green belt lean training

Green Belt Training

Welcome!

Joel Perez

OE Objectives

You will …

– Understand how to use the Lean Tools and Methodologies

– Be able to recognize the Waste in processes

– Learn Lean concepts (Standardized Work, Just in Time, Theory of Constraints, TPM, etc)

– Know how to apply the Lean Tools and Methodologies in DMAIC framework

– Recognize Lean opportunities in office processes

– Learn how to create a Value Stream Map

– Gain practical understanding of Lean tools through a simulation exercise

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OE Agenda

• OE Lean Introduction 7

• Define 41

• Measure 58

• Analyze 127

• Improve 177

• Control 266

• OE Lean Summary 291

• Improvement Ideas 300

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Joel Perez

Introduction

Operations Excellence

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The OE Approach is …

A disciplined methodology for managing the business to

improve customer satisfaction and bottom line results by…

Focusing everyone on a few customer and financial

indicators…

Measuring process performance from the customer’s

perspective…

Applying rigorous analytical tools to improve processes and

move key customer and financial indicators . . .

… and managing by it!

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The OE Approach is Based on Fundamentals

Improvement activities aligned with business objectives

Focus on waste, defect and variation reduction

Defects defined by customer requirements

Use of disciplined methodologies

Data-based decision making

Building capability within the organization

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With Structured Components To Ensure Results Are Delivered

Vital few Top-Level

business metrics

focused on financial

performance and

customer needs

Eliminate defects,

variation, and

waste

Develop new

processes to meet

customer needs

Improved Planning and Execution . . . Emphasizing Critical Thinking & Disciplined Use of Data

Build accountability

into everyday

processes and

identify

performance gaps

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Why Lean and Six Sigma Are Combined Within OE Approach

• Our processes must be:

– Nimble and more responsive to customers

– Virtually defect free

– Effective and efficient

Lean means no waste, streamlined, process

simplicity

Six Sigma means less variability and fewer defects

Only the combination of Lean and Six Sigma can

fulfill all three goals – Quality, Speed, and Cost

OE approach maximizes the benefits of these techniques

Joel Perez

Implementing Lean Techniques Drives Efficiencies

• Lean companies use less amounts of

everything, compared to companies that use

traditional thinking :

– half the human effort

– half the space

– half the investment in tools

– half the engineering hours to develop a new

product in half the time

– less than half the inventory

From Womack, Jones, et.al.,

“The Machine That Changed the World.” Joel Perez

The Underlying Premise of Lean

Waste Customer

Order

Product

Delivery

Traditional

Time in Value Stream, “Lead Time”

Waste Customer

Order

Lean

Product

Delivery

Time in Value Stream, “Lead Time”

“Time to Cash”

Speed

Cost

A relentless focus on reducing cycle time to reduce

costs . . . by driving out WASTE Joel Perez

The Lean Thinking

• Operational philosophy or a business

system

• Alignment of actions that create value, in

the best sequence; elimination of waste

• Getting continuously closer to offering the

customers what they want, at the right time

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The Lean Principles

• Lean journey can be summarized by five principles/steps*: – Principle 1 - Precisely specify the value of a

particular process

– Principle 2 - Identify the value stream for the process

– Principle 3 - Allow value to flow without interruptions

– Principle 4 - Let the customer pull value from the process

– Principle 5 - Continuously pursue perfection

(*)From Womack: “Lean Thinking”

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Keys to Lean

–Integrated single piece production (i.e.. a continuous work flow ) with minimum inventories at each stage of production

–Production is synchronized to fit the schedule, without being based on the machine usage

–Defect prevention

–Team-based work organizations with multi-skilled operators

–The metrics are used to solve problems

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Keys to Lean

– Operators empowered to make decisions and improve operations with few indirect workers

– Workers actively involved in trouble shooting and problem solving to improve quality and eliminate waste

– Close integration of the whole value stream from raw material to finished product, through partnership oriented relations with suppliers and distributors

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Value and Waste - Definition

• WASTE:

• Activities that consume time, resources and space, but do not contribute to satisfy customers needs.

VALUE:

An activity that transforms or shapes

raw material or information to meet

customer needs.

Customers will pay for value … they will not pay

for waste Joel Perez

Value and Waste - Examples

Examples:

• Labeling

• Filling Bottle

Examples:

• Walking to get parts

• Waiting time

• Accumulating papers

Activities

Value

Added

Waste

100%

Operation

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Value added

Non

Value

Added,

but

necessary

Waste

Operation

60%

38%

2% • Report Produced

• Presentation Delivered

• Translating scope of project to completed materials

• Staff meetings

• Researching

• Refilling paper of printer

• Walking to get paper of printer

• Looking for files

• Waiting for data

Examples

Value and Waste - Examples

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Recognizing Waste

MOTION

OVER PRODUCTION

The Seven Major Wastes

OVER PROCESSING

WAITING

Move it over

there until we

need it.

CONVEYANCE

CORRECTION

INVENTORY Joel Perez

Recognizing Waste

Not Using the Skills and Knowledge of the Work Force

The Seven Major Wastes Plus 1 = 8 Wastes

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8 Types of Waste – Motion

• Actions of people or equipment that do not add

value to the product

Examples:

• Turning around to pick

up a part

• Sorting through a box of

parts to find the right one

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8 Types of Waste – Motion

• Poor work area configuration and organization

– Sales personnel walking to a fax machine located at the far end of the room in order to send quotes … missing an important customer call

• Visual Management not implemented, i.e. signs

– Office cubicles/conference rooms difficult to locate … being late to meetings

• Standardized Work not implemented

– A new employee “spinning the wheel” trying to create a monthly report … reports not published on time for customers

• Not storing items where they belong

– Administrative assistant looking for a file the boss wants right away for an important meeting … delayed meeting starts or unproductive meetings

Office Examples

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8 Types of Waste – Over Production

• Parts and products that are produced in excess

or earlier than required

Examples:

• Producing parts on

Monday that are not

shipped to the customer

until Friday

• Producing parts because

machines and people are

available Joel Perez

8 Types of Waste – Over Production

• Printing several hard copies of reports before it is finalized

• Getting to meetings too early before start

• Not making double-sided copies of a long report

• A manager assigning same task to several people

• Preparing and carrying “extra” information to a review meeting

• Salesman spending too much time on paper work instead of customer calls

Office Examples

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Examples:

• Painting the structure of

an automobile seat,

which will be covered

with leather and the

customer will never see

• Inspection, washing, etc..

8 Types of Waste – Over Processing

• Processing steps or unnecessary work

elements/ procedures (non-value-added)

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8 Types of Waste – Over Processing

• Standards unknown / unclear to employees

• Customer specifications are vague or fluctuate

• Functional departments have misaligned goals and poor communication

• Selecting “Reply to All” on emails

• CC’ing more people than really necessary

• Micro-managing

Office Examples

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8 Types of Waste – Waiting

• Time delays, idle time

Examples:

• Waiting for raw material

to be delivered

• Waiting for a machine to

complete its cycle

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8 Types of Waste – Waiting

• Waiting for a meeting to start

• Employee waiting for work directions from supervisor

• Waiting on hold for a telephone call

• Waiting for a copier or computer that is broken

• Waiting for manager’s signature approval before releasing a invoice payment

Office Examples

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8 Types of Waste – Conveyance

• Too much handling, delay on material handling,

unnecessary handling

Examples:

• Moving parts to and from

storage areas

• Transporting parts from

the machining area to the

final assembly area

Move it over there

until we need it.

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8 Types of Waste – Conveyance

• Handling excess paperwork

• Relocating office work materials

• Excessive approval authorities

• Assignment given to the wrong person

• Walking back and forth between

buildings to go to meetings, obtain

signatures, etc.

Office Examples

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8 Types of Waste – Correction

• Producing a product that is scrapped or requires

rework

Examples:

• Scrapping products that

failed final inspection

• Repairing a surface that

was scratched during

process

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8 Types of Waste – Correction

• Poor quality or slow feedback

• Excessive revisions to procedures that

do not add value

• Change document layouts that vary

among organizations

• Personal preference versus functional

requirement

Office Examples

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8 Types of Waste – Inventory

• Keeping or buying unnecessary raw materials,

work in process, finished goods

Examples:

• 10 days of raw material

supply

• A pallet containing 1000

bottles waiting to be

filled

Joel Perez


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Finished Product

to Customer

Tra

ns

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Raw Material Sea of inventory

Material

Manpower

Product

Service

Excessive inventory hides problems/defects

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Reducing inventory makes problems/defects clearly visible

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to Customer

Tra

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Raw Material

Material

Manpower

Product

Service

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• Mass mindset, batch and queue

• Concept of “the more, the better”

• Poor awareness and execution of Record Retention Policy

• Lack of discipline

• Stocking excessive amount of office supplies in the cabinet

Office Examples

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Waste From Not Using the Skills and Knowledge Of the Workforce

• Not listening to people’s suggestions and ideas

for improvement

Examples:

• Buying new computers

without asking for the

opinion of office workers

etc.

• Making changes on the

shop floor without getting

the operators’ input Joel Perez

Lean Benefits

– Efficiency: Eliminating waste of time and

movement makes every process more efficient

– Cost: A more efficient system costs less to

operate and enables the company to realize

greater profit

– Delivery: Right product, right amount, shipped

on time and delivered to customer when needed

– Safety: Eliminating waste makes the work site

safer with less opportunity for injury

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Continuous flow

Batch size

Element

Production

Layout

Processing

Maintenance

Based on forecast

Based on function /

department

Large

Batch & queue

Reactive

Based on orders

Based on product flow

Small

Predictive

Traditional Thinking Lean Thinking

Inventory Stock and buffer Just-in-time

In Summary … What’s Different in Lean Thinking

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DEFINE

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DEFINE Current Situation

• Goal

– Define the project’s

purpose, scope and

major milestones –

bound the problem

• Key Outputs

– A high level map of

the process

– A preliminary problem

statement

– A project plan

2

3

4

5

MEASURE

ANALYZE

IMPROVE

CONTROL

1

DEFINE

Joel Perez

DEFINE: Story Components

Identify Business

Opportunity/Gap ($)

Identify Customer’s

Critical To Quality

(CTQ) Attributes

Map High Level Processes

and Set Boundaries

• Select measures that link process performance to problem area related to CTQ

• Shows need for improvement

Develop

Preliminary Problem Statement

Select Resources (% Time) and

Charter Project

Prepare Communication & Project Plans

Who What When

A A B B C C D D E E Core

1 D

A D

B D

C D

D D

E

A A B B C C D D E E

L D A D

B D

C D

D D

E D A D

B D

C D

D D

E

Good

A A A A

D A

D A

Identify Outcome Indicators

Run Chart

To define the customer, their CTQs, the team charter, and map the core business process

Stakeholder Analysis

Assess Financial $ Impact (COQ)

Project Planning Worksheet

Joel Perez

Customer CTQs

Outcome Indicators

Identify Business Opportunity/Gap ($)

Identify Customer’s CTQ Attributes



Develop Preliminary Problem

Statement


Prepare Communication & Project

Plans

Tools, Indicators and

Methodologies Storyboard

DEFINE: Lean Tools, Indicators and Methodologies

DEFINE: Identify Business Opportunity/Gap

• Defects

• Variability

• Inconsistency

• New Product/Service

• Missed Due Dates

• Rework

• Scrap

• Slow

• Exception handling

• Unplanned downtime

• Bottlenecks

• Redundancies

• Capacity Constraints

• Inventory Write-offs

• Complexity

• Backlogs

• gaps

What problems do you face? Joel Perez

DEFINE: Customer CTQs – Critical to Quality Characteristic (CTQ) - A

description of a product or service attribute that influences a customer’s decision to purchase the product or service

– CTQs exist at various process levels and should be defined so that indicators can be created to measure them

Joel Perez

DEFINE: Determining CTQs

• Who are your customers?

