Lean Enterprise - What is in for
your Customers ?
Chairman – WINOC
Medina- Lean Overview
October 18, 2005
WINOC: Work in Northeast Ohio Council
445 West Liberty Street, Suite 225, Medina, Ohio 44256
(330) 725-4885 l Fax (330) 721-2933 l www.winoc.org
Lean Enterprise-What is in for
• Overview of Lean Enterprise
• Lean System Tools
• Case Study
• Lessons Learned
What Is Lean?
Lean is a business environment
where waste is identified continuously
and eliminated passionately.
What Is Waste?
Any activity (or inactivity) that
for which the customer is not willing to pay.
Seven Wastes of Lean
Lean Enterprise Is Comprehensive
Deals with the total
Product Delivery System Starts with the Customer
Supplier Integration Lean Manufacturing Distribution Integration Market Scope &
SUPPLIER FACTORY WAREHOUSE SELLING ENTITY CUSTOMER
Delivery on demand
Build what is sold
Supply what is consumed
Flexible response and balanced flow
Harbor Consulting Report
Manufacturers HPV % Plant
Toyota 27.90 5.5 107
Nissan 29.43 (4.8) 90
Honda 32.02 0.2 87
GM 34.33 2.5 87
DCX 35.85 4.2 86
Ford 36.98 4.2 95
International Car Distribution
l The Chances in North America and Europe
of getting a vehicle fixed right the first time are
only about 80%.
l The Chances of getting it fixed the first time
and on time are only about 60%.
Total Product Development
for Fast &
Flexible LEAN MANUFACTURING
Suppliers ENVIRONMENT Customers
Lean System Tools
• Value Stream Mapping
• Total Productive Maintenance
• Pull System (Kanban)
• Standardized Work
• Continuous Flow Manufacturing
• Set Up Reduction
• Error Proofing
Value Stream Map
A Value Stream Map (VSM) is a hand-drawn map that
helps people to see and understand both workflow and
information flow within a manufacturing and
administrative process, or value stream, from start to
Why Do Value Stream Mapping?
• To create a high-level look at total efficiency, not the
independent efficiencies of individual departments
• To visually identify improvement opportunities to
– Material Flow
– Paper/electronic document flow
– Information flow
• To help identify applicable improvement tools and
plan for deployment
• To develop process measurements
Typical Plant VSM
Typical Business Process VSM
Business Process Improvement Is
Essential to Build Lean Enterprise
• Non-manufacturing processes can consume
as much as 70% of the order-to-cash lead
• For many businesses SG&A are substantial
proportion of total costs
• Business Process Improvement helps
address these opportunities
Value Stream Map: Driving Force!
Applying Lean & Six Sigma Tools
During Product Development
Lean Enterprise Deployment
Situation: In X Aerospace business, parts are sent in for repairs
by the airlines. Many of them are are not defective. X calls
them No Fault Found (NFF). In case the part is defective, X
has to provide a quotation for repairs. Currently, the Turn
Around Time (TAT) for this process is too long.
Objective: Make the initial evaluation process efficient and if
the part needs repair, send a quote to the customer; and
return the part, if NFF. Reduce TAT.
Process: A Business Process Improvement workshop was
conducted, that included several customer representatives.
Value Stream Maps (Current State & Future State) were
developed to identify opportunities.
Comments of Participating
“We appreciate the opportunity to work with
[your] Kaizen Event – This is a step in the
right direction in securing “our” futures.
Looking forward to partnering with [you] in the
future.” Van Kale, Delta Airlines
“Here are some words of wisdom, change is
constant and no one can avoid it – get ready
to embrace it!” Sylvia Ewaskow, Boeing
“This has been a powerful, productive and informative week. All of the participants had the synergy
required to produce some very solid recommendations and suggestions that we are hopeful will be
implemented. Having been here for a week, we are looking forward to a better partnering experience.
Thank you… for opening yourselves to us.” Glenice Daniels-Chambers, DLA
“There is a difference this time in visiting Jackson. The people are not afraid of
change. The people within the Kaizen Event this week have shown a willingness to
look at what they do, how they do it, and why they do it and want to change it for
what is best for the customer. Richard Loader, Airbus
June Aug G oal
M e tric U n its 2004 2004 D ec 2004
R e p a ir O T D 87% 88% Est 95% G oal
NFF TAT D a ys 2 8 .5 1 8 .5 5
Q ueue TAT L e a d in g M e tric
R e c e ivin g D a ys 1 0 .5 0 .5
E va lu a tio n D a ys 28 15 2 .5
C e rtify D a ys 2 2 1 .5
S h ip D a ys 1 0 .5 0 .5
Close loop with Airlines on other potential causes
for failure to reduce number of NFF’s.
Lean Consumption - Jones/Womack
• Solve customer problems completely
• Don’t waste time (minimize total cost of
• Provide exactly what the customer needs
• Deliver value when needed
• Supply Value when needed
• Reduce and simplify customer decision
• It is not only about deployment of tools.
• Chase the benefits to the bottom line. Our experience
shows that the savings don’t get generated automatically.
• Select the right set of metrics to assess deployment and
• A Lean / Six Sigma coordinator / expert is a tough hire: it
is sometimes easier to grow them than to hire them.
• Linking Six Sigma and Lean is not about creating a
common logo or acronym. Project and event planning
need to tie to a common goal and be prioritized together.
• Like most initiatives, management engagement is critical.