Lean Manufacturing

Lean Manufacturing

Pankaj PathakAshutosh Vatsa

What is Lean Manufacturing?

An overall strategy to improve a production process that focuses on:• Eliminating wastes• Enhancing quality• Reducing production time and cost• Promoting a “Lean Culture” in the company

History and EvolutionEli Whitney (Interchangeable parts)

Drawing conventions, TolerancesModern machine tool development

1850

1900Fredrick Taylor (Standardized work, time study & work standards)

Frank Gilbreth (Process charts, motion study)

Henry Ford (Assembly lines, flow lines, manufacturing strategy)

Deming & Juran (SPC, TQM)

1990

1950Eiji Toyoda, Taiichi Ohno, Shigeo Shingo Toyota production system, JITStockless production, World class manufacture

Lean Manufacture

American Civil War

World War I

World War II

Industry’s Concerns

Govt. PoliciesGlobal Competition

Accountability to shareholders & financers

Rising Cost of Input(Raw material,

Energy)

Competency of employees

Above all SUSTAINABLE Improvement

Preparing for Lean Manufacturing

• Disorganised • Organised

Survival Strategies

• Create Precise Customer Value o goods and services with higher quality and fewer

defectso with less human effort, less space, less capital, and less

time than the traditional system of mass production. • Remove ‘Waste’

o Consume ‘just enough’ recourseso Do more with less

‘Value’ and ‘Waste’

• Value - an item or feature for which a customer willing to pay. Every thing else – waste

• Waste - activities that consume time, resource and/or space but do not add value.

• Lean - Production of product to meet demand on daily basis with minimum lead time & non value added activities eliminated or minimized

Value Addition & No Value Addition

Value Addition Activities

Test for value added activities

Transforms product in some wayCustomer sees & willing to payWill the customer know if eliminated

Overproduction

Waiting

Inventory

TransportationMotion

Over Processing

Rework

1

6

7

5 4

3

2

To produce sooner,fasteror in greater quantitiesthan customer demand.

Raw material,work in progress

or finished goods which is not havingvalue added to it.

People or partsthat wait for

a work cycle tobe completed.

Unnecessary movementof people, parts ormachines within

a process.

Unnecessary movement of peopleor parts between processes.

Non rightfirst time.Repetitionor correctionof a process.

Processing beyondthe standardrequired by thecustomer.

Seek it out and get rid!

1

2

34

5

6

7

An 8th wasteis the wasted

potentialof people

MUDA

7 Steps Of Waste Elimination

• Reduce lead time• Cut operations costs• Improve business performance visibility• Speed time to market• Exceed customer expectations• Streamline outsourcing processes• Manage global operations

Lean Manufacturing- A System Approach

“Lean manufacturing is not a collection of best practices from which manufacturers can pick and choose. It is a production philosophy, a way of conceptualizing the manufacturing process from raw material to finished goods and from design concept to customer satisfaction. Lean is truly a different way of thinking about manufacturing.”

- Running Today’s Factory: A Proven Strategy for Lean Manufacturing, Charles

Standard.

5 Principles of Lean Manufacturing

• Value - specify what creates value from the customer’s perspective.

• The value stream – identify all the steps along the process chain.

• Flow - make the value process flow. • Pull - make only what is needed by the

customer (short term response to the customer’s rate of demand).

• Perfection - strive for perfection by continually attempting to produce exactly what the customer wants.

Value

• Any process that the customer would be prepared to pay for that adds value to the product.

The customer defines the value of product in a lean supply chain.

Value-adding activities transform the product closer to what the customer actually wants.

An activity that does not add value is considered to be waste.

Quality Flexibility Service Variety

Variability Response-Time Cost

- - - - V A L U E - - - -

Value Stream

• The value stream is the sequence of processes from raw material to the customer that create value.

• The value stream can include the complete supply chain.

• Value stream mapping is an integral aspect of Lean.

Value-add time (Hours)

Inventory Waiting

Typical value-add to lead-time ratio ~ 1%

Waste

Value-add activity

Setup Transportation Waiting Inspect

Flow

• Using one piece flow by linking of all the activities and processes into the most efficient combinations to maximize value-added content while minimizing waste.

• The waiting time of work in progress between processes is eliminated, hence adding value more quickly.

