creating the lean car dealer

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ICDP Forum 1999 Creating the Lean Car Dealer Creating the Lean Car Dealer David Brunt

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Page 1: Creating the Lean Car Dealer

ICDP Forum 1999

Creating the Lean Car DealerCreating the Lean Car Dealer

David Brunt

Page 2: Creating the Lean Car Dealer

Creating the Lean Car DealerCreating the Lean Car DealerA Value Stream Mapping WorkshopA Value Stream Mapping Workshop

PurposeTo introduce how lean can be applied in aservice organisation– Through applying 5 Lean Principles

To share a road map for implementation

Page 3: Creating the Lean Car Dealer

Presentation FrameworkPresentation FrameworkAgendaAgenda

Introduction & Industry BackgroundValue & Waste applied to the dealerA Value Stream Map for servicing a carHow manufacturers and dealers canachieve the changeConclusion

Page 4: Creating the Lean Car Dealer

Presentation FrameworkPresentation FrameworkAgendaAgenda

Introduction & Industry BackgroundValue & Waste applied to the dealerA Value Stream Map for servicing a carHow manufacturers and dealers canachieve the changeConclusion

Page 5: Creating the Lean Car Dealer

Autos: “The Industry ofAutos: “The Industry ofIndustries”Industries”

A hugely competitive industry

A “soap opera” where its businessleaders are celebrities

Where companies spend millions tocreate and preserve their brands

The industry where lean productioncan’t be questioned!

Page 6: Creating the Lean Car Dealer

Better service at lower cost

How?

Autos: “The Industry ofAutos: “The Industry ofIndustries”Industries”

No such thing as a “bad car”

Much wider choice basket for consumer

Therefore customer interface (selling &servicing) plays an increasingly vital role

As does competitive pricing –which demands competitive cost

Page 7: Creating the Lean Car Dealer

Lean ProductionLean ProductionToyota has been using the ‘Toyota ProductionSystem’ to improve quality, service andreduce cost for decades– It’s competitors have tried to apply the tools &

techniques as well

It has been applied systematically throughthe supply base upstream and the Partssystem downstream of the assembly plant– Highest service level, fastest response, highest

productivity and lowest stock

Page 8: Creating the Lean Car Dealer

Lean DealerLean Dealer

Despite this success, Dealer Processes are still difficult tomanageOften run by “individuals” or anonymous “groups”Hampered by complex computer systems, staff skillsissues, staff turnover, etc. etc.– And Dealers have to deal with end customers & people from

head office!!

In an industry where lean production can’t be questioned& the customer interface (selling & servicing) plays anincreasingly vital role ………. this is not good!So, do the Lean Principles apply to all thedealer processes?

Page 9: Creating the Lean Car Dealer

Lean ThinkingLean ThinkingA RefresherA Refresher

Specify what creates value from thecustomers perspective

Identify all steps across the wholevalue streamMake those actions that create valueflowOnly make what is pulled by thecustomer just-in-time

Strive for perfection by continuallyremoving successive layers of waste

Page 10: Creating the Lean Car Dealer

Presentation FrameworkPresentation FrameworkAgendaAgenda

Introduction & Industry BackgroundValue & Waste applied to the dealerA Value Stream Map for servicing a carHow manufacturers and dealers canachieve the changeConclusion

Page 11: Creating the Lean Car Dealer

What Consumers WantWhat Consumers Want

How the industry sees it

New Service BodyUsed Parts

Page 12: Creating the Lean Car Dealer

What Consumers WantWhat Consumers Want

How they see it

Mobility

Acquisition Maintenance

Page 13: Creating the Lean Car Dealer

Value Value- in the Eyes of the Consumer- in the Eyes of the Consumer

Acquisition“The right car in theright place at theright time”At the right price

Maintenance“Fixed right firsttime on time”At the right price

Not Measured!Not Measured!

Quality &DeliveryQuality &Delivery

“CustomerFulfilment”

Page 14: Creating the Lean Car Dealer

Service

Howcustomersare treated

Information,Care,

Consideration

Convenience

Ease of theEvent

Distance,Time,

Remembering,etc.