– External (end users/consumer)

– Internal (next process step or operation)

• What is the “Voice of the Customer”?

– VOC is used to describe customers’ needs and

their perceptions of your product or service

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Product CTQs

– Performance

– Features

– Conformance

– Timeliness

– Reliability

– Serviceability

– Durability

– Aesthetics

– Reputation

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Service CTQs

– Reliability

– Responsiveness

– Competence

– Access

– Courtesy

– Communication

– Credibility

– Security

– Understanding

– Tangibles

Joel Perez

Exercise: What CTQs Can Describe Excessive Waste or Slow Speed?

– ______________________

– ______________________

– ______________________

– ______________________

– ______________________

– ______________________

– ______________________

– ______________________

– ______________________

– ______________________

Joel Perez

DEFINE: Outcome Indicators

• From the Business Opportunity/Gap it is possible to obtain Outcome Indicators

• Examples:

–Process speed

–Rework

–Scrap

– Inventory level

–Time delays

–Downtime

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1015202530354045

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• Good preliminary problem statements contain:

– A brief, clear and objective description of the problem revealed by the outcome indicator

– Specific information on the problem - Who? - Which

- What? - How?

- When? - How many?

- Where?

– Should not include solutions or assumptions about causes

Joel Perez


• Problem statement criteria:

–What is Wrong

–Measurable

–Specific

–Objective

–What Is and What Should Be

–How Customers Are Affected

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Is This Problem Clear?

• Preliminary problem statement:

• During the last four months, finished goods

were not shipped to the customers on time.

This generated unnecessary transporting of

finished goods between different

warehouses, besides causing customer

dissatisfaction.

Joel Perez

What do you think now?


• During the last four months, 72% of finished goods produced in the first week of the month were not shipped to the customer until the last week of the month. This generated unnecessary transporting of 750 pallets of finished goods 3 times between the main warehouse to satellites, besides causing customer dissatisfaction.

Joel Perez

The Problems You Face Drives the Choice of Tools to Use


• During the last four months, 72% of finished goods produced in the first week of the

month were not shipped to the customer until the last week of the month. This

generated unnecessary transporting of 750 pallets of finished goods 3 times between

the main warehouse to satellites, besides causing customer dissatisfaction.

Causes

%

Causes

%

Eliminating Defects

(Use Six Sigma Tools) Eliminating Waste/NVA

(Use Lean Tools)

Do we know

the cause of

the problem

yet?

Joel Perez

Exercise: Preliminary Problem Statement

• Instructions: In your project, a key checkpoint is to develop the preliminary problem statement before you review your work in DEFINE with your Leadership Team/Sponsor.

• Write a draft preliminary problem statement for your project and use the problem statement criteria to evaluate its’ effectiveness.

• Time: 10 minutes

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MEASURE

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MEASURE Current Situation

• Goal

– Measure the current process performance and narrow the problem area

• Key Outputs

– Data that pinpoints problem location or occurrence

– Understanding of how current process operates

– Final problem statement

1

DEFINE

2

3

4

5

MEASURE

ANALYZE

IMPROVE

CONTROL

2

MEASURE

Joel Perez

To measure the process performance

Calculate

Performance

DPMO_____

Sigma_____

Graphical Analysis

of data

Frequency Plots

Pareto Chart

Run Chart

Plot Data Over Time

A

Mary

John

Sally

Jim

B C E

Develop Data

Collection Plan Data Collection Plan Project ________________________

What questions do you want to answer?

Data Operational Definition and Procedures

What Measure

type/ Data

type

How

Measured 1

Related

conditions to

record 2

Sampling

notes

How/where

recorded (attach

form)

Create Detailed

Process Map

F 1

F 3

F 4

F 2

Customer Customer

Identify Value Added &

Non-Value Added Steps

Set Process

Performance / $

Improvement

Goal

Develop

Final Problem

Statement

Check Sheet

Collect Data

2 MEASURE Story Components

Joel Perez

Indicators

OEE

DTD

RTY

BTS

WIP

Develop Data Collection Plan

Collect Data

Plot Data Over Time

Graphical Analysis of Data

Calculate Performance

Set Process Performance / $

Improvement Goal

Develop Final Problem

Statement

Tools

Value Stream Mapping

VA & NVA Analysis

Create Detailed Process Map

Identify VA & NVA Steps



MEASURE: Tools, Indicators and Methodologies


• Tools

1. Value Stream Mapping

2. VA & NVA Analysis

• Indicators

3. Overall Equipment Effectiveness (OEE)

4. Dock to Dock (DTD)

5. Rolled Throughput Yield (RTY)

6. Build to Schedule (BTS)

7. Work in Process (WIP) Joel Perez

I. Value Stream Mapping Definition

• Value Stream Mapping (VSM) is a visual tool

which can be used to develop a complete descriptive

analysis of process flows and a detailed breakdown

of value towards the final product or service.

A value stream is all of the

actions required to change raw

materials into a product

delivered to the customer.

What is Value Stream?

Joel Perez

II. Value Stream Mapping Goal

• The goal of a Value Stream Mapping is to significantly reduce customer Lead Time and deliver product to customer at the lowest total

cost through the elimination of waste.

Joel Perez

III. Value Stream Mapping Steps

Current State Map (As Is) - The current state of the

process flow is documented.

Future State Map (To Be) - Identify improvements that

transform the current flow into a lean flow. Document

the future state of the flow – how the flow should be.

Implementation - Implement improvements

(elimination of all wastes ) to achieve the future state.

The major purpose of VSM is not simply to map the

flow, but to implement a lean flow. Joel Perez


• The first step of a

Value Stream

Mapping is to evaluate

the current state

through the

development of a

Current State Map.

How?

Current State Mapping – “As Is”


Physical Pull

Assembly

Manufacturing

process

ACME

Supply

Outside

sources

2 / wk

Truck

shipment

Push System

Buffer safety stock

Marketplace


Symbols

Joel Perez

3 Shifts CO=35 min CT=48 sec

Data Box

Finished goods to

customer

Manual Information

Flow

Electronic Information

Flow

I 200

Parts

1 Day Inventory

FIFO

First in, first out

or

III. Value Stream Mapping Steps Current State Mapping – “As Is”

Symbols

Joel Perez

Supplier Customer

Shipping Process

B

Process

A

Production

Control


Example

Joel Perez

C/T = 65 seconds

C/O = 10 minutes

Uptime = 80%

2 Shifts

27K sec. available

1 Inventory volume

65 seconds Processing time

Process X

3

Inventory or wait time Inventory or wait time

Cycle Time

Changeover Time

65 Sec. 89 Sec.


Example

Joel Perez


•Always collect information while you walk on the shop floor

•Walk fast through the Value flow and start at the end, together with shipment

•Do not ground in the standard times, bring your own timer

•Always draw by hand and by pencil


Some Hints

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• Choose a product or family of products

• Depict the customer requirements

• Follow the flow of the product from shipping, working backwards to

where raw materials arrive at the plant

• Draw the processing steps used to process, move and store the

product

• Input the appropriate process and inventory data

• Draw the information flow

• Draw a timeline depicting the lead time, showing value added and non-

value added time


Steps in Mapping

Joel Perez

IV. Value Stream Mapping Example Current State Map

WELD #1 FIXING WELD #2 ASSEMBLY #2 ASSEMBLY #1 CONVEYANCE

platform 4600 E

2400 D

Rolls

5 days

1100 E

600 D

1600 E

850 D

1200 E

640 D

2700 E

1440 D

Public

Organization Steel Company

Michigan

Production

Control

MRP

1x

daily

Tuesday and

Thursday

152 m rolls 18400 parts/month

- 12,400 E

- 6400 D

2 Shifts

Barrel = 20 parts

Weekly Program Daily Transportation

Program

Forecast: 90/60/30 days

Daily Request

Forecast: 6 weeks

Fax: weekly

I I I I I I 200 T

1 1 1 1

C/T = 1 sec.

C/O = 1hour

Uptime = 85%

27,600 sec. avaib .

EPE = 2 weeks

C/T = 39 sec.

C/O = 10 min.

Uptime = 100%

2 shifts

27,600 sec. avaib .

C/T = 46 sec.

C/O = 10 min.

Uptime = 80%

2 shifts

C/T = 62 sec.

C/O = 0 min.

Uptime = 100%

2 shifts

C/T = 40 sec.

C/O = 0 min.

Uptime = 100%

2 shifts

1 sec.

5 days 7.6 days 1.8 days 2.6 days 2 days 4.5 days

39 sec. 46 sec. 62 sec. 40 sec.

Waiting

Production Time

Value Added

Time

= 23.6

= 188 sec .

Reference: Rother , M. and Shook, J., Learning to See , The Lean Enterprise Institute, Brookline, MA, USA, 1998

27,600 sec. avaib . 27,600 sec. avaib . 27,600 sec. Avaib .

Joel Perez

V. Value Stream Mapping - Office Process

• Production vs. Office Processes: There

are some unique opportunities in applying

the Lean toolset to office processes. Office process Production Process

Minimize Variability

Synchronize Material Flow

Eliminate Physical Batching

Visual Production Controls

Eliminate Wasted Movement

Empower Teams

Minimize Variability

Synchronize Information Flow

Eliminate Time Batching

Visual Project Control/Scorecard

Eliminate Transaction Costs

Empower Teams

Joel Perez

V. Value Stream Mapping - Office Process

•Office Process Waste Examples:

•Ongoing Hand-Off of Information

•Waiting for Information / Decisions

•Multiple Approvals

•Lack of System Discipline

•Non-Standardized Processes

•High Process and Arrival Variation

•System Over-Utilization and Expediting

• Ineffective Communication

•Redundant Tasks Joel Perez

VI. Office Process Value Stream Mapping Example

Value-added Definition: Continuous flow of information and approvals for budget,

limiting delays to 48 hours or less.

