INTRODUCTION TO LEAN MANUFACTURING

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INTRODUCTION TO LEAN MANUFACTURING

• Achieving World-Class
• Organizational
• Results

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Introduction To Lean
WHAT IS LEAN MANUFACTURING? Lean Manufacturing
can be defined as "A systematic approach to
identifying and eliminating waste
(non-value-added activities) through continuous
improvement by flowing the product through flow
processes based on a signal from the customer."
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Introduction To Lean

• What is Lean Manufacturing?
• Lean manufacturing is the process of analyzing
  the flow of information and materials in an
  environment and continuously improving the
  process to achieve enhanced value for the
  enterprise.
• It uses the building blocks of standardized
  work, workplace organization, visual controls,
  effective plant layout, quality at the source,
  batch reduction, teams, customer demand-based
  manufacturing, point-of-use storage, quick
  changeover, one-piece flow, cellular
  manufacturing, and Takt time.Lean manufacturing
  also applies the modern elements and technologies
  of scrap reduction, process improvements in
  machining and tool selection as well as material
  selection, set-up reduction, Just-In-Time,
  Kaizan, world class manufacturing, synchronous
  manufacturing, and inventory management.

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Introduction To Lean
CUSTOMER FOCUS A lean manufacturing enterprise
thinks more about its customers (internal
external) than it does about running machines
fast to absorb labor and overhead. Ensuring
Internal and External customer input and
feedback assures quality and customer
satisfaction,
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Introduction To Lean

• FOCUS ON WASTE
• The aim of Lean Manufacturing is the elimination
  of waste
• in every area of the organization
• including
• Customer relations (Sales)
• Accounting
• Product design
• Supplier Networks
• Quality
• HR
• Safety
• Manufacturing
• Engineering
• .

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Introduction To Lean

• LEAN GOALS
• Goal is to IMPROVE EVERY PROCESS WITHIN AN
  ORGANIZATION REQUIRING
• Less human effort
• Less materials
• Less inventory
• Less time
• Less space
• To become highly responsive to
• customer demand while producing top quality
• products in the most efficient and economical
  manner possible

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Introduction To Lean

• In 1945, Toyoda challenged Taiichi Ohno to learn
  how to compete with US Automakers not on building
  large volumes of similar models, but many models
  in low volume.
• Ohno was given 3 years to develop a system to
  achieve this goal.

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Introduction To Lean

• Ohno went to the US and studied Ford mass
  assembly processes at the Rouge River Plant.
• Ohno learned a lot from this experience, but felt
  Ford stopped short of a better system.
• Ohno also studied the supermarket concept of
  ordering and replenishing stock by a signal
  system. This resulted in Ohno applying the KANBAN
  concept to the system he would develop.

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• It took Ohno over 20 years to develop the system
  that became known as The Toyota Production System
  (TPS)
• It took until the 1974 Oil Crisis before
  outsiders and others in Japan really took notice
  of the TPS system that Ohno built and the way it
  was allowing Toyota to compete when others were
  faltering.

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Typical use of automation which results in
running parts faster and faster but result in
increased inventory as downstream cells cannot
use the product as fast as the upstream equipment
is producing the parts. Increases inventory which
is waste
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Introduction To Lean

• Lean Manufacturing came to the US with James
  Womacks Book, The Machine That Changed The
  World in 1990.
• Focused on Toyota Production System Concepts and
  Why Toyota was able to so successful over US Auto
  Manufacturers.

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• Glossary of Lean Manufacturing
  Terms
• Following is a short list of terms often used in
  explaining lean manufacturing techniques.Cellula
  r Manufacturing - linking of manual and machine
  operations into the most efficient combination to
  maximize value-added activities while minimizing
  waste. A cell layout is typically U-shaped and
  utilizes one-piece flow.Kanban System - a pull
  system that uses color-coded cards attached to
  parts or part containers to regulate the upstream
  production and delivery flow.Lean Manufacturing
  - the process of analyzing the flow of
  information and materials in a manufacturing
  environment and continuously improving the
  process to achieve enhanced value to the
  customer.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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Introduction To Lean

• Pull System - method of controlling the flow of
  resources by replacing only what has been
  consumed. A pull system relies on customer
  demand.Push System - resources are provided to
  the consumer based on forecasts or schedules.
  (Lean manufacturing encourages the elimination of
  push systems.)Takt Time - customer demand rate.
  Takt time sets the pace of production to match
  the rate of customer demand and becomes the
  heartbeat of any lean system. It is calculated by
  taking the work time available and dividing it by
  the number of units sold.Value Added - Any
  activity that increases the market form or
  function of the product or service. (These are
  things the customer is willing to pay for.)