Value:Value:ExtendingExtending thethe Concept Concept

Quality &Delivery

Acceptable

Price

Right FirstTime

On Time

Ref: J.S. Kiff, International Car Distribution Programme (ICDP)

Page 15: Creating the Lean Car Dealer

Value and Its Flipside:Value and Its Flipside:

Value - what customer wants to pay forWastes: The Flipside of Value:

WorkerMovement

Waste

Net Work

Value AddedWork

Non-Value Added Work

Not needed at allin doing the work

Waiting Transport Sorting Rework

No added valuebut must be done

Walking toanother location toreceive parts

Removingpackaging

Removing partsfrom a pallet

Ref: Taiichi Ohno (1988): Toyota Production System

Page 16: Creating the Lean Car Dealer

WastesWastes(Things that don’t add value from the customer’s perspective)(Things that don’t add value from the customer’s perspective)

Re-do cars or jobs…or paperworkSearch for tools,parts or equipmentClean cars twice +Move cars on siteWait for the next job

Re-input data on DMSHaven’t enough space– Parking workshop cars– Old equipment / tools

Buy in batches, then……write off stockPay customers to takethe ‘wrong’ car

How many of you…

How much does it cost???

Lean is simply abouteliminating waste…to release resource

Page 17: Creating the Lean Car Dealer

Presentation FrameworkPresentation FrameworkAgendaAgenda

Introduction & Industry BackgroundValue & Waste applied to the dealerA Value Stream Map for servicing a carHow manufacturers and dealers canachieve the changeConclusion

Page 18: Creating the Lean Car Dealer

Value Stream MappingValue Stream Mapping

Follow a product’s production path from beginning to endand draw a visual representation of every process in thematerial & information flowsThen draw (using icons) a “future state” map of how valueshould flow

Helps us see flow

VALUE STREAM: All the steps, VA & NVA, requiredto bring the product from raw material to customer

Page 19: Creating the Lean Car Dealer

ProcessBox

DataBox

Inventory“Push”

VSM from “Learning to See”VSM from “Learning to See”

Page 20: Creating the Lean Car Dealer

What are Your Value Streams?What are Your Value Streams?

Develop Manufacture Assemble

Distribution

Distribution

Manufacture

Sub Assemble

Suppliers CustomersDistributionR&D Manufacture Assembly

HRMarketing

Primary“What people pay for”

Secondary“Support the Primary

Value Streams”

Page 21: Creating the Lean Car Dealer

Using the Value Stream Mapping ToolUsing the Value Stream Mapping Tool

Product Family

Current State Drawing

Future State Drawing

Work Plan

Understanding how thevalue stream currentlyoperates

Designing a lean flow

Page 22: Creating the Lean Car Dealer

Focus on One Product FamilyFocus on One Product Family

Process Steps & Equipment

Prod

ucts

/Ser

vice

s

Determine product/service families via– Similar downstream steps & equipment

ValetTestCar

Book inCar

Cust.Meet’g

OrderParts

Work-shop

ServiceLetter

Cust.H-overInvoice

Service(car dropped off)

Repair(car dropped off)

Service(collect / deliver)

Repair(collect / deliver)

Service(loan car)

XXX X X XXXXX X X

XXX X XXXXX X

XXX X X XX

XXXX

XX

XXRepair

(loan car)

Breakdown(service provider del.)

XXX X X

XXX X

XX

X

We often think“every job is

different”

Page 23: Creating the Lean Car Dealer

Distribution of Time Taken per JobDistribution of Time Taken per Job

0

5

10

15

20

25

30

35

Jobs

Tim

e (H

ours

)

Planned Taken

Page 24: Creating the Lean Car Dealer

Cumulative Time Taken per JobCumulative Time Taken per Job

0

50

100

150

200

250

300

350

400

Jobs

Tim

e (H

ours

)

Cumulative Planned Time Cumulative Taken Time

Page 25: Creating the Lean Car Dealer

Cumulative FrequencyCumulative Frequency

0.00%

20.00%

40.00%

60.00%

80.00%

100.00%

120.00%

Hours

Occ

urre

nces

Cumlative %age (Planned) Cumlative %age (Actual)

