OTM 300-Chapter 8

Kaizen

(process improvement) Make small changes to the process with the goal of eliminating waste

Taiichi Ohno

-former chief engineer or Toyota Reduction of waste=first objective Interested in how members spend their time "Moving is not working

Pillar 2 process

1. Detecting quality problems, stopping the process, and alerting the operator (jidoka) Jidoka=detect problem, shut down the bachine to force a human intervention 2. Thoroughly analyzing the root cause on the shop floor (kaizen). 3. Avoiding the recurrence of the problem by implementing improvements (poka-yoke). Poka-yoke=foolproof

Philosophy

A long-term approach that favors quality and capabilities over short-term financial goals.

Process

All work is highly specified in its content, sequence, timing, and outcome (Rule #1) Process is seen as a series of supplier-customer connections (Rule #2) Every unit flows along a simple, specified path (Rule #3)

How Much WIP is Needed in a Pull System?

Amount may vary from stage to stage and for different items Depends on several questions: What is the lead time to replenish? What is the demand or usage rate? How much safety stock is desired?

Problem solving

Any improvement to processes, worker/machine connections, or flow path must be made through the scientific method, under a teacher's guidance, and at the lowest possible organizational level. (Rule #4) Workers are taught how to improve Typically, production line workers solve their own problems under the direction of a teacher/supervisor

Processes

Continuous process flows that match supply with demand, aiming to reduce wastage of flow time and capacity.

lack of standardization

Contractors making parts used slightly different gauges Machine tools couldn't cut hardened steel Parts needed to be heated after cutting to harden Resulted in warping Parts needed to be filed to fit together

Key dimensions of process choice

Control every step of the process Degree of vertical integrations Capital or labor intensive Flexible or specialized workers

Production at P&L

Decentralized production system Lack of standardization

Improvement potential

Demand constrained-lower costs Capacity constrained-increased flow rate

Demand during replenishment time

Demand during replenishment time=replenishment time*demand rate

Just in time flow

Demand leveling (heijunka) Value stream mapping Use of preventive maintenance to make the system more predictably reliable Use the pull system of production control: produce what is needed, when it is needed, and nothing more - react to demand Kanban

People

Employees: treated as knowledge workers empowered - more challenging jobs, more decision- making training encouraged and supported Suppliers: shorter, more precise lead times more frequent deliveries of smaller quantities quality at the source tight coordination of production/delivery schedules long-term relationships are common

Wasting time of flow units

Flow units don't like sitting in inventory wasting their flow time without receiving value-added work Goal: turn incoming raw materials into fulfilled customer demand as quickly as possible Waste of time becomes visible Taking the perspective of the flow unit Make a flow line Looking at inventory

Philosophy

Focus on continuous improvement overrides short-term financial goals

Scientific management

Frederick Winslow Taylor=father of scientific management-framework that emphasizes efficiency and optimization "Taylorism" How to not manage lean operations Squeeze out every last bit of productivity

Rise of mass production

Henry Ford's Model T - Introduced in 1908 Two key innovations for parts Key innovations for work flow

Drawbacks of craft production

High production costs - Costs didn't drop with increased volume Lack of consistency and reliability Limited ability to innovate - Small, independent shops lacked resources for systematic research to develop fundamental innovations These limitations opened the door to mass production

Mass production summary

High volume Low variety Interchangeable, standardized parts Extreme form of division of labor: Unskilled work force Repetitive small tasks assigned to each worker Inflexible, dedicated machines/tools Assembly line

Job shop

Highly customized, sometimes unique products Sell a 'set of capabilities', not a specific set of products Make-to-order Products follow a variety of paths through the shop Example: custom cabinetmaker

CPM and arrows

If arrow points at it, it can not start until the thing pointing at it finished Any delay delays the whole process

Requirements for process change

Implementing a pull system. Transferring units piece by piece (no transport batching), which typically requires a change in the facility's layout. Operating on takt time. Leveling the demand rate so that the takt time does not constantly change and providing the flexibility in the process to produce different variants of a product.

U-shaped lines

Increase the flexibility of workers to perform multiple tasks One worker in charge of multiple machines Multitask job assignment

Decentralized production system

Independent contractors within the P&L plant Independent machine shop owners supplying parts

Kanban considerations

Kanban should be used for products or parts (a) that are processed in high volume and limited variety, (b) that are required with a short lead time so that it makes economic sense to have a limited number of them (as many as we have kanban cards) pre-produced, and (c) for which the costs and efforts related to storing the components are low. Make to order should be used for products or parts (a) that are processed in low volume and high variety, (b) for which customers are willing to wait for their order, and (c) for which it is expensive or difficult to store the flow units.