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• Most waste is invisible. Nor is elimination easy.
  A set of techniques  that identify and eliminate
  waste has evolved into "Lean Manufacturing."
• Cellular Manufacturing
• Takt Time
• Kanban
• Setup Reduction
• Implementing
• Kaizen
• Group Technology
• Small and frequent Lot Sizing

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TOOLS ASSOCIATED WITH LEAN
                                                
                                                  
                         Transforming small
manufacturers to high performance requires that
they address
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                  Understand the Current State
                                                
                                                  
                        
Start
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Present State Value Stream Map
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
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Future State Value Stream Map
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                   
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Improve processes (manufacturing engineering
HR Safety Quality Sales Accounting) by
looking at building cells of operations that
are small complete factories of their own instead
of moving products, materials and information by
large lots throughout a large facility or office-
Quick response Processing results
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Introduction To Lean

• A work cell is a work unit larger than an
  individual machine or workstation but smaller
  than the usual department. Typically, it has 3-12
  people and 5-15 workstations in a compact
  arrangement.
• An ideal cell manufactures a narrow range of
  highly similar products/information/procdesses.
  Such an ideal cell is self-contained with all
  necessary equipment and resources.
• Cellular layouts organize departments around a
  product/information/process or a narrow range of
  similar products. Materials sit in an initial
  queue when they enter the cell.

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Introduction To Lean

• Once processing begins, they move directly from
  process to process (or sit in mini-queues). The
  result is very fast throughput.
• Communication is easy since every person is close
  to the others. This improves quality and
  coordination. Proximity and a common mission
  enhance teamwork.
• Simplicity is an underlying theme throughout
  cellular design. Notice the simplicity of
  material/information/process flow. Simpler
  Scheduling, supervision and many other elements
  also reflect this underlying simplicity.

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This complicated flow becomes a much improves and
simpler flow between areas that are adding value
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Key Element Functional Cellular
Inter-department Moves Many Few
Travel Distance 500'-4000' 100'-400'
Route Structure Variable Fixed
Queues 12-30 3-5
Throughput Time Weeks Hours
Response Time Weeks Hours
Inventory Turns 3-10 15-60
Supervision Difficult Easy
Teamwork Inhibits Enhances
Quality Feedback Days Minutes
Skill Range Narrow Broad
Scheduling Complex Simple
Equipment Utilization 85-95 70-80
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Introduction To Lean

• An
  Example
• A firm that assembles air-handling products faced
  high inventories and erratic delivery. They
  originally assembled units on a traditional line.
  Long setups and logistics required long
  production runs. Often, they pulled products from
  finished goods and rebuilt them for custom
  orders.
• Twelve small (1-3 person) assembly work cells
  that were always set up and ready. People worked
  in different cells each day and assembled to
  customer order. Finished Goods Inventory dropped
  by 96. Lead-time was 24 hours. Productivity
  improved by 20-30.

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Traditional Manufacturing Lean Manufacturing
Scheduling Forecast - push Customer Order - pull
Production Stock Customer Order
Lead Time Long Short
Batch Size Large - Batch Queue Small - Continuous Flow
Inspection Sampling - by inspectors 100 - at source by workers
Layout Functional Product Flow
Empowerment Low High
Inventory Turns Low - lt7 turns High - 10
Flexibility Low High
COGS High and Rising Lower and Decreasing
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Continuous Improvement Firm (CIF) versus Mass Production (MP) firm Continuous Improvement Firm (CIF) versus Mass Production (MP) firm Continuous Improvement Firm (CIF) versus Mass Production (MP) firm
Issues MP CIF
Strategic advantage Large volume of homogenous output Production flexibility
Workforce Narrow specialization Multi-skilled
Output based on Forecasted demand Real demand
Productivity success factors Quality of management its ability to plan and to direct the implementation of those plans The ability of the entire work force, not just management, to constantly improve both the product and the processes whereby it is produced
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ISSUE OLD INDUSTRIAL ECONOMY NEW ECONOMY

