Transcript LEAN MANUFACTURING

Lean Manufacturing
A Presentation
With Success Stories!!!
Contents
 A Brief
Over-view
 A Brief History
 Lean Enterprise
 Tools & Methodology
 Successful Case Studies
 Conclusion
How to make Lean Work
Lean People
Overcoming Obstacles
Benefits of Lean Manufacturing
Key Definitions
 Value – A capability provided to a customer at
the right time at an appropriate price as defined
in each case by the customer.
Product ( or service) features, cost,
performance and availability are dimensions of
value.
 Waste – Any activity that consumes resources
but creates no value (waste).
What Is Lean Manufacturing?
Lean manufacturing can be defined as
“A systematic approach to identifying
and eliminating waste (non-value-added
activities) through continuous
improvement by flowing the product at
the pull of the customer in pursuit of
perfection.”
Over-view of Lean Production
 Focuses
on eliminating wastes in
process
 Is not about eliminating people
 Is about expanding capacity by reducing
costs and cycle time
 Is about understanding what is important
to customer
Lean = Eliminating Waste
(Typically 90-95% of Total Lead Time Is
Non-Value Added!)
 D - Defects
 O - Overproduction
 W - Waiting
 N - Non (under) utilized people
 T - Transportation
 I - Inventory
 M - Motion
 E - Extra (unnecessary) processing
Lean Is Not Restricted to
Shop-floor
 Lean
is not a “point” solution but a
continuos improvement process
 Lean practices & principles are not just
“shop floor” improvements
 Lean can be deployed in Marketing,
Finance, Design, Procurement and
other Administrative areas
 Best Companies are migrating lean
“beyond shop floor”
Lean Manufacturing: A Brief History
FORD
 One of the most noteworthy
accomplishments in maintaining low price
of Ford Products was gradual shortening of
their production cycle
 “The longer an article is in the process of
manufacture and the more it is moved about, the
greater is its ultimate cost” – Henry Ford, 1926
 Henry Ford identified 5 of the 7 Lean
Wastes in the 1920’s
Lean Manufacturing: A Brief History
TOYOTA
 Manufacturer
of Trucks and Small
Automobiles in the post WW-II Japan
 A need declared by Toyota’s President for
a new production method that would help
to eliminate wastes and catch up with
foreign competitors
 Chief Engineer studied Henry Ford’s
writings and visited Ford plants
extensively in the 1950’s
Lean Manufacturing: A Brief History
TOYOTA
This led to “Toyota Production System (TPS)”
which became popular in the 1970’s
 The concept introduced by the Japanese was
first applied by the factories in America
 Later came to be known as
“Lean Manufacturing”
 Lean Production Strategies were adopted by
most industries around the world in the 1990’s
and beyond

Lean Enterprise - Definition
Extends lean principles to all business
functions including manufacturing,
finance, design, planning, human
resource and supply chain
Lean Enterprise
With less:

Does
more
Materials
 Electricity
 Space
 Paperwork
 Transportation
 Waste
 Effort
Objectives of Lean Enterprise
Total
Customer
Satisfaction
Elimination of
Waste
Business Processes
Physical Processes
Respect for
Workers Dignity
Product Life-cycle
DESIGN
Concept to Customer
Usage to Recycle
SUSTAIN
Order to Delivery
BUILD
Transformation to Lean
Enterprise
Lean Manufacturing
 Pull
 Flow of
Parts
 Flexible
 Shop Floor
Managed
Lean Enterprise




Pull Applied in All
Business Functions
Flow of Parts and
Paper / Information
Flexibility in
Production,Design,
Sales,Marketing
Value Stream
Managed
Old Paradigm
New Paradigm
Lean Vs. Traditional

Half the hours of engineering effort
 Half the product development time
 Half the investment in machinery,tools and
equipment
 Half the human efforts in factory
 Half the defects in output
 Half the factory space for the same output
 A tenth or less of in-process inventories
Lean Implementation
Dimensions
Spatial
Transactional
Resource
Organizational
Tools & Methodology
 Value
Stream Mapping
 JIT (KANBAN)
 SMED
 Pokayoke
 Six-Sigma
 Motion Study
 DFM
 Benchmarking
 KAIZEN
Value Stream Mapping
 The
initial step which must be taken for an
organisation to adopt lean strategies
 A method
of visually mapping the flow of
materials and information from the time
products come in the back door as raw
material, through all manufacturing process
steps, and off the loading dock as finished
products
Value Stream Mapping
 Can
be a communication tool, a business
planning tool, and a tool to manage an
Organisation’s change process
 Visualises
the current state of the process
activities and guides towards the future
desired state
 Goal
is to identify and eliminate waste (any
non-value addition) in the process
Benefits of Value Stream Mapping



Helps visualize the production process at
the plant level not just the single process
level
Helps you see more than waste it helps
you see the sources of waste in your
value stream
Shows the linkage between the
information flow and the material flow
Benefits of Value Stream Mapping
 Makes
decisions about the flow apparent,
so you can discuss them
 Forms the basis of an implementation plan
 Ties together lean concepts and
techniques to enable improvements that
show up in your organization's bottom line
Value of Time
 Henry
Ford, 1922, My Life and Work:
"If a device would save in time just 10 per
cent. or increase results 10 per cent.,
then its absence is always a 10 per cent
tax.
…Save ten steps a day for each of twelve
thousand employees and you will have
saved fifty miles of wasted motion and
misspent energy."
Ford on Supplier Development