Page 26: Creating the Lean Car Dealer

Current State DrawingCurrent State Drawing

Material & information flowsDraw using iconsStart with the “door to door”flowHave to walk the flow & getactuals– No standard times– Draw by hand, in pencil

Foundation for theFuture State

Product Family

Current State Drawing

Future State Drawing

Work Plan

Understanding how the processcurrently operates

Page 27: Creating the Lean Car Dealer

Cars

Mins15240

Cars

Mins32240

Cars

Mins32240

Cars

Mins34240

Cars

Mins95

A/W

A/W

Additional Work(A/W)

Inform Parts

AppointmentManufacturerParts Warehouse

Service Reception

3SA, 1 Books

Service Reminder

Park Car Inspect Car Carry outWork

Road Test Valet Handover

Parts Workshop Control

15 Mins 50 Mins 15 Mins 10 Mins

34240

Mins 32240

Mins 32240

Mins 15240

Mins95 Mins

Customer RequirementsCars 1-7 years old

1,2,3,4 Class, 1500 hourssold/month.

Lead Time = 7 Days50% Service, 20%

Service & Repair, 20%Warranty, (20% of alljobs have MOT), 10%

BreakdownsTime up Job

A/W

CycleTime

Mins5 Cycle

TimeMins15

sss

CycleTime

Mins50 Cycle

TimeMins15 Cycle

TimeMins20

Distance m30 Distance m30Distance m30 Distance m120 Distance m30

ReserveC/T

Mins5

A/W Inf C/T Mins1

20 Mins

CycleTime

Mins10

A/W C/T Mins5

Give Job C/T Mins5

Drop off C/T Mins10

Booking C/T Mins5

Cost & InformC/T Mins9

A/W Job C/T Mins3 CycleTime

Mins10

InvoiceCycleTime

Mins5

5 Mins

5 Mins

1 Day1 Day

Page 28: Creating the Lean Car Dealer

BOOKIN

CUST.

DROPOFF CAR

PARTS RESERVED

INSPECT+ A/W

INFORM

TECH

CUSTOMER

PARKCAR

CHECKSTOCK

GO AHEAD

DO JOB

GIVE TOTEST

GIVE TOVALET

TIMEUP

INVOICE HAND OVER

Current StateCurrent StateCustomer RequirementsCars 1-7 years old 1,2,3,4 Class, 1500 hours sold/month.

Lead Time = 3 Days50% Service, 20% Service & Repair, 20% Warranty, (20% of all jobs have

MOT), 10% Breakdowns

CT=5 minDist.= 0Q = N/A

1 A/W510

ADMIN.

3 A/W510

SERVICEADVISOR

1 A/W510

ON SITEDRIVER

1 A/W510

WORKSHOPCONTROL

10 A/W510

TECHS.

1 A/W510

TESTER

2 A/W510

VALET

2 A/W510

PARTS

CT=10 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=3 min CT=2 min

CT=2 min

CT=2 min

CT=5 min

CT=5 minDist.=0mQ = N/A

CT=15 minDist.=30mQ = N/A

CT=2 min CT=2 min CT=10 min

CT=10 minDel.=N/AQ = N/A

CT=5 min

CT=1 minDist.=120mQ = N/A

90 min

5 min

2 min

3 min

1 min

1 min

30 min

30 min

VALET

INFORMTIME JOB

COST &INFORM

TESTCT=60 minDist.=120mQ = N/A

CT=15 minQ = N/A

CT=20 minDist.=30mQ = N/A

GIVE TOTECH

CT=15 min

GETPARTS

Page 29: Creating the Lean Car Dealer

BOOKIN

CUST.

DROPOFF CAR

PARTS RESERVED

INSPECT+ A/W

INFORM

TECH

CUSTOMER

PARKCAR

CHECKSTOCK

GO AHEAD

DO JOB

GIVE TOTEST

GIVE TOVALET

TIMEUP

INVOICE HAND OVER

Current StateCurrent StateCustomer RequirementsCars 1-7 years old 1,2,3,4 Class, 1500 hours sold/month.

Lead Time = 3 Days50% Service, 20% Service & Repair, 20% Warranty, (20% of all jobs have

MOT), 10% Breakdowns

CT=5 minDist.= 0Q = N/A

1 A/W510

ADMIN.

