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Capital Solutions
LEAN Workshop
October 2006
Sharon Garavel, SVP Quality & Operations Raj Wadehra, Lean & Originations Process Leader Ryan McMillian, ACFC Lean Leader
GE PROPRIETARY INFORMATION
The information contained in this document is disclosed in confidence to GE customers/partners. It is the property of the General Electric Company and should be used only within your company this notice shall appear on any reproduction, in whole or in part. It should not be disclosed to others without the expressed written consent of the General Electric Company.
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2/ GE Proprietary Information
2005 2004
Imagine, Solve, Build, Lead Using Change as a Strategic and ACFC (At the Customer For the Customer): 2000 Faster, Better, Closer to the Customer Competitive Advantage Digitization: 1998 Sell, Buy, Make using Technological Tools Optimizing Change Six Sigma Quality: Effectiveness 1996 Productivity, Span, Data-Driven Decision-Making Make Customers Winners: Building a Culture that GE Tool-Kit Drives Change Key Strategic Initiatives: QMI*, NPI*, OTR*, SP*, Productivity, Globalization
Imagination at Work:
1992
Process Improvement:
Process-mapping, re-engineering, Bullet Train Approach
1989
1995
GE Launches Six Sigma Throughout Company
Focus : Core Activities Objective : Productivity & Asset Utilization
Evolution
PRODUCTIVITY
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1997
GE Turns to Six Sigma For New Products
Focus : New Product Design Objective : World Class Capability in the Market Place
Evolution
PRODUCTIVITY PRODUCT DESIGN
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1999
GE Turns Six Sigma Loose at the Customer
Focus : Customer Productivity & Value Added Services Objective : Revenue Growth & Share Shift
Evolution
PRODUCTIVITY PRODUCT DESIGN CUSTOMER FOCUS
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2001
Six Sigma Leadership Critical to Success
Focus : Developing Future Six Sigma Leaders Objective : Common Company Wide Training & Certification
Evolution
PRODUCTIVITY PRODUCT DESIGN CUSTOMER FOCUS THE WAY WE WORK
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2003
Enabling Growth
Focus : NPI, ITO, OTR, ACFC Objective : Improve/Digitize Key Processes & Free Up Resources for Growth
Evolution
PRODUCTIVITY PRODUCT DESIGN CUSTOMER FOCUS THE WAY WE WORK ENABLE GROWTH
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Enabling Growth
Customer Focus
PRODUCTIVITY
Customer Focus
PRODUCT DESIGN
CUSTOMER FOCUS
ENABLE GROWTH
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10 9 8 7 6 5 4 3 2 1 0
% Promoters
% Detractors
% Net Promoters
06 Detractors
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LEAN Principles
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Flow Processing
First person writes their name on one post-it notes and hands to second person as soon as theyve finished signing one post-it. While the second person is signing the 1st post-it, the first person begins signing the 2nd post-it note. Continue until last person has finished signing all post-it notes.
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What Is LEAN?
Defines Value from the Customers perspective.
The relentless pursuit of the perfect process through Waste Elimination. Minimize Material or Information Flow Time from Start to Finish Process/Goods.
All we are doing is looking at a time line from the moment the customer gives us an order to the point when we collect the cash. And we are reducing that time line by removing the non-value added wastes Taiichi Ohno
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After
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Why LEAN?
Eliminate waste >Deliver exactly what customers need exactly when and where they need it >Eliminating all that does not add value in the eyes of the customer
>Reinforce a performance culture and sense of urgency; learn by doing >Tied to clear goals, and real consequences
>Optimize service, cost, and asset productivity >Segment, integrate, and accelerate information flows throughout the business >Employ proven tools to eliminate waste, manage variability, and synchronize flows >Deploy cross-functional problem-solving teams throughout the organization, driving to measurable, actionable solutions
Improve performance
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Heijunka
Level Loading Sequencing Stability
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Leveling
Heijunka
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Normal
Abnormal
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3 Establish Flow
Continuous movement of products, services & information from end to end through the process
4 Implement Pull
Nothing is done by the upstream process until the downstream customer signals the need
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1. Specify Value
Value can only be defined by customer Product Flow: Value changes the form, fit and function of the product. Knowledge Flow: Value adds necessary knowledge or information.
