Lean Fundamentals And Line Design 06 04 01

Lean Fundamentals Lean Supplier Association - Austin May/2001 WELCOME!

Agenda Introduction Lean Thinking Lean Line Design Conclusion

Influences That Trigger Change high cost of manufacturing fluctuations in demands rapid growth in size & revenue tighter quality standards highly configurable products long learning curves material shortages increased competition insufficient vendor capabilities inconsistent processes

Industry Phases Cost Drivers Simpler Designs Commonality Manufacturable Models Maintainability/Serviceability Economies of Scale Short Cycle Times Supply Chain Management Differentiation Cost Innovation

Lean Manufacturing Progression 1995 Benchmarking Training at JcIT Institute Pilot conversions on modules

Lean Manufacturing Progression 1995 1996 ‘ Lean Teams’ Formed Division Conversions Began Support Functions Re-design Began

Lean Manufacturing Progression 1995 1996 ULMI 1997

Establishment of Common Processes for: - Manufacturing - Product development - Product management Improved Performance in: - Profitability - Quality - Cycle Time - Asset Management - Delivery Unified Lean Manufacturing Initiative

Transitioning to a Lean Enterprise

Going Up for a Strategic View...

What It Means to be a Lean Enterprise? Products Processes Individuals Teams Organizations Functions The WHOLE Business System It Reaches across It Consists of Customers Suppliers Board of Directors Investors

A LEAN enterprise focuses on... A LEAN enterprise practices LEAN thinking! Eliminating non value-added activities throughout the enterprise Building an integrated product delivery process to meet changing needs of customers Supporting a fundamental change in management philosophy

Characteristics of a Lean Enterprise Processes are in place to capture the knowledge of customers (internal and external!) and their values All processes, systems and initiatives -including supplier partnerships- are aligned, to efficiently provide the right products to the right customers at the right time…. The entire product delivery process is flexible so the enterprise can respond quickly to changes Management of the business is based on metrics, and they are aligned at all levels to evaluate performance

Lean Thinking... ...a mentality that emphasizes doing those things, and only those things, that create or add value to what the customer is willing to pay for. If it doesn’t add value, it is WASTE !

Principles of Lean Thinking from Womack & Jones Lean Thinking Specify the value of each product and service from the customer’s perspective. Identify every step in the value stream to highlight waste. Make products flow without interruption by eliminating waste. Produce only what is pulled by the customer. Pursue perfection by continually improving.

Lean Principle #1 Specify the value of each product or service from the customers’ perspective.

What is value? Value is the product or service which meets the customer’s requirements at a price he is willing to pay when he requests it. Value is providing the right product for the right price at the right time.

Who’s the Customer? You will likely have multiple customers, and they change frequently! Anyone, internal or external, who requires a product or service Final consumer Boss/management Co-workers

Lean Principle #2 Identify every step in the value stream to highlight waste.

Mapping out the Process 1. Identify all steps in the value stream, including an estimated duration. 2. Identify value add activities vs. waste: Value Added Necessary, but non-value added Non-value added 3. Indicate types of waste

A Value Stream … consists of all activities and processes that are required to bring a specific product/service: from concept to design and engineering from raw materials to product launch from order-taking to scheduling from delivery to & support of the customer This means everybody , and everything that takes place to produce the product/service!

Disconnected Processes Lost orders, Delays, Mistakes and Other failures that cost time, money and customers! Most processes are full of disconnects and bottlenecks where the process crosses departmental lines.

Adding Value or Waste? Lean thinking distinguishes between those activities that are actually adding value to the product or service, and those activities that are not adding value. If it’s not adding value, it is WASTE !

Waste Eliminating waste is the greatest potential source of improvement in corporate profit, performance, and customer service. For most production operations: - 60% add no value at all - 35% are “necessary” activities, but don’t add value - only 5% of activities actually add value!

Lean Flow Waste disrupts the continuous flow to complete a product or process Processes or machines that take too long Inadequate training or staffing Lack of information and direction Bad quality or late arrival of materials Inventory and queues are usually symptoms of another problem

Value Stream Mapping Tool Value Stream is all the actions (both value added and non value added) currently required to bring a product through the main flows essential to every product

Why Value Stream Mapping is an Essential Tool Helps you to visualize the big picture, not just individual processes to improve the whole, not just optimizing the parts. Helps you to see the sources of waste in your value stream It forms the basis of a Lean Implementation Plan. It shows the linkage between the information flow and the material flow.

Initial Value Stream Mapping Steps Product Family Current-State Drawing Future-State Drawing Work Plan & Implementation

Value Stream Improvement & Process Improvement Follow the product from beginning to end Draw visual representation of every process in the materials and information flows

Information for a process data box “ The Big Four”: Number of product variations Cycle time (from 1 piece to the next) Changeover time Process Reliability Number of operators Scrap Rate Production batch size Working Time (minus breaks) Pack Size

A Fictional Value Stream Map - An example of Lean Tools Total lead time

A Fictional Value Stream Map -An example of Lean Tools Total lead time

We need a next Lean Leap: Value Stream Management Focus on the entire value stream for product families. Make someone responsible for each product family: the Value Stream Manager. Ask them to create an accurate current state. Tell the traditional functions to support the VSMs.