Continuous flow

Often, only a single product is produced Product flow follows a single path No discrete parts; flow is continuous Example: chemical production

Problem solving

Ongoing improvement of the operations leveraging the experience of the front-line employees.

7 forms of waste (muda) in the process:

Overproduction Overprocessing Waiting time Material movement Inventory Worker movement Defective products

Panhard et Levassor (P&L)

Paris machine tool company World's leading auto manufacturer in 1894 Building several hundred automobiles per year

Four Ps of the Toyota production system

Philosophy Process People Problem solving

Assembly (flow) line

Produce a narrow range of standardized products Discrete parts follow a predictable path with only slight variations Design of the process for maximum efficiency is critical Almost always make-to-stock Example: appliance mfg.

Project

Producing a unique item - make-to-order Daily coordination and planning are crucial Manage time, cost, technical requirements Design and production is different every time Example: bridge construction

Demand leveling

Producing to demand decreases inventory Spikes in demand are not compatible with TPS Mura Muri Ohno observed that an uneven workflow (mura) will lead to an overburdening of workers and equipment (muri) and will drive up waste (muda) 2 M's are the enemies of lean operation Production leveling (heijunka)

5 basic manufacturing processes

Project Job shop Batch process Assembly (flow) line Continuous flow

Potential difficulties with CPM

Projects change over time Sequence relationships may not be known in advance Cost of over- and underestimating activity times not explicitly considered

Make-to-order

Refers to the release of work into a system only when a customer order has been received for that unit.

Batch process

Relatively stable line of products Higher volume, less customization than job shop Products move through the plant in batches usually make-to-order or assemble-to-order Example: business suits

People and partners

Respectful interactions with employees and partners emphasizing skill development and growth.

Ohno comparison

Run like the tortoise not the hare Steady work is better than bursts with periods of no movement It takes 8 men to row a boat It is the fastest rower who does the damage Demand tends to come in at one time-batch flow units togehter

Key innovations for parts

Same gauging system for all parts Machine tools able to work on pre-hardened metals Result: Completely interchangeable parts

Critical path method (CPM)

Single time estimate for each activity Activity sequence well-defined Identify critical path Focus most effort on keeping the critical path on track

Key innovations for work flow

Specialization of labor Workers now moved from car to car doing just one task Moving assembly line Cars move down the line while workers stood still Cut cycle time from 2.3 minutes to 1.19 minutes

Lean toyota

Spring of 1950, Eiji Toyoda toured River Rouge facility Wrote that he "thought there were some possibilities to improve the production system." lean production grew out of continuous improvement efforts over several decades in Toyota production facilities

Value stream mapping

Steps that create value Steps that create no value but are unavoidable with current technologies and production assets Nonvalue-adding steps that can be eliminated (waste)

Choice of process

Strategic decision Driven by planned product mix Older winners-beyond competition

Benefit of successful lean production

Streamlined flow of materials from raw materials to the final customer Reduced investment in inventories More predictable, better controlled processes Reduced levels of product defects More reliable suppliers Improved responsiveness to changing markets and customer requirements

Pillar 2

TPS pillar 2:Expose problems and solve them when they occur: detect stop alert The production process should halt production when a quality problem is discovered Times that do not stop are either perfect or facing big problems

Takt time

Takt time=rate of demand that drives the production system Ratio between the time available and the number of units demanded Takt time=available time/demand rate Target manpower-workers required based on takt time and labot content Target manpower=labor content/takt time

Benefits of Ikko-nagashi

The flow is visual, so idle time and inventory are easily spotted. There is a baton passing zone, so idle time can be avoided. There is no need for transportation. If demand falls, the number of workers can be adjusted; potentially, one worker might take on tasks across multiple machines.