Economic Development Steady and linear, quite predictable Volatile - extremely fast change, sudden downturns, and chaotic - the direction of the changes is not perfectly clear4
Market changes Slow and linear Fast and unpredictable
Economy Supplier-driven Customer-driven
Lifecycle of Products and Technologies Long Short
Key Economy Drivers Large industrial firms Innovative firms
Scope of Competition Local Global hyper-competition
Competition Name of the Game Size The big eats the small Speed
Marketing Name of the Game Mass marketing Differentiation
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DEFINITION OF
WASTE Essentially, "waste" is anything that the
customer is not willing to pay for.
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• 8 TYPES OF WASTE
• TRANSPORTATION
• WASTED MOTIONS
• EXCESS INVENTORY
• WAIT TIME
• SCRAP OR REWORK
• OVER-PROCESSING
• OVER-PRODUCTION
• UNDERUTILIZED HUMAN RESOURCES.

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Waste In Organizations
is Usually Disguised as

• Lost Time/Injury Accidents
• Scrap/Rework
• Machine Setups
• Machine Downtime
• 3rd Party Inspection

• Calibrations
• Inventory Storage
• Counting Inventory
• Supplier Lead-times
• Product Test
• Profit Reductions
• Falling Market Share

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Waste In the Office Is Disguised As

• Administrative Waste
• Conflicting Department Goals not everyone on
  the same page
• Traditional Accounting Methods rewarding people
  for creating waste, for example inventory
• Poor Product Design designs which do not
  include the needs of the internal and external
  customers
• Long Order Processing Time
• Searching, Hunting, Looking for files, orders,
  invoices, reports, memos etc.
• Waiting Time waiting for batched paperwork,
  instructions, supervision etc.
• Purchasing Reorders, Transactions
• Authorizations

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What Types of Waste Do You Have in Your Facility?
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Eliminating Waste

Improves our ability to provide customer
satisfaction, while reducing our overall costs!
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• Overproduction
• To produce more than is sold or produce it
  before it is needed.
• It is visible as storage of material.
• Overproduction means making more than is
• - Required by the next process
• - Making earlier than is required by the next
  process, or
• - Making faster than is required by the next
  process.

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• Causes for Over Production
• Just-in-case logic
• Misuse of automation
• Long process setup
• Unleveled scheduling
• Unbalanced work load
• Over engineered
• Redundant inspections

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• WAIT TIME
• Any time that is non-value added where the
  operator must stop producing good parts and wait
  for materials instructions Team Leader
  equipment downtime.

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• Causes of Wait Time Waste
• Unbalanced work load
• Unplanned maintenance
• Long process set-up times
• Misuses of automation
• Upstream quality problems
• Unleveled scheduling
• Poor Communication

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• Inventory or Work in Process (WIP) Waste
• Represents the material between operations
  due to large lot production or processes with
  long cycle times
• One of the most frequent types of waste and
  one of the most expensive to have

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• Causes of Excess
  Inventory
• Compensating for inefficiencies and unexpected
  problems
• Product complexity
• Unleveled scheduling
• Poor market forecast
• Unbalanced workload
• Unreliable shipments by suppliers
• Misunderstood communications
• Reward systems

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Introduction to Lean

• Over Processing Waste
• Doing more processing to the parts than the
  customer really requires
• .
• Over processing waste can be minimized by
  asking why a specific processing step is needed
  and why a specific product is produced.
• All unnecessary processing steps should be
  eliminated.

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• Causes for Over Processing Waste
• Product changes without process changes
• Just-in-case logic
• True customer requirements undefined
• Over processing to accommodate expected downtime
• Lack of communication
• Redundant approvals
• Extra copies/excessive information

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Introduction To Lean

• Transportation Waste
• Excess Material Handling either to production
  area or within production areas.
• Does not add any value to the product. Instead
  of improving the transportation, it should be
  minimized or eliminated (e.g. forming cells)

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• Causes of Transportation Waste
• Poor plant layout
• Poor understanding of the process flow for
  production
• Large batch sizes, long lead times, and large
  storage areas

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• WASTED MOTIONS
• Any movement that does not add value.
• Examples looking for tools walking many
  steps to get parts or place parts into finished
  goods more movements than necessary to perform
  an operation.