Pull

• Pull = response to the customer’s rate of demand i.e. the actual customer demand that drives the supply chain.

• Based on a supply chain view from downstream to upstream activities where nothing is produced by the upstream supplier until the downstream customer signals a need.

Perfection

• The journey of continuous improvement.• Producing exactly what the customer

wants, exactly when, economically.• Perfection is an aspiration, anything and

everything is able to be improved.

TYPES OF LEAN MANUFACTURING

Pull Production• Minimum Inventory• Supplying the right part, at the right time, in the

right amount• Each sub-process draws its needs from the

preceding sub-processes, and ultimately from an outside supplier.

• When a preceding process does not receive a request or withdrawal it does not make more parts.

Automation

Intelligent Automation:

• Detect the abnormality.• Stop.• Fix or correct the immediate

condition.• Investigate the root cause and

install a countermeasure.

Fixed Repeating SchedulesRed Stream/Green

Stream

Green Stream: Continuously produces products for which there is a stable demand

Red Stream: Flexible work schedules and factory layouts allow products to be produced only when ordered

Shortening FRS

• Reduces amount of stock needed

• Improves efficiency of sub processes

• Leads to lower lot sizes and enhanced flexibility

Kaizen (Continuous Improvement)

• Identify a problem• Collect input from employees• Make a change• Monitor results• Adjust• Apply across the board

Lean Manufacturing - Pros

• Minimizes the overhead fixed cost; reduces operational cost

• Implementing manufacturing techniques and strategies reduce manufacturing time

• Targets to eliminate most of the wastes that were mentioned on the previous slides

• Use of energy will be significantly reduced• Tries to eliminate wasted space since it is very important

for the company to run smoothly

Lean Manufacturing - Cons• Support of employees and upper management

throughout the overall org chart is necessary to make the lean techniques implement in the company and make them successful.

• Proper leaders should be trained to direct teams about lean manufacturing and how it works.

• Leaders should be employee friendly since there can be personality clashes and it is difficult to get people to follow and take orders from co-workers.

• Training is an on-going process and it is a long time process to completely adopt “lean manufacturing” for the overall company.

Lead Time Comparison

CustomerOrder

Waste ProductShipment

Time

CustomerOrder

ProductShipment

Time (Shorter)

Business as Usual

Waste

Lean Manufacturing

Features of Lean Manufacturing:

• Greater Product Variety• Fast Response (Flexibility)• Stable Production Schedules• Supply Chain Integration• Demand Management• Broader jobs, highly skilled workers, proud of

product• Excellent quality• Reduced costs• Ability to meet global market & competition

Graph Representing Benefits of Waste Reduction Techniques

BOEING MANUFACTURING BUSINESS UNIT

Case Study

Issues• Average job moved to 30 different stations• Pieces travelled miles throughout the shop• Most space was used for storage of work in

progress• Large inventory

Changes and Results

• Product based cells• Wheels on equipment for flexibility• Storage spaces stocked to max/min• Overall travel was reduced between 1 and

3 miles• Reduced need for forklifts and trucks

Changes and Results

• Reductions of bulk purchasing• Manufacturing occurs in ship sets• Just-in-time scheduling• 100,000 square feet of storage space

reduced• Off-site storage no loner needed

Overall results• Reduced total cost of 30%• Productivity improved by 39%• Defects reduced from 12% to 3%• Production flexibility increased 40-50%

Stages Of Lean

Curtail Down the Waste

How People Benefit From LEAN?

Elements Traditional Lean Improvement

Communication Slow & Uncertain Fast & Positive Quality & Coordination

Teamwork Inhibited Enhanced Effective Teams

Motivation Negative, Extrinsic Positive, Intrinsic Strong Motivation

Skill Range Narrow Broad Job Enrichment

Supervision Difficult and Fragmented

Easy & Localized Fewer Supervisors

How Customers Benefit from LEAN?

Elements Traditional Lean Improvement

Response Weeks Hours 70-90%

Customization

Difficult Easy Competitive Advantage

Delivery Speed

Weeks-Months Days 70-90%

Delivery Reliability

Erratic Consistent & High Up to 90%

Delivery Quantities

Large Shipments JIT as Required Locks in JIT Customers

Quality Erratic Consistent & High Delighted Customers

What do we want to measure?