Current State Map

Develop Project

Mgt. Review

Mgt. Approval

Plant Approval

Controller

Approval

Eng.

Director

Approval

Mfg.

Director Approval

Funding

Available

10 Weeks

6 h

221h 158h 60 h 75 h 20 h 40 h 64 h

2 h 0.5 h 1.0 h 16 h 2.0 h 2.0 h 3.0 h

Total =

1070.5 h

33.0

ME Supplier Supplier Plant

C/T = 6 RW = 98%

C/T = 3

RW = 95%

C/T = 2

RW = 65%

C/T = 2

RW = 85%

C/T = 16

RW = 33%

C/T = 1

RW = 20%

C/T = 0.5

RW = 18%

= 3 = 6 = 3 = 3 = 10 = 1 = 1 = 1 W W W W W I

1

I

20

Mgt. Review

Mgt. Review

Mgt.

221h 158h 60 h 75 h 20 h 40 h 64 h

2 h 0.5 h 1.0 h 16 h 2.0 h 2.0 h

C/T = 3 C/T = 2 C/T = 2 C/T = 16 C/T = 1 C/T = 0.5

= 3 = 3 = 6 = 6 = 3 = 3 = 3 = 3 = 10 = 10 = 1 = 1 = 1 = 1 = 1 = 1 W W W W I

1 1 1

I

20 20 20

Joel Perez

VII. Magic Caramel – Current State Map Exercise (Appendix 1)

Setup Setup Setup Setup Setup Setup Setup Setup

Availability Availability Availability Availability Availability Availability Availability Availability

Performance Performance Performance Performance Performance Performance Performance Performance

Quality Quality Quality Quality Quality Quality Quality Quality

Cycle Time Cycle Time Cycle Time Cycle Time Cycle Time Cycle Time Cycle Time Cycle Time

Receiving Laudering Wadding Cover Label Date Inspection Shipment

Supplier Customer

Joel Perez


• Tools



• Indicators






I. Process Mapping Tools

– Activity Flowchart

• Functional Flowchart

Note: Functional Flowcharts are required as part of the Process Management

Control System implemented in the CONTROL step Joel Perez

II. Activity Flowchart Features

Process Name

Date of creation

/update &

name of creator

Clear direction of

flow (top to

bottom or

left to right)

Clear starting and ending

points

Consistent level of detail

Key of symbols

Numbered steps

Hotel Check-out Process

10

Approach front desk

20

Is there a line?

30 Wait

40 Step up to desk

70 Give room number

50 Clerk

available?

80 Check bill

90

Charges

correct?

100 Correct charges

110 Pay bill

No

No

No

Yes

Yes

Yes

Start/End

Action/Task

Decision

Sequence

J. Irving 7/19/97

BIT

60

Wait

Joel Perez

III. Value Analysis

Process Step

Necessary to Produce Output

Business Value Added Customer Value Added No-Value Added

Yes

Yes Yes

No

No

No Necessary to Meet Valid Requirement?

Needed for Business Requirement?

VA BVA NVA1 Update of EMS with new plant information X

2 Determine number of plants to be audited (EMS) X

3 Request information on plant maturity, risk and audit timing X

4 Evaluate every plant against agreed criteria (DIVISION) X

5 Prioritize based on risk and audit timing (DIVISION) X

6 Comunicate prioritized plant list to audit group (DIVISION) X

7 Collect prioritized list from divisions X

8 Any new process identified in the prioritized list? X

YES (10), NO(12)

9 Request information regarding new process X

10 Provide information regarding new process X

11 Development and inclusion of the new module X

12 Update prioritized list X Perform updating of EMS each quarter and detec new processes

13 Compare mandays required with mandays available X

14 Are sufficient auditors available within SBU? X

15 Are there auditors available in other SBU´that can be used? X

16 Re-evaluate prioritized list to focus on risk priority X Define sufficient number of auditors, based on process knowledge, language

skill, location, leading. Reduce number of audits based on risk evaluation

17 Do auditors have required process knowledge? X

18 Do auditors have required language skill? X

VALUE CATEGORY

ACTIONSTEP

Joel Perez

Yes

No No

No

Yes

Yes

Loop

Loop

Loop

Value-Added Steps Non-Value-Added Steps

Steps that

would not be

needed if

everything

worked right

the first time

move across

the right

side.

Steps that

are

essential

even when

everything

works

correctly

move down

the left side.

IV. Opportunity Flowchart Features

Joel Perez

Step P R I M E D O T S Action(s)

Step 1 X Action 1

Step 12 X Action 5

R = Rework created

P = Personnel efficiency possible

I = Indirect cost reduction

M = Mistake earlier in the process

causes this step

E = Eliminate this step?

D = Delays can occur in this step

O = Overproduction caused

T = Transportation of materials,

personnel, information is

unnecessary

S = Simplification of overly-

complicated step possible

V. Productivity Analysis

Joel Perez

V. Productivity Analysis

MOTION X X X X X

OVER PRODUCTION X X

OVER PROCESSING X X X

WAITING X X X X

CONVEYANCE X X X X X

CORRECTION X X X X X

INVENTORY X X

HUMAN RESOURCES X

WASTE P R I M E D O T S

VI. Opportunity Flowchart Features - Example

Hotel Check-out Process

10

Approach front desk

20

Is there a line?

30 Wait

70 Give room number

50 Clerk

available?

80 Check bill

90

Charges

correct?

100 Correct charges

110 Pay bill

No

No

No

Yes

Yes

Yes

60

Wait

40 Step up to desk

Value-Added Steps Non-Value-Added Steps

Joel Perez

VII. Value Analysis Matrix - Exercise

Fill the Value Analysis Matrix for the process of Hotel

Check out

Process Step 10 20 30 40 50 60 70 80 90 100 110 Total % Total

Time (Min) 1 1 10 1 1 10 1 2 1 5 3 36 100%

Add Value

P

R

I

M

E

D

O

T

S

Joel Perez


• Tools



• Indicators






I. OEE Definition

• OEE is a fundamental measurement for

Lean and TPM. The objective is to

evaluate the global effectiveness of a

specific equipment. It is calculated

considering losses of availability,

productivity and quality.

Joel Perez

II. OEE Goals

PERFORMANCE

AVAILABILITY

QUALITY

OEE

• Improvement of quality and productivity

• Cost reduction

• Customer satisfaction

• Safe work

Joel Perez

III. OEE Description

• = X X

Overall

Equipment

Effectiveness

(OEE)

Availability Performance

Efficiency Quality Rate

Identifiable Stops

Equipment failure

and Tool Wear-out

Adjustment and Set

up losses

Losses with

reduced speed

Downtimes and

small breaks

Quality

defects or

process

losses

Joel Perez

Availability

Availability takes into account Down Time Loss, and is calculated as:

Availability = Operating Time / Planned Production Time

Performance

Performance takes into account Speed Loss, and is calculated as:

Performance = Actual Produced Parts / Ideal Production


Quality = Good Parts / Total Parts

Quality Quality takes into account Quality Loss, and is calculated as

Overall Equipment Effectiveness = Availability x Performance x Quality Yield

Availability Downtime loss

Speed loss Performance

Quality Yield Quality loss


Joel Perez

Total Operating Time

Availability

A. Net Operating Time

No

Scheduled

Production

B. Running Time Failure

Set-up

Performance

C. Target Output

D. Actual Output Minor

Stop

Quality

E. Actual Output

F. Good Output Scrap

Rework

OEE = B/A x D/C x F/E


Joel Perez

IV. OEE Example

Item Data

Shift Length 8 hours = 480 min.

Short Breaks 2 @ 15 min. = 30 min.

Meal Break 1 @ 30 min. = 30 min.

Down Time 47 minutes

Ideal Production 22,380 parts / shift

Total Produced Parts 19,271 parts / shift

Rejected Parts 423 parts

• Planned Production Time = [Shift Length - Breaks] = [480 - 60]= 420 minutes

• Operating Time = [Planned Production Time - Down Time] = [420 - 47] = 373 minutes

• Good Parts = [Total Parts - Rejected Parts] = [19,271 - 423] = 18,848 parts

Joel Perez

IV. OEE Example

Availability

Availability = 373 minutes / 420 minutes = 0.8881 (88.80%)

Performance

Performance = (19,271 parts / 22,380 parts) = 0.8611 (86.10%)

Quality = 18,848 / 19,271 parts = 0.9780 (97.80%)

Quality First Time Through (FTT)

OEE = 0.8881 x 0.8611 x 0.9780 = 0.7480 (74.80%)

OEE

Joel Perez

V. First Time Through

• Definition: Percentage of parts or aspects of a service that are completed without error the first time they go through a work process without being scrapped, re-run, re-tested, returned, or diverted.

• Corresponds to the Quality rate of the OEE indicator

Input = 1,000 parts

Scrap: 30 parts

Output = 970 parts approved

FTT = 900 / 1,000 = 90%

Step

1

Rework: 70 parts

Joel Perez

VI. OEE Exercise

• Calculate the OEE considering the

following data:

Item Data

Shift Length 8 hours = 480 min.

Short Breaks 2 @ 15 min. = 30 min.

Meal Break 1 @ 45 min. = 50 min.

Down Time (Set-up and Corrective Maintenance)

85 minutes

Ideal Production 15,750 parts / shift

Total Parts 12,300 parts / shift

Rejected Parts 63 parts

Joel Perez

VI. OEE Exercise

Availability

Availability = minutes / minutes = ( %)

Performance

Performance = ( parts / parts) =

Quality = parts / parts = ( %)

Quality

OEE = x x = ( %)

OEE

Joel Perez


• Tools



• Indicators






I. Dock to Dock (DTD) Definition

• Dock-to-Dock Time is the elapsed time

between unloading raw materials and

releasing finished goods for shipment

ProcessInputs

Outputs

CustomersSuppliers

II. Dock to Dock (DTD) Benefits

• Decreasing inventories lead to less material handling and storing, which results in fewer opportunities for part damage. Few damaged parts improve the First Time Through (FTT)

• The improved DTD leads to an enhanced ability to adjust to changes in schedule and to support customers

• Less handling material, obsolescence and inventory maintenance costs lead to an Improvement in the Total Cost

Joel Perez

Production Process

Raw

material

warehouse Manufacturing Cycle Time (MCT)

Finished

Goods

warehouse

Dock-to-Dock (DTD)

Receiving Shipping

III. Dock to Dock (DTD) Example

1.5 days

3.0 days

Joel Perez

IV. Dock to Dock (DTD) Summary

• Dock-to-Dock time measures the time it

takes for raw materials to be converted

into finished products


• Tools



• Indicators






• I. Rolled Throughput Yield (RTY) Definition

• Percentage of parts which go through the plant from

start to finish without being scrapped, rerun, retested,

returned, or diverted

Joel Perez

•II. Rolled Throughput Yield (RTY) Goal

• Objective: 100% RTY; zero defects made or passed on

Not baked

well

Ok

Joel Perez

• Enhanced quality reduces the need for abundant

inventories, therefore improving the Dock-to-Dock Time

(DTD)

• Improves the ability to keep a sequence along the

process

• The quality improved before the constraint assures the

revenue of “good parts” only, which reduces the wasted

output in constraint, improving the OEE

• Total Cost is reduced through warranty costs, scrap,

rework and lower repairs

•III. Rolled Throughput Yield (RTY) Benefits

Joel Perez

Step

1

Step

2

Step

3

Step

4

Input:

1000

parts

Output:

900 parts

without

defects

Is the RTY equal 90%?

