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1. Value Stream Map the Process AND identify the Process Wastes 2. Look for the bottleneck and remove the bottleneck 3. Look for wastes within the process and remove them 4. Look for manual steps and try to automate them
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Process Step
Processing Time = FTE = Automated? = WIP(in tray) =
You can add more information about the process in the Process Step. Typical Info are Processing Time and Number of Full Time Equivalent (Staffing)
Process Step
Processing Time = FTE = Automated? = WIP(in tray) =
End
End
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Credit Check & Evaluate Processing Time = 2 mins FTE = 1 Automated? = Semi WIP (in-tray) = 50 Send Rejection Letter Processing Time = 1 min FTE = 1 Automated? = Semi WIP (in-tray) = 0
No
Find the step which Processing Time / # of FTE is higher than Takt Time That step will be the bottleneck and it will likely have Work-inProgress stuck at the start of the Process Why is that? See the next few slides.
Yes
Service Activation Processing Time = 1 min FTE = 1 Automated? = Semi WIP (in-tray) = 0
End
End 4
10 mins
Application Form
Every Ten Minutes One Job Arrives Into the Value Stream E.g.,
10 mins
10 mins
Application Form
10 mins
10 mins
Evaluate & Recommend PT = 10 minutes Approval PT = 10 minutes
10 mins
Service Activation PT = 10 minutes Print Credit Card PT = 10 minutes
From Start to End, this Value Stream will always take no more than 40 minutes
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Why thrive towards Continuous Flow? 1. More Speed because in a Continuous Flow, no Work-In-Progress is ever kept Waiting. 2. Consistency Cycle Time from Order to Delivery is kept consistent and predictable because there is no excess WIP in the Value Stream to cause Lead Time to fluctuate or grow excessively 3. Less Cost There is no waste of Transportation and Excess Inventory hence the organization does not incur cost associated with the management of them
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But your process is not idealized. Not every step has the same processing time. How can we achieve continuous flow?
Every 6 mins, one job arrived Processing Time = 16 mins FTE =2
Question will this process step become a bottleneck? Answer So long as Processing Time / # of FTE is less than the inter arrival time of jobs, it will not become a bottleneck 16 / 2 = 8 mins > 6 Mins Hence, it will become a bottleneck Question How can we improve this process so that it ceases to be a bottleneck? a.Reduce the Processing Time to 12 mins or Less b.Increase the # of FTE by 1 (16/3 = 5.3 mins) c.Increase the interarrival time of jobs (generally out of your control)
Note on FTE FTE stands for Full Time Equivalent It represents how many staff are manning the process on a full time basis It is not the same as number of employee Say you employ 10 staff in your team. The team handles three processes. Your staff divide their time equally between these three processes during the available time. Hence, the FTE per process is NOT 10 but 10/3 = 3.333.
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Note on Available Time Available Time has nothing to do with the staffing level of the process It refers to the time the process is available for processing of jobs Hence, let s say we have two Mac Donalds. They are both opened 24 hours. The 1st Mac Donalds has 10 staff, and the 2nd has 20. Their available time is the same 24 hours. Staffing has nothing to do with it.
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Let s use an example that looks complicated like your own production process to convince you that this works
P/T = 25 mins FTE = 2 P/T = 5 mins FTE = 0.5
P/T = 15 mins FTE = 0.5 50% P/T = 5 mins FTE = 0.25 P/T = 2 mins FTE = 0.5
50%
Start
End
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50%
P/T = 2 mins FTE = 0.5 TT = ? PT/FTE = P/T = 45 mins FTE = 3 TT = ? PT/FTE =
Start
End
End
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Step 2 Look at the points where the flow is separated and compute the Takt Time for each new stream
P/T = 25 mins FTE = 2 TT = 10 PT/FTE = P/T = 6 mins FTE = 0.5 TT = 10 PT/FTE =
Daily Demand = 60 / 2 = 30 Avail Time = 10 hrs Takt Time = 10 x 60 /30 = 600 / 30 = 20 mins 50%
P/T = 2 mins FTE = 0.5 TT = 20 PT/FTE =
50%
P/T = 2 mins FTE = 0.5 TT = 20 PT/FTE = P/T = 45 mins FTE = 3 TT = 20 PT/FTE =
Start
End
End
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50%
50%
P/T = 2 mins FTE = 0.5 TT = 20 PT/FTE = 4 P/T = 45 mins FTE = 3 TT = 20 PT/FTE = 15
Start
End
End
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The 1st process step where the PT/FTE is greater than the Takt Time will be the bottleneck. All subsequently steps where PT/FTE is greater than the Takt Time will in turn become bottlenecks when the bottleneck higher up in the flow becomes unclogged.