• Productivity o Units produced per day per employee (all employees

in the building).

• Throughput Time (Dock to Dock)o Time (in days or hours) it takes for units to move from

first dock (receiving raw materials) to the last dock (finished goods shipping area).

• Total Cost / unito Must include all costs in the garment. Overhead,

variable cost, labor, materials, etc.

What do we want to measure?

• WIP Cost for the systemo Number of units inside the process times the value of

the materials in the process.

• First time througho Quality level at each step accumulated across all

steps. % of the total that make it to the end with no re-work.

• Productive time, Non-productive time, Waiting timeo Start by removing non-productive time into waiting

time. It then moves from waiting to productive time.

Lean Pilot Results

Productivity 25 pr/person 40 pr/person 60% Improvement

Quality 4.6% defects at final audit

2.1% defects at final audit

58% less defects

Space 102 sq. ft. per person

36 sq. ft. per person 64% less sq. ft. per person

WIP 4 units of WIP per unit produced.

0.3 units of WIP per unit produced

13 times less units in inventory

Lead Time 3.7 days 0.27 days 93% reduction

Absenteeism 3.2% daily 2.1% daily 33% reduction

Variation in Process

(Daily Schedule attainment)

+/- 45% variation (Daily Schedule attainment)

+/- 10% variation(Daily Schedule attainment)

88% more reliable process

(Daily Schedule attainment)

BEFORE PILOT IMPACT

House of LEAN

LEAN TOOLS AND SUPPORTING STRATEGY

Lean Tools & Supporting Strategies

• 5S • Visual control• Team building• Problem solving• Standardised processes • Value stream mapping


• Pull system• Kanban• Takt time – rate of customer demand• Manufacturing Cells • Heijunka• 5Ws & 1H


• Kaizen• Total Productive Maintenance• SMED (setup reduction)• Poka-Yoke or mistake-proofing• Cycle time reduction• Andon – signalling system to stop

line

5SA method for organizing a workplace, and keeping it organized.

Benefits:• Improve safety• Decrease down time• Raise employee morale• Identify problems more quickly• Develop control through visibility• Establish convenient work practices

Unneeded equipment, tools, furniture; unneeded items on walls, bulletins; items blocking aisles or stacked in corners; unneeded inventory, supplies, parts; safety hazardsItems not in their correct places; correct places not obvious; aisles, workstations, & equipment locations not indicated; items not put away immediately after useFloors, walls, stairs, equipment, & surfaces not lines, clean; cleaning materials not easily accessible; labels, signs broken or unclean; other cleaning problemsNecessary information not visible; standards not known; checklists missing; quantities and limits not easily recognizable; items can’t be located within 30 secondsNumber of workers without 5S training; number of daily 5S inspections not performed; number of personal items not stored; number of times job aids not available or up-to-date

Keep only what you need

A place for everything and everything in its place Cleaning, and looking for ways to keep clean and organized

Maintaining and monitoring the first three categoriesSticking to the rules

Seiri(sort)

Seiton(set in order)

Seisou(shine)

Seiketsu(standardize)

Shisuke(sustain)

5S Scan Goal Eliminate or Correct

Visual Control

Any communication device used in the work environment that tells us at a glance how work should be done and whether it is deviating from the standard Benefits

1. Increase productivity2. Improve quality3. On-time delivery4. Reduce inventory 5. Increase equipment reliability6. Boosts bottom-line profits

Visual management

• Visual management maintains an orderly work environment.

• Employees have quicker and safer access to items that are needed.

• Colour-coding is often used to remind employees of where items belong.

• If order is not continually stressed, disorder will result and create an unfriendly work atmosphere.

Lean Tool Introduction Benefits

Team Building

An active process by which a group of individuals with a common purpose are focused and aligned to achieve a specific task or set of outcomes

1. Improves morale and leadership skills.

2. Finds the barriers that thwart creativity

3. Clearly defines objectives and goals

4. Improves processes and procedures

5. Improves organizational productivity

6. Identifies a team’s strengths and weaknesses·

7. Improves the ability to problem solve

Team Building


Problem Solving

The Problem Solving is a systematic approach with a sequence of sections that fit together depending on the type of problem to be solved. These are: 1. Problem Definition• Problem Analysis• Generating possible Solutions• Analyzing the Solutions • Selecting the best Solution(s)• Sustaining the gains

1. Leads to identify root cause(s) of chronicle problems

Problem Solving


Standardized Process

Standardization is the process of developing and agreeing upon technical standards.