• IV. Rolled Throughput Yield (RTY) Example

Scrap: 30 Scrap: 20 Scrap: 40 Scrap: 10

Joel Perez

FTY1= (890/1000) = 0.890 = 89.0%

FTY2= (900/970) = 0.928 = 92.8%

FTY3= (850/950) = 0.895 = 89.5%

FTY4= (830/910) = 0.912 = 91.2%

RTY = 0.89 x 0.928 x 0.895 x 0.912 =

Step

1

Step

2

Step

3

Step

4

Input:

1000

parts

Output:

900 parts

without

defects

Scrap: 30

970 950 910

67.4%!!

• IV. Rolled Throughput Yield (RTY) Example

Rework:80 Rework:50 Rework:60 Rework:70

Scrap: 20 Scrap: 40 Scrap: 10


• Tools



• Indicators






• It’s a way of knowing whether you have built the right

parts, in the right quantity, in the right order

• BTS = Volume x Mix x Sequence

• Build to Schedule measures how well a plant executes

the process to deliver the right product on the right day,

and in the right mix or sequence

• BTS aligns capacity with the market demand

I. Build to Schedule (BTS) Definition

Joel Perez

II. Build to Schedule (BTS) Goal

• Objective: 100% Build-to-Schedule

Pizzaria

*Mozzarella

*Pepperoni

*Tomatoes

Joel Perez

III. Build to Schedule (BTS) Benefits

• Improved BTS requires less inventory,

which improves Dock-to-Dock Time (DTD)

•Less material handling and less cost of

inventory lead to improved Total Cost

Joel Perez

Usual causes for BTS Problems:

• Poor production schedule

• Production ignores the timelines that come from the

Schedule activity

• Equipment failures

• Lack of material

• Quality issues

• Product complexity

IV. Build to Schedule (BTS) Problems

Joel Perez

V. Build to Schedule Example

BTS calculation:

• Volume: (550 / 650) x 100 = 84.6%

• Mix: (390+140) / 550 x 100 = 96.4 %

• Sequence: (2 lots / 4 lots) x 100 = 50.0 %

• BTS= 0.846 x 0.964 x 0.50 = 40.8 %

V. Build to Schedule Example

• BTS is a production performance indicator. It can

be used in the Measure Step to establish an

initial situation, or in the Improve Step to verify

the improvement

Sequence Type Quantity Sequence Type Quantity

1 A 200 1 A 190

2 B 100 2 B 40

3 A 200 3 B 100

4 B 150 4 A 220 650 550

Planned Production Actual Production


• Tools



• Indicators






I. Work in Process (WIP) Definition

• Work in Process Inventory is the number of parts that

have started the first value added step in the process

but have not completed the last value added step in

the process

Process 1 Process 2 WIP

Examples:

1 ton or

1150 units or

125,000 USD

½ Inventory day Joel Perez

II. Work in Process (WIP) Goal

• Tracking materials throughout the production process

provides increased visibility throughout the supply

chain

Joel Perez

II. Excessive Work in Process Problems

• By reducing WIP, wastes are clearly identified

• Excessive WIP can cause problems in terms of:

Quality

Space

Planning

Cost

Organization

• The higher the WIP, the higher is Dock to Dock

What different problems can result from

excessive Work in Process? Joel Perez

Metrics – Office Examples

Workload balance Employee

Efficiency

Overall Equipment

Effectiveness (OEE)

Customer Satisfaction

Survey results

Meeting Customer

Requirements

Build to Schedule (BTS)

Project delivery time Lead time Dock to Dock (DTD)

# projects completed

within targets

Quality Rolled Throughput Yield

(RTY)

Office Examples

What it Indicates

Production Measurable

# invoices in process Speed Work in Process

Final Problem Statement

• A good final problem statement contains:

– A more specific (focused) statement of what is wrong in terms of defects, or which customer needs are not being met, than the preliminary problem statement

– Current data on the problem (or defects)

- Who? - Which

- What? - How?

- When? - How many?

- Where?

– The improvement goal of the project

Joel Perez

What do you think?

• Final Problem Statement:

• During the last four months, 55% of the finished

goods of model “A-2006” produced in the new

plant were shipped with 3 weeks of delay. This

generated unnecessary transporting of 50 big

trucks between the main warehouse to satellites,

besides causing customer dissatisfaction.

• Goal: Reducing the delay 4x will reduce the

transporting from 50 to 7 trucks.

Joel Perez


Causes

%

Causes

%

Eliminating Defects

(Use Six Sigma Tools) Eliminating Waste/NVA

(Use Lean Tools)

Do we know

the cause of

the problem

yet?

Final Problem Statement:

During the last four months, 55% of the finished goods of model “A-2006”

produced in the new plant were shipped with 3 weeks of delay. This

generated unnecessary transporting of 50 big trucks between the main

warehouse to satellites, besides causing customer dissatisfaction.

Joel Perez

Joel Perez

ANALYZE

Joel Perez

ANALYZE to Identify Causes

• Goal

–Analyze potential root causes and confirm them with data

• Key Outputs

–Root causes that have been tested and confirmed

1

2 4

5

DEFINE

MEASURE IMPROVE

CONTROL

3

ANALYZE

Joel Perez

ANALYZE Story Components To analyze the data and the process map to determine

root causes and opportunities for improvement

Scatter Plots

Y

X

Contingency Table Sub Cause

Yes No

Present

Not

Present

Defe

ct

5 5

5 5

Made the Sale

Did Not Make the Sale

Time With Customer

(in minutes)

5 10 15 20 25 30 3 5 40 45 50 55 60 >60

5 10 15 20 25 30 3 5 40 45 50 55 60 >60

Made the Sale

Did Not

Make the Sale

5 10 15 20 25 30 3 5 40 45 50 55 60 >60

5 10 15 20 25 30 3 5 40 45 50 55 60 >60

Time With Customer

(in minutes)

5 10 15 20 25 30 3 5 40 45 50 55 60 >60 5 10 15 20 25 30 3 5 40 45 50 55 60 >60

5 10 15 20 25 30 3 5 40 45 50 55 60 >60 5 10 15 20 25 30 3 5 40 45 50 55 60 >60

Stratified Frequency Plots

Root Cause

1

Root

Cause

2

Sub

Cause

Sub Sub Cause

Sub

Cause

Sub Sub Cause

Sub Sub Sub Cause

Sub

Cause

Sub

Cause

Sub Cause Sub Sub Cause

Sub Sub Cause

Cause and

Effect

Diagram

Brainstorm and Organize Potential Causes

Verify Potential Causes with Data

Confirm Root Causes

Root Cause

1

Root

Cause

2

Sub

Cause

Sub Sub Cause

Sub

Cause

Sub Sub Cause

Sub Sub Sub Cause

Sub

Cause

Sub

Cause

Sub Cause Sub Sub Cause

Sub Sub Cause

Cause and

Effect

Diagram

Final Problem

Statement

Final Problem

Statement

3

Joel Perez

Takt Time

TOC

SMED

Brainstorm and Organize

Potential Causes

Verify Potential Causes with

Data

Confirm Root Causes



ANALYZE: Tools, Indicators and Methodologies


1.Takt Time

2.Theory of Constraints (TOC)

3.SMED

Joel Perez

I. Takt Time Definition

• Takt Time (“Pace”) - The rate of customer

demand. Takt is the heartbeat of a lean system.

Takt time is calculated by dividing production time

by the quantity the customer requires in that time.

TAKT = Available Time

Customer Demand

TAKT

Process 1 Process 2 Process 3

Joel Perez

I. Takt Time Definition

• What causes the inability to reach Takt Time and, therefore, add costs to the system?

• Examples of Wastes:

– Breaks (longer downtime) – Changeover – Interruptions (shorter downtime) – Late start-up – Delays – Scrap/Rework

Joel Perez

II. Cycle Time Definition

Cycle Time - Time (in seconds) to perform the process

operation at the workstation.

Cycle Time1 Cycle Time2 Cycle Time3


Joel Perez

III. Lead Time Definition

Lead time - Time (in seconds) to produce one part.

LT = Cycle Time1 + Cycle Time2 + Cycle Time3

Cycle Time1 Cycle Time2 Cycle Time3


Joel Perez

IV. Example – Pen Final Assembly

Process 1

Process 2

Process 3

Joel Perez

450 minutes available for

production

IV. Takt Time Example

TAKT = 2.3 s

TAKT = 27,000 seconds

11,740 parts

Customer Demand

Assemble pen

refill and spring

Assemble pen

refill inside the

pen body

Final Assembly

Body + Cap

Pen Final Assembly


Joel Perez

IV. Cycle Time Example

Cycle Time1 = 2.5 s Cycle Time2 = 2.2 s Cycle Time3 = 2.4 s

Cycle Time = 4.7 s Cycle Time = 2.4 s

Assemble pen

refill and spring

Assemble pen

refill inside the

pen body

Final Assembly

Body + Cap

Pen Final Assembly

Joel Perez

LT = 2.5 + 2.2 + 2.4 LT= 7.1 s

IV. Lead Time Example

Cycle Time1

= 2.5 s

Cycle Time2

= 2.2 s

Cycle Time3

= 2.4 s

Assemble pen

refill and spring

Assemble pen

refill inside the

pen body

Final Assembly

Body + Cap

Joel Perez

VII. Takt Time vs Cycle Time

0

1

2

3


Workstation

Tim

e (

seco

nd

s) TAKT TIME

= 2.3 sec.

Pen Final Assembly

• Which process cycle times do not meet the Takt time requirement?

• Can you meet the customer demand rate? Joel Perez


0

1

2

3


Workstation

Tim

e (

se

co

nd

s)

Waste

TAKT TIME

= 2.3 sec.

Pen Final Assembly

VA/NVA analysis revealed several opportunities for improvements.

Joel Perez

Wastes were removed from the process steps.


0

1

2

3


Workstation

Tim

e (

seco

nd

s)

TAKT TIME

= 2.3 sec.