P/T = 6 mins FTE = 0.5 TT = 12 PT/FTE =10 P/T = 2 mins FTE = 0.5 TT = 20 PT/FTE =4
50%
50%
P/T = 2 mins FTE = 0.5 TT = 20 PT/FTE = 4 P/T = 45 mins FTE = 3 TT = 20 PT/FTE = 15
Start
End
End
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A simple and quick way to improve this process is to take staff from those steps that are have too much FTE (those in Green) and assign them to the bottlenecks
P/T = 6 mins FTE = 0.5 TT = 12 PT/FTE =10 P/T = 2 mins FTE = 0.5 TT = 20 PT/FTE =4
50%
50%
P/T = 2 mins FTE = 0.5 TT = 20 PT/FTE = 4 P/T = 45 mins FTE = 3 TT = 20 PT/FTE = 15
Start
End
End
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Generic Ways to remove a bottleneck? Reducing Processing Time to synchronize with Takt Time Simplification Automation Line Balancing Increase FTE Optimize the Staff allocation by identifying process steps that are over staffed and assigning those excess staff to bottlenecks Reduce the Demand (normally not possible)
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Thinking about Waste A simple way of thinking about improving cycle time finding and eliminating waste. So the task is two fold: We must know how to find waste We must know how to reduce or eliminate waste What is Waste? Anything other than the absolute minimum of material, machines, and manpower required to add value to the product. Everything that is not value-added is waste
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Necessary but Non Value Added Activities that do not add value from customers perspective but is required by the business
Does this activity:
Non Value Added Activities that do not add value from customers perspective and is not willing to pay for
What is it?
Is the Product or Service Transformed by this activity? Does it add a feature, function or form to the product or service that the customer is willing to pay for?
1. 2. 3. 4.
Reduce Financial Risk? Comply with some regulation? Comply with some internal control? Does anything bad happen if we remove this step?
1. 2. 3.
Does this activity create a known type of waste? Is the customer willing to pay for it? Is it rework or corrective action?
Action Mode
Try to separate this activity from the main flow so that the customer is not impact by the time it consumes
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Application Application Form Application Form Application Form Form Out Box Transport = 20 mins Wait in Out Box = 60 mins Credit Check 10 mins Application Application Form Application Form Application Form Form In Box Wait in In Box = 60 mins
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Application Application Form Application Form Application Form Form Out Box Transport = 20 mins Wait in Out Box = 60 mins Credit Check 10 mins Application Application Form Application Form Application Form Form In Box Wait in In Box = 60 mins
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*Actually it is more because we have not even counted the time lost after the work day has ended
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Production Wastes
7 Types of Waste + 2
Defects Waiting Over Processing Unnecessary Motion Inventory Unnecessary Transportation Over Production
Service Examples
Errors and Rework Work not meeting Requirements Missing Info Job waiting in In-Box, Out-Box Equipment Downtime Waiting for Info, Approval etc Unnecessary Steps Multiple Handoffs Walking Searching for Files
Manufacturing Examples
Scrap, Defects
Equipment Downtime Waiting due to Batch Processing Processing Step that adds any feature that the customer does not value
Excessive Raw Material, WIP and Finished Goods that has not been sold yet
Abilities
Customers Time
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