1. Better decision making 2. Cost reduction and increase in

efficiency3. Effective information sharing4. Easier international transfer of

marketing skills5. Simplifying the coordination and

control between subsidiaries and business functions

Value stream Mapping

A tool for guiding improvements by identifying waste & isolated processes

1. Enable Visualizing the production process

2. Identifies waste in each step of the production process.

3. Provides a plan for implementing improvements to the production process to reduce costs.

Standardized Process & Value stream Mapping


Pull system

A method of controlling the flow of resources by replacing only what has been consumed

1. Reduce lead times2. Minimize work in process3. optimize floor space usage4. Simplify production signals and

improve on-time delivery to customers.

Pull system


Kanban

A system of continuous supply of components, parts and supplies, such that workers have what they need, where they need it, when they need it

1. Reduces waste and scrap 2. Provides flexibility in production 3. Increases Output 4. Reduce Preventing Over

Production 5. Minimizing Wait Times and

Logistics Costs 6. Reduce Stock Levels and

Overhead Costs 7. Save Resources by Streamlining

Production 8. Reduce Inventory Costs

Kanban


Takt time – rate of customer demand

The rate that a completed product needs to be finished in order to meet customer demand

1. Gives the rhythm at which system should operate

2. Smooth production planning & reduced interruptions in operations

3. System synchronization with customer requirement

4. Enable pull scheduling5. No over production6. No rush hours in work7. WIP reduced

Manufacturing Cells

Comprises a group of equipment, that is dedicated to the complete production of a family of similar parts

1. Flexible Operation 2. Setup Time Reduction 3. Process Simplification 4. Schedule Variety

Takt time – Rate of customer demand & Manufacturing Cells


Heijunkathe leveling of production by both volume and product mix

1. Stability of manpower 2. Reduction of unnecessary overtime 3. Reduction in inventory levels 4. Reduction of stress levels in the

production area

5Ws & 1 H

It is a method of questioning that leads to the identification of the root cause(s) of a problem

1. Identify root cause2. Identify current and future needs for

organizational improvement.3. Develop a logical approach to

problem solving; using data that already exists in most operations.

Heijunka & 5Ws & 1 H


Kaizen Continuous Improvement

1. Increased Space utilization2. Increased product quality3. Better Use of capital4. Communications5. Production capacity 6. Employee retention

Total Productive Maintenance

A maintenance philosophy designed to integrate equipment maintenance into the manufacturing process. The goal is to keep equipment producing only good product, as fast as possible with no unplanned downtime.

1. Improve Productivity2. Reduce breakdown leading to

Zero breakdown concept3. Leads to multi-skilling of workers4. Better safety5. Improve quality of products

Kaizen & Total Productive Maintenance


SMED (Set up reduction)

The practice of reducing the time it takes to change a line or machine from running one product to the next

1. WIP and lot size reduction2. Finished goods inventory

reduction3. Improved equipment

utilization/yield4. Increased profitability without

new capital equipment purchase

Poka-yoke or mistake proofing

A techniques that help operators avoid mistakes in their work caused by choosing the wrong part, leaving out a part, installing a part backwards, etc.

1. Better safety2. Reduce breakdown3. Improve Productivity

SMED (Set up reduction) & Poka-yoke or mistake proofing


Cycle Time reduction

Reduction of total time taken from start of the production or service to its completion. It includes processing time, move time, wait time, and inspection time

1. Reduced costs 2. Increased throughput3. Streamlined processes4. Improved communications 5. Reduced process variability6. Schedule integrity7. Improved on-time delivery

Cycle Time reduction


Andon – Signaling system to stop line

A Japanese term refers to the warning lights on an assembly line that light up when a defect occurs. When the lights go on, the assembly line is usually stopped until the problem is diagnosed and corrected.

1. Bring immediate attention to problems as they occur in the manufacturing process.

2. Provide a simple and consistent mechanism for communicating information on the plant floor.

3. Encourage immediate reaction to quality, down time, and safety problems.

4. Improve accountability of operators by increasing their responsibility for “good” production and empowering them to take action when problems occur.