"The man finally consented to try to manufacture
at exactly one half his former price. Then, for the
first time in his life, he began to learn how to do
business. …he found he could make cost
reductions here, there, and everywhere, and the
upshot of it was that he made more money out of
the low price than he had ever made out of the
high price, and his workmen have received a
higher wage" (Henry Ford, 1926, Today and
Tomorrow).
 The supplier had wanted $152 per body. Ford
built a model for $50 in labor and materials. The
supplier then agreed to accept $72 per body.
Waste To Profit
Henry Ford:

A wood distillation plant turned scrap wood into methyl
alcohol, charcoal, tar, and fuel gas
 $12000/day could pay 2000 workers @$6/day (Ford's
relatively high minimum wage) in 1926
 Charcoal briquettes from sawmill chips (Kingsford
charcoal)
 Blast furnace slag  cement and paving material
 A paper plant converted waste paper into binder board
and cardboard
 Fumes from a coating operation were recovered by
adsorption in charcoal and reused
Keep Your Eye on the
Doughnut's Hole
• Doughnut = the product
• Hole = whatever is thrown away
Example: metal sheet with six stamped holes (product)
Workers ask,
"What was in
those holes?"
Most people saw scrap for remelting
and reuse. Ford's workers saw
radiator caps. Pressing two disks
made a very strong radiator cap.
Organisations Working on
Lean

Boeing
 BMW
 Carrier
 Caterpillar
 Chrysler
 Coca Cola
 Dell
 Ford

General Motors
 IBM
 Toyota
 Johnson & Johnson
 Subway
 US Navy, Air force
 Gateway
 Exxon Mobil
Success Stories of Lean
Implementation
Donnelly Mirrors Grand Haven Plant
Donnelly Mirrors Grand Haven Plant
Results of Improvements
Korry Electronics Co.
Successfully Implemented Lean in their
entire Organisation
 ISO-9001:2000
Certified Company
 Located in Washington, USA
 Specialises in Operator’s Interfaces for
Aerospace, Defence & Other Industries
 Expertise in Electronic Displays, Lighting,
Switching …
Korry Needed a Better Way
 To
eliminate mistakes
 To reduce cycle and lead time
 To lower labour costs
 To save space
 To reduce inventory
5S Organization Methods
Lean Manufacturing Is Not
Only for Big Organisations
Case Study of Kamaka Hawaii Inc., USA
Kamaka Hawaii Inc.
 A family-owned
and operated business
with fewer than 50 employees.
 Manufactures
high-quality Ukuleles
(Guitar - like musical instrument), parts,
and accessories.
 Leading
supplier of Ukuleles to the
Hawaii marketplace.
Problem Faced by the
Company
 Product
demand outpaced its
production capacity
 Considered
moving to a larger facility
to allow for expansion
Solution
 General
Manager decided to apply
lean concepts
 Realized
his company did not need to
move
 Could
instead improve its process flow
Results
 Decreased
work in process by 60 percent
 Reduced space requirements and product
damage
 Streamlined production process
 Simplified order entry
 Improved customer service and flexibility
to manufacture products as per order
 Avoided expense of moving to larger
facility, while expanding production
The Impact of Becoming Lean
Toyota has overtaken Ford as number two in
the global motor industry
It intends to overtake General Motors to
become number one by 2010
“Brilliant process management is our
strategy.” Senior Toyota executive
How Important Is Lean?
To Conclude:
How to Make Lean Work?
Philosophy
System
Techniques
People
Lean People Make a
Lean Enterprise
 An
enterprise is a collection of people
voluntarily banding together to produce a
product or service
 To have a lean enterprise, you have to
have lean people
 People have to get lean before the
enterprise can get lean
Lean People Have Something
Skills
Pre-requisites to applying the knowledge
And experience
 Understanding value
 Identifying and working in the value
stream
 Being able to adapt rapidly
 Leading from below
 Taking the initiative
 Innovating: changing things for the better
 Having a collaborative outlook
Obstacles
Resistance to change – An emotional /
Behavioural Response to real or
imagined work change
Main Reasons For Resistance
To Change
 Culture
Limitations
 Knowledge Limitations
 Management Limitations
Culture Limitation
 An
individual’s misconception about
change
 Poor Communication
 Fear of failure
 Climate of mistrust
 Time Pressure
Knowledge Limitation
 Lack
of Training
 Lack of Knowledge in both Management
and Team Members
 Lack of Team and Meeting Skills
Management Limitation
 Lack
of Management Commitment
 Lack of Leadership
 Unprofessional behaviour of
Management
Winston Churchill On Change
“To improve is to change; To be perfect is to
change often”
Most Companies have “Continuos Improvement” in
their Quality Policy but still resist Change
Remember…
 Improvement
Requires Change
 Change Requires Experimenting
 No Cookie-Cutter approach to Change
 No one gets it right the first time, every
time!
 A Change-friendly culture will use “failure”
as an opportunity to learn and share
Become Lean & Attain
Innumerable Benefits

Improved customer
service
 Reduced inventory
costs
 Increased quality
 Reduced scrap
 Improved cash flow
 Increased
productivity

Decreased down
time
 Increased flexibility
 Reduced lead times
 Growth from within
the organization
 Better utilization of
resources,rather
than adding
resources
And Much More…
Thank you!