Intro.

to Lean Manufacturing

Craft Manufacturing
‡ Late 1800¶s ‡ Car built on blocks in the barn as workers walked around the car. ‡ Built by craftsmen with pride ‡ Components hand-crafted, hand-fitted ‡ Excellent quality ‡ Very expensive ‡ Few produced
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Mass Manufacturing
‡ Assembly line - Henry Ford 1920s ‡ Low skilled labor, simplistic jobs, no pride in work ‡ Interchangeable parts ‡ Lower quality ‡ Affordably priced for the average family ‡ Billions produced - identical
3

Lean Manufacturing
‡ Cells or flexible assembly lines ‡ Broader jobs, highly skilled workers, proud of product ‡ Interchangeable parts, even more variety ‡ Excellent quality mandatory ‡ Costs being decreased through process improvements ‡ Global markets and competition
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Influences That Trigger Change
highly configurable products high cost of manufacturing rapid growth in size & revenue tighter quality standards insufficient vendor capabilities material shortages long learning curves inconsistent processes

fluctuations in demands increased competition

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In 1926 Henry Ford wrote
± ³To standardize a method is to choose out of the many methods the best one, and use it. Standardization means nothing unless it means standardizing upward. Today¶s standardization, instead of being a barricade against improvement, is the necessary foundation on which tomorrow¶s improvement will be based. If you think of ³standardization´ as the best that you know today, but which is to be improved tomorrow - you get somewhere. But if you think of standards as confining, then progress stops.´
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Definition of ³Lean´
‡ Half the hours of human effort in the factory ‡ Half the defects in the finished product ‡ One-third the hours of engineering effort ‡ Half the factory space for the same output ‡ A tenth or less of in-process inventories

Materials

Labor

Equipment Energy

Methods

Products

Source: The Machine that Changed the World Womack, Jones, Roos 1990 7

Lean Manufacturing 
is a manufacturing philosophy which shortens the time line between the customer order and the product shipment by eliminating waste.
Business as Usual

Customer Order

Waste Time

Product Shipment

Lean Manufacturing

Customer Order

Waste

Product Shipment

Time (Shorter)

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The 3 M¶s of Lean
‡ muda ± waste ‡ mura ± inconsistency ‡ muri ± unreasonableness

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7 Wastes

Defining Waste
Webster¶s Dictionary:
³To Consume Carelessly´ ³Squander´ ³Fail to Take Advantage´ ³Uncultivated Area´ ³Junk´ ³Loose Energy´ ³Grow Weaker´ ³Worthless Residue´

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Waste
³Anything that adds Cost to the product without adding Value´

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Waste
Eliminating waste is the greatest potential source of improvement in corporate profit, performance, and customer service.
For most production operations: - 60% add no value at all - 35% are ³necessary´ activities, but don¶t add value - only 5% of activities actually add value!
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7 Wastes

Identification and Elimination of Waste
Philosophy ‡ Identification and elimination of waste is the central theme of a lean manufacturing production system ‡ Lean manufacturing is a dynamic and constantly improving process dependent upon understanding and involvement by all employees ‡ Successful implementation requires that all employees must be trained to identify and eliminate waste from their work ‡ Waste exists in all work and at all levels in the organization

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7 Wastes

Identification and Elimination of Waste
Philosophy ‡ Effectiveness is the result of the integration of: - Man - Method - Material - Machine At the worksite ‡ Waste exists in all work and at all levels in the organization

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7 Wastes

Seven Types of Waste
Over-production Wait time/Delays Transportation Processing Inventory Motion Defects
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7 Forms of Waste
CORRECTION WAITING
Any non-work time waiting for tools, supplies, parts, etc.. Repair or Rework

MOTION
Any wasted motion to pick up parts or stack parts. Also wasted walking

PROCESSING
Doing more work than is necessary

Types of Waste

OVERPRODUCTION
Producing more than is needed before it is needed

INVENTORY
Maintaining excess inventory of raw mat¶ls, parts in process, or finished goods.

CONVEYANCE
Wasted effort to transport materials, parts, or finished goods into or out of storage, or between processes.

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Lean Manufacturing
‡ A production philosophy in which materials flow continuously from raw materials to finished goods. ‡ Producing more with less«Time, Inventory, Capital ($), and Resources. ‡ Highlights what needs to be changed. What is in the way of continuous flow is waste. ‡ Principles apply to small and large manufacturers.
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Lean Manufacturing - Key Philosophies
‡ Streamline the production flow by eliminating wasted time, wasted effort, and wasted processing. ‡ Small batch (one piece lots). ‡ Redirect non-value added activity into value added activity. ‡ Reduce cycle time, reduce non-value and receive revenues ($) faster. ‡ Flow manufacturing ± make one, move one. ‡ Product cells.
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Focus of Mass Manufacturing vs. Lean Manufacturing
Mass Manufacturing Lean Manufacturing
Economies of scale Individual efficiency Whole system improvement Total system efficiency

