page 1 lean manufacturing andrew w. dalziel product director - scm intentia international...
TRANSCRIPT
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Agenda – Lean Manufacturing
Introduction – The Challenge
Why Lean Manufacturing Makes Sense
What is Lean Manufacturing?
How Does Technology Support Lean?
Intentia and Lean Manufacturing
The Benefits of Lean Manufacturing
Example of Where to Start the Lean Journey
Summary
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The Challenge – Low Cost Competition
% of respondents facing competitive challenges
Companies Increased Competition on Costs
•>70% facing some or significant low cost competition
•95% of customers demanding lower prices
•50% say competitors are producing higher valued added goods
•>70% facing some or significant low cost competition
•95% of customers demanding lower prices
•50% say competitors are producing higher valued added goods
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The Challenge – Manufacturing Costs
Manufacturers Look Abroad
% of companies employing competitiveness strategy
• 45% planning to or have outsourced manufacturing abroad
• 30% planning to or have invested abroad to replace capacity
• 45% planning to or have outsourced manufacturing abroad
• 30% planning to or have invested abroad to replace capacity
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Why Lean Manufacturing Makes Sense
Western manufacturers under cost pressure from low-cost countries
Customers are demanding greater product variety and highly customized products
Customers are demand more new products
Customers demanding shorter delivery lead-times and lower prices
Increasing transactional volumes
Worker motivational issues
Stricter Health & Safety rules
Cash flow issues with working capital tied up in inventory
Competitive global environment - advantage through delivering greater added value
….
Lean Manufacturin
g Makes a Lot o
f Sense
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Adoption of Lean Manufacturing
An ARC Group strategy report written by Simon Bragg (2004) suggests that “Today 36 percent of US manufacturers and 70 percent of UK manufacturers are using lean as their primary improvement methodology.”
Use of Lean as Improvement Methodology
0
10
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US UK
Country
Pe
rcen
tag
e o
f Ma
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factu
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Lean manufacturing is essentially a philosophy that focuses on customer value-adding activities and the systematic identification and elimination of waste, as well as continuous improvement in flow manufacturing environments to increase productivity.
Defining Lean Manufacturing
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1. Value Identify and deliver value to the customer
2. Value stream Identify the value stream to see what is necessary
3. Flow Make value flow
4. Pull Make as needed. Customer demand driven manufacturing
5. Perfection Continuous improvement in pursuit of perfection
Five Core Elements of Lean Thinking
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How Technology Can Support Lean Manufacturing
Product data management for managing exploding product variety
Electronic kanban offers many advantages over physical kanbans
– Avoids problems of loss or sabotage of physical kanbans
– Quicker transfer of information between production areas and partners
– Faster and easier to resize kanbans
– Easier to phase in new products
Supplier and customer portals for kanban control or JIT call-offs
Ability to support complex algorithms for Theory of Constraints planning
Databases and powerful analytics tools to identify customer value and support continuous improvement
Elimination of waste in administration, such as order entry, order management, invoicing, etc.
Page 10 EDI=Electronic Data Interchange
Intentia Support for Lean Manufacturing
Lean Manufacturing
Electronic & Physical kanbans
EDI/XML SupplierCall-Offs
OrderlessProduction
Production Rate
Plant Maintenance
TOC Drum-Buffer-Rope
Materials Back-
flushing
EnterprisePerformance Measurement
Lean Material Planning
Order Initiation
Business Process
Design Tool
Forecasting
CustomerDelivery
Schedules
Opportunity Analyzer
ProductConfigurator
iBrix based Customer and Supplier Portals
Examples of Intentia Support
Pull - JIT/Kanban
Pull - Theory of
Constraints
Flow - Lean MaterialPlanning
Flow -Levelled
Scheduling
Flow - Total Productive
Maintenance
Perfection-Continuous
Improvement
Value Stream - Mapping
Value -Analysis
Pull -RepetitiveScheduling
Pull - ProductConfiguration
Examples of Lean Techniques
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Value – Enterprise Performance Management
“In competitive terms, value is the amount buyers are willing to pay for what the firm provides them. Value is measured by total revenue, a reflection of the price a firms product commands, and the units it can sell.”
Michael Porter
“In competitive terms, value is the amount buyers are willing to pay for what the firm provides them. Value is measured by total revenue, a reflection of the price a firms product commands, and the units it can sell.”
Michael Porter
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Flow – Total Productive Maintenance (TPM)
Advanced enterprise asset management options increase equipment reliability and thus:
– Improve availability
– Reduce downtime
– Reduce product scrap and wasted time managing that scrap
– Increase machine tolerances and thereby increase quality
Diagnostics management features automatically identify situations where the current maintenance strategy is not working and trigger a continuous improvement review.
Support for reliability centered maintenance (RCM), which can underpin the TPM strategy
Synchronized maintenance and production planning maximizes the available production time
Contributes towards throughput and OEE and supports simulation
Ultimately, provides focused support for reducing the “big six” TPM losses.
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Pull – Product Configurator
Enables customers to configure their ‘perfect order’
Added value for the customer
Web-enabled
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Support physical and electronic kanban systems One-card and two-card systems – production and transportation kanbans External kanban requirements from customers and for call-offs to suppliers Manual or automatic dimensioning of kanban chain (number of cards in
system)
Physical Kanban System
Production kanban
KAN-001 Kanban item KANBAN11 85
Item no . . . . . . Name . . . . . . . . To location . . . Order Quantity .
10/08/05
Electronic Kanban System
Pull – Kanban
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Pull – Theory of Constraints Production Planning
Makes value flow through the bottleneck (and factory)
Easy to communicate and intuitive for the planner to use
Does not require high data quality 50% of the time and effort to implement of
an advanced production planning solution Can result in less inventory overall than
when using kanban
Remaining buffer on a non-bottleneck resource
Remaining buffer on a non-bottleneck resource
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Some Benefits of a Lean Manufacturing Philosophy
For the CEO
Focus on customer value-adding activities
Elimination of activities that do not contribute directly to customer value and built-in quality
Support or pull-based manufacturing with quick response to customer orders
For the CFO
Reduced waste -> removal of unnecessary activities and cost
Removal of stock and work in progress (WIP) -> improved inventory turns and less working capital employed in the business
Improved return on capital employed (ROCE)
For the Operations Director
Shorter production cycle times and greater agility
Productivity and quality improvements
Increased employee motivation (through teams and empowerment)
Promotes continuous improvement
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Example: Lean Manufacturing in F&B – Where to Start?
Future
Move decoupling point upstream, e.g., fill and bake-to-order
ShippingSupplier RawMaterial
Warehouse
Mixing FinishedGoods
Warehouse
Baking/Cooking
FillingLine
PackingLines
TemporaryStorage
PullPack or
Label-to-orderor using
ElectronicKanban or TOC
Order-less Productionwith Back-flushing of
Raw Materials
PullSupplier Agreements
with JIT call offor
Supplier ManagedInventory
DecouplingPointStill need to forecast
VMIAt customer
DC
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Summary – What’s the Issue?
ISSUEMaximizing customer valueTO Protect andgrow market share
PROBLEMDemanding customersANDCash tied up in inventoryAND Cost pressures
SOLUTIONAdoption of a leanmanufacturing philosophyWITHIntentia as a partner forlean solutions
VALUEIncreased customer valueANDElimination of wasteANDContinuous improvement
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Thank You for Your Time
and
Questions