Copyright EMS Consulting Group, Inc. 2008 Using Lean Ideas to Get Jobs to Production Faster Darren Dolcemascolo EMS Consulting Group, Inc

Copyright EMS Consulting Group, Inc. 2008

Using Lean Ideas to Get Jobs to Production Faster

Darren Dolcemascolo

EMS Consulting Group, Inc.


Using Lean Ideas to Get Jobs to Production Faster

• You will learn:– Why It is Important to Apply Lean

Principles to the Pre-Production Value Stream

– How Lean Principles and Tools Apply to Such Processes

– How One Company Utilized These Principles


Presentation Agenda

1. Lean Administrative Principles and Benefits

2. Applying Lean Tools to Non-Manufacturing Processes

3. Case Study

4. Q&A


What Is Lean?

“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” – James Womack


•Value - A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer. Features of the product or service, availability, cost and performance are dimensions of value.

Definitions

•Waste (“Muda”) - Any activity that consumes resources but creates no value.

Value - what your customers are willing to pay for.


Definitions

–Value Stream - the set of all the actions required to bring a product to the customer. (material + information flow)


Thinking Lean5 Principles of Lean

• Specify value – can only be defined by the ultimate customer

• Identify and Map the value stream – exposes the enormous amounts of waste

• Create flow – reduce batch size and WIP

• Let the customer pull product through the value stream – make only what the customer has ordered

• Seek perfection – continuously improve quality and eliminate waste


“All we are doing is looking at the time line from the moment the customer gives us an order to the point when we collect the cash. And we are reducing that time line by removing non-value-added wastes.” – Taichi Ohno

Lean Thinking


From Shop Floor to Office

• Lean should not be limited to the shop floor:– Support processes often cause delays in the

factory.– Support processes create delays in getting

existing product to the customer (lead time)– Support processes delay the product

development process.– Support processes delay the delivery of

materials.


Eight Wastes

• Overproduction

• Waiting

• Transporting

• Inappropriate Processing

• Unnecessary Inventory (WIP)

• Unnecessary / Excess Motion

• Defects

• Underutilization of Employees’ Minds/Ideas


Eight Wastes Revisited• Overproduction

– Printing paperwork out before it is needed

– Purchasing items before they are needed

– Processing paperwork before the next process is ready for it

• Waiting

– “System” downtime

– Paperwork/Approval queues (waiting in someone’s inbox)

– Waiting for information from outside sources (customer or supplier)


Eight Wastes Revisited• Transportation (Paperwork or Electronic Info)

– Multiple hand-offs

– Too many approvals required

– Excessive email attachments

• Inappropriate Processing– Re-entering data or re-checking

– Making extra copies

– Too many reports distributed

– Excessive transactions

– Unnecessary details in expense reports, budgets, etc.

– Month-end closing activities


Eight Wastes Revisited

• Unnecessary Inventory

– Filled in-boxes (electronic and paper)

– Office supplies

– Batch processing transactions/reports

– Sales literature

• Unnecessary / Excess Motion

– Walking to/from printer/copier/fax

– Walking to other cubicles/offices (or to find someone)


Eight Wastes Revisited

• Defects

– Design errors

– Invoice, purchase order, or order entry mistakes

– Other paperwork errors

• Underutilization of Employees’ Minds/Ideas

– Limited authority and responsibility for basic tasks

– Management command and control

– Inadequate business tools provided


Lean Principles for the Office

1. Understand Customer Needs2. Measure and Check Performance to

Customer Needs Often3. Eliminate steps that do not create value4. Find ways to eliminate

interruptions/handoffs.5. Control the flow of work between

interruptions.6. Balance the workload/Eliminate bottlenecks.


Customer Needs/Requirements

• Who needs the output of the process?

• What is specifically required and how often?

• When do they need the output?


Determine Performance Check Window

• How often will performance (status) to customer requirements (takt time) be measured?

• Wide range of answers can be appropriate: from hourly to several times daily (or in some cases, less frequently).



• Use a visual means of checking performance

• If orders are not processed in a timely manner, the team must identify root causes and take corrective actions to return to the desired service level.



• Lean Example– Printing company developed a goal of three-day

turnaround on orders with a one-day turnaround in the preproduction portion of the order.

– They set a 2 hour management time frame to review the preproduction process (customer service, artwork, and plate making).

– Every two hours reps from each area reviewed orders in process to determine if they were meeting the desired service levels.

• If not, they took proper action (redeploy resources, work o.t., etc.)


Determine which steps in the process create value and which generate waste

• Ask questions to determine this:– What does the customer really need?– Why are the current steps being performed?– What can the company do differently or not at all while still

meeting customer needs?– Is the order of steps creating waste? At what steps should

decisions be made?– What assumptions underlie the design of the current

process?– Are current controls and administrative guidelines

appropriate?– What knowledge and skills are truly required to perform the

steps?


