Lean Manufacturing Overview

1
Outline

1.Lean Manufacturing
2.5S & Visual Controls
3.Kaizen
4.Value Streams
5.Pull Manufacturing
6.Mistake Proofing
7.Quick Changeover
8.Six Sigma
9.Lean Accounting
10.Theory of Constraints
11.Human Factors

2
Lean Manufacturing

3
Definitions

• 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.

• Waste - Any activity that consumes resources but

creates no value (waste).

4
What is Lean?

• Lean production focuses on eliminating waste in

processes (i.e. the waste of work in progress and
finished good inventories)
• Lean production is not about eliminating people
• Lean production is about expanding capacity by
reducing costs and shortening cycle times between
order and ship date
• Lean is about understanding what is important to the
customer

5
Thinking Lean

• Specify value
• can only be defined by the ultimate customer
• Identify 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

From Lean Thinking by Womack and Jones

6
Benefits

• Lean provides tangible benefits

• Reduces costs not just selling price
• Reduces delivery time, cycle time, set-up time
• Eliminates waste
• Seeks continuous improvement
• Improves quality
• Improves customer ratings and perceptions
• Increases overall customer satisfaction
• Improves employee involvement, morale, and company
culture
• Helps “transform” manufacturers

7
Toyota Production System (TPS)

• Quality, Cost, Delivery

• Shorten Production Flow by Eliminating Waste
• Just In Time
• The Right Part at the Right Time in the Right Amount
• Continuous Flow
• Pull Systems
• Level Production
• Built-In Quality
• Error Proofing – Poka Yoke
• Visual Controls
• Operational Stability
• Standardized Work
• Robust Products & Processes
• Total Productive Maintenance
• Supplier Involvement

8
Types of Waste

• Overproduction
• Excess inventory
• Defects
• Non-value added processing
• Waiting
• Underutilized people
• Excess motion
• Transportation

9
Lean vs. Traditional Manufacturing

• Half the hours of engineering effort

• Half the product development time
• Half the investment in machinery, tools and equipment
• Half the hours of human effort in the factory
• Half the defects in the finished product
• Half the factory space for the same output
• A tenth or less of in-process inventories

Source: The Machine that Changed the World, Womack, Jones, and Roos, 1990.

10
Lean vs. Traditional Manufacturing

• 99.9% Customer Schedule Attainment

• Defects of 15 PPM or less
• 4-6 Inventory Days of Supply
• 92%+ Operational Availability
• Leveled, Sequenced Production
• Order to Customer Use - Hours, not weeks
• Functioning Supplier Partnership
• Strong Production Control Function

Examples: Tier 1 Suppliers: Johnson Controls Seating, Litens Automotive Partnership,

Cadimex, Denso Manufacturing, Toyota Motor Corporation.

11
Barriers to Lean

• Implementing Lean Can Be Difficult Because it is

Counterintuitive from a Traditional Paradigm:
• Buying multiple small machines rather than one big machine
that offers economies of scale.
• Shutting down equipment when maximum inventory levels
are reached rather than running flat out.
• Using standards to continuously improve.
• There is no step-by-step cook book
• There are some basic steps but the how-to varies from
organization to organization
• Requires an assessment of the company in order to map out
the strategy
• Company culture plays a big part in the how-to

12
Implementing Lean

• Gain top Management “Buy In” and Support

• Perform overall company assessment tied to company
strategic, operational, and marketing plans
• Develop strategic lean deployment plan
• Integrate customized training with lean to improve
specific skill sets, leverage training resources
• Team Building, Communications, Problem Solving,
Change Management, Lean Manufacturing Tools
• Conduct “Kaizen blitz” high impact events
• 5S, Manufacturing Cell, Set-Up Reductions, Inventory
Reductions, Work Standardization
• Use an enterprise wide approach to help “Transform” a
client’s culture and the way they do business.

13
Progress Toward Lean

• Smaller lot sizes

• Increased capacity / throughput
• Higher inventory turns
• More available floor space
• Improved workplace organization
• Improved quality : reduced scrap / re-work
• Reduced inventories : raw, WIP,
• Reduced lead times
• Improved participation & morale

14
Lean Is A Journey

• The Journey never ends

• Toyota estimates it is only 50% waste-free

• Where can we begin? Where can we improve?

15
5S & Visual Control

16
5S and Visual Control
• 5 Elements of 5S
• Why 5S?
• Waste
• Workplace observation
• Sort
• Straighten
• Shine
• Standardize
• Sustain
• Visual Factory

17
5 Elements of 5S

• Sort
• Straighten
• Shine
• Standardize
• Sustain

18
Why 5S?

• To eliminate the wastes that result from “uncontrolled” processes.

