Transcript LM21 Operating Excellence Lean and Six Sigma Supplier Engagement Matt Vlcek

LM21 Operating Excellence
Lean and Six Sigma Supplier
Engagement
Matt Vlcek
LM21 Operating Excellence
Sept 24, 2002
LOCKHEED MARTIN PROPRIETARY INFORMATION
Outline
• LM21 Operating Excellence Roadmap
• Supplier Engagement
• Approach
• Deployment
• Results
• Challenges
LM21 Operating Excellence –
Leadership
LRP
OP Plan
Productivity
Targets & Strategy
Quarterly
Review
Leader
Leader
Training
Training
Leadership Council
Strategic
• Knowledge
• Discipline
Program
Value Stream
Map
Functional
Alignment
Program
Excellence
Plan
Review – Capture - Update
Train &
Deploy
Experts
Tactical
• Engagement
Intuitive Improvement Events
Target Improvement
Events: PDK, Kaizen, 6S
Apply LMC’s Proven Excellence Roadmap Model
Operating Excellence Approach
• Educate LM Leadership – Executive, Functional, Program
• Map Program Value Stream, Identify Supplier Issues
• Develop Program Excellence Plan
Subcontracts
58%
`
Indirect
17%
Direct
25%
$12.6B Annual Spend
Mutual Benefit – Reduce Waste, Not Margins
Deployment
Step 1: LM Leadership Alignment
Begin With The End In Mind
• VSM Defines Objectives for Each Subcontractor
 Cost – Schedule – Quality – Risk
• Develop Primary and Secondary Objectives for Each Subcontractor
 Coordinate Between Program and Functional Management
• Assess the Situation/Benefit to Subcontractor – “Put Yourself In
Their Shoes”
 Current Business Situation
 Current or Prior Improvement Targets/Programs
 Internal
 External
Concurrence on Mutual Targets & Objectives Provides
Alignment with Overall Program Goals
Deployment
Step 1: Leadership Alignment (continued)
Supplier Priority & Objectives
Primary
Objectives
Supplier
Secondary
Objectives
Supplier #1
1)
2)
Reduce supplier variability
Meet delivery requirements
1)
2)
Reduce Lead Time
Implement process control
Supplier #2
1)
2)
Improve Supplier Yield
Implement process controls
1)
2)
Reduce Inventories
Maintain cost w/BOA
Supplier #3
1)
2)
Reduce Rate Production Risk
1)
2)
Enable Schedule Flexibility
Increased automation
Supplier #4
1)
2)
Reduce Tooling NRE
1)
2)
Eliminate CFE
Supplier #5
1)
2)
1)
2)
Supplier #6
1)
2)
1)
2)
Supplier #7
1)
2)
1)
2)
Deployment
Step 2: Subcontractor/LM Leadership Alignment
• Leadership Engagement With Subcontractor is Critical…
 Relationship With Supplier Must:

Share Program Data
 Be Based on Mutual Benefit
 Rely on Trust
 Actively Drive Open, Honest, Two-Way Communication
 Carry Equal or Greater Importance Than Contract
People Make Things Happen
Deployment
Step 3: Resource Identification
• Effective Engagement Requires a Multifunctional Team Approach
• Required Resources For Effective Deployment
• Site/Program/Corporate Leadership
• LMC Black Belt/ Greenbelts
• Subcontract Manager
• LM21 SME or External Consultant
• IPT Members (Engr, Qual, etc)
• Other Functional Expertise (e.g. Welding)
Supplier
Engagement
Site/Prog/Corp Leadership

Subcontract Manager

IPT Member(s)

Event
Preparation
VSM
Events
Rapid
Improvement
Events
Monitoring of
Supplier
Progress








Site BB/GB



LM21 SME
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External Consultant

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Other Functional Support
Deployment
Step 4: Scheduled Supplier Events
• Use Value Stream Mapping as Primary Strategic Planning Tool
• Establish a Rhythm of Events with Program’s Supply Base
Suppliers Engagement Schedule
Supplier
Product
Activity
VSM
Oct
2002
Nov
Dec
Jan
Feb
Mar
Apr

Supplier #1
#1
Projects
VSM
#2
#3

Supplier #2
#1
Projects
VSM

Supplier #3
Projects
VSM
Supplier #4
Projects

#2
2003
May
Jun
Jul
Aug
Sep
Supplier Lean Deployment
Results
Cost Drivers
Results
Required Space
↓ 75%
Product Travel Distance
↓ 64 %
Work in Process
↓ 91 %
Inspection Labor
↓ 51 %
Cycle Time Reduction
↓ 58 %
Capital Required
↓ $1M
5/19/2016
Year End - DMF
Capturing
Substantial 1999
Opportunity
Within Supply Base
Challenges
• One Company “Face” to Supplier
• Mutual Benefit /Trust
• Gain Sharing
• Margin
• Reserve Management
• Equitable Sharing
• Multi-Functional Resource Commitment
• Program Priorities