CERTIFICATE PROGRAM IN LEAN SIX SIGMA

By – Paresh Kariya B.E.(Mech), MBA. Ph.D. Six Sigma, FIV

[email protected]
Session -5
Can Start ?
 RECALL- D4

LSS-4
 DPU-DPMO-TY-RTY-PPM
EXERCISES
KAIZEN- DOWNTIME
PM
Y= FX- CT CONCEPT
LSS-4 RVA-BVA-NVA
LEAN BASICS- HISTORICAL ASPECTS
LEAN SIX SIGMA TOOL BOX
Q.& A.
 CEO EXPECTATIONS
SHINY EYES
COMPLIANCE TO CONVICTION
COPQ EXERCISE
CTQ-D-S…
TERMINOLOGIES IN LSS- CHECK POINTS- SHEET-LIST
LSS-3
SIPOC
DPU
DPMO
EXERCISES
Q.& A.
 LSS PROJECT FORMAT-DMAIC
QUALITY GURUS
TQM
CCP
MFA
AEIOU
LSS-2
PROCESS APPROACH
EXERCISE- K & S
COST OF QUALITY
COST OF NON CONFORMANCE- IF+EF+H
COST OF CONFORMANCE- P+A
Q.& A.
 1NTRODUCTION- YOUR EXPECTATIONS & MINE
LEAN SIX SIGMA INTRODUCTION
QUALITY
LEAN SIX SIGMA LETTER

LSS-1 PROFESSIONAL
QDRR
O.A.D.- CURRENCY NOTE OF INDIA
Wednesday, August 26, 2020 Company Private 9
Company Private 15
 KAIZEN – Definition
“Kai” = Take apart and make new (change)

“Zen” = Think, make good the actions of others, do

good deeds and help others

“Kaizen” = To take (Processes) apart to understand

them, then (and only then) put them back
together in a better way.

• Business philosophy of continuous, incremental improvement

• Rapid, team-based activity within a short time period
• Application of intelligence & ingenuity rather than immediately
or abundantly spending money
• Focus on quick and simple solutions to eliminate waste
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 KAIZEN INTRODUCTION – Waste
Elimination
The 7 + 1 Deadly Wastes

1. DEFECTS 2. OVERPRODUCTION 3. WAITING 4. N0N-USE

7. MOVEMENT 8. EXCESS-PROCESSING
5. TRANSPORTATION 6. INVENTORY
ON-HAND REQUIRED
PARTS
PARTSPARTS
PARTS PARTS

PARTS PARTS
PARTS PARTS
PARTS PARTS
PARTS

PARTS PARTSPARTS
PARTSPARTS PARTS PARTS
PARTS

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 KAIZEN EVENT – Types
Flow Kaizen
• Focuses on the Value Stream
Process Kaizen
• Focuses on individual processes to eliminate waste

Management FLOW KAIZEN

(Value Stream Improvement)

PROCESS KAIZEN
(Elimination of Waste)
Front Line

Focus

24 * Source: Lean Lexicon by the Lean Enterprise Institute, 2008

PROCESS MANAGEMENT DEFINED

Process: A series of activities that transforms inputs into an output required

by a customer
Key process: A process that has a high impact on customer requirements
and business need
Robust (certified): The ability to repeatedly meet customer requirements
and business needs
Process management: A disciplined method for identifying and managing
improvement activities that will make key processes robust

Process Management

Improve
Define Define Prioritize Document
processes
customers processes processes (DMAIC) success

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Agenda

Lean Thinking
What is Value Stream Mapping (VSM)
Seven Principles to Lean
Building the Lean Organization
Your Roles

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Roots of “Lean Thinking”

Ford: Moving Final Assembly Line: 1913

GM: Mixed Model, Batch Process: 1930-1940
Taiichi Ohno: American Supermarkets: 1950’s
Toyota Production System: 1945-1970’s
World Class Manufacturing: 1980’s
Womack & Jones: “Lean Manufacturing”: 1990

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“Lean Thinking” - Womack & Jones

1 - Specify value - Customer

Perspective
2 - Identify & map the value stream
3 - Make the product flow
4 - Pull from the customer
5 - Always seek perfection

Jim Womack and Dan Jones,

Lean Enterprise Institute, USA & England

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Its About – Elimination of Waste and
Continuous Improvement. . .

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 LEAN DEFINED

Lead Time: The total elapsed time between initiation and execution of a
process

Lean: A business strategy to profitably grow market share focused on

creating and improving flow

Value: The worth attributed to a product or service, as defined by the

customer

Just-in-time

Zero-
Flow Takt Pull
defect

Set-up
Line balancing Supermarket DOWNTIME
reduction

KAIZEN

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 Definitions of Value
• Value-Added (VA):
Activities that must be performed to meet customer requirements.
- Submitting a proposal - Create a computer program
- Creating a design - Answer a tech request

• Business Value-Added (BVA):

Activities that are essential to conducting business, but could be eliminated without
impacting the product functionality or service to the customer.
- Order supplies - Update Personnel Records
- Maintain copiers, faxes - Prepare Financial Reports

• Non Value-Added (NVA):

Activities that do not contribute to meeting customer requirements.
- Review and Approval - Movement to other organizations
- Rework - Waiting in an inbox

Value – Is defined by the customer and is anything they are

willing to pay for!
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 WASTE AND FLOW

•What problems prevent a smooth flow of information and deliverables

from your process?