3 A/W510

SERVICEADVISOR

1 A/W510

ON SITEDRIVER

1 A/W510

WORKSHOPCONTROL

10 A/W510

TECHS.

1 A/W510

TESTER

2 A/W510

VALET

2 A/W510

PARTS

CT=10 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=3 min CT=2 min

CT=2 min

CT=2 min

CT=5 min

CT=5 minDist.=0mQ = N/A

CT=15 minDist.=30mQ = N/A

CT=2 min CT=2 min CT=10 min

CT=10 minDel.=N/AQ = N/A

CT=5 min

CT=1 minDist.=120mQ = N/A

90 min

5 min

2 min

3 min

1 min

1 min

30 min

30 min

VALET

INFORMTIME JOB

COST &INFORM

TESTCT=60 minDist.=120mQ = N/A

CT=15 minQ = N/A

CT=20 minDist.=30mQ = N/A

GIVE TOTECH

CT=15 min

5 min 15 min10 min

15 + 3 + 5 + 5 + 2 + 2 + 115 min 50 min 15 min 20 min 10 min

15 min7 min7 min

VA NVA

0 5

20 12

0 5

0 34

65 16

15 2

20 2

0 1112087

GETPARTS

Page 30: Creating the Lean Car Dealer

BOOKIN

CUST.

DROPOFF CAR

PARTS RESERVED

INSPECT+ A/W

INFORM

TECH

CUSTOMER

PARKCAR

CHECKSTOCK

GO AHEAD

DO JOB

GIVE TOTEST

GIVE TOVALET

TIMEUP

INVOICE HAND OVER

Current StateCurrent StateCustomer RequirementsCars 1-7 years old 1,2,3,4 Class, 1500 hours sold/month.

Lead Time = 3 Days50% Service, 20% Service & Repair, 20% Warranty, (20% of all jobs have

MOT), 10% Breakdowns

CT=5 minDist.= 0Q = N/A

1 A/W510

ADMIN.

3 A/W510

SERVICEADVISOR

1 A/W510

ON SITEDRIVER

1 A/W510

WORKSHOPCONTROL

10 A/W510

TECHS.

1 A/W510

TESTER

2 A/W510

VALET

2 A/W510

PARTS

CT=10 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=3 min CT=2 min

CT=2 min

CT=2 min

CT=5 min

CT=5 minDist.=0mQ = N/A

CT=15 minDist.=30mQ = N/A

CT=2 min CT=2 min CT=10 min

CT=10 minDel.=N/AQ = N/A

CT=5 min

CT=1 minDist.=120mQ = N/A

90 min

5 min

2 min

3 min

1 min

1 min

30 min

30 min

VALET

INFORMTIME JOB

COST &INFORM

TESTCT=60 minDist.=120mQ = N/A

CT=15 minQ = N/A

CT=20 minDist.=30mQ = N/A

GIVE TOTECH

CT=15 min

5 min 15 min10 min

15 + 3 + 5 + 5 + 2 + 2 + 115 min 50 min 15 min 20 min 10 min

15 min7 min7 min

VA NVA

0 5

20 12

0 5

0 34

65 16

15 2

20 2

0 1112087

GETPARTS

NVA 82 min

VA 120 min

Page 31: Creating the Lean Car Dealer

BOOKIN

CUST.

DROPOFF CAR

PARTS RESERVED

INSPECT+ A/W

INFORM

TECH

CUSTOMER

PARKCAR

CHECKSTOCK

GO AHEAD

DO JOB

GIVE TOTEST

GIVE TOVALET

TIMEUP

INVOICE HAND OVER

Current StateCurrent StateCustomer RequirementsCars 1-7 years old 1,2,3,4 Class, 1500 hours sold/month.

Lead Time = 3 Days50% Service, 20% Service & Repair, 20% Warranty, (20% of all jobs have

MOT), 10% Breakdowns

CT=5 minDist.= 0Q = N/A

1 A/W510

ADMIN.

3 A/W510

SERVICEADVISOR

1 A/W510

ON SITEDRIVER

1 A/W510

WORKSHOPCONTROL

10 A/W510

TECHS.