• To gain control on equipment, material & inventory placement and position.
• Apply Control Techniques to Eliminate Erosion of Improvements.
• Standardize Improvements for Maintenance of Critical Process Parameters.

19
Types of Waste

• Overproduction
• Delays (waiting)
• Transportation
• Process
• Inventories
• Motions
• Defective Products
• Untapped Resources
• Misused Resources

20
Waste Identification

• What waste can be identified in the following photos?

After 5S

• Clear, shiny aisles

• Color-coded areas
• Slogans & banners
• No work in process
Workplace Observation

• Clearly define target area

• Identify purpose and function of target area

• Develop area map

• Show material, people, equipment flow

• Perform scan diagnostic

• Photograph problem areas

• Develop a project display board (area)

Sort

• When in doubt, move it out

• Prepare red tags
• Attach red tags to unneeded items
• Remove red-tagged items to “dinosaur burial ground”
• Evaluate / disposition of red-tagged items
Straighten

• Make it obvious where things belong

• Lines
• Divider lines
• Outlines
• Limit lines (height, minimum/maximum)
• Arrows show direction
• Labels
• Color coding
• Item location
• Signs
• Equipment related information
• Show location, type, quantity, etc.
Shine

• Clean everything, inside and out

• Inspect through cleaning
• Prevent dirt, and contamination from reoccurring

• Results in
• Fewer breakdowns
• Greater safety
• Product quality
• More satisfying work environment
Standardize

• Establish guidelines for the team 5-S conditions

• Make the standards and 5-S guidelines visual

• Maintain and monitor those conditions

Sustain

Determine the methods your team will use to

maintain adherence to the standards

• 5-S concept training

• 5-S communication board
• Before and after photos
• One point lesson
• Visual standards and procedures
• Daily 5-minute 5-S activities
• Weekly 5-S application
Visual Factory Implementation

• Develop a map identifying the “access ways”(aisles,

entrances, walkways etc.) and the “action” areas.
• Perform any necessary realignment of walkways, aisles,
entrances.
• Assign an address to each of the major action areas.
• Mark off the walkways, aisles & entrances from the
action areas
• Apply flow-direction arrows to aisles & walkways
• Perform any necessary realignment of action areas.
• Mark-off the inventory locations
• Mark-off equipment/machine locations
• Mark-off storage locations (cabinets, shelves, tables)
• Color-code the floors and respective action areas
Kaizen
What is Kaizen?

• Kaizen (Ky’zen)
• “Kai” means “change”
• “zen” means “good (for the better)”
• Gradual, orderly, and continuous improvement
• Ongoing improvement involving everyone
How to Kaizen

• Identify the customer

• Deming Cycle
• Plan – identify what to change and how to do it
• Current state
• Future state
• Implementation plan
• Do – execute the improvement
• Check – ensure the improvement works
• Act – future and ongoing improvements
• Repeat
Identify the Customer

• Value added is always determined from the customer’s

perspective.
• Who is the customer?
• Every process should be focused on adding value to the
customer.
• Anything that does not add value is waste.
• Some non-valued added activity is necessary waste
(“NVA-R”)
• Regulatory
• Legal
Types of Waste

• Overproduction
• Excess inventory
• Defects
• Non-value added processing
• Waiting
• Underutilized people
• Excess motion
• Transportation
Identify the Current State

• Crucial first step in process improvement

• Deep understanding of the existing processes and
dependencies
• Identify all the activities currently involved in
developing a new product
• Observe the process first hand
• Identify Value Added (VA), Non-Value Added Required
(NVA-R), and Non-Value Added (NVA)
• Generally creates more questions than answers
Brainstorm and Analyze

• Kaizen team brainstorming to develop new process

• Post improvement ideas on map or by category
• Workflow
• Technology
• People / Organization
• Procedures
• Develop detailed future state map
• New workflow
• Value Add and Non-Value Add
• Cycle times
• Identify Kaizen “bursts” (immediate radical change)
Implementation Plan

• Think global / systems optimization

• Maximum impact to process
• Speed of implementation – create small victories
• Cost-benefit analysis
Execute

• Develop a concise, achievable milestone plan

• Communicate the plan to everyone
• Suppliers
• Team members
• Customers
• Track activities in public
• Celebrate small victories and publicly analyze failures
Check and Sustain

• Meet regularly (weekly?) to review status of open

implementation items
• Re-evaluate Future State regularly (quarterly?) for
additional improvement
• Track results on a public Kaizen Board
Kaizen Blitz