Pen Final Assembly

• How about now? Are process cycle times below Takt time?

• Can you meet the customer demand rate? Joel Perez

Takt Time vs Cycle Time

• Let’s suppose, due to increased customer

demand, an uplift in production capacity is

required from 11740 parts to 13500 parts

(15% increase)

• What would you do?

Joel Perez


• Let’s calculate the Takt time:

Takt Time

Takt Time

=

=

Available Time

Customer Demand

27,000 seconds

13,500 parts = 2.0 seconds

Pen Final Assembly

Joel Perez


0

1

2

3


Workstation

Tim

e (

seco

nd

s)

TAKT TIME

= 2.0 sec.

Pen Final Assembly

• How about now? Are process cycle times below Takt time?

• Can you meet the increased customer demand rate? Joel Perez


0

1

2

3


Workstation

Tim

e (

se

co

nd

s)

NEW

TAKT TIME

= 1.5 sec

Further improvements in process cycle times may be possible by

continuously identifying and eliminating wastes, thus improving ability to

meet increased customer demand rates, if required.

Pen Final Assembly

Joel Perez

VIII. Takt Time Summary

• Takt time / balancing is a tool that helps to

measure the capability of a process to

meet customer’s demand, as a guide for

better allocation of resources and

eliminating wastes

Joel Perez


1.Takt Time


3.SMED

Joel Perez

I. Theory of Constraints Definition

• It is a management philosophy with the basic premise that the optimization of all steps of a process does not necessarily generate improvements to the system as a whole

• One should work to identify, minimize or eliminate the main problems, called constraints

The TOC, or Theory of Constraints,

was developed in the 70’s by the

physicist Eliyahu Goldratt, who

wrote the book The Goal.

Joel Perez

II. Theory of Constraints - Bottleneck

•

Process constraint

(Bottleneck)

The constraint

determines the line

speed

Work accumulation

because of the

bottleneck

Joel Perez


• The bottlenecks (process constraints) limit a system's ability to achieve a better performance

• The bottleneck is a priority problem to be improved or, if possible, eliminated

• The process speed is determined by its bottleneck; thus, the process must be balanced through constraint

Joel Perez


• From the TOC, we can focus the efforts on

few process points that determine the

constraint performance, resulting in

immediate improvements.

Do you know the constraints of

your processes?

Joel Perez

III. Theory of Constraints Steps

• The process is divided into five steps:

1. Identify the system constraint.

2. Explore the system constraint.

3. Improve the system constraint.

4. Submit the whole system to the constraint.

5. If one of the previous steps is broken, you should go back to step 1.

IV. Theory of Constraints Terms

The Theory of Constraints has adopted three key terms:

• Drum

• Lung

• Rope

Joel Perez

Drum:

The system constraint determines its

rhythm.

In many cases, the drum should

include a program to assure that the

bottleneck is being used 100% of the

time, without the occurrence of

problems due to the lack of raw

material or because of damaged

equipment.


Joel Perez

Lung:

It is the inventory used to protect the

constraint integrity from any kind of

problem (ruptures, delays,

deficiencies, etc.).

It is necessary to calculate how

much of the inventory will be used

as lung and that this number never

exceeds the determined values.


Joel Perez

Rope:

Mechanism that requires all parts

of the system to work in a rhythm

given by the drum.


Joel Perez

V. Theory of Constraints Example

Available Time / day = 28,000 sec.

Daily demand = 1,000 parts

Is there any bottleneck?

P1 P2 P3 P4 P5 Cycle

time

(sec.) 20 10 25 30 5

Product Book

Joel Perez

0

10

20

30

40

1 2 3 4 5

Process

Tim

e (

sec) Takt Time

28 sec

Cannot meet the demand Bottleneck

V. Theory of Constraints Example

Process 4 is the constraining process & determines the pace of production! Joel Perez


1.Takt Time


3.SMED

Joel Perez

I. SMED Definition

• Time needed to prepare a machine on model changes, measured from the last part of model A to the first quality part of model B.

What is Changeover?

Joel Perez

I. SMED Definition

• Reducing the time for tool change to less than 10 minutes (single digit of minutes), through the analysis and improvement of internal and external activities

Single Minute Exchange of Dies (S.M.E.D.)

Joel Perez

II. SMED Goals

• Team work

• Quality verification and assurance from the first time

• More flexibility, shorter downtime, availability for

preventive maintenance

• Allows production of smaller batches that can meet the

customer demand as well as reduce WIP

• Eliminates unsafe operational conditions

• Eliminates NVA activities

Joel Perez

III. Spaghetti Diagram

• What is the distance covered by the

operator?

Table of

Tools

Cabinet

Machine

Distance covered: 110 m

From: The new Manufacturing Challenge - Suzaki

Joel Perez

IV. Quick Changeover Methodology Steps

1. Document current changeover elements

2. Separate internal and external activities

3. Change internal activities to external

4. Locate parallel activities

5. Speed up internal activities

6. Implement the plan

7. Validate procedures / verify results

Joel Perez

• Internal Activities:

• The machine must be stopped. These can be main activities or can be executed while other activity is being performed (parallel activity).

• Example: Tooling changes, adjustments, tests, etc...

• External Activities:

• The activities performed when the machine is running.

• Example: Tooling preparation, Locating parts, tooling transportation, etc...

V. Internal and External Activities

Joel Perez

VI. Results of Quick Changeover

MORE FREQUENT CHANGES

SMALLER BATCHES

SMALLER INVENTORY

IMPROVED QUALITY

LESS WASTE

MORE FLEXIBILITY

DELIVERIES ON TIME

COMPETITIVE ADVANTAGE

LITTLE USE OF THE PHYSICAL SPACE

LITTLE

EFFECTIVE STOCK

LITTLE PRODUCT LOSS BY DETERIORATION

PRODUCTION OF SEVERAL

MODELS IN A LINE

HIGHER FINANCIAL MOVEMENT

Joel Perez

VII. Example of Setup Elements Form

If the area is occupied with

another tool, deposit it along

with the column of the

adjacent presser

X

Remove tool from the

inventory area, depositing it in

a space along with the

external column of the

machine to be prepared

5

Check Preventive

Maintenance program

X

Verify the integrity of the tool,

confirming the lack of

problems with the Tools 4

X

Locate the tool to be used 3

Implementation proposal

X

Apply Setup Check list 2

X

Consult Production Program

in order to identify the next

part to be produced 1

Parallel Main

Internal

External

Observations

Rate

Description Element

Joel Perez

VIII. Setup Analysis Example Office Example: Printing Reports Printing Certificates

E I

1 Close file LS x

2 Take the reports from the printer LS x

3File the reports in appropriate

placeLS x

4Take special paper to print

certificatesLS x

5 Put special papers in the printer LS x

6Take the list of people who will

receive the certificatesLS x

7 Open File - Certificate Model LS x

8Create models according to the

number of certificates to be printedLS x

9 Type the names in the models LS x

ProblemImprovement

Action

Form - Setup Analysis

Time (min)

Accum

ula

ted

Tim

e

Time (min)

E = External

I = Internalnº Activity

Responsib

le

En

d o

f re

po

rt

pri

ntin

g

1 2 3 4 5

Joel Perez

Determine Potential Causes

Starting from the final problem statement, you need to identify

and organize potential root causes following the next steps:

1. Review the final problem statement 2. Identify possible causes 3. Affinitize: Sort possible causes into reasonable clusters 4. Choose a cluster and label main bone 5. Develop and arrange bones for that cluster

Joel Perez

Determine Potential Causes

Usually, you will find most of the potential causes inside these

four groups:

System

Constraint

Sub

Cause

Sub

Cause

Sub Sub Cause

Final Problem

Statement

Sub

Cause

Sub Sub Cause

Sub

Cause

Sub

Cause

Change

Over

Downtime Inventory

Joel Perez

System

Constraint

Sub

Cause

Sub

Cause

Sub Sub Cause

Final Problem

Statement

Sub

Cause

Sub Sub Cause

Sub

Cause

Sub

Cause

Confirm Potential Causes

Change

Over

Downtime Inventory

Then, you need to collect data to confirm which potential

causes actually contribute to the problem.

Joel Perez

System

Constraint

Trucks

breakdown

often

Poor

Maintenance/

schedule

55% of Model-A were shipped

with 3 weeks of delay

Non-standard

Shipping racks

Short supply

Truck spare

Parts in W/H

Confirm Potential Causes - Example

Change

Over

Downtime Inventory

C/O time is

too long

between models

on truck

Drivers

Absenteeism

Not enough

trucks

Excessive

Loading

time

Collect data to confirm which potential causes actually

contribute to the problem.

Joel Perez


• Final Problem Statement:

• During the last four months, 55% of the finished goods of model “A-

2006” produced in the new plant were shipped with 3 weeks of

delay. This generated unnecessary transporting of 50 big trucks

between the main warehouse to satellites, besides causing

customer dissatisfaction.

Causes

%

Based on data, Excessive set-up time of shipping racks

on trucks for model changes and truck breakdowns

were identified as the top two root causes.

Consider applying appropriate Lean tools

to solve the problem!

Joel Perez

Joel Perez

IMPROVE

Joel Perez

IMPROVE the Process

• Goal

– Improve the process by developing and piloting solutions that address root causes

• Key Outputs

– Cost/benefit analysis with sign-off from Finance

– Planned and tested actions

– Before and After data that show how much of the initial gap was closed

1

2

3

5

DEFINE

MEASURE

ANALYZE

CONTROL

4

IMPROVE

Joel Perez

IMPROVE Story Components To generate, select, and implement improvements

Solution Selection Matrix

Identify and

Select Solutions

Conduct

Cost/Benefit Analysis

FMEA

Item or

Process

Step

Potential

Failure

Mode

Potential

Effect (s)

of Failure

Potential

Cause(s)

Current

Controls RP

N

Recommended

Action

Responsibil ity

and

Target Date Action Taken

Se

ve

rity

Occu

rre

nce

De

tecti

on

RP

N

“After” S

eve

rity

Occu

rre

nce

De

tecti

on

Total Risk Priority Number = “After” Risk Priority Number =

Develop Action Plan For

Full Implementation

Conduct

Risk Analysis Develop Pilot Plan

Updated Pareto Chart

Before After

Quantify Pilot Results

Update Outcome

Indicators

Before After

IMPROVE changes

implemented

} Improvement

Good

Time

DEFINE

Before After Good

Time

Before After

IMPROVE changes

implemented

Time

} Improvement

3.2s 3.6s

Cost/Benefit

Analysis

Approval from

Finance

Cost

Benefit

Solution (s) / Specific Task (s) ____________________________

Problem Statement ________________________________________ :