1 A/W510

TESTER

2 A/W510

VALET

2 A/W510

PARTS

CT=10 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=5 minDist.=30mQ = N/A

CT=3 min CT=2 min

CT=2 min

CT=2 min

CT=5 min

CT=5 minDist.=0mQ = N/A

CT=15 minDist.=30mQ = N/A

CT=2 min CT=2 min CT=10 min

CT=10 minDel.=N/AQ = N/A

CT=5 min

CT=1 minDist.=120mQ = N/A

90 min

5 min

2 min

3 min

1 min

1 min

30 min

30 min

VALET

INFORMTIME JOB

COST &INFORM

TESTCT=60 minDist.=120mQ = N/A

CT=15 minQ = N/A

CT=20 minDist.=30mQ = N/A

GIVE TOTECH

CT=15 min

5 min 15 min10 min

15 + 3 + 5 + 5 + 2 + 2 + 115 min 50 min 15 min 20 min 10 min

15 min7 min7 min

VA NVA

0 5

20 12

0 5

0 34

65 16

15 2

20 2

0 1112087

GETPARTS

NVA 82 min

VA 120 min

IncorrectDiagnosis

Parts notAvailable

Difficultto Park

Car Hardto Find

Parts Waiting

Delay for

Authorisation

Delay for

Authorisation

Wait for

Next PersonWait for

Next Person

Wait forParts Search for

Tools

Wait forTester

Wait forValet

No ParkingSpaces

IncorrectBilling

AvailableLoan Cars?

Page 32: Creating the Lean Car Dealer

Future State QuestionsFuture State QuestionsWhat is the Takt Time?Where can we use continuous flowWhere do we have to use supermarket pull systems?At what single point in the production chain do wetrigger production?How do we level the production mix at thepacemaker process?What increment of work will we release and takeaway at the pacemaker process? (levelling thevolume)

Supporting ImprovementsWhat process improvements will be necessary?(e.g. uptime, changeover & training)

Page 33: Creating the Lean Car Dealer

TAKT TimeTAKT Time

AvailableWork Time 480 min

Demand 30 cars

34% ofDemand 10 cars

StandardTime Slot 30 min

60 90 120 240No. of JobsBooked in 4 3 2 2

TimeRequired

1stYear

2ndYear

3rdYear

4thYear Totals

Total TimeBooked in 240 270 240 480 1230

No. ofWork Cycles 8 9 8 16 41

TAKT Time 60.0 53.3 60.0 30.0 11.7

Manpower 0.5 0.6 0.5 1.0 2.6

Page 34: Creating the Lean Car Dealer

After Sales Future State Value Stream

TECHNICIAN

Physical FlowInformation Flow

TIME123

KEYS

TECH

CUSTOMER

SERVICEADVISOR

P/DTECHN.

PLANNING

TECHS.

VALET

PARTS

CT=60 minDist.=60mQ = 99%

Page 35: Creating the Lean Car Dealer

After Sales Future State Value Stream

TECHNICIAN

Physical FlowInformation Flow

TIME123

KEYS

TECH

CUSTOMER

SERVICEADVISOR

P/DTECHN.

PLANNING

TECHS.

VALET

PARTS

CT=60 minDist.=60mQ = 99%

PARTS

PARTS

Page 36: Creating the Lean Car Dealer

After Sales Future State Value Stream

TECHNICIAN

Physical FlowInformation Flow

TIME123

KEYS

TECH

CUSTOMER

SERVICEADVISOR

P/DTECHN.

PLANNING

TECHS.

VALET

PARTS

CT=60 minDist.=60mQ = 99%

PARTS

PARTS

CUSTOMER

PDTBOOKING

CT=5 minDist.= 0Q = 100%

PRE-DIAGNOSIS

CT=30 minDist.= 0Q = 100%

Page 37: Creating the Lean Car Dealer

After Sales Future State Value Stream

TECHNICIAN

Physical FlowInformation Flow

TIME123

KEYS

TECH

CUSTOMER

SERVICEADVISOR

P/DTECHN.

PLANNING

TECHS.

