Lean Management

History - Lean manufacturing

Developed from the Toyota Production System

• Toyota’s steady growth has led to interest in Lean
manufacturing.
• Lean identifies “wastes” and eliminates them.
• Three types of waste: non-value added work,
overburden, unevenness
• Seven deadly wastes: overproduction, transportation,
waiting, inventory, motion, over processing, defects
 Different Types of Activities

The part of the job the customer wants to

Value Added Activity
pay for

Work that does not add value but is

Non-Value Added Activity necessary under the current operating
conditions

Obvious Waste Work that does not add value and is not
necessary
 7 Wastes
• Over production
• Unnecessary transportation
• Waiting
• Inventory
• motion
• over processing
• defects
 7 WASTES
Unnecessary Travel/ transportation

Defective
products

Steps are wasteful, people are valuable

 Lean
• Focus on what is of VALUE to the customer
• Separate non-value added from value added
– Map the actions required to produce (value stream)
– Eliminate activities that do not move the product closer to
its final form
• Make the remaining value added activities flow
smoothly
• Produce only what customers need (pull)
• Continuous improvement
 Lean Philosophy
Value
More to value than just cost
“Defined by the ultimate customer” –
Voice of the Customer (VOC)
Expressed in terms of
A specific product
A function or capability
Questions
What does the customer want to buy?
What would they pay extra for?

• Focus on what is of VALUE to the customer

 Principles of Lean Management
• To create Continuous flow
• To use pull systems to manage work flow

Pull Actual Eg.Placing an

order
System Demand

Push Forecasted Eg. FMCG

system Demand
 Principles of Lean Management
• Eliminate Batch Sizes and Inventory
• Eliminate Waste
• To cross train workers in-order to deal with
inherent variability
• Selective use of Automation
• To instill a continual improvement
competence
 Batch versus Continuous Flow
Batch & Queue Processing

Process Process Process

A B C

10 Minutes
10 Minutes
10 Minutes
30+ Minutes for order of 10

Continuous Flow
Process Process Process
A B C

12 Minutes for
order of 10

Lean Six Sigma 10

 Lean Approach From: NAVSEA VSA Training

Dept 1
Batch Continuous Flow
Dept 2 DONE 4 3
IN OUT
OUT

IN IN

Dept 3
1 2

Dept 4

OUT IN IN

OUT

DONE

Batch processing has a direct impact on

the total Work-in-Process
Approved for Public Release
 Lean Approach
Disassemble
Wait Transport
Transport Wait Set-up
Machine Machine Re-Install
Remove From
Ship

Start Time
Finish
Broken Repaired
Component Component

= Value Added Time = Non-Value-Added Time (WASTE)

Value-Added time is typically only a small percentage of

the total time
Lean Six Sigma 12
 Lean Approach
From: NAVSEA VSA Training

Traditional Focus
• Improve Value-Added
work steps
• Better tools, machines,
Time instructions
Small Amount of
LARGE amount Time Eliminated • Result: Small time
savings
of time saved

Lean Focus Time savings have a direct

• Make all of the Value Stream visible impact on
• Reduce or eliminate Non-Value-Added • Cost • Capacity
portions of the process • Schedule • Flexibility
• Result: Large time savings
• Resources • Etc.
Lean Six Sigma 13
Approved for Public Release
 How Does Lean
Solve Problems?
• Focuses on what is of VALUE to the customer
– Understand customer expectations and
requirements
– In terms of the what the product provides, not
just the product itself
• Eliminates activities that do not move the
product closer to it’s final form
– Reduces the 8 types of waste
• Creates continuous flow
 COST OF POOR QUALITY
Reject
Sorting
reprocess

Scrap

repack

• Set up • Higher risk

•Time value •Administration cost
• Schedules •Lost sale
conflict •Transportation cost
•Over time •Customer
payment complaints
• Damage to good
• Morale loss will
LEAN MANAGEMENT TECHNIQUES
• 5s
• Standardized work
• Value stream mapping
• Kaizen
• Kanban
• Poka-yoke
• TPM