Task / Project Who Due Date Status

Gantt Chart

Problem Root

Causes

Solutions Specific

Tasks

1.3 s

A1 A2 A3 A4

} Improvement

A2 A1 A3 A4

3.1 s

50%

25%

75%

100%

50%

25%

75%

100%

Joel Perez

IMPROVE: Identify and Select Solutions

System

Constraint

Sub

Cause

Sub

Cause

Sub Sub Cause

Final Problem

Statement

Sub

Cause

Sub Sub Cause

Sub

Cause

Sub

Cause

Change

Over

DowntimeInventory

System

Constraint

Sub

Cause

Sub

Cause

Sub Sub Cause

Final Problem

Statement

Sub

Cause

Sub Sub Cause

Sub

Cause

Sub

Cause

Change

Over

DowntimeInventory

• Start with the results of the cause-and-effect diagram

• Identify possible solutions for verified root causes - denoted by an oval that is not crossed out

• Consider Waste Reduction Strategies as solutions for the verified root causes

Joel Perez

IMPROVE: Tools, Indicators and Methodologies

Storyboard Tool, Indicators and

Methodologies

Identify and Select Solutions

Conduct


Conduct Risk Analysis

Develop Action Plan For Full

Implementation

Develop Pilot Plan


Update Outcome Indicators

Just in Time

Pull System

One Piece Flow

5S

Poka Yoke

Kanban

Heijunka

TPM

Kaizen

Value Stream Mapping –

Future State


1. Just-in-Time - Pull System - One Piece Flow

2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka

6. Total Productive Maintenance (TPM)

7. Kaizen

8. Value Stream Mapping – Future State

Joel Perez

I. Just-in-Time Definition

• Just-in-Time: Means producing and

delivering the right parts/items, in the right

amount, and precisely at the right time

• All upstream and downstream tasks are

balanced and choreographed into a

perfect sequence, which eliminates the

need for too much inventory throughout

the process

Joel Perez

II. Just-in-Time Commitment

– Just-in-Time production requires a commitment

from everyone from the bottom up to the top

down

– Everyone must be dedicated to the elimination of

waste through continuous improvement

– Commitment is acquired through

communication, training and application

Joel Perez

III. Just-in-Time as a Pull System

• Traditional “Push” System

• When process A is completed, the product is “pushed” to process B where it is stored in inventory until required

•

Joel Perez


• Pull System

• Process B is responsible for getting parts and

supplies from Process A as they are needed,

there is no intermediate inventory (storage)

• Value of a Pull System

• The pull system provides an opportunity

for eliminating waste

–Waste of waiting (if parts are missing)

–Waste of production

–Waste of inventory


Joel Perez

• An analysis of the work process flow leads to: – Improved processes

– Increased efficiency

– Elimination of waste

– Greater savings

The Pull System and Process Flow

The pull system works in a better way when the process

flows efficiently.


V. Just-in-Time Example

• In the automotive assembly line, parts are supplied in

right amount, precisely at the right time

Joel Perez

IV. One-Piece Flow

• The process flow examines the flow of materials or products throughout the system

–Starts with procurement of raw material from suppliers

–Continues through each step of production process

–Ends with the delivery of finished product to the customer

Joel Perez

IV. One-Piece Flow

• Traditional process flow

–Process fluctuates

–Busy times and slow times

• Continuous one-piece process flow

–Process flows smoothly, one piece at a time

–Work load is leveled and steady

Joel Perez

IV. One-Piece Flow: Benefits

– Makes NVA work more evident

– Minimizes WIP

– Reduces excessive inventory

– Increases flexibility in meeting customer demands

– Produces only what the customer orders

– Shortens lead time from order to shipping

– Focuses on actual processing rather than waiting, transporting, storing

– Facilitates teamwork and communication

– Reduces costs

Joel Perez



2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka


7. Kaizen


Joel Perez

Manage

Activities

Optimize and organize

activities

I. 5S Definition

Sort

Straighten

Sweep

Standardize

Sustain

Joel Perez

OBJECTS

NECESSARY

UNNECESSARY

HIGH DISPLAY

MEDIUM DISPLAY

LOW DISPLAY

AUCTIONING

DISCARDED MATERIAL

SCRAP

RED CARD

METHOD

Desired Outcome: A safe and uncluttered work site, free of

hazards and workarounds

I. 5S Definition

• Sort: Get rid of what is not needed (separate what you do not

want)

Joel Perez

• Straighten: Arrange tools, parts and equipment so they can

be used without wasting time and motion. Mark and label

everything in order to find and access them easily.

Desired Outcome: Tools, equipment and materials are located

such that they are safe and easy to use. Waste due to motion is

minimized.

I. 5S Definition

Joel Perez

• Sweep, Wash, Clean and Tag abnormalities:

Clean work site daily to guarantee safety. This applies to both

office and plant areas. Tag items that need repair or removal.

Desired Outcome: The work site, required tools, equipment

and materials are clean, defect-free and ready for use.

I. 5S Definition

Joel Perez

• Standardize: Create standardized procedures and practices

(Safety First)

Desired Outcome: A plan with documented graphic layout of the

work site showing the proper location and amounts of all required

tools, equipment and materials, including visual controls and coding,

with required team member actions and assignments

I. 5S Definition

Joel Perez

• Sustain: Maintain good housekeeping and seek ways to improve

Desired Outcome: A continuously ready operational work site,

excellent housekeeping.

I. 5S Definition

Joel Perez

II. 5S Application

Is the object necessary?

Organize it! Eliminate it! Red Card

Auctioning

Discarded Material

Scrap

High Display

Medium Display

Low Display

Mark and Label

Create standardized

procedures and practices!

Yes No You don’t

know

Keep it clean

and usable !!!

Joel Perez

The objective here is to validate the application of 5S

• All participants will be audited and evaluated

• The auditors will visit the area and will give a 5S

qualification for each one

• This should be repeated periodically

An example of the graph is included in the following page

IV. 5S Audit

Joel Perez

IV. 5S Audit

Radar

0 4

8

12

16

1º S Sort (Seiri)

2º S Straighten (Seiton)

3º S Sweep (Seiso)

4º S Standardize (Seiketzu)

5º S Sustain (Shitsuke)

March

April

Joel Perez



2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka


7. Kaizen


Joel Perez

I. Poka Yoke Definition

• Mistake Proofing is a technique that

prevents the occurrence of failures or

identifies/eliminates defects, avoiding

their propagation.

•

Working on What You Can

Get Your Arms Around

Joel Perez

II. Poka Yoke Concepts

Failure is something that occurs outside the

expected process standards.

Defect is an effect resulting from a failure.

FAILURE DEFECT

CAUSE EFFECT

Joel Perez

II. Poka Yoke Concepts

• Detection is an inspection performed to identify potential defects.

Prevention means to analyze causes

of the failure and prevent their

occurrence.

Joel Perez

III. Types of Poka Yoke

FAILURE DEFECT CAUSE

(OF FAILURE)

Prevention Identify the cause and

prevent the

occurrence of the

failure

Detection Eliminate the failure and prevent the

occurrence of the defect

Eliminate the defect at the point of

occurrence, preventing its propagation

Ex.: A plastic cap placed

on electric points prevents

the risk of electric shocks.

Ex.: A sensor placed on the production

mat detects products outside the

specifications and warns the operator

through a light sign.

Joel Perez

POKA-YOKE

Signals the occurrence of

abnormalities for the operator through

light signs or sounds

Ex.: Fire sirens are activated by sensors

when the temperature is higher than normal

Ex.: Some home electric sets have a device that

turns off the equipment, in case the lid is open.

ALERT SHUTDOWN CONTROL

Corrects a failure or stops defective

products from going to the next processing

step

If there’s any sign of abnormalities, it

interrupts or blocks the process

Ex.: Spam identification system

III. Types of Poka Yoke

Poka Yoke Classification by Function

Joel Perez

Control Shutdown Alert

Detection

Prevention

VI. Poka Yoke Example

Long time spent to clamp bolts in its appropriate places during

setup.

What is the problem?

By Combining the colors of

the bolts with the colors on

the respective device, you

can speed up the setup

process.

X Joel Perez


Detection

Prevention


The introduction of a part with incomplete form.


A device was installed in

order not to allow products,

with height lower than

specified one, pass to the

next stage. Thus, products

with incomplete form are

separated in boxes.

X Joel Perez


Close document without saving the modifications.


When a file is closed and

there are modifications not

saved, a window is opened

asking whether the user

wants to save them or not.


Detection

Prevention

X

Joel Perez

Turn off

VI. Poka Yoke Exercise

The part is not positioned correctly in a machine.


A button was installed to

identify a wrong part. If the part

is placed in the incorrect

position, the button will be set

and will not allow the machine

to work.


Detection

Prevention

What do you think?

Joel Perez



2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka


7. Kaizen


Joel Perez

I. Kanban Definition

Kanban is a Just-in-Time tool that manages material

handling in the right time, place and in exact quantity.

• Kanban card indicates standard quantity of production

• Derived from two-bin inventory system

• Kanban maintains discipline of pull production

• Production kanban authorizes production

• Withdrawal kanban authorizes movement of goods

Joel Perez

II. Kanban

Q = order quantity

R = reorder point

= demand during lead time

Bin 1 Bin 2

Q - R

R

Reorder

Card

Kanban

a. Two-bin inventory system b. Kanban Inventory System

Origin

Joel Perez

II. Kanban

Machining

M-2 Assembly

A-4

Part no.: 7412

Description: Covers

From : To:

Box capacity 25

Box Type A

Issue No. 3/5

A Kanban Sample

Joel Perez

II. Kanban

P P

P

W

W

Container with withdrawal kanban

Container with production kanban

X

X

X X X

Work flow

Kanban flow

Dual Kanbans

Joel Perez

II. Kanban

X X X

X X

X

Work Flow Information Flow

Kanban Squares

Joel Perez

II. Kanban

407 409 410 412

408

411

Part

Number

Kanban Racks

Joel Perez

II. Kanban

• Kanban aims to transmit production information among the work and process areas.

Green

level

SYSTEM KANBAN

Needed

pieces

Red

level

Yellow

levelA visual management can be used to

indicate a Kanban.

Joel Perez

VI. Example – Kanban in the Office

Control inventory of papers in the office through Kanban cards.

Green: There is

enough material, it’s

not necessary to feed

the inventory

Yellow: This is an

alert. It’s suggested

to feed the inventory

at this stage.

Red: Risk of lack of

material

Joel Perez



2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka


7. Kaizen


Joel Perez

I. Heijunka (Production Leveling) Definition

• Produce only what the customer needs

• Equalize volume and types of production

• Level production sequence

Joel Perez

II. Production Leveling

• This load smoothing method significantly reduces the

risk of waste in the system by producing only what the

customer needs.

• Level production scheduling, determined by sales

volume and variety, then equalizing the volume and

types across the entire manufacturing process.