Using Five Whys Root cause Problem Data gathering Problem clarification Why? Why? Why? Why? Why?

Measurements Why measure? What to measure? Hierarchy of measurements Leading and lagging indicators Importance of adding a reference, benchmark, or standard Location for measurements Data and information Data collection and processing

Measurements- Why Measure? You can manage if you can measure Offers a baseline for continuous improvement You will know if your efforts to improve are working Customer requirements demand it You can make decisions based on the information derived from the measurements Lean conversion Certification Pricing Etc.

Measurements To ensure they will be effective and useful, determine: Which measures does the customer want? Which measures do you need to improve performance? Cycle time Quality Cost Productivity What information/results do you want to obtain? Remember: if the measure is not being used for decision making, ask “WHY ARE WE MEASURING THIS?” Caution: Measurements entail cost and effort!

Measurements Determine how the types and locations of the metrics are linked throughout the organization Identify the critical operations to determine where to start for the most cost effective improvements Create documented maps of the processes: Identify the inputs & outputs Set applicable standards for each critical step Show cause and effect relationships Disconnects will indicate missing or non value- adding measurements

It all starts with a Hoshin Annual Operating Plan (AOP) ... A specific, measurable objective to achieve breakthrough results. Measurements

The Aim of Hoshin Planning is to ... Align people, activities, and performance metrics throughout all levels of the organization with strategic priorities so the Company can achieve its corporate mission….

Measurements Hoshins/AOP Goals Inventory Quality Cost Cycle Time Failure Internal/ External Appraisal Prevention Throughput Takt Operating Expenses

Measurements- Measure What? Hierarchy of Measurements Similar to Hoshin planning, define the hierarchy of measurements and show the cascading links between metrics at different levels of the company. Level 1: Earnings / Profitability, Customer satisfaction, On time delivery Level 2: Plant based metrics: scrap rates, returns, schedule… Level 3: Line based metrics: cycle time, yields, escapes... Plant 1 Plant 2 Company Line 1 Line 2 Line 3 Line 2 Line 1 Example: 3 Level System

Cascading Objective Process Level 1 Level 3 Level 2 Programs Division Corporation Hoshin Initiatives Corporate Objectives Strategies Business Unit Strategies Division Strategies Business Unit Business Unit Objectives Division Objectives

Measurements- Measure What? Have consistent definitions for whatever is being measured Know the difference between proactive and reactive: - Lagging - downstream indicators for use in preventing defects upstream (reactive) - Leading - upstream indicators for use in predicting quality downstream (proactive) Example: high reject rates (leading) can be an indication of poor profitability (lagging)

Measurements- Measure What? Measures have little meaning in isolation Comparison with a reference will add relevance In absence of a standard or benchmark, at least have a baseline to use for making comparisons Month Cycle Time Month Cycle Time Target

Measurements- Measure Where? Most measurements are carried out too late; typically at the end of the process (lagging indicators) Such measurements are usually easy and convenient to install, but might be of little help in preventing problems Measuring as close as possible to the point of cause or occurrence is more pro-active (leading indicators) Implementing closed loop feedback and real time controls on the operations can actually prevent non-conformances from occurring in the first place Measurements are often started on every operation in the business, even if they aren’t the right ones!

Measurements- Data and Information Data is not always the same as information Information is that which can be used for decision making Information for one stage can be data for the next ---Data set 1 ---Data set 2 ---Data set 3 Information set 3 Information set 1 Information set 2 Processing Data set 4 Data set 5 Processing Supplier End Applied Materials End

Measurements - Data Collection and Processing The metric is only as good as the integrity of the data collected Statistical treatment of data can add more power to analysis & decision making Presentation of information should be simple yet comprehensive, and it should be directly aimed at facilitating the decisions that are to be made Information should be made available in a timely manner to those who need it Cross check to see if the information is useful in the way it is intended to be

Measurements - Summary Start with what is important to the customer Remember that measurements are often lagging indicators Understand the process, the causes/effects, the inputs/outputs Develop the hierarchy of measurements to address gaps and redundancies Identify the critical points where measurements will make the biggest difference

Measurements - Summary Use measurements as leading indicators for the most proactive approach, and understand how they are linked to lagging indicators. Data integrity checks are important since it becomes the foundation for many decisions Presentation of information (rather than data) should be simple, comprehensive, and timely

Overproduction Waiting Time Transportation Processing Inventory Motion Defects 7 Wastes

Overproduction Producing More Than Needed Producing Faster Than Needed

Wait Time Waiting for signatures Watching machines or equipment run Keeping busy to avoid being idle Waiting for computers to process data Waiting for materials Waiting for someone w/ the right skill Waiting in traffic

Transportation Sending materials/product long distances Handling materials/paperwork multiple times Storing incoming material before it is used Returning unused materials Having multiple storage locations Routing documents to multiple signers

Processing Processes that don’t do the entire job, or that do it incorrectly Poorly maintained equipment that produces poor quality Doing things manually instead of automatically Doing more than would be necessary

Inventory Cost of materials Cost and management of obsolete materials Space & equipment Interest charges Defects, rework Paperwork & documents in queue Inventory accounting

Inventory Analogy Wait Time Defects Process Over Production Water Level = Inventory Level Boat = Production System Rocks = Hidden Problems (Uncovered as Inventory is Reduced)

Motion Searching for tools or supplies Walking to multiple areas to accomplish a task Things located in random locations or not according to frequency of use Picking something up multiple times

Defects Rework Scrap Lost work Time Sorting Warranty Costs Lost Customer Satisfaction Other intangibles (Typos?)

