Lean Manufacturing Breakfast Seminar

This programme is funded by the European Union under an Agreement with the Government of the Republic of Trinidad and Tobago

Lean Manufacturing Breakfast Seminar 1. Overview: Concept Cases Benefits 2. The Seven Wastes: Identifying and Eliminating Waste Tools 3. Implementation: Roadmap to Lean Production

Lean Manufacturing Lean Manufacturing is a strategy with a set of tools aimed at eliminating waste in every area of production, including customer relations, product design, production management, services, and supplier networks. Objectives To become or stay highly responsive to customer demands; To deliver top quality products and services in the most efficient and economical ways possible; To involve less human effort, less inventory, less space, less time in development and production.

Lean Manufacturing Focus on processes that add value Reduce non value added activities Eliminate waste

Value = what the customer is prepared to pay for Waste = what the customer is not prepared to pay for

Customer Perspective How to create value in products and services How to maximize value in each process from acquisition and order entry to delivery and after sales Who is the customer What does the customer want When does the customer want it How does the customer want it

Traditional high-volume manufacturing principles Rational, specialised processes and skills Economic order quantities High capacity utilization High inventory levels Economy of scale Indirect Labour: Engineering, Management, Communication Issues

Typical Mass Production Issues

Waste Material Time Equipment Inventory

Hidden Costs Setup and changeovers Reduced Speed Breakdowns Idling and Minor Stoppages Defects, Rework Overproduction

Whats So New? Toyota Production System - JIT Womack Jones Roos The Machine That Changed The World: The Story of Lean Production 1990s Paradigm Shift - Automotive Industry - Logistics, Military - Construction - Service Industry, IT - SMEs

Lean Manufacturing Characteristics Made to order Single piece production Just in Time supplies Pull scheduling Short cycle times Highly flexible equipment Highly flexible and responsive processes Quick changeovers Continuous flow (work balancing, cells) High first-pass yields Significantly less waste and defects Collocated equipment, tools, people Compressed space Multi-skilled employees

Lean Principles Identifying Waste Process Mapping, Value Stream Mapping Product Flow, Takt, Overall Equipment Effectiveness Set up Reduction, Quick Changeover (SMED) Standard Work Levelled Production, Work Balancing Pull Scheduling, Point of Use Storage (Kanban) Team Development Cellular Production, One-Piece-Flow Error Proofing (Poka Yoke) Visual Controls, 5 S / 5 C, FiFo Total Productive Maintenance Impact and Culture Change (Kaizen)

Business Case 1
Automotive Supply Chain 20 selected car component producers Objective Transform business to meet international standards Prime Areas Flow layout, cells, standardised work Teamwork Lean Scheduling, 5 S Setup, Single Minute Die Exchange Outcome Reduction in throughput and changeover times, improvement in delivery times, reduction in machine downtime, increase in flexibility and productivity, businesses less dependent on largest customer

Business Case 2
Upholstered Furniture Manufacturers Size: 45-75 employees, turnover under USD 1.5 million Objective Streamline manufacturing systems Prime Areas Flow layout, 5 S, standardised work Teamwork Lean Scheduling, Material Requirement Planning Finished Goods Inventories Outcome Gains in space, working conditions, management practices, productivity, scheduling, delivery times and inventory, businesses more customer responsive, more opportunities

Business Case 3
Printing Industry Sheet Offset, Flexo SMEs and Blue Chip Objective Management Turnaround Prime Areas Setup, Changeover Teamwork Lean Scheduling, Kanban Lean MIS Outcome Reduction in setup and changeover times, increase in operator productivity and machine efficiency, reductions in raw material waste, increased customer focus throughout departments

Lean Manufacturing Benefits

Organised and visual workplace Improved knowledge retention New employees fit in more quickly with less training Flexible work cells with flexible people Small batch operations more cost effective Productivity/Capacity increase Inventory reduction Lead time reduction Quality improvement Improved use of floor space Cost reduction Improved efficiency Improved communication Improved profit margins Improved customer relations

Transition from mass production to lean enterprise

Mass Production Business Strategy Product-oriented strategy focused on exploiting economies of scale of stable product designs and non-unique technologies Hierarchical structures that encourage following orders and discourage the flow of vital information that highlights defects, operator errors, equipment abnormalities and organisational deficiencies Dumb tools that assume an extreme division of labour, the following of orders, and no problem skills Lean Enterprise Customer-oriented strategy focused on identifying and exploiting shifting competitive advantages Flat structures that encourage initiative and that encourage the flow of vital information highlighting defects, errors, equipment abnormalities and organisational deficiencies Smart tools that assume standardised work, strength in problem identification, hypothesis generation, and experimentation

Organisational Structure

Operational Capability

Key Elements Typical Improvements

Mass/Functional Inter-department moves Travel distance Routings Route structure Lot sizes Queues Throughput Quality feedback Response time Warehouse policies Customisation Delivery speed/quantity Delivery reliability/quality Inventory turns Supervision Teamwork Skill range Scheduling Responsibilities Management style Problem solving Motivation Many 500-4000 Complex Variable Large 12-30 Weeks Days Weeks Make to Stock Difficult Slow/Large Erratic 3-10 Difficult Inhibits Narrow Complex (MRP) Fragmented Police Fragmented Avoid Sanctions Lean/Cellular Few 100-400 Simple Fixed Small 3-5 Hours Minutes Hours Make to Order Easy Days/JIT Consistent 15-60 Easy Enhances Broad Simple (Kanban) Focused (in Cell) Self enforced Team based Pride

Key Elements Typical Improvements

Lean Inter-department moves Travel distance Routings Route structure Lot sizes Queues Throughput Quality feedback Response time Warehouse policies Customisation Delivery speed/quantity Delivery reliability/quality Inventory turns Supervision Teamwork Skill range Scheduling Responsibilities Management style Problem solving Motivation Few 100-400 Simple Fixed Small 3-5 Hours Minutes Hours Make to Order Easy Days/JIT Consistent 15-60 Easy Enhances Broad Simple (Kanban) Focused (in Cell) Self enforced Team based Pride Improvement 50-90% 70-90% Possible Automation Simplified 50-100% 50-80% 50-90% 80-90% 70-90% Eliminate FG Stock Competitive Advantages 70-90% 80-90% 60-90%, Flexibility Less Supervising Functions Effective Teams Job Enrichment, Backup Simplified, Visual 50-90% Job Satisfaction Continuous Improvement Peak Performance

Typical Short Term Improvements Inventory reduction Lead time reduction Productivity/Capacity increase Quality improvement Floor space reduction Cost reduction Value added/person Improved profit margins Overall effective efficiency 90% 90% 35% 15% 60% 20% 10% 25% 5%

Lean manufacturing uses less of everything compared with mass production - half the human effort in the factory, half the manufacturing floor space, half the investment in tools, half the engineering hours to develop a new product in half the time. Also it requires keeping far less than half the needed inventory on site and results in fewer defects.

(James P Womack, Daniel T Jones and Daniel Roos, The Machine that Changed the World, Harper Perennial, New York, 1990)