Volume Type

Joel Perez

III. Leveling and Sequencing

• Assuming 20 working days per month: – If a customer orders 5000 A models per month

We should produce 250 a day

– If another customer orders 2500 B models per month We should produce 125 a day

– And, if another customer orders 2500 C models per month We should produce 125 a day

– Should we first produce all A’s, then all B’s, and then all C’s, or . . . ?

• Well, what do you think?

Joel Perez

III. Leveling and Sequencing

• To level the production mix and volume, it

is necessary to:

• Determine the package size

• Determine the work pitch Pitch = Takt Time x Package Size

Joel Perez

IV. Example

• Assuming 20 working days per month:

• Takt Time = =

• Assuming 1 package with 50 parts:

Pitch = 57.6 x 50 = 2,880 seconds = 48 minutes

576,000 seconds

10,000 parts 57.6 seconds

Joel Perez

IV. Example

• For each 48 minutes:

Production of a package amount (50 parts)

Withdrawal of finished goods amount from one pitch

A A B C A A B C A A B C A A B C A A B C A A B ...

First day of production Second day of production

10 packages per day

Or another combination like:

B A A C B A A C B A A C B A A C B A A C B A A B ...

Joel Perez



2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka


7. Kaizen


Joel Perez

I. TPM Definition

•Total Productive Maintenance is a process

that allows continuous improvement within

the production processes of the company

•It consists of cross-functional work teams

which work together in order to improve

equipment effectiveness in their work areas

Joel Perez

I. TPM Definition

• A plant-wide, team-based effort to build quality into equipment and to improve Overall Equipment Effectiveness.

• Total

– all employees are involved

– it aims to eliminate all accidents, defects and breakdowns

• Productive

– actions are performed while production goes on

– troubles for production are minimized

• Maintenance

– keep in good condition

– repair, clean, lubricate

Joel Perez

II. TPM Objective

• The objective of TPM is to create a culture where

operators develop ownership of their equipment, and

become full partners with Maintenance, Engineering and

Management to assure equipment operates properly

everyday.

GOAL: Zero Breakdown

• Zero accidents

• Zero quality defects

• Zero machine downtime

• Zero waste

Joel Perez

III. TPM – The Five Elements

5. SGA´S – Small

Groups Activities

1. Training in operation

and maintenance

4. Improving the

overall equipment

effectiveness

2. Conducting planned

maintenance

3. Management of the

whole equipment

life cycle

5

TPM elements

Joel Perez

1. Training in Operation and Maintenance

• Team work

• Single Point Lesson

• Specialized training in one function

• Inspection techniques

• Data collection

• Knowledge of Lubrication

• Skills and performance on basic mechanics

• Knowledge of R&M (Reliability & Maintainability)

Training is a critical

part of TPM.


1

Joel Perez

2. Conducting Planned Maintenance

• Specialized Staff – Facilitators and high level of

technical knowledge

• Operators – Group performance with

maintenance

• Preventive Maintenance Schedule

• Autonomous Maintenance – Develop

operator’s capacity to execute small repairs

and inspections, keeping the process according

to the established standards, predicting the

occurrence of problems


2

Joel Perez

3. Management of the Whole Equipment Life Cycle

• Minimizing the cost of a new equipment’s life cycle

• Data collected by SGA’s (Small Groups Activities) to

prevent the recurrence of problems


3

Joel Perez

MTTR & MTBF

MTTR (Mean Time To Repair): Average time to repair a

machine/equipment to normal working condition

MTBF (Mean Time Between Failure): Average time a

machine/equipment operates before it experiences a failure

MTTR = Total repair time

Number of failures

MTBF = Available Time – Downtime

Number of failures


Better

Better

Joel Perez

Reliability

• Probability of the machine/equipment operating

continuously, without failure, for a time period

under regular conditions


Joel Perez

Maintainability & Availability

• Availability

• The percentage of time a machine/equipment is ready to function

• Maintainability

• The probability that a failed machine/equipment is fixed or replaced at or before certain time


Joel Perez

4. Improving the Overall Equipment Effectiveness

PRODUCTIVITY

AVAILABILITY

QUALITY

O. E. E. • Improvement of quality

and productivity

• Cost reduction

• Customer satisfaction

• Work safety


4

Joel Perez

5. Small Groups Activities

• 1 - Cleaning is Inspection

• 2 - Lubrication, Cleaning and Safety Procedures

• 3 - Eliminating Contamination Sources

• 4 - Training on general Inspection

• 5 - SGA´s Inspections and Procedures

• 6 - Organization of the Work Area

• 7 - Equipment Handling by the SGA


5

Joel Perez

IV. TPM Workshop

Small Groups Activities

• Measuring and eliminating deterioration trends

• Ensuring that the equipment is maintained at the optimum

operational level

• Eliminating problems that impact quality and productivity Joel Perez



2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka


7. Kaizen


Joel Perez

I. Kaizen Definition

Kaizen philosophy states that our way of life –

at work, in our society or at home – should be

continually improved.

Joel Perez

II. Origin of Kaizen

–Developed in postwar Japan by companies needing to rebuild

–Deming and Juran provided Japan concrete process tools to assist in implementing Kaizen philosophy

–Based on a belief that there should be step-by-step continuous improvement

–Established a strategy for making improvements every day

–Kaizen, “the elimination of waste through continuous improvement,” became a way of life

Joel Perez

III. Kaizen/Standardized Work Stair Steps

Standardize

Standardize

Standardize

Ka

izen

Kaiz

en

Kaiz

en

Standardized Work:

The foundation step

for Kaizen

Kaizen:

Elimination of waste

through continuous

Improvement, using

lean tools

Standardize

Joel Perez



2. 5S

3. Poka Yoke

4. Kanban

5. Heijunka


7. Kaizen


Joel Perez

I. Value Stream Mapping Steps

• Current state map – “As Is”

– Identify sources of waste

• Future state map – “To Be”

–Eliminate wastes, creating a value stream the way it should be

• Customer-oriented processes

• Continuous or pulled flows

• Producing only what is required, when required

Future State Mapping – “To Be”

Joel Perez


• The pacemaker process is the scheduling point. Typically, it is where you begin implementing the leaner future-state value stream designed during the value stream mapping (VSM) process

• The pacemaker process is generally at the customer end of the value stream where products take their final form. It's often the final assembly process, but not all of the time

• This process is called the pacemaker because how production is controlled there determines the pace of production at all the upstream processes. How well the pacemaker functions also determines how well you meet external customer demand. Mess up at the pacemaker, and the rest of your value stream will never be lean


Joel Perez


•What is the target time?

•Will you build to a finished goods supermarket, or directly to shipping?

•Where can you use continuous flow processing?

•Where will you need to use supermarket pull systems to control production of upstream processes?


Key Questions for Future State Map

Joel Perez


•At what single point in the production chain (the “pacemaker process”) will you schedule production?

•How will you level the production mix at the pacemaker process?

•What increment of work will you consistently release and take away at the pacemaker process?

•What process improvements will be necessary for the value stream to flow as your future-state design specifics?


Key Questions for Future State Map

Joel Perez


• In order to reduce Lead

Time, one should not only

eliminate the seven wastes,

but also find the basic

causes of these wastes.


Value Lean Flow

Joel Perez


• “What we are trying to do in lean production is to obtain a process

that can do only what the next process needs and when it is

necessary. We are trying to link all of the processes – from raw material to the final customer –

in a regular flow decreasing lead time, increasing quality and

reducing costs”.


Value Lean Flow

Joel Perez


•Produce according to your Takt Time

•Develop a continuous flow wherever possible

•Use supermarkets to control production where the continuous flow does not extend to the previous processes

•Try to send the customer schedule to only one production process


Rules for a Value Lean Flow

Joel Perez


•Uniformly distribute production of different products through time in the pull process

•Create an initial “pull” releasing and withdraw a small and uniform work improvement in the pull process

•Develop the ability to perform “every part every day” in the fabrication processes previously to the pull process


Rules for a Value Lean Flow

Joel Perez


• An Implementation Plan should be used to help in the Future State Map implementation process. It includes:

–Lean Policy (Mission, Vision, Values)

–What is planned to do and when

–The responsibility for implementation

–Quantifiable goals

–Clear checking points including time limit and appraiser

Implementation Plan

Joel Perez

II. Business Value Stream Mapping Example

Future State Map

Develop Project

Mgmt . Review

Plant Approval

Controller Approval

Mgmt .

Approval Funding Available

6 Weeks

6 h

48h 48h 48h 48h 10 h 473.5 h

1.0 h 3 h 16.0 h 2.0 h 5.0 h


PT = 15 Wks PT = 240 h

FTT = 30%

PT = 72 h

FTT = 100%

= 3 = 2 = 3 = 10 = 1 = 1 W W

W W I

20 = 3 = 3 = 3 = 3 = 10 = 10 = 1 = 1 = 1 = 1 W W W W

W W I

20

I

20 20

PT = 96 h

FTT = 50% PT = 30 min

FTT = 99%

PT = 2 h

Local

33.0

Project . Plant

Approval

.

6 Weeks

6 h

48h 48h 48h 48h 10 h 473.5 h

1.0 h 3 h 16.0 h 2.0 h 5.0 h


PT = 240 h

FTT = 30%

PT = 72 h

FTT = 100%

= 3 = 3 = 2 = 2 = 3 = 3 = 10 = 10 = 1 = 1 = 1 = 1 W W W W

W W W W I

20

I

20 = 3 = 3 = 3 = 3 = 10 = 10 = 1 = 1 = 1 = 1 W W W W

W W I

20 20

I

20 20

PT = 96 h

FTT = 50% PT = 30 min

FTT = 99%

PT = 2 h

33.0

Joel Perez

IMPROVE: Select Solutions

• Shows relationship of problem statement, root causes

and proposed solutions

Problem Root

Causes

Solutions (What)

Specific

Tasks (How) X X =

SCALE: 1-None 2-Somewhat 3-Moderate 4-Very 5-Extreme

Joel Perez

Solution Selection Matrix - Example

Separate internal &

external activities

Non-standard

shipping

racks

Poor maint.

& schedule

Late Delivery to

Customers

Problem Root

Causes

Solutions (What)

Specific

Tasks (How)

Prepare tools for next

change before truck

arrives

X X =

SCALE: 1-None 2-Somewhat 3-Moderate 4-Very 5-Extreme

5 4 3 60 Yes

5 3 4 60 Yes

4 2 1 8 No

4 4 4 64 Yes

5 3 3 45 Yes

... ... ... ... ...

... ... ... ... ...

Standardize procedure for

rack adjustments

Contract maintenance

work Schedule preventive

maintenance

Improve maintenance

quality

Shop Foreman develops

schedule

& allocates work to Techs

Improve Tech skills thru

Training and SOPs

........... ..................... ........

........

