unnecessary step and non value added.

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2. After mapping the process, the lean team collected data from the Material Review Board (MRB) bench to measure and analyze major types of defects . To better understand the process, the team also did a time study for 20 days period production run.

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In the original state, the tube line consisted of one operator and four operations, separated into two stations by a large table using a push system. The table acted as a separator between the second and third operation.

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The first problem discovered was the line’s unbalanced . The first station was used about 70% of the time. Operators at the second station were spending a lot of their time waiting between cycle times. By combining stations one and two, room for improvement became evident with respect to individual responsibility, control of inventory by the operator, and immediate feedback when a problem occurred. The time study and the department layout reflect these findings.

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A second problem was recognized. Because of the process flow, the production rate did not allow the production schedule to be met with two stations. Because operators lost track of machine cycles, machines were waiting for operator attention. Operators also tried to push parts through the first station—the bottleneck operation in the process—and then continued to manufacture the parts at the last two operations. Typically, long runs of WIP built up, and quality problems were not caught until a lot number of defective pieces were produced.

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The original state data were taken from the last 20 days before the change. The teams analyze each step in the original and making changes. The findings of the time study on the original process provided the basis for reducing cycle time, balancing the line, designing the using Just In Time kanbans and scheduling, improve quality, decrease lot size and WIP , and improve flow. The new process data were taken starting one month after implementation. This delay gave the machine operators an opportunity to train and get to with the new process layout system.

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With the U shaped cell design; The parts meet all the customer requirement. Table in the original process was removed ,almost eliminating WIP. With the reducing WIP and increasing production.

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Some of the concepts used to improve the process included total employee involvement (TEI), smaller lot sizes, scheduling, point of use inventory, and improved layout. All employees and supervisors in the department were involved in all phases of the project. Their ideas and suggestions were incorporated in the planning and implementation process to gain wider acceptance of the changes to the process. Smaller lot sizes were introduced to minimize the number of parts produced before defects were detected. Kanbans were introduced (in the form of material handling racks) to control WIP and to implement a pull system. And the cell layout decreased travel between operations.

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Operators were authorized to stop the line when problems arose. In the original-state , the operators were still continue running parts when a operation was down.

With kanban control, the layout eliminated the ability to store WIP, requiring the operator to shut down the entire line. The cell layout provides excellent opportunities for improving communication between operators about problems and adjustments, to achieve better quality.

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Day-to-day inspection of the original-state process the operators spent a lot of time either waiting for material- handling person, or performing as a material handling. With the U-shaped cell, delivery to the point of use is more better for the operator. The operator places boxes of raw material on six moveable roller carts, where it’s easily to get. The six boxes are enough to last a 24-hr period.

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To reduce setup times, tools needed for machine repair and adjustments are located in the cell. The screws are not standardized; tools are set up in order of increasing size to quickly identify the proper tool.

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For three months the process was monitored to verify that it was in control. Comparison of time studies from the original-state and the implemented layout demonstrated an increase in production from 300 to 514 finished products per shift. The new layout eliminated double handling between the second and third operations, as well as at the packing step. It also reduced throughout time by making it easier to cycle all four operations in a pull-system order. Customer demand was met by two shifts, which reduced the labor cost.

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The results of the redesign are as follows:

???????? WIP decreased by 97%

???????? Production increased 72%

???????? Scrap was reduced by 43%

???????? Machine utilization increased by 50%

???????? Labor utilization increased by 25%

???????? Labor costs were reduced by 33%

???????? Sigma level increased from 2.6 to 2.8

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This project yielded reduced labor and scrap costs, and allowed the organization to do a better job of making deliveries on time, while allowing a smaller finished- goods inventory. Daily production numbers and single part cycle time served as a benchmark for monitoring progress towards the goal. Although the sigma level increase , the 43% reduction in defects, 97% reduction in WIP, and production increase of 72% contributed to the project objective.

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Implementing lean is a never ending process; this is what continuous improvement is all about. When you get one aspect of lean implemented, it can always be improved. Don’t get hung up on it, but don’t let things slip back to the starting point. There will always be time to go back and refine some of the processes.