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• Causes of Motion Waste
• Poor people/machine effectiveness
• Inconsistent work methods
• Failure to take ergonomic issues into
  consideration
• Poor facility or cell layout
• Poor workplace organization and housekeeping
• Extra "busy" movements while waiting

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• SCRAP OR REWORK
• Requires additional resources and time to
  correct defects before shipping or replace parts
  that are scrapped due to defects.

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• Causes of Scrap or Rework
• Little or no process control
• Poor quality standards or inconsistent quality
  standards
• Lack of or little planned equipment preventive
  maintenance
• Inadequate education/training/work instructions
• Product design (Process cannot produce to
  quality)
• Customer needs not understood

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• UNDER-UTILIZED HUMAN RESOURCES
• The lack of involvement and participation of
  the employees in improving operations quality
  and safety.

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• Causes of People Waste
• Old guard thinking, politics, the business
  culture
• Poor hiring practices
• Low or no investment in training
• Low pay, high turnover strategy
• Management thinking it has to drive everything
  instead of involving those who know the process
  the best

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• SOME BASIC ELEMENTS OF LEAN
• Elimination of waste
• Equipment reliability
• Process capability
• Continuous flow
• Material flows one part at a time
• Less inventory required throughout the production
  process,
• raw material, WIP, and finished goods
• Defect reduction
• Lead time reduction
• Error proofing
•                      

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• Stop the Line quality system
• Kanban systems
• Standard work
• Visual management
• In station process control
• Level production
• Takt Time
• Quick Changeover
• Teamwork
• Point of use storage

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KAIZEN The definition of Kaizen is "improvement"
and particularly------"Continuous Improvement"--
slow, incremental but constant Small-scale
improvements are easier and faster. The risks
are lower because they generally have limited
effect. However, the accumulated effect  is
often greater than a single large improvement
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• Takt Time
• The desired time between units of production and
  output, synchronized to customer demand.
• The concept carries backward through a process
  stream. Ideally, every step synchronizes with the
  final output. Takt Time is fundamental to Lean
  Manufacturing.

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• Takt time is useful for lean cells  These are
  typical of the work cells at Toyota and what most
  people think of when they picture a cell.
• Such cells have
• Minimal Setups
• A Single Routing
• Identical Work Times for All Products
• Job-shops and other low-volume, high-variety
  operations can also use cellular manufacturing,
  it's just a bit more complicated

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• Small lot production (ideally one piece) is an
  important component of any Lean strategy.
• Lot size directly affects inventory and
  scheduling
• The larger the lot size the more time, materials,
  money, inventory, lead time, scrap is produced
  and lead time and scheduling is extended.

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Batching has an even greater effect on inventory.
This chart shows the minimum inventory on hand
downstream of the work center. A lot size of 20
units generates an average inventory of 15
units. A lot size of 200 generates an average
inventory of 93 units with wide fluctuations.
This is a 600 increase!  Actual inventory would
be much larger than shown here because of the
uncertainty of fluctuations, the difficulty of
correcting a stock out and the need for coping
with other contingencies.
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The chart above shows the effect of large and
small lots on one particular work center's
production. A green line shows daily demand from
the customer. It averages 50 units/day and does
not vary more than about 20. The black line
shows the actual production if units are made in
lots of 20 or about 0.4 days of demand. With this
small lot size, required production tracks demand
and even smoothes the demand a bit. Output is
quite linear.
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A lot size of 200 units is about 4.0 days of
demand. The purple line shows production
requirements. Here there are large, intermittent
swings between 200 units and 0 units-- very
non-linear.  This kind of pattern complicates
scheduling, precludes the use of kanban and
generates large inventories. The slightest glitch
can cause stock outs
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Leaders must lead! Everyone must be involved
without exception! Lean applies to the office
and shop floor and it paves the approach
necessary for all other improvements which are
the long-term hope for a companys survival.
You will achieve the level of excellence that you demonstrate you want to achieve. Dupont
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