Lean Principle #3 Make products flow without interruption by eliminating waste.

Tools & Techniques 5Ss Poka-yoke Visual Controls 5 Whys Lean Enterprise

Benefits Gives the opportunity to provide creative input to how your workplace should be organized and laid out, and to how your work should be done Makes your workplace more a pleasant to work Makes your job more satisfying Removes many obstacles and frustrations in your work Helps you know what you are expected to do, and when and where you are expected to do it Makes it easier to communicate with everyone you work

5Ss: The Gateway to Quality 5 S Set in order Standardize Shine Sustain Sort

Sort & Discard-Implementation No Value & Easy To Dispose Of Retain Some Value No Value But Costly To Dispose Of Dispose Immediately Actively Look For Best Customer Work Out Less Costly Method For Disposal Necessary Items Implement Next S Unnecessary Items

Sort & Discard BEFORE Sort & Discard AFTER Sort & Discard

Set in Order To arrange necessary items in good order so that they are easily accessible for use There should be a home for everything and everything should be in its home 60 SECONDS RULE Everything should be able to be found & retrieved within 1 min.

Set in Order-Implementation Unnecessary Items Sort/Discard Frequently Used Sometimes Used Not Used But Must Be Kept Place Near To The Point of Use Place A Bit Distant To The Point Of Use Place Separately Necessary Items

Set in Order-Tools BENEFITS OF MOTION MAPPING BEFORE Workstation 100 Workstation 200 Parts Integration Integration AFTER Workstation 100 Parts Integration Workstation 200 Integration Parts

Set in Order-Tools FLOOR TAPING

Set in Order-Tools Visual Management - You can see the work status of the line - there is no work present at these stations

Set in Order-Tools COLOR CODING

Set in Order-Tools Part Replenishment carts are color coded by particular route.

Set in Order-Tools SILHOUETTES /CUTOUTS

Set in Order-Example Material Kanbans Tool Cutouts Bin Labels In Process Testing Kanban

Shine/Inspect-Implementation Unnecessary Items Sort/Discard Set in order Necessary Items Defect or Irregularity Found Instant Maintenance Requested Maintenance Shine/Inspect

Shine/Inspect-Tools 1. DEFINE AREA OF RESPONSIBILITY Draw map of cleaning area 2. DISTRIBUTE RESPONSIBILITY Schedule cleaning to be done and people to do it Devote certain times exclusively to cleaning 3. DEFINE STANDARD Develop a cleaning/inspection checklist Establish a minimum requirement

Shine/Inspect-Tools CHECKLISTS Checking Item 5 S Checklist No unnecessary stock items or work in progress All machines & equipment are in regular use All jigs, fixtures and tools are in regular use All unnecessary items can be identified at a glance There are clear standards for eliminating excess 1 2 3 4 5 Seiri 1 2 3 4 5 Seiri Parts or Materials Machines & Equipment Jigs, Fixtures & Tools Visual Controls Standards for Disposal Visual controls used to fix location of all items within the workcenter Clear indications of max & min stock quantities Blue tape used to divide workcenter Jig and tool storage organized for ease of removal and return Score Evaluation Criteria Workcenter Name Out Of Cat Comp. By Date Score No. 1 2 3 4 Seiton Storage Labels Quantity Indicators Dividing Lines Jigs, Fixtures & Tools

5S Organizer and Implementation Schedule

Shine/Inspect-Tools SHELVES SHELVES SHELVES SHELVES SHELVES SHELVES INTEGRATION STATION 2 INTEGRATION STATION 1 MAPS SHELVES SHELVES SHELVES SUBASSEMBLY STATION 3 SUBASSEMBLY STATION 3 SUBASSEMBLY STATION 3

Shine/Inspect-Tools Decide order and frequency: daily, weekly, monthly SCHEDULE Seiri Sort/ Discard Seiton Arrange/ Order Seiso Clean/ Inspect Seiketsu Stand./ Improve Shitsuke Believe/ Discipline 5 S Category Task Responsibility Date To Complete Date Completed 5 S Schedule

5 S Schedule - another example

Shine/Inspect-Tools -- Radar Chart

Shine/Inspect-Tools -- Thermometer

Standardize VIP TOUR MONDAY TUESDAY THURSDAY … ...Not just when the boss is around

Standardize THURSDAY MONDAY TUESDAY …… .Not just at the beginning of the week WEDNESDAY