Create a work flow with fewer interruptions

• Create flow (one-piece or small batch size)• Ask the following questions:

– Can standardizing work improve flow?– Would it be beneficial to dedicate resources to

specific tasks?– Can one person be cross-trained to perform

several sequential tasks?– Would moving people and tasks together into a

“cell” help?– What would be the benefits and issues of a flow

approach?


Create a work flow with fewer interruptions

Paperwork Processing

Monday: 40A

Tuesday 10A, 30B

Wednesday: 20B, 20C

Thursday: 40C

Friday: 20C, 20A

Monday: 14A, 10B, 16C

8:00AM: 3A, 2B, 3C

9:00AM: 4A, 2B, 2C

Each type processed once weekly

Each type processed once daily

Each type processed once hourly


Determine how to control work from step to step (between interruptions)

• Usually two possible solutions– FIFO lane - limits the amount of work that

can be pushed from step to step and ensures proper prioritization.

– Pull system - work is pulled from the supplying process to the customer process. (Example: printing information only upon demand.)



• Lean Example – Problem– Job shops use job packets throughout production

to make sure that the product is made correctly.– At one company, the office released job packets to

the floor ASAP, creating overproduction.– Production began work on many of these released

packages and spent a lot of time reacting to customer changes.



• Lean Example - Solution– The company implemented a simple pull

system for job packets by having production tell the office when it needed the next job packet.

– Company reduced the # of job packets by 50%, and the number of time-consuming changes to job packets by 80%.


Balancing the Activities/Workload

• Two issues– Process Level – people who overproduce

in big batches, creating queues at the next step.

– System Level – lopsided transactions and activities that require different amounts of resources at different points in time (month-end).



• Process Level– Balance by using shorter performance

check windows, cross-training, and FIFO lanes.



• System Level– Level work and mix- Distribute transactions and

work over a longer period to reduce system chaos and overtime.

– Creates a predictable enterprise and improves the visibility and responsiveness to problems and/or shifts in customer demand.

– Leveling mix of transactions to improve the ability of the system to flow or respond to particular steps (e.g., ideal # of rush orders to standard orders).


Case Example: Value Stream Mapping

• Original State: 5 weeks average pre-production lead-time; 6 week average total lead-time (1 week in production)

• Project Objective: To reduce pre-production lead time to < 4 weeks


Case Example: Current State

Pre-Production Current State

Customer

P/T: 10m

Sales D-base

Log into Sales “System”Tech

Support

P/T: 10m avg

Enter into MRP System and

spdshtProd Mgr.

P/T: 10m

Create a kit in MRP

Prod. Mgr

MRP System

P/T: 60 min

Run MRP

Daily

Phone Queue

IN

Fax

IN

E-mail

IN

E-mail

IN

MS Excel

L/T = 5 DaysL/T = 1 Day

MRP System

L/T = 1 Day L/T = 1 Day

P/T: 60 min

Order Parts

Buyer

Daily

L/T = 15 Days

P/T: 10 min

Cut Work Order

Planner

Daily

L/T = 1 Day

P/T: 0 min

Start Work

Production

Daily

L/T = 1 Day

P/T = 150 min

L/T = 24 Days


Case Example: Current State Issues

• Redundant data entry of customer orders/reliance on e-mail

• Multiple shop orders per customer order• No control of release of orders to shop

floor• Requirement for shop floor personnel to

prioritize work based on MS Excel spreadsheet


Case Example: Improvements

• Customer order entry system becomes part of the ERP/MRP system– Customer service person completes transaction- no

handoff to production manager (make continuous flow)

• MRP system notifies purchasing to order “non-stock” parts for each customer order same day.

• Shop Orders are cut after parts arrive and delivered to production based on “kanban.”– Priority spreadsheet eliminated


Case Example: Future State

Pre-Production Future State

Customer

P/T: 10m

MRP System

Enter into MRP SystemTech

Support

Auto-GenerateCustomer Order

Phone Queue

IN

Fax

IN

E-mail

IN

L/T = 1 Day

P/T: 0 min

Start Work

Production

Daily

L/T = 0 Days

Auto-Notfify Purchasing

P/T: 60 min

Order Parts

Daily

L/T = 15 Days

P/T: 10 min

Cut Work Order

Planner

Daily

L/T = 1 DayP/T = 80 min

L/T = 17 Days


Case Example: Results

• Pre-production lead-time cut from 25 business days to 17 business days

• Processing time cut from 250 minutes to 80 minutes


Questions?

Documents

Copyright EMS Consulting Group, Inc. 2008 Using Lean Ideas to Get Jobs to Production Faster Darren Dolcemascolo EMS Consulting Group, Inc