• Total focus on a defined process to create radical

improvement in a short period of time
• Dramatic improvements in productivity, quality,
delivery, lead-time, set-up time, space utilization, work
in process, workplace organization
• Typically five days (one week) long
Kaizen Blitz - Agenda

• Day 1: Setting the scene

• Meet the team, training
• Day 2: Observe the current process
• Flowchart, identify waste, identify root causes
• Day 3: Develop the future state process
• Brainstorm and flowchart
• Day 4: Implement the new process
• Plan, communicate, implement, modify
• Day 5: Report and analyze
• Performance vs expectations
Roadblocks

• Too busy to study it

• A good idea but the timing is premature
• Not in the budget
• Theory is different from practice
• Isn’t there something else for you to do?
• Doesn’t match corporate policy
• Not our business – let someone else analyze it
• It’s not improvement – it’s common sense
• I know the result even if we don’t do it
• Fear of accountability
• Isn’t there an even better way?
Pull Manufacturing
Outline

• Why Pull Manufacturing?

• The Problem of Inventory
• Just In Time
• Kanban
• One Piece Flow
• Demand / Pull
• Standard Work & Takt Time
• Production Smoothing
Why Pull Manufacturing?

Lean manufacturing is really about minimizing the

need for overhead
• which is about concentrating precisely on only
what is necessary
• which is about linking interdependent supply
system decisions, and actions
• which needs to be visual, responsive and simple to
manage
 Push Vs. Pull Scheduling
• Push Scheduling
• traditional approach
• “move the job on when finished”
• problems - creates excessive inventory
• Pull scheduling
• coordinated production
• driven by demand (pulled through system)
• extensive use of visual triggers
(production/withdrawal kanbans)
Lowering Inventory Reveals Problems

Accommodate lower inventory levels by:

•Reducing variability
•Eliminating waste
•Streamlining production and material flows
•Accurate information
What is Just-in-Time?

• Management philosophy of continuous and forced

problem solving (forced by driving inventory out of the
production system)
• Supplies and components are ‘pulled’ through system to
arrive where they are needed when they are needed.

Goal: Achieve the minimal level of resources required to add the

necessary value in the production system.
Objective of JIT

• Produce only the products the customer wants

• Produce products only at the rate that the customer
wants them
• Produce with perfect quality
• Produce with minimum lead time
• Produce products with only those features the
customer wants
JIT Principles
• Create flow production
• one piece flow
• machines in order of processes
• small and inexpensive equipment
• U cell layout,
• multi-process handling workers
• easy moving/standing operations
• standard operations defined
Quality enables JIT
• Processes are easy to understand—visible
• Quality issues are apparent immediately
• Scope of problems are limited because of lower
inventory levels
• TQM management methods are very important

Quality of execution typically determines how

low inventories can be reduced!
 How to accomplish JIT production
1) Design Flow Process
7) Improve Product Design -Link operations
-Standard product configuration -Balance workstation
-Standardize and reduce capacities
number of parts -Re-layout for flow
-Process design with -Emphasize preventive 2) Total Quality Control
product design maintenance -Worker responsibility
-Quality expectations -Reduce lot size -Measure: SQC
-Reduce setup/changeover time -Enforce compliance
-Fail-safe methods
-Automatic inspection

6) Reduce Inventory More

-Look for other areas Concurrently
-Stores Solve Problems 3) Stabilize Schedule
-Transit -Root Cause -Level schedule
-Carousels -Solve permanently -Underutilize capacity
-Conveyors -Team approach -Establish freeze
-Line and specialist windows
responsibiity
-Continual education
5) Work with Vendors
-Reduce lead times
Measure Performance 4) Kanban Pull
-Frequent deliveries
-Emphasize -Demand pull
-Project usage
improvement -Backflush
requirements
-Track trends -Reduce lot sizes
-Quality expectations
Kanban
• Japanese word for card
• Authorizes production from downstream operations
based on physical consumption
• May be a card, flag, verbal signal, etc.
• Used often with fixed-size containers
• Kanban quantities are a function of lead-time and
consumption rate of the item being replenished (min
qty=(demand during lead-time + safety stock)/
container quantity)
Kanban Squares

X X X

X
X X

Flow of work
Flow of information
Kanban Card

Unique Part #
46-281247p1 Description
27” Al Rim
Qty
Where to find
part when bin 23 Kanban Qty
is empty Where to return
Stock Loc: Line Loc: filled Kanban
RIP 1 Asm. 1
 Quality at the Source

• For JIT & Kanban to work, quality must be high

• There can be no extra inventory to buffer against the
production or use of defective units

• Producing poor-quality items, and reworking or

rejecting them is wasteful

• The workers must be responsible for inspection &

production quality

• The philosophy is, “NEVER pass along defective

item”
 One Piece Flow

• A philosophy that rejects batch, lot or mass processing

as wasteful.