Standardize ...But as a regular function of your daily activities WEEK 1 WEEK 5

Sustain PROMOTION AND RECOGNITION PROGRAM Leadership Roles Establish a 5 S evaluation and promotion plan Organize 5 S inter-departmental competitions to sustain activities Periodically award groups and individuals implementing good 5 S practices Implementation Roles Conduct 5 S audits regularly Look for innovative and exceptional 5 S performance and bring to the attention of supervisors

Sustain Ergonomic floor mats for work areas. Material Kanbans Overhead signs designating area. Additional overhead task lights for ergonomic concerns. Parts off work surface and labeled. Designated location for desk equipment

Visual Controls Visual controls are intended to make things easy to understand at a glance

Visual Controls 0060-04090 Qty 20 XYZ Line A, Op 30 50-46-23 DMR Shift Output Output Level (1/29 to date) Goal Credit Memo Debit Memo

Visual Controls Red Bins: DMR Parts A Flow Rack Yellow Bins: CES or low usage Parts Blue Bins: Regular Parts

Visual Controls Builds trust between Management and Employees. Creates a company culture where sharing is a key principle. Employees control the production line with minimum confusion for “What needs to be done” and maximum understanding of “How it must be done." Allows everyone to visually observe factory progress and expose inefficiencies. Toyota: When you make problems visual, it takes less people to solve them. “ A picture is worth a thousand words.”

Visual Controls Some Considerations of Visual Management A few, not too many Easy to see Must get your attention Must have an effect on you Anyone can understand

Visual Management: Display Boards Line #3 P5000 Robot Supervisor: John Glenn The Team: Dave Thomas Brian Roy Pat Wilson Greg Watkins Pete Wilson Lines Stops due to: (1/29 to date) Defective part Part shortage Accident Test fixture failure Tool failure Week # of Shortages Goal Quality Level (1/29 - 5/27) Shift Output Output Level (1/29 to date) Line Status Board Example Goal Pareto Chart (1/29 to date) Part Shortage # of Line Stops Defective Parts Test Fixture Failure Tooling Failure Accident

Visual Management: Display Boards Orientation Trainee Certified Master Skill Diversity Chart Operations Line #: 3 P5000 Robot Team Members A1 A2 A4 A5 A6 A7 Adrian Castro Mike Depp Jorge Nakos Ricky Martin Eli Button

Visual Management - Sequencing board is present on the floor for workers to see.

Visual Management: Schedule Board

Visual Example: Andon System Line Status Communication

Visual Example: Andon System Line Status Communication Red: Work activity stopped due to a problem Yellow: Problem encountered, but no disruption of activity Andon: Japanese word for lantern Alert Buttons Andon Unit

Andon System Data Collection Visual Signal located at the cell Light Flag Andon Metrics Sheet located at Cell can track: Issues and reason codes Corrective actions taken Repeat issues (pareto of part shortages, root cause) Amount of time andon light is on = workstation is down # of times per month or quarter - root cause Andon Escalation Procedure posted Who to contact, escalate Time based

5S Tool Display You can visually see the tools that are missing. Work station is color coded and labeled. Tool cutouts are present and tools are color coded.

Visual Example: Kanban Signal to Build or Fill

Before - WHSE Ship and Receive

After - Shipping and Receiving Non value added items removed Yellow tape indicates walk way Shipping is in designated and appropriate area Blue tape for designated cells and traffic flow Cells clearly marked Better traffic flow

Error Proofing: Poka Yoke Poka yoke is a method aimed at designing a product, process or service where mistakes are prevented, or at least easily detected and corrected.

Error Proofing: Poka Yoke Poka Yoke is Japanese for Mistake Proofing. Poka Yoke differs from traditional inspection techniques that are problem detection oriented rather than problem prevention. The focus of Poka Yoke is on 100% inspection at the source rather than sample inspections at the end of a process or set of processes. Inspection at the source allows a process to be stopped when a nonconformity is present. The key to effective Poka Yoke is to target repetitive tasks and actions that require operator diligence, uncover the root cause of errors, and make it impossible to make a mistake.

Error Proofing: Poka Yoke A Few Everyday Examples Auto shut-off irons so we cannot make the mistake of leaving the iron on all day. Automatic sinks in public facilities so the water cannot be left on when someone walks away. Automatic toilets in public facilities so …….(well, you know) Coffee makers that stop brewing when the pot is removed. Circuit Breakers that trip when they are overloaded Overwrite protect tabs on disks

Error Proofing: Poka Yoke Example Visual cues . Often visual cues, in the form of templates, guides and color coding make it easier for the operator to complete the procedure without making a mistake. The Clippard Valve Polylines Template, for example, guides the operator to correctly attach polylines to the assembly.

How could you use the tools to eliminate the waste you’ve identified? Suggest other ways to eliminate waste automation? reorganizing departments? make different staffing decisions? etc. Eliminating Waste in the Process

Lean Principle #4 Produce only what is pulled by the customer.