Incidental Work
Does not add value, but required by the business (eg. Taxes)
2 ITO
Inquiry to Order
3 OTR
Order to Remittance
Future State
6-9 Month Roadmap
3. Flow
Batch Production
Flow Production
A
Operator 1
B
Operator 2
C
Operator 2
A B C
5 Hours
5 Hours
5 Hours
Time for First Order = 15 Hours Time for Last Order = 15 Hours
Time for First Order = 3 Hours Time for Last Order = 7 Hours
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4. Pull
Customer initiates business process Produce only what is required by the customer Each step in the process takes the product and adds knowledge it needs, as it is needed No action is taken until the downstream process initiates it to prevent batches and queues
One more please!
Okay
supplier
customer
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5. Improve To Perfection
Goal: perfect process Tools allow you to see & eliminate waste There is always more waste True continuous improvement philosophy Next Future State Future State Current State
Original State
The perfect process is a continuous flow of customer value add, without interruption
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Overproduction Inventory
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A value stream shows all the tasks (Value and Non-Value) required to bring a product, service, or capability from start to customer delivery
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1. 1. 1.
EXPERIAN/ EQUIFAX
Map information flows Create cycle time ladder Identify the Waste
LEGACY SYSTEMS PARTNER
Enter Deal Into Sales locates Autodecision and sends to W Decisioning W 40 Mins 90 Mins customer tool
Daily demand Process Time Inventory flow stops and Yield
7 Min
Daily demand Daily demand Process Time Process Time Process Box Inventory Inventory A point in the value stream at which Yield Yield
1 Mins 40 Mins 0.2 Min 1 Min
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Kaizen Team #1
Kaizen Team #2
Kaizen Team #3
Kaizen Team #4
future state
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Consistently Meet Customer Requirements All we are doing is looking at a time line from the moment the customer gives us an order to the point when we collect the cash. And we are reducing that time line by removing the non-value added wastes Taiichi Ohno
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6-week Forecast
Production Control
2 shifts Daily
Daily Schedule
Flow Problems
Long Set up
High Scrap
Cutting Laser
OXOX
Too Much Inventory
Finish
Daily
I
1900 pieces LB 1900 pieces SB 2 days
Issue
19 pieces LB
C/T=5.5 min C/O=0 min. 3 SHIFTS VA= .5 min 0% SCRAP Up Time = 100% C/T=120 min C/O=240 min 3 SHIFTS VA=7 min 10% SCRAP Up Time = 80% C/T=1445 min C/O=15 min. 3 SHIFTS VA=5 min 5% SCRAP Up Time = 98% C/T=2880 min C/O=0 min. 3 SHIFTS VA=1500 min 0% SCRAP Up Time = 99% C/T=720 min C/O=0 min. 3 SHIFTS VA=72 min 1% SCRAP Up Time = 100%
Machine Issues
1900 pieces
1900 pieces
7 min 5 min
720 min
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TPS
Pull Production Single Piece Flow Takt Time Production Leveling Stop @ Abnormality
JIT
Jidoka
Autonomation
Heijunka
Sequencing
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VSM Helps Identify Current State and Prioritize an Improvement Plan TPS are Tools for Improvement
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C/T=120 min C/O=240 min 3 SHIFTS VA= 7 min 10% Rework Up Time=80%
Cycle Time Change Over Time Value Added Defect Rate Process Up Time
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Tools
Spaghetti Chart 5S Standard Work Cell Formation
C/T=120 min Cycle Time C/O=240 min 3 SHIFTS VA= 7 min Value Added 10% Rework Up Time=80%
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Spaghetti Chart
Previous Flow Chart New Flow Chart
4 8 4 3 1 7
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5S Workout
Ensure that the workplace contains only what is needed, when it is needed and where it is needed Quickly, any abnormalities can be detected Minimal time is spent on nonvalue added activities A way to see and eliminate waste