• States that product should move (flow) from operation

to operation, only when it is needed, in the smallest
increment.

• One piece is the ultimate (one-piece-flow)

 Continuous Flow

• Line up all of the steps that truly create value so they occur in a
rapid sequence

• Require that every step in the process be:

• Capable – right every time (6 Sigma)

• Available – always able to run (TPM)

• Adequate – with capacity to avoid bottlenecks

(right-sized tools)
 Pull Production

• Actual customer demand drives the manufacturing process.

• It creates a system of cascading production and delivery

instructions from downstream demand to upstream production in
which nothing is produced by the upstream supplier until the
downstream customer signals a need.

• The rate of production for each product is equal to the rate of

customer consumption.
 Pull Production

• Through lead time compression & correct value specification, let

customers get exactly what’s wanted exactly when it’s wanted:

• For the short term: Smooth pull loops to reduce inventory

• For the near term: Make-to-order with rapid response time

• For the long term: Diagnostics and prognostics in a stable

relationship to take out the surprises for consumers and
producers
 Standardized Work
• Standardized work consists of three elements:

• Takt time
Matches the time to produce a part or finished product with the
rate of sales. It is the basis for determining workforce size and
work allocation.
• Standard in-process inventory
The minimum number of parts, including units in machines,
required to keep a cell or process moving.
• Standard work sequence
The order in which a worker performs tasks for various
processes.

• Once a standard work is set, performance is measured

and continuously improved
 Work Balancing / TAKT Time

• Work balancing maximizes operator efficiency by

matching work content to TAKT time

• TAKT time is the rate at which customers require your

product

• TAKT time is calculated as follows:

Available work time per day
Daily required customer demand in parts per day
 Production Smoothing / Leveling

• Averaging both the volume and the production

sequence of different model types on a mixed-model
production line.

• Example: Toyota Manufacturing

Toyota makes 3 car models - a convertible, hardtop,
and an SUV. Assume that customers are buying nine
convertibles, nine hardtops, and nine SUVs each day.
What is the most-efficient way to make those cars?
 Production Smoothing / Leveling

Leveling production also helps to avoid the problem of excess inventory of

finished vehicles. The vehicle plants make the different types of cars at
about the same pace that customers buy those cars. They can adjust the
pace of production as buying patterns change.
As the result, dealers only need to maintain a minimal inventory of cars to
show and sell.

Parts Factory Car Factory Dealer

 Production Smoothing / Leveling
Toyota solved the problem by production leveling.
If customers are buying nine convertibles, nine hardtops, and nine SUVs
each day, Toyota assembles three of each in the morning, three of each in
the afternoon, and three of each in the evening. It also distributes the
production of convertibles, hard tops, and SUVs as evenly as possible
through each shift: convertible, hard top, SUV, convertible, hard top, SUV,
and so on.

© 2004 Superfactory™. All Rights Reserved.

Wrap-up - Pull Manufacturing

Lean manufacturing is really about minimizing the

need for overhead
• which is about concentrating precisely on only
what is necessary
• which is about linking interdependent supply
system decisions, and actions
• which needs to be visual, responsive and simple to
manage
Mistake Proofing
(Poka Yoke and Error Proofing)
What is Mistake Proofing?

• The use of process or design features to prevent errors or their

negative impact.
• Also known as Poka yoke, Japanese slang for “avoiding inadvertent
errors” which was formalized by Shigeo Shingo.
• Inexpensive.
• Very effective.
• Based on simplicity and ingenuity.
Everyday Examples
3.5 inch diskettes cannot be inserted unless diskette
is oriented correctly. This is as far as a disk can be
inserted upside-down. The beveled corner of the
diskette along with the fact that the diskette is not
square, prohibit incorrect orientation.

Fueling area of car has three error-proofing devices:

1. insert keeps leaded-fuel nozzle from being inserted
2. tether does not allow loss of gas cap
3. gas cap has ratchet to signal proper tightness and
prevent overtightening.

New lawn mowers are required to have a safety bar

on the handle that must be pulled back in order to
start the engine. If you let go
of the safety bar, the mower blade stops in 3
seconds or less.