Examples of customer pull signals Kanban Alarm! Phone Call Andon Purchase Order

Lean Principle #5 Pursue perfection by continuously improving

Kaizen “ Zen” (For the Good) = Continuous Improvement “ Kai” (Change) +

Kaizen Rules K eep an open mind to change A lways maintain a positive attitude I nvolve everyone in the activity Z ero blame! Fix the problem instead E ach member has an equal vote N ever leave in silent disagreement R esults should be publicly displayed U nderstand the thought process L earn by taking action E xercise mutual respect. Work together S hare the successes

Kaizen Team Upper Management support extremely critical to success Usually 6 to 8 members Include or consult with customers (both internal and external) of the process Should have representation from different levels in the company Always use an “extended” team member as a sanity check (Why?)

Kaizen Time Line Determine how much time it would take one (100% dedicated) person to complete the tasks Use commitment % per team member to determine the length of the kaizen Three major components of a kaizen Cost Time Manpower

SMART Goals Kaizen Team Goals must be: S pecific M easurable A ttainable R elevant T ime bound

Kaizen Process Identify Sustain Implement Define

Identify Wastes Takt time Plant layout & material flow Work sequence Cycle times Quality issues Safety & Ergonomics Don’t forget to ask the 5 why’s

Define Opportunities for improvement Would plant layout changes eliminate waste? Is there any waste at any operation which could be eliminated? Optimum staffing level Standard work sequences Standard WIP Quality checks Safety considerations

Implement Brainstorm for solutions Institute Standardized Work methodologies Get input and make improvements Document the new standard operation Train on new methods Design & install visual management systems Get management approval where needed

Sustain Adhere to the new process Continue to improve Visual controls Retrain after each improvement Management support & commitment Follow up, Follow up, Follow up

Kaizen Summary Upper Management support determines the path for success Conveys the intent of the kaizen and the deliverables at a glance Displays the expected benefits obtained by conducting an analysis on ROI (return on investment) Helps to determine whether it is feasible to continue with the kaizen

Identify the number of potential projects Identify the kaizen type for each project Determine return on investment (ROI) of each project to assist with prioritizing cost and time investment for each project potential savings after improvement Kaizen Event Selection

Automate Routing Process Cost $ 10,000 programmers ($100/hr x 40 hrs) training Time to Implement - 3 months Savings $ 500,000/year labor materials defects cycle time (decreased from 116 to <6 hrs!) Implement Visual Controls Cost $300 new envelopes training Time to Implement - 3 weeks Savings $ 48,000/year labor cycle time defects Kaizen Event Selection

Choose the team Write project summary & objectives “ to develop a process to automatically route data for signature to multiple users” Is it S M A R T ? Determine project timeline Collect baseline data Determine implementation strategy & tools Present results Audit Kaizen Event Selection

Total Product Cycle Time- Product Sync TPCT =4950 Minutes Longest Path Back

Accomplishments TPCT reduced from 15 days to 5 days (67%) Created 5 standardized Work Cells 4 Mixed Model feeders for identified parallel work Established Takt Time at 7.8 hrs Implementation of 2 bin kanban system FIFO material flow Standardized and structured the manufacturing process (SOE) Operational Method Sheets for training Balanced the line

Traditional Situation Managing Change Change Management's Attention Resistance 80 % Undecided Cooperation Reduced Resistance 30 % Undecided Increasing Cooperation 10 % 10 % Managing Resistance to Change

Traditional Production Work order driven “push” system Batch production Rework areas necessary to bring finished goods up to quality standards Characteristics Results Poor Delivery Long/Inconsistent Cycle Times Customer Dissatisfaction Poor Quality Excessive Resources Excess Inventory / Liabilities Inflexible System Long Lead Times Capacity Constrained High Working Capital

Traditional vs. Lean Materials are purchased for “just-in-case” usage Large-scale machines Functional layout Minimal skills Long production runs Massive inventories Development is isolated, with little input from production or customers Materials are pulled on a just-in-time basis Human-scale machines Cell-type layout Multi-skilled workers One-piece flow Low inventories at point-of-use High input from customers, concurrent development of product and production process design

Traditional Production System PUSH SYSTEM Supplier Production and Finished Goods AMAT Forecast EDI OP OP OP OP OP OP OP OP Finished Goods Applied Materials Production Ship Work Pushes to Next Operation AMAT

Traditional Production System Machine Paint Weld Pack & Ship Saw Push Push Push Push Poor On Time Delivery Poor Quality High/Inconsistent Cycle Times Long Lead Times Excess Inventory / Liabilities Capacity Constrained Imbalanced Operations Customer Dissatisfaction COMMON PROBLEMS

Lean Production System AMAT Forecast Supplier Production and Finished Goods EDI OP OP OP OP OP OP OP OP Finished Goods PULL Work is pulled as needed by Next Operation Order Point Applied Materials Production AMAT PULL SYSTEM

Lean Production System Machine Paint Weld Pack & Ship Saw Lean Lean Lean Lean Pull Pull Pull Pull Improved OTD Improved Throughput Improved Quality Reduced Inventory Greater Flexibility Shorter Lead Times BENEFITS TOOLS Value Stream Mapping Pull System 5S Program Visual Management

Lean Production System Production system which operates with much lower costs by focusing on: Elimination of waste Process re-engineering Simple self managing systems Crosses functional boundaries to rethink the entire production stream, including: Scheduling and planning Relationships with vendors Material & product delivery processes Layout & management of the processes