Kanban

The upstream resource replenishes what demand has withdrawn from the downstream resource. Standardized controllable parts containers circulare between upstream and downstream resources Upstream produces when it receives an empty container

TPS house

Top/roof --Principle of waste reduction and the goal to match supply with demand Two pillars holding roof --Just in time production (single flow unit) --Built in quality Foundation --Culture of process improvement and stable environment with limited variability

Early Toyota

Toyota Motor Company founded in 1937 Early years difficult By 1950, Toyota had produced only 2685 cars (Ford's River Rouge facility produced 7000 per day)

Value-added percentage

Value-added percentage=Value added time of a flow unit/flow time Related to labor content (sum of processing times) Do not count the time the flow unit spends in inventory

7 sources of production waste

Waiting (time on hand) --Wait for inputs from the previous step --Idle time and utilization Overproduction --Should only produce the amount demanded --Just in time production (JIT) Inventory --JIT has not been implemented --Overproduction, handling, storage Transport --Physical layout reflects the process flow time to minimize distance flow units must travel through the process Overprocessing or incorrect processing --Workers spend more time than necessary Rework --Do it right the first time Unnecessary motions and movements

Muda

Waste needless waste of time and worker movements that ought to be eliminated immediately Idle time Fixing broken units Stockpiling inventory Meaningless transport

Built in quality

Workers responsible for quality (andon cord) Detect-stop-alert (jidoka) Root cause analysis leading to process improvement (kaizen) Foolproofing (poka-yoke) Go to the source and observe (genchi genbutsu)

Andon

a cord running adjacent to assembly lines that enables workers to stop production if they detect a defect. Just like the jidoka automatic shutdown of machines, this procedure dramatizes manufacturing problems and acts as a pressure for process improvements

Matching supply with demand

achieve synchronization across process stages to deliver immediately 2. achieve high levels of efficiency by eliminating waste

2. achieve high levels of efficiency by eliminating waste

better flow (from view of flow unit) better use of resources (from view of machine or worker) 7 forms of waste (muda) in the process:

Non-value added work

do not add value in the eyes of the consumer but must be done under certain conditions of the process in order to complete a unit Receive parts Unpacking input materials Pressing a button on a machine

Waste of time of a flow unit

flow time is longer than needed in the eyes of the consumer

Ikko-nagashi

flow units can flow from one unit at a time from one resource to the next Process layout guidelines --Organize work stations matching the flow of materials R--educes transportation needs Baton passing zones U-shaped lines

Toyota Production System

framework used to run operations with the goal of reducing both the waste of capacity and the waste of flow time thereby making sure supply and demand are matched just in time

Genchi genbutsu

go and see in the real place) First hand info Go and observe, collect data, and analyze data

Overall Equipment Effectiveness (OEE)

identify what percentage of a resources time is true, value-added time and what percentage is wasted OOE=(value-added time)/total available time Observation is key to avoid tension between observing managers and employees Genchi genbutsu Kaizen

Baton passing zone

instead of having fixed allocations of activities to workers, the process can absorb variations in the speed and starting time

Production leveling (heijunka)

lower the peaks of production and raise the valleys in production as much as possible so that the flow at the surface is smooth Match true rate of demand Avoid large production batches Level daily production volume

# of kanban cards

max inventory authorizes Managers control Container size Demand rate Replenishment time Safety stock # of kanban cards-(demand during the replenishment =safety stick)/container size

Automation

merging human intelligence required for handling expectations with the mechanical power of a machine (1) detect the problem (2) stop production (3) alert operator Ex: andon

Value added work

movements valued by customers as they are absolutely required to transform the flow unit from its inputs to being the output the customer wants

Single flow unit

operate at a flow of one unit per time from one resource to the next instead of transfer batched Less inventory Inventory helps cover up defects and imbalances Shorter response times to demand Faster feedback Correct mistakes Simpler and more flexible staffing Produce the demand Shorter processing times\ Workers slow down when buffers exist More transparency

Muri

overburdening of workers or equipment

Waste of time at a resource

reduces capacity of the resource Workforce or production equipment Capacity is wasted because of idle time Non value adding work

Pull system

resource furthest downstream is paced by market demand Production or replenishment of a unit is only initiated when a demand occurs Relays demand info to the next station upstream so they are paced by demand Kanban

Process layout

resources that are close to each other in the process flow diagram should be co-located in physical space Avoid unnecessary transports Reduces need to form transfer batches

achieve synchronization across process stages to deliver immediately

the product version requested, with zero defects, in a batch size of one Key: reduce unexpected variability in the process through constant experimentation and improvement

Benefits of kanban

there can never be more inventory between resources than what has been authorized by the kanban cards

Information turnaround time (ITAT)

time between creating a defect and receiving the feedback

Mura

unevenness in flow Associated with uneven flow