69
Quick Changeover
Single Minute
Exchange of Dies
Outline

• Changeover and Changeover Time

• Traditional Setup
• SMED
• SMED Process Steps
• Ideas for Improvement
Changeover Defined

• Changeover is the total

process of converting a
machine or line from running
one product to another
Changeover Time Defined

• Changeover time is the total elapsed time

between the last unit of good production of
the previous run, at normal line efficiency, to
the first unit of good production of the
succeeding run, at full line efficiency.
Traditional approach

• Setup is given and fixed

• Therefore,
• Use highly skilled setup personnel
• Minimize product variety
• Combine lots
• Make large batches
Another way

• Setups CAN be improved!

• Small lot production REQUIRES short setups
• Setup time reduction of 90% and more is common
Benefits of setup reduction

• Better quality
• Lower cost
• Less inventory
• Better flexibility
• Better worker utilization
• Shorter lead time and more capacity
• Less process variability
Classification of setup activities

• Type 1
• Gathering, preparing, and returning tools, fixtures, etc.
• Type 2
• Removing previous setup, mounting next setup on machine
• Type 3
• Measuring, calibrating, adjusting
• Type 4
• Producing test pieces, further adjustment until parts are good
What is SMED?

• Single Minute Exchange of Dies is changing process tooling in

9 minutes or less.
• The process was developed by Shigeo Shingo at Mazda,
Mitsubishi and Toyota in the 1950’s and 1960’s.
• Separate internal and external activities.
• Convert internal activities to external activities.
• Streamline all activities.
Single Minute Exchange of Dies

• Internal set-up activities.

Elements in the changeover which can only be done when
the machine is stopped.
• External set-up activities.
Elements that can be performed when the machine is
running.

© 2004 Superfactory™. All Rights Reserved. 79

Why SMED?
• Reduced inventories.
• Improved productivity.
• Higher quality levels.
• Increased safety.
• Improved flexibility.
• Reduction in throughput time.
• Improve operator capabilities.
• Lower manufacturing costs.
SMED Methodology

• Identify internal and external steps

• Convert internal steps to external
• Improve all aspects of the setup operation
• Abolish setup
The SMED Process
• Preliminary Stage – Observe and record.
• Stage 1 – Separate internal and external activities.
• Stage 2 – Convert internal activities to external activities.
• Stage 3 – Streamline all activities.
• Stage 4 – Document internal and external procedures.

© 2004 Superfactory™. All Rights Reserved. 82

Preliminary Stage
Observe and record
• Team-work
• Recorder
• Overall duration (from last product to first good product).
• Describe the change (from what to what?).
• Record the equipment used.
• Timers
• Time each step
• Fact collectors
• Breakdown the steps into actions – as much detail as possible.
 Stage 1

Separate internal and external activities.

• Study each internal step and ask if it could be external.
• Common issues:
• Dies in remote storage racks.
• Spanners not available.
• Raw material checks.
• Lifting equipment not available.
Stage 2

Convert internal to external.

• Ask why the remaining internal steps can’t be external.
• Re-examine the true function of each step.
• Common issues:
• Cold dies – using material to heat the dies.
• Imaginary center lines and reference planes.
• No record of settings.
Stage 3

Streamline all activities.

• Analyze the elements (facts), and discuss all possible ways
of improving the step.
• Study the external activities as well as the internal
activities.
• Common issues:
• Fastenings – Are bolts needed? If so remember that only
the last turn tightens a nut or bolt.
• Standardize bolt heads.
• Standardize die heights.
Stage 4

Document the procedures.

• Write down the new internal and external procedures.
• Fill in an action sheet to ensure that the new procedures
can be achieved.
• Review the whole activity to determine “What went well?”,
“What went badly?” and three changes that the team
would make before the next SMED activity.
The SMED System - Results
Company Machine Before improvement After improvement Red’n

T Manufacturing1 80t single shot press 4 hours 0 mins 4 mins 18 sec 98%

S Metals1 100t single shot press 40 mins 2 mins 26 sec 94%

H Press1 30t single shot press 50 mins 48 sec 98%

TT Industries1 50 oz injection moulding 1 hour 10 mins 7 mins 36 sec 89%

m/c

Expanded Metal Co. 4’6” lath press 4 hours 30 mins 11 mins (note: NOT 96%
SMED)

S Engineering Machining Centre 139 minutes 59 mins 29 secs 57% *

AM Bottlers Bottling plant 32 mins 43 secs 23 mins 33 secs 28% *

E Finishing Paint Plant 56 mins 26 secs 23 mins 12 secs 59% *

* After one SMED exercise

Ref 1: Modern Approaches to manufacturing improvement – the Shingo System,
Shigeo Shingo, ISBN: 091529964x