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Before Lean Manufacturing was implemented at Nypro Oregon Inc., we would operate using traditional manufacturing. Traditional manufacturing consists of producing all of a given product for the marketplace so as to never let the equipment idle. These goods them need to be warehoused or shipped out to a customer who may not be ready for them. If more is produced than can be sold, the products will be sold at a deep discount (often a loss) or simply scrapped. This can add up to an enormous amount waste. After implementing Lean Manufacturing concepts, our company uses just in time. Just in time refers to producing and delivering good in the amount required when the customer requires it and not before. In lean Manufacturing, the manufacture only produces what the customer wants, when they want it. This often a much more cost effective way of manufacturing when compared to high priced, high volume equipment.

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Architecting Lean Enterprises

What Is Lean Enterprise?

Lean enterprise refers to a production principle stating that any component of a business enterprise that fails to directly benefit a final product is superfluous. Lean enterprise focuses on value creation while eliminating waste and non-essential processes. The most valuable elements of a product or a service are largely decided by consumers, based on the discretionary income they are willing to pay for an item.

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Understanding Lean Enterprise

Lean enterprise is sometimes simply referred to as "lean." Although both terms came into popular usage in the 1990s, the concept itself was devised by Toyota Motor Corporation when it introduced the Toyota Production System (TPS).

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Developed by Eiji Toyoda and Taiichi Ohno, the Toyota Production System (TPS) integrated socio-technical management philosophy and was practiced between 1948 and 1975. The lean enterprise philosophy was also inspired by telecommunications giant Motorola, which implemented a manufacturing principle known as Lean Six Sigma in 1986.

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This quality-control methodology uses a data-driven review to limit mistakes and defects in the production process. At its core, a company that adopts lean enterprise combines these two disciplines in order to maximize value for customers while slashing the money and resources spent on creating the products and services in question.

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Lean Enterprise Principles

According to Lean Thinking: Banish Waste and Create Wealth in Your Corporation, co-written by economists James Womack and Daniel T. Jones, lean enterprise is characterized by the following five chief tenets:4

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? Value: This pertains to the manner in which end customers value a certain product or service as it relates to their wants or needs.

? Value stream: This breaks down the life cycle of a product or service, including the acquisition of raw materials, the manufacturing of goods, the sale and delivery of inventory, and the ultimate consumption of items by end-users.

? Flow: If any iteration of the value stream is stagnant or inefficient, it is considered wasteful and antithetical to creating customer value.

? Pull: This is a directive stating that nothing should be produced until there is clear demand or official purchase orders from customers.

? Perfection: This ethos states that any element of the process that results in inferior product quality shall be excised from the manufacturing process.

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What Does It Take To Become A Lean Enterprise?

In our experience, there are three keys to successful implementation of Lean: Leadership Commitment, Employee Involvement and Execution. These form the foundation that will allow Lean to take root and drive results.

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Leadership Commitment

A true Lean Enterprise is only achieved if it is rooted in the culture of a company. It becomes part of the DNA of how the company operates; how employees view and handle challenges as well as opportunities. Leaders need to provide encouragement, reinforcement and most of all, lead by example. Often, employees see Lean as a ―fad or like mentioned above, a manufacturing initiative. Only when they see that leadership is practicing Lean day in and day out will the employees fully believe in its power and commit 100%. They can develop the drive for continuous assessment and improvement that makes a Lean Enterprise a sustainable entity.

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Employee Involvement

Employee involvement is a key to success for two reasons. First, it builds ownership of change. People are more likely to adopt change they helped design rather than change thrust upon them. Second, the people doing the work are in the best position to understand how the work gets done and are better suited to solve any issues that may arise. For that reason, involving the employees in the Lean Enterprise transformation is a key factor. There are numerous practices and tools that can be used depending on your unique situation, but from our experience there are 3 practices that ensure employee involvement and empowerment to drive the sustainable change and imbed it in the culture.