Pull System Lean Enterprise Production & Quality Customer Order Pull Suppliers Suppliers Suppliers Suppliers Pull Pull Pull Pull Pull Pull Pull

Lean Production Journey Past F astest Delivery Highest Quality Lowest Cost Customer Response & Speed to Market In-Process & Customer Satisfaction Inventory Space Overhead Future World Class

Lean Production Basics Establishing a Lean Flow Establishing Pull with Customers Continuously Improving

Reminder: Lean Principle #3 Make products flow without interruption by eliminating waste Establishing a Lean Flow Waste Elimination Basic Production Elements + Line Design

Basic Elements of a Pull Production System -Reminder 5 S Philosophy Visual Controls Poke Yoke

Other Basic Elements of a Pull Production System Total Productive Maintenance Set up reduction Tooling and Fixture Design Variability Reduction Ergonomics

Establishing a Lean Flow - Basic Elements Ergonomics Safety lifting practices and limits no slippery surfaces access/stack height of material Work station design tables and seating Tools hanging tools ergonomic design fixed storage locations Parts presentation gravity bins Adequate lighting, ventilation and noise control Motion economy

Establishing a Lean Flow - Basic Elements Maintenance Total Productive Maintenance (TPM) Routine maintenance performance by the operator simple repairs daily thorough cleaning Preventive maintenance maintenance experts during reserved third shift Calibration procedures (stickers part of visual controls) Life cycle management monitoring with SPC increasing life of equipment with good care

Establishing a Lean Flow - Basic Elements Setup Reduction Single Minute Exchange of Dies (SMED) External vs. internal setup Dynamic vs. static Quick disconnect fittings on test fixtures Specialized tools to perform a specific job

Establishing a Lean Flow - Basic Elements Tooling and Fixture Design Why special tools and fixtures? safety reduce the level of human effort required improve quality Sourcing commercially available modified commercially available fully customized design

Establishing a Lean Flow - Basic Elements Variability Reduction Process capability studies how does the natural variation of the process output compare to specification limits? Statistical process control has the process shifted based on sample output? Quality control charting techniques facilitates investigation into causes so that actions can be taken to improve the process. cause and effect (fish bone) diagram, Pareto charts, etc.

Establishing a Lean Flow World Class Lean Production Waste Elimination Basic Production System Elements + Line Design

Lean Process Design Start Here Operations Balance In-process Kanbans Flexible employees Materials Kanbans Operational Method Sheets

Establishing a Lean Flow Product Synchronization Product Synchronization: Grouping products on a production line according to similar processes. Assembly 1 Test Box Assembly 2 Assembly 3 Assembly 4 Repair Sub 1 Sub 2 SP Test

Establishing a Lean Flow Product Synchronization Process Map: A matrix of information, process names across the top and product names along the side, that is used to see commonality among products being considered for the same mixed model production line. Process Map Model A Model B Model C A1 Sub1 A2 A3 Sub 2 A4 Sp Test Rep Test Box

Establishing a Lean Flow Process Types Sequential Assembly Test Post-test Assembly Box

Establishing a Lean Flow Process Types Option Assembly 1 Test Box Assembly 2 Post-test Assembly

Establishing a Lean Flow Process Types Feeder Assembly Test Post-test Assembly Box Test Sub-assembly

Establishing a Lean Flow Process Types Spur Assembly Test Post-test Assembly Box Spare Boxing

Establishing a Lean Flow Process Types Rework Assembly 1 Test Box Assembly 2 Repair

Example Product Synchronization: RF Match Assembly Sub-Assy DMR (Rework) Setup PVD/Etch/Tung/MxP CVD CVD Burn-In Shipping Customer Returns Pre-Test PVD/Etch/Tung/MxP TPCT = 338.75 min = (5.65 hours) 21.5 min 16.75 min 19.75 min 157 min 41 min 20 min 82.75 min Calibration

Lean Line Design Operations SOE Balance IPKB Flexible Employees Material Kanbans

Sequence of Events (SOE) A document that contains: A description of each step in the process. Time required for each step. Tools required for each step. Quality requirements for each step.

Establishing a Lean Flow Define the Work in the Process Sequence of Events (SOE) Product: Model B Seq. Task Time Type VA Quality 1.0 Unwrap face plate 32.0 SL Check for Scratches 2.0 Insert four screws, 44.0 RL • Window at upper left attaching to main unit 3.0 Test 51.0 RL Pass/Fail 4.0 Move to next Op. 12.0 ML Type Codes: SL= Setup Labor SM= Setup Machine RL= Req’d Labor RM= Req’d Machine ML= Move Labor MM= Move Machine Is it Value Added in the eyes of the customer? Work that will ensure quality

Lean Line Design Operations TPCT Balance IPKB Flexible Employees Material Kanbans

Establishing a Lean Flow Total Product Cycle Time (TPCT) The sum of work time along the longest path in the product synchronization TPCT = 160 30 50 20 10 20 20 30 40 70

Lean Line Design Operations Demand Balance IPKB Flexible Employees Material Kanbans