VALET

PARTS

CT=60 minDist.=60mQ = 99%

PARTS

PARTS

CUSTOMER

PDTBOOKING

CT=5 minDist.= 0Q = 100%

PRE-DIAGNOSIS

CT=30 minDist.= 0Q = 100%

VALET

VALET

CT=20 minDist.=60mQ = 100%

Page 38: Creating the Lean Car Dealer

After Sales Future State Value Stream

TECHNICIAN

Physical FlowInformation Flow

TIME123

KEYS

TECH

CUSTOMER

SERVICEADVISOR

P/DTECHN.

PLANNING

TECHS.

VALET

PARTS

CT=60 minDist.=60mQ = 99%

PARTS

PARTS

CUSTOMER

PDTBOOKING

CT=5 minDist.= 0Q = 100%

PRE-DIAGNOSIS

CT=30 minDist.= 0Q = 100%

VALET

VALET

CT=20 minDist.=60mQ = 100%

HANDOVER

CT=10 min

Del.=N/A

Q = N/A

INVOICE

CT=5 min

Page 39: Creating the Lean Car Dealer

After Sales Future State Value Stream

TECHNICIAN

Physical FlowInformation Flow

TIME123

KEYS

TECH

CUSTOMER

SERVICEADVISOR

P/DTECHN.

PLANNING

TECHS.

VALET

PARTS

CT=60 minDist.=60mQ = 99%

PARTS

PARTS

CUSTOMER

PDTBOOKING

CT=5 minDist.= 0Q = 100%

PRE-DIAGNOSIS

CT=30 minDist.= 0Q = 100%

VALET

VALET

CT=20 minDist.=60mQ = 100%

HANDOVER

CT=10 min

Del.=N/A

Q = N/A

INVOICE

CT=5 min

NVA 145 min

VA 120 min

VA NVA

10 10

30 0

0 0

60 0

20 0

120105 min 60 min

30 min 60 min 20 min 10 min20 min60 min5 min 60 min

30 min 60 min 20 min 10 min20 min60 min

Page 40: Creating the Lean Car Dealer

Additional Work(A/W)

Arrival

AppointmentSlots

Inform Parts

AppointmentManufacturerParts Warehouse

Service Reception

3SA, 1 Books

PreDiagnose

Carry outWork

+ Road Test

Valet Handover

Parts

30 Mins 60 Mins 10 Mins

60 Mins 20 Mins95 Mins

Customer RequirementsCars 1-7 years old

1,2,3,4 Class, 1500 hourssold/month.

Lead Time = 7 Days50% Service, 20%

Service & Repair, 20%Warranty, (20% of alljobs have MOT), 10%

Breakdowns

CycleTime

Mins15Cycle

TimeMins15Cycle

TimeMins15Cycle

TimeMins30 Cycle

TimeMin

s60 CycleTime

Mins20

Distance m30Distance m30 Distance m120 Distance m30

ReserveC/T

Mins5

Drop off C/T Mins10

CycleTime

Mins10

Booking C/T Mins5

A/W C/T Mins5

CycleTime

Mins15

5 Mins

5 Mins

1 Day1 Day 5 Days

Service Reminder

FIFO x3

OXOX

0-4

8+

4-8 FIFO

Time up &Invoice

60 Mins

20 Mins

Page 41: Creating the Lean Car Dealer

Presentation FrameworkPresentation FrameworkAgendaAgenda

Introduction & Industry BackgroundValue & Waste applied to the dealerA Value Stream Map for servicing a carHow manufacturers and dealers canachieve the changeConclusion

Page 42: Creating the Lean Car Dealer

Work Plan & ImplementationWork Plan & Implementation

Step by step - when, what, who

Clear review points– Real deadlines

– Named reviewers (clear responsibility)

– Reviewable deliverables

Able to see if we are behind or ahead

Contract - a commitment toaccomplish something by a specifictime

Product Family

Current State Drawing

Future State Drawing

Work Plan

Detailed plan of how to get there

Page 43: Creating the Lean Car Dealer

TECHNICIAN

Physical FlowInformation Flow

TIME123

KEYS

TECH

CUSTOMER

SERVICEADVISOR

P/DTECHN.

PLANNING

TECHS.

