Lean Manufacturing Overview
with Lego Simulation
Ted Theyerl NWMOC / CVTC Project Manager V-Feb 2007
“Helping Manufacturers Succeed”
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The National MEP System
United States Department of Commerce, National Institute of Standards and Technology, State of Wisconsin
Blue = NWMOC Region
Headquarters Location
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Economic Development
NWMOC Promote economic development in Northwest Wisconsin through retention and growth of the
existing manufacturing base.
“To create and keep good jobs for our clients”
Last year NWMOC’s client companies reported over $93 million dollars in positive impacts to their organizations directly attributed to our work with them.
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Some NWMOC Services
• Strategic Focus - Business planning - Performance measures - People, culture, leadership, work teams
• Operations Improvements – Both Manufacturing and Office - Value Stream improvements - Tactical tools such Lean; 5-S, Quick Change-over, Cellular, Pull/Kanban,
• Sales and Marketing Improvements - 21st Century Lean Marketing System - Selling to the Government
• Training, Certifications, Resources - Lean Certificate series; Public and in-house - Technical College System; Workplace training - standard, custom, on site - UW-Stout; Technical resources, faculty, class projects, internships
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Introductions
• Name!
• What you do?
• Why did you come?
• What do you expect to learn?
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Round 1 Instructions
“Traditional Manufacturing”
1. Build airplanes with Legos 2. 7 minute round 3. Follow your instructions. 4. Do your own job, don’t worry about others – don’t stop. 5. Batches of 5 – make a batch, move a batch, make another batch and keep moving. 4. Station #1 – keep process moving (expensive
equipment) 5. Quality problems – turn upside down, keep going. 6. Let me know when first batch of 5 is complete.
Questions?
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Round One: Debrief
• Discuss results
• Discuss the process
• Relationship to real world
• List problems that need to be solved on flip chart
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Traditional Manufacturing
» Large inventories » Manufacture in Batches » Shortages » Delivery delays » Overtime » Excess equipment » Process problems hidden » Short on Space
“Push System”
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Why should a business consider a lean strategy?
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Mass Production
Material
Value-Added Time: Minutes Time in Plant: Weeks
Receiving Warehouse
Sawing
Pre-fab Fabrication
Storage
Repair
Assemble
Shipping Warehouse
Ship
ORDER CASH
Lay-up
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Rapid Changes in the World – Since About 2000
Shorter Lead Times
Price set by the Customer More frequent
schedule changes, expedites
More Changeovers
Increased competition
Smaller batches
The Customer
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So… We want to help our country??? Let’s Buy an “American Car” !
• Toyota - Is manufactured in the USA. - Has a higher percentage of US-made parts than any other car
made in the USA, or anywhere.
• Chevy Equinox - Made in Canada - With a motor made in China
• Chevy Impala – you guessed it, Canada
• Chrysler PT Cruiser - Mexico
Toyota is pushing the in-USA percentage higher. US auto companies are pushing their percentage lower.
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Lean is Market Driven
Price Set By Manufacturer
Cost + Profit = Price
Price Set By Market
Price - Cost = Profit
Past Present
Customer Demands:
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It’s All About Time
“The longer an article is in the process of manufacture,
the greater is its ultimate cost.”
Henry Ford, 1926
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More about time…
“The average North American-produced vehicle crosses the border seven times.
During the journey each vehicle faces a staggering 28,200 customs transactions.
By comparison, cars imported from Europe or Asia involve a single customs transaction.
If we delay cross-border shipments by just a day, the Americas lose their proximity advantage over Asia.”
Mike Eskew UPS Chairman and CEO July 23, 2007
Read into this: If we delay Manufacturing Thru-put Time……
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Defining Lean
Lean is:
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Definitions
• Value Added Any activity that increases the market form or function of the product or service. i.e. Chip time, paint time, touch time. (These are things the customer is willing to pay for.)
• Business Value Added Any activity that is necessary to run the business. Examples: Financial, legal, payroll services, maintenance.
• Non-Value Added Any activity that does not add market form or function or is not necessary. (These activities should be eliminated, simplified, reduced, or integrated.)