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? Continuous improvement – through proven Lean tools and practices, employees are empowered to always look to eliminate waste and improve their work streams

? Communication process – employee suggestions and transparency encourages continuous communication of changes, ideas and issues throughout the transformation and after its implementation

? Effective change management – in a transformation, employee resistance to change can be detrimental to meeting the goals if not properly managed

? When all employees – regardless of position or function – are immersed in Lean thinking, a powerful Lean culture is created. The core of a Lean Enterprise is made up of a culture that is always consciously and subconsciously thinking Lean.

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Execution

Effective execution requires a focused direction and detailed plan to address near-term and longer-term needs that build the business capabilities to support fluctuating business climates. Without a structured plan, direction becomes foggy, leadership will not fully grasp the benefits of the implementation and employees will lose faith in the process.

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A generic representation of entrepreneurial lean thinking to architect lean enterprises The plan should strive to be in the same form as the desired results: streamlined with a clear view ahead. The focus should be based on:

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? A comprehensive company-wide plan

? Staying disciplined throughout the transformation and throughout the organization

? Clearly defining accountability for not only leadership, but for all employees

? Effective communication of accountability and progress throughout the transformation Organisational Culture and Change Leadership

In the context of organisational change we look for methods that will support sustainability, that is, obtaining enduring benefits. The decision to implement lean is typically a decision of senior management, that is, a top-down change initiative. While there are many models of the change management process, the process is not always as successful as intended.

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As change management shows, abrupt changes result in resistance. At the deeper level lean is a culture, that is, a set of organisational attitudes, rather than a mere use of tools. The sustainability depends on organisational culture and the collective response to the change. Furthermore, many of the lean tools are sophisticated in their requirement for a particular type of culture, including strong intrinsic motivation at the shop-floor level for the processes (e.g., kaizen, 5S, quality circles, work cells, and six sigma). Thus implementing lean requires a change management process that fosters the outcomes, hence change leadership through coaching as opposed to merely directive top-down change.

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In a lean system the respect for humans principle is equally important as the elimination of waste. Lean is commonly associated with the latter and the respect for humans component is largely neglected. True lean involves a focus on the people of an organisation, creating a culture that empowers staff at all levels to make innovative changes that improve productivity by reducing wasteful action (muda). This creates dynamic and flexible learning organisations of emergent change. Efficient and effective communication processes enable collaboration and consensus along with shared vision and engagement.

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Lean methods or tools: a selection of some (not all) of lean methods indicating the importance of having a selection criteria and prioritisation method for implementation.

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In this way “respect for humans” works synergetically with and for “waste elimination.” Neglecting the human component jeopardises the sustainability of the change and makes it difficult to reach the level of cultural excellence for continuous improvement. A popular representation of this is the iceberg model of Hines et al., with the lean tools, processes, and techniques being the visible component above the waterline, with the unseen supporting functions being strategy, leadership, and employee behaviour and engagement.

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This introduces a time dimension to the implementation, since culture is not instant. Consequently it may be necessary to build that culture. Specifically, lean is implemented in stages over time, by selecting tools that are appropriate to the organisation at that point in time. It may be wiser to first implement simpler methods with the view of engagement and acceptance of staff as opposed to attempting to immediately introduce the more complex lean tools.

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These become small “wins” that build momentum and staff confidence. Employees need to be engaged to support a difficult method (like JIT). Thus, even though certain lean tools may hold the promise of high returns, they may also be risky to implement. Failure could ruin future chances of success and engagement.

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Implementation of lean is therefore an organizational strategy regarding the changing of culture over time, by the selective and progressive implementation of lean tools that are situational relevant for that organization at that time, followed by further implementation later when the culture has caught up. Practitioners typically describe this deliberate temporal progression as the lean journey. Thus the concept of continuous improvement (CI) applies not only to the technical operations but also the strategic implementation at organizational level. The residual difficulty is that of deciding which lean tools are relevant for the organization at that point in its journey. This is a question to which we return, and in the next section we show how consideration of organizational risk can lead to a solution.

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