In Lean Manufacturing an individual part of the system may be operating less efficiently, but at the same pace as upstream and downstream processes.
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Lean Manufacturing ± Common Traits
Methods
Visual Management Goal: Highlight problems

Common traits
Status boards Right size storage space Andon lights Colored bins, areas Simple workstation documentation Flexible layout Flexible work centers
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Standardized Work

Flexible Work

Lean Manufacturing ± Common Traits
Methods Common traits
Production based on consumption Triggers: Pull Production
- Kanban cards - Bins - Marked space - Dedicated containers - Computer system

Quality at the Source

Minimum disruption Quicker cause effect identification
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Lean Manufacturing ± Common Traits
Methods
Performance Measures

Common traits
Decision tools, not tracking tools Inventory Disruption in material flow Dock to dock time

Common awareness to business Operating Environment goals Commitment of management

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The Nature of Lean Manufacturing
‡ What Lean Manufacturing is not
± JIT ± Kanban

‡ Characteristics
± Fundamental change ± Resources ± Continuous improvement

‡ Defined
± ³A system which exists for the production of goods or services, without wasting resources.´
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New Paradigm: Non-blaming Culture
Management creates a culture where:
‡ Problems are recognized as opportunities ‡ It¶s okay to make legitimate mistakes ‡ Problems are exposed because of increased trust ‡ People are not problems - they are problem solvers ‡ Emphasis is placed on finding solutions instead of ³who did it´
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What Makes a Manufacturing System Lean?

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Who wants what...

$

Cash !!

Value !!
Customer
Low Cost High Quality Availability

Your Company
Profit Repeat Business Growth
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Price Increase
3 Price to Sell

3

Some Profit
Cost to Produce

2 1

Bigger Profit
1

2

Cost + Profit = Price

Cost Reduction
Price to Sell 1 1

Some Profit
Cost to Produce

3 2

Bigger Profit

3

2

Price - Cost = Profit

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Elements of Lean Manufacturing
‡ ‡ ‡ ‡ Waste reduction Continuous flow Customer pull 50, 25, 25 (80,10,10) Percent gains

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Benefits of Lean Manufacturing
‡ 50 - 80% Waste reduction
± WIP ± Inventory ± Space ± Personnel ± Product lead times ± Travel ± Quality, costs, delivery
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Setting the Foundation
‡ Evaluating your organization
± Management culture ± Manufacturing culture

‡ Lean Manufacturing Analysis
± Value stream (from customer perspective) ± Headcount ± WIP ± Inventory ± Capacity, new business, supply chain
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How to go lean
Objective 1
Understand customers and what value they want Define the internal value stream Eliminate waste, make info & products flow, pulled by customer needs Extend the definition of value outside your company Continually aim for perfection

Method
Setting the direction, targets and checking results An internal framework for delivering value Appropriate method to make necessary change Externalise the value focus to the whole value stream Strive for perfection in the product and in all processes and systems
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2

3

4

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Tools of Lean Manufacturing
‡ Waste reduction
± ± ± ± ± ± ± ± ± ± Full involvement, training, learning Cellular manufacturing Flexible manufacturing Kaikaku (radical change) Kaizen (continuous improvement) & standard work 5S Jidoka (autonomation) Poka-yoke (error proofing) Shojinka (dynamic optimization of # of workers) Teien systems (worker suggestions)
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Kaizen vs Reengineering
‡ The evolution consists of continuous improvements being made in both the product and process. A rapid and radical change (kaikaku) process is sometimes used as a precursor to kaizen activities. ± Carried out by the utilization of process reengineering or a major product redesign. ± Require large investments and are based on process automation. ‡ In the U.S., these radical activities are frequently called ³kaizen blitzes´.

‡

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Kaizen vs Reengineering
‡ Creating an useable and meaningful standard is key to the success of any enterprise. ‡ Businesses usually utilize two different kinds of improvements. ± Those that suppose a revolution in the way of working. ± Those that suppose smaller benefits with less investment.
Final situation productivity Kaizen Reengineering Initial situation time 35

Kaizen vs Reengineering
‡ If the process is constantly being improved (continuous line), the innovation effort required to make a major change can be reduced (discontinuous line in the left). ± Otherwise, the process of reengineering can become very expensive (discontinuous line in the right).

Final situation productivity Kaizen Reengineering Initial situation time

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Tools of Lean Manufacturing
‡ Continuous Flow (10% - 25%)
± SMED (Shingo) ± Andon ± Takt time ± Line balancing ± Nagara (smooth production flow)

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Tools of Lean Manufacturing
‡ Customer pull (10%- 25%)
± Just-in-time ± Kanban

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Other Tools
‡ ‡ ‡ ‡ Visual Factory Error Proofing Quick Changeover Total Productive Maintenance

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Evidence of Progress toward Lean
‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ Smaller lot sizes Increased capacity / throughput Higher inventory turns More available floor space Improved workplace organization Improved quality: reduced scrap / re-work Reduced inventories: raw, WIP, FG Reduced lead times Greater gross margin Improved participation & morale
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