Joel Perez

IMPROVE: Update Outcome Indicators

Ja

nu

ary

Ma

y

Se

pte

mb

er

Ja

nu

ary

Ma

y

Se

pte

mb

er

Ja

nu

ary

Ma

y

0

10

20

30

40

50

• Revise Outcome Indicators showing improvements in

the process performance

Before

After

%

Joel Perez

Joel Perez

CONTROL

Joel Perez

CONTROL the Process • Goal

– Control the process to maintain the gains and transition to full implementation

• Key Outputs

– Documentation for the new method

– Training for the new method

– An operating Process Management Control System

1

2

3

4

5

DEFINE

MEASURE

ANALYZE

IMPROVE

CONTROL

Joel Perez

CONTROL: Story Components To institutionalize the improvement and implement ongoing monitoring

Develop and Document

Standard Practices Train Personnel

Training

Curriculum Training

Manual

Build the

Process Management Control System

Fully Implement Solutions

and PMCS

Close Project

and Celebrate

Standard

Practice

Replicate

Projects at Other

Locations

Cost/Benefit

Analysis

Approval from

Finance

Verify Cost/Benefit

“X” Upstream Indicators UCL

LCL

UCL

LCL

“Y” Outcome Indicators

Good

5

Joel Perez

PMCS (Standardized Work)

Visual Management/Andon


Standard Practices

Build the Process Management

Control System

Train Personnel, Fully Implement

Solutions & PMCS

Close Project, Celebrate and

Replicate



CONTROL: Tools, Indicators and Methodologies


1.PMCS

2.Visual Management/Andon

Joel Perez

I. PMCS (Standardized Work)

Process Management

Control System

Process

Control Improving

= Process

Stability

A

Improving

= Process

Capability

B

Identify and Select Top-Priority Process

Identify and

remove

special

cause

variation

Investigate

common

cause

variation and

change the

process

Standardize and Replicate

Is process stable?

Develop Indicators and Build the Process Management Control System

Identify Customer and Supplier Requirements

Document Top-Priority Process

Implement the Process Management Control System

N

N

Y

Y

A

B

Is process capable?

Managing Process Performance…

Pro

cess M

an

ag

em

en

t

Joel Perez


Outcome Indicators ( Ys ): Customer’s CTQs : Primary Customer of Process: Process Name:

Misc.

Information Capturing Data Process Map

Position

Step/

Time

- Indicator Formula

- Procedures

- Abbreviations

- Comments

Recovery

Action

Who

Perform

Check

When to

Check

“ Physical “

Item to

Check

Indicator

Chart

Type

- Name

- Numerator &

Denominator

or Description

Approver By Change Log – Describe Revisions Date Rev #

Outcome

Indicators

(Ys)

- Name

- Numerator &

Denominator

- Specification

Upstream

Indicators

(Xs)

Joel Perez


Outcome Indicators ( Ys ): Customer’s CTQs : Primary Customer of Process: Process Name:

Misc.

Information Capturing Data Process Map

Position

Step/

Time

- Indicator Formula

- Procedures

- Abbreviations

- Comments

Recovery

Action

Who

Perform

Check

When to

Check

“ Physical “

Item to

Check

Indicator

Chart

Type

- Name

- Numerator &

Denominator

or Description

Approver By Change Log – Describe Revisions Date Rev #

Outcome

Indicators

(Ys)

- Name

- Numerator &

Denominator

- Specification

Upstream

Indicators

(Xs)

Yes

Step up to desk

Is there a line?

Wait

Approach front desk

Clerk available?

Give room number

Check bill

Charges

correct?

Correct charges

Pay bill

Yes

Yes

No

No

No

Wait

Hotel Check-out Process Hotel Customer

Y1 = % of

bills paid in

more than 10

minutes

X1 = Waiting

time (line)

CUSTOMER CLERK

X2 = Waiting

time (clerk)

X3 =

Checking the

bill

XR Chart

XR Chart

XR Chart

Trend

Chart

Y1

X1

X2

X3

Check and

record in

worksheet

5

measurements

per hour

5

measurements

per hour

5

measurements

per hour

Daily K.

Houston

J.Blake

J. Blake

J. Blake

Free

daily

expense

3 m

inu

tes

Lin

e / C

lerk

ava

ila

bili

ty

3 m

inu

tes

Pa

y B

ill

Y1 = % of bills paid in more than 10 minutes Timeliness

Check and

record in

worksheet

Check and

record in

worksheet

Check and

record in

worksheet

Joel Perez


1.PMCS

2.Visual Management/Andon

Joel Perez

I. Visual Management Elements

• 1. Visual Display

• Communicates important information, but does not always control what people or machines execute. It is the first level of visual control.

• Example: Information can be placed in a safety chart, however this information alone cannot control the behavior.

• Ex.: n# of accidents/month

MONTH

ACCIDENTS

0

5

Joel Perez

I. Visual Management Elements

• 2. Visual Control

• Provides important information, usually standards, in a way that activities can be controlled based on these information and standards. There are several levels of visual control.

• Example: Several controls are placed to direct specific individual behavior and to prevent accidents: tickets, machine protectors, non-slippery surface, etc.

CAUTION!!!

HIGH POTENTIAL Ex..:

Joel Perez

II. Visual Control System

• A visual control system is a set of control equipment, information, color codes, layouts and plates (indicative and warning), all standardized, which creates a common visual language in the workplace to:

• Readily distinguish the normal from the abnormal

• Make abnormalities and wasting obvious enough so that anyone can see them

• Constantly discover improvement needs and opportunities

Joel Perez

III. Visual Management Implementation

5 STEPS:

1. Project identification

2. Workplace organization (5s)

3. Visual display

4. Elements to control/tools and methods

5. Visual control development

Joel Perez

1. Project Identification 1. PLACE

Identify the specific area to

implement Visual Control.

Selection criteria:

- Disordered and disorganized

- Consistent problems

- Low adherence to standards

- Great improvement opportunity

2. PURPOSE

Identify the primary purpose to

which the area is used.

What is described:

- Which is the process

- Inputs and outputs

- More important functions performed

3. PEOPLE

Identify individuals who work

with and/or need information.

Who identify:

- Operators

- Maintenance and setup personnel

- Engineers, supervisors, managers

- Suppliers, customers

4. VCS TEAM (VISUAL CONTROL SYSTEM)

Who will be responsible for the

implementation of Visual

Control.

Who select/identify::

- People who work in the area

- Everybody motivated to the improvement

- A customer or supplier


Joel Perez

2. Workplace organization (5S)

SORT STRAIGHTEN

SWEEP STANDARDIZE

SUSTAIN


Joel Perez

3. Visual Display

• Everything which helps, informs, directs, warns and leads, etc.

• Standards established to: • - inventory • - equipment • - operations • - quality • - safety

• Activities results and improvements such as: • - production number • - defects • - maintenance number • - preparation time • - improvement goals • - operational productivity time

Other information such as:

- name of the department

- equipment and processes identification

- employees’ names

- training

- 5S/plant/line map

- process chart

- sample of pieces

- maintenance plan

- labels


Joel Perez

4. Elements to Control: Tools and Methods

• Elements to Control/Tools and Methods for Visual Management

• Contents/amount at inventory/container

• Location/proximity of inventory

• Distinction of conforming from non-conforming goods

• Preventive maintenance schedule and verifications

• Detection of abnormalities/Detection of defects

• Dangerous operation


Joel Perez

5. Visual Management Development

1. What information (standard) about the focus area needs to be

known by each team member?

2. How is each team member notified about standards,

information and/or situations/positions?

3. Make a list of ideas about how the standards, information

and/or situations/positions above can be visually

communicated for the co-workers of an area. (Brainstorming).

4. What are the resources needed to implement visual displays

or controls?


Joel Perez

IV. Visual Management - Andon

• Andon immediately alerts the supervisors

about abnormalities that happen in the

plant.

Joel Perez

Library shelf

Work station

Visual kanbans

Tool board

Machine controls

Better

Good

Best

30-50

How

to

sensor

V. Visual Management Example

Joel Perez

Font: www.london-electronics.com

V. Visual Management Andon Example

Joel Perez

V. 5S & Visual Management Exercise

• Using 5S & Visual Management, let’s organize the room!!

Joel Perez

Lean Summary

Joel Perez

DEFINE: Identify Business Opportunity/Gap

• Defects

• Variability

• Inconsistency

• New Product/Service

• Missed Due Dates

• Rework

• Scrap

• Slow

• Exception handling

• Unplanned downtime

• Bottlenecks

• Redundancies

• Capacity Constraints

• Inventory Write-offs

• Complexity

• Backlogs

• PMCS gaps

What problems do you face? Joel Perez

Customer CTQs

Outcome Indicators

Identify Business Opportunity/Gap ($)

Identify Customer’s CTQ Attributes



Develop Preliminary Problem

Statement


Prepare Communication & Project

Plans



DEFINE: Lean Tools, Indicators and Methodologies

Indicators

OEE

DTD

RTY

BTS

WIP

Develop Data Collection Plan

Collect Data

Plot Data Over Time

Graphical Analysis of Data

Calculate Performance

Set Process Performance / $

Improvement Goal

Develop Final Problem

Statement

Tools

Value Stream Mapping

VA & NVA Analysis

Create Detailed Process Map

Identify VA & NVA Steps




Takt Time

TOC

SMED

Brainstorm and Organize

Potential Causes

Verify Potential Causes with

Data

Confirm Root Causes





Storyboard Tool, Indicators and

Methodologies

Identify and Select Solutions

Conduct


Conduct Risk Analysis

Develop Action Plan For Full

Implementation

Develop Pilot Plan


Update Outcome Indicators

Just in Time

Pull System

One Piece Flow

5S

Poka Yoke

Kanban

Heijunka

TPM

Kaizen

Value Stream Mapping –

Future State

PMCS (Standardized Work)

Visual Management/Andon


Standard Practices

Build the Process Management

Control System

Train Personnel, Fully Implement

Solutions & PMCS

Close Project, Celebrate and

Replicate




OE LEAN Tools Summary

MEASURE ANALYZE DEFINE IMPROVE CONTROL

• VSM (current state)

• VA/NVA Analysis

• OEE

• DTD

• RTY

• BTS

• WIP

Project

Opportunity

Sources

• Takt Time • Theory of Constraints

• SMED (Quick Changeover)

• Spaghetti Chart

• Just-in-Time

• Pull System

• One-Piece Flow

• Kanban Pull

• 5S

• Poke-Yoke

• Heijunka

• TPM

• Kaizen

• VSM (future state)

• PMCS (Standardized Work)

• Visual Management

• Bottlenecks

• Complaints

• Business Plan

gaps

• PMCS gaps

• Value Stream

Map

• Capacity

Constraints

Joel Perez

Joel Perez

Improvement Ideas

Joel Perez

green belt lean training

Education