Demand at Capacity (D c ) : The demand that will be used to design the line. It represents the line’s capacity without overtime. Daily Rate(D r ) : The average day’s rate of production, usually less than Demand at Capacity. The actual daily demand is used to calculate staffing requirements. Establishing a Lean Flow D c = Demand at Capacity Get Average Daily Rate Planning Manufacturing Marketing 120% D c 50% D c D c D r Q1 Q2 Q3

Establishing a Lean Flow Effective Work Hours per Person 8 hours total work time? ? hours for production Breaks Cleaning Paperwork Projects Delays Vacation & Sick Training

Lean Line Design Operations Takt Balance IPKB Flexible Employees Material Kanbans

Establishing a Lean Flow Takt The speed or rhythm of the production line, expressed in time per unit. A statistic representing total work time divided by total demand for the line. Takt Takt Takt Takt Takt = 1 min. = 10 min. = 60 min. (7.1 hrs. / shift) (60 min / hr) (1) 426 units / day (7.1 hrs. / shift) (60 min / hr) (1) 43 units / day (7.1 hrs. / shift) (60 min / hr) (1) 7 units / day Formula for Takt = (H s ) (# of Shifts) D c

Lean Line Design Operations Operations Balance IPKB Flexible Employees Material Kanbans

Establishing a Lean Flow Operations Physical places to work on the Lean line. Each operation represent a portion of the work in the process. Operation 1 Operation 2 Operation 3 Examples 60 min. of work / 10 min. Takt = 6 ops. 8 hrs. work / 6 hrs. Takt = 2 ops Operation 4

Establishing a Lean Flow Placement of the Operations Sequential whole whole whole whole whole Builds quality into the product whole Parallel (Bay Build) Checks quality after the product is complete 1/6 1/6 1/6 1/6 1/6 1/6

Establishing a Lean Flow Balance Operational Cycle Time (OPCT) is the time each operation takes start to finish. The target for OPCT is Takt. Balance is the relationship between Takt and OPCT. An imbalanced operation is one that has cycle time in excess of Takt. Takt Takt Takt Takt Takt Takt SL RL RM RL ML Op 1 Op 2 Op 3 Op 4 Op 5 OPCT

Sequence of Events (SOE) Product: Model B Process: Assembly 2 Establishing a Lean Flow Five Ways to Achieve Balance Seq. Task Time Type VA Quality 1.0 Unwrap face plate 32.0 SL Check for Scratches 2.0 Insert four screws, 44.0 RL X Window at upper left attaching to main unit 3.0 Test 51.0 RL Pass/Fail 4.0 Move to next Op. 12.0 ML #1 Eliminate Work Setup & move Eliminate as many non-value add tasks as possible Low value add tasks

#2 Move Work Establishing a Lean Flow Five Ways to Achieve Balance Takt SL RL RM RL ML Op 1 Op 2 Op 3 Op 4 Op 5 OPCT

#3 Add People or Machines Establishing a Lean Flow Five Ways to Achieve Balance Takt SL RL RM RL ML Op 1 Op 2 Op 3 Op 4 Op 5 OPCT Machine 1 Machine 2 Takt Takt Takt

#4 Move People (use “flexing”) Establishing a Lean Flow Five Ways to Achieve Balance Takt SL RL RM RL ML Op 1 Op 2 Op 3 Op 4 Op 5 OPCT

#5 Rely on Overtime & Inventory First Shift Overtime / Second Shift Establishing a Lean Flow Five Ways to Achieve Balance Takt RL Op 5 OPCT

Establishing a Lean Flow Operational Method Sheet (OMS) Operational Method Sheets are simple, graphic, color-coded work instructions used on the Lean Manufacturing line instead of engineering drawings and bills of material. EC# 12345 OP# 123 REV. A PG# 1 of 10 P/N 0250-12345 TITLE: Smoke Sensor Assembly APPLIED MATERIALS Information contained in this document is considered by Applied Materials to be confidential and is not to be used in any manner without the consent of Applied Materials. TQC VERIFY WORK PART DESCRIPTION SEQ FIND QTY TASK DESCRIPTION TQC/TOOLING PART # 6 1 2 4 3 5 270 1 Check label orientation 275 2 Loosen screws 280 3 0150-20764 System Controller Smoke Sensor Cable Assembly 1 Strip wires from C/A & insert in matching slots on Sensor 300 4 Tighten screws 400 5 Verify wires are securely in place 410 6 Replace top of Sensor & secure with wire clip YELLOW indicates the WORK CONTENT to be performed by the current production employee Work to be VERIFIED by the production employee that performed the work is coded BLUE RED indicates the TQC (Touch Quality Check.) A TQC is the current production employee verifying the previous work content done by another employee

Lean Line Design Operations Flexible Employees Balance IPKB Flexible Employees Material Kanbans

Establishing a Lean Flow Employee Certification Orientation Trainee Certified Master Skill Diversity Chart Operations Line #: 3 P5000 Robot Team Members A1 A2 A4 A5 A6 A7 Dave Thomas Brian Roy Pat Wilson Greg Watkins Pete Wilson

Establishing a Lean Flow Flexible Employees Flexing is the movement of employees who are trained and certified in different parts of the process. At a minimum, employees should be trained “one-up” and “one-down.” On most days, the number of operations will not equal the number of employees on the line D c Q1 Q2 Q3