•How do you identify and remove non-value add activities from your
process?

Eight Wastes
D Defects / rework
O Overproduction
W Waiting
N Non-utilization of people’s skills
T Transportation
I Inventory
M Motion
E Excess processing

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Operations Transformation –
through VSM

“It’s all about

Connecting
the Dots”

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Operations Transformation
Current Supply Chain
(typically in excess of 40 weeks)
Order Procurement Assembly Delivery
Cycle Cycle Cycle Cycle

FAB FI NL
A

Customer Assembly
Raw Material Manufacturing Shipping
Order & Test

Supply Chain Vision

(<20 weeks)

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Lean the Enterprise

ENGINEERING

SUPPLIERS

FACTORY CUSTOMER

SALES & OFFICE AFTERMARKET

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The Lean Six Sigma Toolbox

Six Sigma Toolbox

3P

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Key Learnings

Operations Transformation vision includes the

shortening of lead times within our factories…and
our supply base.
The vision takes us beyond the 4 walls of our factories -
we are striving to lean the entire enterprise
Value Stream Mapping allows us to “connect the dots”
by aligning and connecting improvements across the
enterprise
Value Stream Mapping is part of the SS Toolbox

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What is a Value Stream?
All activities both value added and non-value added required to
bring product from raw material to the customer

Value Stream

Process Process Process Assembly Process

A B C & Test D Customer

Raw Finished
Material Product

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Why Value Stream Mapping?
A new pair of ‘lean glasses’

You have to see things differently, to do things

differently

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 VALUE STREAM DEFINED
Value: The worth attributed to a product or service, as defined by the
customer

Value add work: Work that a customer is willing to pay for when
purchasing a product or service

Value stream: An organized group of processes that work together to

provide value to customer(s)

Accts
Order Entry Design Prod Plan Suppliers Manufacture Distribute Customer Receivable

Value Stream

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Session -5
 VALUE STREAM MAPPING DEFINED
Value stream map (VSM): A visual representation of the material and
information flow of a value stream

Value stream mapping: A technique for graphically depicting a value

stream

Value stream process management: A disciplined method for identifying,

prioritizing, and improving processes through standardization and waste
elimination

Value Stream Mapping

Define Create the Apply lean Create the Create the

Product / value Execute
current future state implementation the plan
Process state map stream map plan
family guidelines

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BENEFITS OF VALUE STREAM MAPPING

Employ value stream mapping to improve performance

Apply in all areas of the organization

Engineering Business and

Operations Service

• Reduce product lead-time

• Improve speed to market • Reduce lead time
• Improve responsiveness
• Reduce lead time • Increase service capacity
• Improve demand flexibility
• Address low delivery metrics • Eliminate value stream waste
• Improve delivery performance

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Value Stream Mapping
Provides visual representation of:
Material flow
Information flow

Enables you to see:

Waste

System view

Customer’s perspective

Operating philosophy

Roadmap for change

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Using Value Stream Mapping

Implementation
Plan

Future State
Map

Current State
Map

Product Family
Definition

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 MAP
Utilize standard symbols for mapping

Identify key elements of the current state value stream

Process Inventory
name
Wait

External customer Process

or supplier Delay

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CURRENT STATE MAP

Separate process time from total lead time

Calculate the lead time ladder to identify waste

Request for PO
ERP 25 RPO’s
External External per week
Procurement Customer
Supplier(s)

RPO

Purchase
Order
placed
P.O. Excel
FLOW Clarification
 File

I ID Need
I Request Bid I Receive Bid I Select Vendor
I Create PO
20 reqs 50 reqs 9 reqs 13 reqs 10 reqs
1 1 1 1 2
P/T = 13 min P/T = 7 miin P/T = 18 min P/T = 24 min P/T = 6 min
C&A = 60% C&A = 60% C&A = 60% C&A = 60% C&A = 90%

Total LT =
4 days 10 days 1.8 days 2.6 days 2 days
20.4 days

13 min 7 min 18 min 24 min 6 min PT=

68 mins

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7 Principles to Make a Value Stream Lean

1 - Takt time
2 - Finished goods strategy
3 - Continuous flow
4 - Pull System
5 - Schedule only one point
6 – Interval
(EPEI = Every Part Every Interval)
7 - Pitch

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1st = Takt Time
Customer demand rate.
Synchronizes the pace of
production to the pace of
sales.

Effective working time per shift

Takt Time = Customer demand per shift

460 minutes
= = 1 min
460 pieces

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2nd = Finished Goods Strategy
To Shipping To Supermarket

Customer Customer

assembly shipping assembly shipping

supermarket

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3rd = Continuous Flow
Batch & Push Processing Anything and
Process time = 1 minute per piece everything
can happen

A B C
Customer wants 10 pieces, how long will it take?
30 ++ minutes
Customer wants 1 piece, how long will it take?
30 ++ minutes
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3rd = Continuous Flow
Make One
Process time = 1 minute per piece
Move One

A B C

Customer wants 1piece, how long will it take?