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Lean = Eliminating Waste
Value-Added
Typically 95% of all manufacturing lead time is non-value-added.
1. Overproduction
2. Waiting
3. Transportation
4. Non-value-added processing
5. Excess inventory
6. Defects
7. Excess motion
8. Underutilized people
Non-Value-Added - “The 8 wastes”
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Total Lead Time
Waste In A Value Stream
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Value Stream: Every activity,from Beginning to End
Value Added Activities – Customer is willing to pay for
Non Value Added Activities – Customer is not willing to pay for
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The downward pressure on price is because the customer does not want to pay for the “wastes” in the system.
Waste Eliminated from the System
Invoice
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The Value Stream / Lead Time
Investing $$
12 Wks Lead Time
Invoice
3 Wks Lead Time
Invoice
9 Wks Invested $$ Now Available
Traditional
Lean
Lead Time Affect on Cash Flow
Value Stream: Every activity,from Beginning to End
As Waste is Eliminated from the Value Stream, the Lead Time is Shortened,
and Invested Dollars Lowered!
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How Do I…?
STOP / REDUCE
THE
WASTE
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Lean Tactical Building Blocks
Quick Changeover
Standardized Work Batch Reduction Teams / Culture
Quality at Source
5S / Visual Measures Plant Layout
Point of Use Storage
Cellular/Flow Pull / Kanban / Scheduling
Equipment Reliability
Value Stream Mapping
Continuous Improvement
Foundations of Lean for Office and Manufacturing
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How to Improve
Utilizing Lean Tools
1. Create a work cell 2. Balance the workload – establish takt time 3. Implement a pull/kanban system 4. Batch size reduction 5. Simple, visual instructions 6. Point of use storage
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Impact Of Batch Size Reduction
10 minutes 10 minutes
• Batch & Queue Processing
Lead Time: 30+ minutes for total order 21+ minutes for first piece
10 minutes
Process A
Process B
Process C
Process B
Process A
Process C
• Continuous Flow Processing
12 min. for total order
3 min. for first part
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Pull System Flow Diagram
Supplier Raw Matl
Process A
Process B
Fin. Goods
Kanban Locations
Process C
Customer
Part Flow
Information Flow
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Cellular Manufacturing
Linking of manual and machine operations into the most efficient combination to maximize value-added content while minimizing waste.
Punch
Cut to size De-burr
Sand
Form Package
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Takt Time
Helps us understand the flow patterns and demand rate of processes that are reasonably repetitive in nature.
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Balance the Process
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Round Two Preparation
What lean manufacturing techniques can we use to improve our Lego airplane production?
How can we solve the problems?
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Typical Results
Lead Time Reduction
Productivity Increase
WIP Reduction
Quality Improvement
Space Utilization
Quick Changeover
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Where do I Start ??
– Current State Map: Create a clear picture of current material and information flow .
– Future State Map: Build a future vision of an improved process through effective use of lean and value stream mapping strategies.
– Action planning: Make it happen.
Value Stream Mapping is key.
Or…….. Just do something ….. Anything.
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Sample Value Stream Maps
Current State
Future State
Thru put: 4 weeks to 3 days Travel Distance: 4,337 feet to 340 feet
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Continuous Improvement
Old Adage:
“If you always do what you always did, you’ll always get what you always got.”
Competitive Corollary:
“If the other guy gets BETTER, you’re gonna get LESS.”
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Conclusion - The Journey to Lean
• Simple and visual • Demand driven • Inventory as needed • Reduce non-value- added • Small lot size • Minimal lead time • Quality built • Value stream managers
Lean Traditional
• Complex • Forecast driven • Excessive inventory • Speed up value-added
work • Batch production • Long lead time • Inspected-in • Functional departments
Thank You.
“Helping Manufacturers Succeed”
If you can do this for Lego airplanes………...
Think what you can accomplish on a process you understand and care about!
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Contact Information
• Phone Number: (715) 232-2397 • Fax Number: (715) 232-1105 • Web Site: http://nwmoc.uwstout.edu
NWMOC Central Office
Ted Theyerl NWMOC/CVTC – Project Manager CVTC Gateway Campus 715-874-4658 [email protected]