5. Improve the ability of supervisors to quickly identify and resolve manufacturing issues.

Andon–Signaling system to stop line

Lean Maintenance

A Simultaneous Approach

Cellular Manufacturing

Dividing the manufacture of products into semi-autonomous and multi-skilled teams

known as work cells

Cellular Manufacturing Example

Functional Layout Cellular Layout

Cells with Worker Routes

Worker Routes Lengthen as Volume Decreases

Pull System

• Material is pulled through the system when needed

• Reversal of traditional push system where material is pushed according to a schedule

• Forces cooperation• Prevent over and underproduction• While push systems rely on a predetermined

schedule, pull systems rely on customer requests

Kanbans

• Card which indicates standard quantity of production

• Derived from two-bin inventory system• Maintain discipline of pull production• Authorize production and movement of

goods

Sample Kanban

Origin of Kanban

a) Two-bin inventory system b) Kanban inventory system

Reorder card

Bin 1

Bin 2

Q - R

Kanban

RR

Q = order quantityR = reorder point - demand during lead time

Types of Kanban

• Production kanbano authorizes production of

goods• Withdrawal kanban

o authorizes movement of goods

• Kanban squareo a marked area designated

to hold items

• Signal kanbano a triangular kanban used

to signal production at the previous workstation

• Material kanbano used to order material in

advance of a process• Supplier kanban

o rotates between the factory and suppliers

Determining Number of Kanbans

where

N = number of kanbans or containersd = average demand over some time periodL = lead time to replenish an orderS = safety stockC = container size

No. of Kanbans =average demand during lead time + safety stock

container size

N =dL + S

C

Determining Number of Kanbans: Example

d = 150 bottles per hourL = 30 minutes = 0.5 hoursS = 0.10(150 x 0.5) = 7.5C = 25 bottles

Round up to 4 (to allow some slack) or down to 3 (to force improvement)

N = =

= = 3.3 kanbans or containers

dL + SC

(150 x 0.5) + 7.525

75 + 7.525

Small Lots

• Require less space and capital investment

• Move processes closer together• Make quality problems easier to

detect• Make processes more

dependent on each other

Inventory Hides Problems

Less Inventory Exposes Problems

Components of Lead Time

• Processing timeo Reduce number of items or improve efficiency

• Move timeo Reduce distances, simplify movements, standardize

routings• Waiting time

o Better scheduling, sufficient capacity• Setup time

o Generally the biggest bottleneck

Quick Setups

• Internal setupo Can be performed

only when a process is stopped

• External setupo Can be performed

in advance

• SMED Principleso Separate internal setup from

external setupo Convert internal setup to external

setupo Streamline all aspects of setupo Perform setup activities in parallel

or eliminate them entirely

Common Techniques for Reducing Setup Time

Common Techniques for Reducing Setup Time (cont.)

Uniform Production Levels

• Result from smoothing production requirements

• Kanban systems can handle +/- 10% demand changes

• Smooth demand across planning horizon

• Mixed-model assembly steadies component production

Mixed-Model Sequencing

Quality at the Source• Visual control

o makes problems visible

• Poka-yokeso prevent defects from

occurring• Kaizen

o a system of continuous improvement; “change for the good of all”

• Jidokao authority to stop the

production line• Andons

o call lights that signal quality problems

• Under-capacity schedulingo leaves time for planning,

problem solving, and maintenance

Examples of Visual Control

Examples of Visual Control (cont.)

Total Productive Maintenance (TPM)

• Breakdown maintenanceo Repairs to make failed machine operational

• Preventive maintenanceo System of periodic inspection and

maintenance to keep machines operating• TPM combines preventive maintenance

and total quality concepts

TPM Requirements

• Design products that can be easily produced on existing machines

• Design machines for easier operation, changeover, maintenance

• Train and retrain workers to operate machines• Purchase machines that maximize productive

potential• Design preventive maintenance plan spanning

life of machine

Supplier Networks• Long-term supplier contracts• Synchronized production• Supplier certification• Mixed loads and frequent deliveries• Precise delivery schedules• Standardized, sequenced delivery• Locating in close proximity to the customer

Thank you.

Lean Manufacturing

Education

Transcript of Lean Manufacturing