3 minutes
Customer wants 10 pieces, how long will it take?
12 minutes
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FIFO – First In First Out
FIFO is similar to ping pong balls going through a
pipe.
They always come out in the same order.
And the pipe is only so big.
Once you fill it, that’s it.

Process A Process B

FIFO

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4th = Pull System
Pull when flow is not possible
production withdraw
kanban kanban Schedule

supplying customer
process process

new withdrawn
product product

supermarket

Customer goes to supermarket and gets what they need when they need it
Supplier produces to replenish what was withdrawn

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5th = Schedule Only One Point
Schedule / “Pacemaker”

customer

1 2 3 4
supermarket
flow
customer
pull

1 2 FIFO 3 FIFO 4

flow

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6th = EPEI (Every Part Every Interval)

Source = LEI

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7th = Pitch

Source = LEI

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7th = Pitch
Business Process Example of visual controls & visual management

Schedule boards, status boards

Color coded files
Clear signage in work area

7 AM 9 AM 11 AM 1 PM 3 PM 5 PM

Quote
Packages

It’s 11:30 AM? Are we on schedule?

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 FUTURE STATE MAP
Design future state map by applying lean guidelines

Identify kaizen bursts required to achieve future state

Business Lean Guidelines

1
External ERP
P.O. Request
1 – Takt time
Supplier(s) Procurement External Takt =
Customer 96 min 2 – Continuous flow
Purchase 3 – FIFO flow
Order
Quote
placed
4 – Work-flow cycles
4
daily 5 – Integration events
08:00 am
7 3
Max = 5 Max = 5 Receive Bid and Select Vendor Max = 5
9 6 – Standard work
Request
7 – Single point initialization
ID Need PO
FIFO Bid
FIFO 2 FIFO 6
1 1 1 8 – Pitch
1 Day pitch. 8 9 – Changing demand
1 day 1 day 1 day Total LT =
3.1 days
5 min 15 min 30 min 7 min PT=
57 mins
5

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Future State - What to expect
Operational Improvements
Takt Time Set the pace, less waste
Pitch Level the volume, how performing
EPEI Level the mix, more flexibility
Flow / Pull / Pacemaker Know what to work on next

Business Performance Improvements

Lead-time decreasing
Inventory decreasing
Quality increasing
Total Product Cost decreasing
Market Growth increasing

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Key Learnings

Value Stream = All activities both value added and

non-value added required to bring product from
raw material to the customer
Value Stream Mapping enables one to see things
differently – to see waste, big-picture view, value
from customer perspective

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Building the Lean Organization
Each one of us must realize that:
The company is in business to make money by
providing value to our customers
Our customers have choices – buy from us or
buy from our competition
Every element of waste adds cost and time,
giving advantage to the competition

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LEAN IN BUSINESS PROCESSES

Quiz!
•People that work in offices are more organized, and therefore there is less waste in a
business process/office environment.

False: There is a tremendous amount of hidden waste in business processes

•Business processes have less variation than manufacturing processes because trained
professionals are completing tasks.

False: Administrative activities may be MORE likely to have variation.

•Office work usually accounts for less than 20% of the total cost of operations.
False: >50% of costs are related to administrative activities
•Most office work/business processes have been mapped out, and most of the
participants have standard work procedures and are aware of the flow of work.

False: Flow of work is mostly invisible and computerized

•Standard work does not apply in offices as people have different agendas every day.
False: Standard work applies in the office

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 SUMMARY: FUTURE STATE QUESTIONS
Apply the nine business lean guidelines by asking questions

Business Lean Guidelines

Plan 1 – What is our takt time?

2 – Where can we create continuous flow?

Design 3 – If not continuous flow, where can we apply FIFO flow?
4 – Where can we utilize workflow cycles?
5 – Where can we utilize integration events?
6 – Where do we need standard work created or updated?
Control
7 – At what single point in the value stream do we initiate production?

8 – What is the management timeframe or pitch?

9 – What is our plan to respond to changing demand?

What other process improvements will be necessary?

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 SUMMARY
▪ Value stream mapping (VSM) is a tool used to identify
obstacles to flow by providing visual representation on a
single document – of both material and information flow and
how the two are linked.
▪ VSM can be used for any type of process
▪ Use value stream mapping to help see the flow and the
sources of waste that inhibit flow
▪ VSM provides a common language for process management
▪ VSM is a tool for communication / strategic planning /
change management / transforming operations to lean

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 SUMMARY
Value Stream Mapping

Define Create the Apply lean Create the Create the

Product / value Execute the
current future state implementa plan
Process state map stream map tion plan
family guidelines

C2
A1

A2

B4 IMPLEMENTATION
C X X 2

X X X 3
G .

P X X X 2 B
E X X X 2

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Wednesday, August 26, 2020 Company Private 69
Thank YOU
Too many people want the rewards of world-class
without doing the work required of world-class.
Let's not be in this category.
- Dr.Paresh Kariya