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Before
After
5S Improvement
Planning
Tools
Material
Cart
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Results 12 minutes
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Tools
Setup Reduction
C/T=120 min C/O=240 min. Change Over Time 3 SHIFTS VA= 7 min 10% Rework Up Time=80%
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Setup Reduction
Finish part A SETUP PART A PRODUCTION PART B PRODUCTION SETUP Make and Inspect B Finish part A Make and Inspect B
PART A PRODUCTION
PART B PRODUCTION
INTERNAL : You must shut the machine off to perform Changing chuck jaws Changing dies Changing inserts Adjustments to dial in
EXTERNAL : You can perform while the machine is running Pre accumulate tooling Installing / replacing inserts Getting paperwork together Setting tool heights
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After
Before
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Results 27 minutes
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Tools
Build Quality In Poka Yoke
C/T=120 min C/O=240 min. 3 SHIFTS VA= 7 min 10% Rework Up Time=80%
Six Sigma
Defect Rate
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Tools
Preventative Maintenance
C/T=120 min C/O=240 min. 3 SHIFTS VA= 7 min 10% Rework Up Time=80%
Process Up Time
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Preventative Maintenance
Machines Deteriorate Over Time Maintenance Should Be Preformed in the Beginning Stages of Deterioration You can pay me now (with short daily CCO)...or pay me later (with poor quality, lots of downtime, high maintenance costs, etc...)
CCO Checklist
Machine #: General - Nuts/bolts loose, wobbly or missing? - Any play in moving parts or fixture mounting section? - Any unnecessary items on the body of the machine? Lubrication - Are oil levels correct? - Does oil reach sliding parts? - Any oil leaks from supply devices, pipes, fittings? Pneumatics - Pressures gages in proper range? - Any stop valve, ball valve leaks? - Air flowing through closed valves? Badge/Date
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Results
Old 120 240 10% 80% New 12 27 0.7% 100% Improvement 90% 89% 93% 20%
Cycle Time (min) Setup Time (min) Defect Rate Process Up Time
Increased Capacity for Customer Growth Significant Cash Savings to the Business
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Launching LEAN at GE
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Toyota and Dell have demonstrated that cycle time reduction in core customer facing processes drives growth
Toyota vs. US auto industry Growth (CAGR) Revenue Earnings Lean focus Inventory turns NPI cycle time 8% vs. 3% 24% vs. 0% Every 2 hrs vs. 30% faster Dell vs. PC industry 28% vs. 3% 33% vs. 10% 5 min. vs. 11 days
Keys To Success At GE
1. Select the Right Process
(ITO,OTR, NPI)
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Lean WorkOuts Are The Perfect Tool For Driving Significant Cycle Time Reduction
WEEK ONE
Draw Wing-to-wing value stream maps for innovating (NPI), selling (ITO), and/or fulfilling (OTR) including all relevant multi-functional participants to define future vision for the organization
WEEK TWO
Action teams implement as much as possible during the Lean WorkOut to reduce cycle times
Magnetic Resonance
Quoting from 62 days to same meeting NPI from 29 to 0 weeks
Locomotive
Assembly cycle from 29 to 10 days 40% increase in capacity
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Tool Sophistication
Co mp le
LEAN Six Sigma
xit y
&C on tro l
Sp e
ed
&W as
te
Eli
mi na
tio
n
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USE LEAN METHODOLGY TO DRIVE IMPROVEMENTS WHERE CYCLE TIME IS IDENTIFIED AS ROOT CAUSE
Project Management Still Uses DMAIC With Lean as a Critical Tool For Improving Processes
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Questions?