VALET

PARTS

CT=60 minDist.=60mQ = 99%

PARTS

PARTS

CUSTOMER

PDTBOOKING

CT=5 minDist.= 0Q = 100%

PRE-DIAGNOSIS

CT=30 minDist.= 0Q = 100%

VALET

VALET

CT=20 minDist.=60mQ = 100%

HANDOVER

CT=10 min

Del.=N/A

Q = N/A

INVOICE

CT=5 min

NVA 145 min

VA 120 min

VA NVA

10 10

30 0

0 0

60 0

20 0

120105 min 60 min

30 min 60 min 20 min 10 min20 min60 min5 min 60 min

30 min 60 min 20 min 10 min20 min60 min

Value Stream LoopsValue Stream Loops

Technician Loop

Parts Loop

Invoice & Handover Loop

Booking & Pre-Diagnosis Loop

Valet Loop

Page 44: Creating the Lean Car Dealer

1.2

1.3

1.4

1.5

1.6

1.1

2.2

2.3

2.4

2.1

3.1

3.2

4.1

4.2

5.1

5.2

5.2

Site Level Objective

Value Stream Manager

Site Manager

Date:

Harry BamfordDave Johnson

20/12/02Yearly Value Stream Plan: After Sales

Signatures

Site ManagerD. Johnson

SalesT. Plant

After SalesH. Bamford

PartsA. Harvey

PersonResponsible

RelatedIndividuals/Departments Reviewer DJ

DateReviewer DJ

Date

Review ScheduleMonthly Schedule

2 3 4 51 6 7 8 9 10 11 12Value

StreamLoop

No Value Stream Objective Goal (Measurable)

Proposed Start

Proposed Completion

Actual Start

Actual Completion

Review

Review Complete

On Target

Behind Target

TroubleX

“right first time, on time, at the right

price.”Quality = 99%

Delivery on Time = 91%

Productivity = 100%Lead Time = 3 days

1Technician

31.3 ○ 31.5 31.3 ○ 31.5 28.2 ∆ 31.5 30.4 ○ 31.5 30.4 ∆ 31.7 30.4 ○ 31.5 31.3 ○ 30.4 ○

31.3 ∆ 31.5

28.2 ○ 31.5

30.4 ∆ 31.5

30.4 ○ 31.5

31.5 30.6

31.7 30.9

31.7 30.9

31.10 31.11

31.10 31.11

31.11

2 Booking

&Pre-Dia-

gnosis

3Parts

4Valet

5Invoice &Handover

H. Bamford Adm PartsSA Tch Wco

TAKT = 39 Mins2 Technicians

Develop pull systemfrom car park

1 car WIP

Eliminate searchingfor tools

100%Productivity

Eliminate waiting forworkshop control

100%Productivity

Eliminate waiting forauthority

Reduce additionalwork sheets by50%

Develop pull for parts 100%Productivity

Develop flow in aftersales to TAKT & 30minute slots

Pre diagnose to astandard cycle time withthe customer

Pre-diagnose oncollection & delivery cars

Develop planningboard

Develop a proactivebooking process

Pre-pick parts foreach job to TAKT

Deliver parts totechnician

Valet to a standardcycle time

Develop handover parkingarea for finished cars

Eliminate billingerrors

Allocate handoverslots

Minimise debtors list

100% of jobs

50% of cars30 Mins C/T

100%Productivity

100% of jobs

TAKT = 39 Mins1 parts person

99% partsavailability

100% of cars20 Mins C/T

100% of cars

100% accurate

C/T = 15 Mins100% of customers

C/T = 15 Mins100% of customers

T. Kent Sales, PartsSA, Val

H. Whittle Tch Wco

S. Wilson Tch, Wco

S. Wilson Wco, Tch,SA, Parts

A. Harvey Parts, Tch,Wco

T. Kent SA, Adm

S. Wilson Tch, Wco

H. Whittle Tch, Wco, SA

S. Wilson Tch, Wco

A. Harvey Parts

A. Harvey Parts, Wco,Tch

B. Cox Val, Wco

T. Kent Sales, PartsSA, Val

T. Kent Wco, Tch,SA, Parts, Fi

T. Kent SA

H. Bamford SA, Fi

Page 45: Creating the Lean Car Dealer

Implementation via Point Implementation via Point KaizenKaizen

Process

PointKaizen

Eraser

Future State Map

Page 46: Creating the Lean Car Dealer

But How do we Really ImplementBut How do we Really Implement& Sustain a Change?& Sustain a Change?