Lean Line Design Operations Material Kanbans Balance IPKB Flexible Employees Material Kanbans

Reminder: Lean Principle #4 Produce only what is pulled by the customer A ‘pull signal’ acts as a request for someone to: Produce Replenish The signal -which is really a customer demand - can provide information on: When How many What kind Establishing Pull with Customers

Establishing Pull Kanban: Communication Signal In-Process Kanbans = Signal for Work

Establishing Pull In-Process Kanbans Add Queue Time When will you be finished? You are here 3 minute process

Establishing Pull In-Process Kanbans Represent Inventory Money spent ahead of time Space needed to store product Rework, obsolescence, damage possible

Establishing Pull Things to Know About Kanbans A full kanban does NOT need a new limit A kanban should NOT always be full, it is a signal to build. Kanbans can and will cause a line stopper. When the kanban is full you can... Flex Housekeeping DMR Scrap tickets Training ? ? ? ?

Establishing Pull Material Pull Raw & In-Process Material (RIP) - All parts that are kept in the resupply area or on the production line. RIP Area Backflush Scrap Resupply Stores Transaction Resupply: A designated area within RIP used to replenish the line, or to hold those parts that are not kept on the line.

Establishing Pull Material Replenishment Part No. Qty. Usage Supply Stores RIP Area Resupply

Establishing Pull Non-Replenish Materials Planning Stores Kanban Card Part No. Qty. Usage Supply Non Replenish Unique Parts RIP Area Resupply Common Parts

Reminder: Lean Principle #5 Pursue perfection by continuously improving Continuous Improvement The Lean Production Basics and Lean Line Design will always need to be revisited, as there will always be room for improvement!

BREAK TIME (15 MINUTES) LEGO ASSEMBLY WORKSHOP NEXT STEP

Establishing a Lean Flow - Workshop LEGO ASSEMBLY 1. Create a Product Synchronization diagram 2. Conduct a Time Study and Develop SOE’s 3. Calculate Total Product Cycle Time (TPCT) 4. Calculate TAKT Time 5. Balance the assembly flow line 6 Create a line layout diagram and indicate staffing at each operation (station). 7. Share your results Workshop Objectives (Team effort):

Establishing a Lean Flow - Workshop LEGO ASSEMBLY Given: 1. Lego Model 2. Operation Method Sheets (OMS’s) 3. Demand at Capacity (Dc) 4. Operation Constraints 5. Line design formulas

Establishing a Lean Flow Workshop LEGO ASSEMBLY : PRODUCT SYNCHRONIZATION DIAGRAM 1. Draw a circle to represent each job step (reference OMS’s provided) and write down a brief description. 2. Connect the circles (job steps) in sequence using an arrow to represent the process flow TPCT = _______ Step 1 2 3 4

Establishing a Lean Flow Workshop LEGO ASSEMBLY : Sequence of Events 1. List each task (reference the Product Synch), determine the time for each task (job step) through time study work. Seq. Task Time Type VA Quality

Establishing a Lean Flow Workshop LEGO ASSEMBLY: CALCULATE TAKT TIME CALCULATE NUMBER OF STATIONS (OPERATIONS) Formula for Takt = (H s ) (# of Shifts) D c = = Given: Dc = 852 Lego Assy’s per day Hs = 7.1 Hrs./shift # of shifts = 1 Convert answer to seconds and plot line on graph Hours Seconds =

Establishing a Lean Flow Workshop LEGO ASSEMBLY: CALCULATE NUMBER OF STATIONS (OPERATIONS) Formula for Number of Stations = (TPCT)/Operators per Station = Note: Use the same time units for TPCT and TAKT Time in the formula. This is only a guideline, you still need to balance the line by grouping job steps to achieve a station time equal to or below the desired TAKT Time. Stations TAKT Time

LEGO ASSEMBLY: LINE BALANCING 1. Draw a horizontal line on the chart representing the TAKT time for the line. 2. Draw a bar for each job step identified on the SOE’s, indicating the total time for each bar on the chart below. 3. Draw a circle around a group of job step bars that will be grouped into a station (operation). 4. For job step bars that exceed the TAKT Time line, indicate how that particular job step time will be reduced (ex. adding operators, process redesign, job step work breakdown, etc.) Establishing a Lean Flow Workshop

Establishing a Lean Flow Workshop LEGO ASSEMBLY: LINE BALANCING Job Task Descriptions Time Scale

Establishing a Lean Flow - Workshop LEGO ASSEMBLY: LINE LAYOUT Use a square to represent one station Use arrows to show assembly flow Show material and operator placement Make suggestions for line improvements TAKT Time = ____________ TPCT = ____________ # Stations = ____________ # Operators = ___________ Capacity = ____________

Wrap Up Where Do We Go From Here? Course evaluations

Where to go from here… Lean Fundamentals Materials Lean Production Basics Kaizen Workshop Poka-yoke Design for Manufacturability Systems Thinking Project Management Program Management Concurrent Engineering Lean Line Design

Lean Fundamentals And Line Design 06 04 01

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