Develop a ‘cadre’ of dealers from a network– Six dealers per club– Drive improvement through competition within the

groupTeach these pioneers to see their business asa series of processes– Measure how well these processes deliver what

customers want– Look at the costs and time spent fixing processes

that don’t workAnd recognise that the answer is to redesigneach process – not push people harder!

Page 47: Creating the Lean Car Dealer

Progress MeasureProgress Measure

Time will tell…Progress will be evident from…– Dealers’ attitudes and efforts, and– Level of change achieved

…whether they’ll become self-sustainingi.e. motivated to continuously improve:– Processes– Knowledge of Lean tools & techniques

Once there are some examples it will beeasier for others to follow

Page 48: Creating the Lean Car Dealer

Presentation FrameworkPresentation FrameworkAgendaAgenda

Introduction & Industry BackgroundValue & Waste applied to the dealerA Value Stream Map for servicing a carHow manufacturers and dealers canachieve the changeConclusion

Page 49: Creating the Lean Car Dealer

Creating the Lean Car DealerCreating the Lean Car DealerA Value Stream Mapping WorkshopA Value Stream Mapping Workshop

PurposeTo introduce how lean can be applied in aservice organisation– Through applying 5 Lean Principles

To share a road map for implementation

Page 50: Creating the Lean Car Dealer

ConclusionConclusion

Always start with the principles– Teach your own people how to add value &

eliminate wasteDesign the system so that value flows & sothat problems can be flushed out– People need to be able to solve rather than be

blamed for problemsToday nobody has to do this…….unless oneof your competitors starts…….then theagenda will change from “if” to “how” asit did in manufacturing over 10 years ago

Page 51: Creating the Lean Car Dealer

ICDP Forum 1999

Creating the Lean Car DealerCreating the Lean Car Dealer

David Brunt

Page 52: Creating the Lean Car Dealer

BiographyBiographyDavid’s journey down the lean path started in the automotive industry at Rolls-Royce Motor Carswhere he held a number of roles in the fields of Purchasing, Supplier Development, Quality andCustomer Service. In 1993, his interest in Lean Thinking led to studying for the part-time MBA inSupply Chain Management at Cardiff Business School under the guidance of Professor Daniel T.Jones.He joined the Lean Enterprise Research Centre at Cardiff Business School as a Senior ResearchAssociate in February 1997 to further research, develop and implement lean principles. There hewas involved in a number of research projects:

The Lean Processing Programme (LEAP), a three-year initiative focused on mapping steel to component value streams toidentify significant gains in competitive advantage for the UK upstream automotive industry.Projects with individual firms to research and apply Lean Thinking outside the automotive industry in areas such as FMCGand non-automotive based manufacturing.The International Car Distribution Programme (ICDP), the world’ leading co-operative research programme into the futureof car distribution and retailing. Research focussed on the application of Lean Thinking to car distribution and cardealerships.In addition, David has written a number of reports and publications including “Supply Chain Management And The BritishMetals Industry” for The Metals Industry Competitive Enterprise (MICE) and the book “Manufacturing Operations andSupply Chain Management – The Lean Approach” with David Taylor.

In 2001 he took up the part-time role of PVP (Porsche Improvement Process) Manager atPorsche Cars Great Britain. At Porsche, David has carried out work to develop lean in after sales,used car processing and the parts operation as well as conducting a number of other businessprocess improvement projects.David has helped Dan Jones set up the Lean Enterprise Academy (LEA) – a non-profit Academyestablished to develop knowledge of Lean Thinking and its implementation and to disseminatethis knowledge through publications and workshops. He currently divides his time between workfor LEA, ongoing research with ICDP and helping firms make a lean transformation.David can be contacted at:The Lean Enterprise Academy, 17, Church Street, Ross-on-Wye, Herefordshire. HR9 5HN+44 1989 764440, +44 7703 538083 (M), or by e mailing [email protected] www.leanuk.org