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					Lean Manufacturing

      Eric Hong
      Shari Sledge
      Michelle Woeste
Agenda

   Background
   Toyota Production System
   Key Lean Techniques
   Advantages and Disadvantages
   People and Customers
   Economics
   Changes in Lean
   Current Lean Practices
   Case Studies
    Definition

   Lean Manufacturing – A way to eliminate
    waste and improve efficiency in a
    manufacturing environment
   Lean focuses on flow, the value stream and
    eliminating muda, the Japanese word for
    waste
   Lean manufacturing is the production of
    goods using less of everything compared to
    traditional mass production: less waste,
    human effort, manufacturing space,
    investment in tools, inventory, and
    engineering time to develop a new product
Lean and Just-in-Time

   Lean was generated from the Just-in-
    time (JIT) philosophy of continuous
    and forced problem solving
   Just-in-time is supplying customers
    with exactly what they want when
    they want it
   With JIT, supplies and components
    are “pulled” through a system to
    arrive where they are needed when
    they are needed
What is Waste?

   Waste is anything that
    happens to a product
    that does not add
    value from the
    customer’s
    perspective
   Products being stored,
    inspected or delayed,
    products waiting in
    queues, and defective
    products do not add
    value
     Seven Wastes
   Overproduction – producing more than the
    customer orders or producing early. Inventory of
    any kind is usually waste.
   Queues – idle time, storage, and waiting are wastes
   Transportation – moving material between plants,
    between work centers, and handling more than
    once is waste
   Inventory – unnecessary raw material, work-in-
    process (WIP), finished goods, and excess
    operating supplies
   Motion – movement of equipment or people
   Overprocessing – work performed on product that
    adds no value
   Defective product – returns, warranty claims,
    rework and scrap
Origins

Lean Manufacturing
  is sometimes
  called the Toyota
  Production System
  (TPS) because
  Toyota Motor
  Company’s Eiji
  Toyoda and
  Taiichui Ohno are
  given credit for its
  approach and
  innovations
Underlying Principles to TPS

   Work shall be completely specified as to
    content, sequence, timing, and outcome
   Every customer-supplier connection, both
    internal and external, must be direct and
    specify personnel, methods, timing, and
    quantity of goods or services provided
   Product and service flows must be simple
    and direct – goods and services are
    directed to a specific person or machine
   Any improvement in the system must be
    made in accordance with the “scientific
    method” at the lowest possible level in
    the organization
Toyota Production System

   Since the Toyota Production System
    requires that activities, connections,
    and flow paths have built-in tests to
    signal problems automatically, gaps
    become immediately evident.
   Results of the TPS are
    improvements in reliability,
    flexibility, safety, and efficiency.
   These lead to increase in market
    share and profitability.
Timeline
Key Lean Manufacturing Techniques


5S

Single Minute Exchange of Dies

Kanban

Cellular Manufacturing
  5S

Strategy for creating a well organized, smoothly
          flowing manufacturing process
5S Examples

   Before     After
Benefits of 5S

   Increases organization and
    efficiency
   Avoids wasted motion
   Increases safety
   Eliminates unnecessary inventory
   Offers improvements at an
    inexpensive cost
5S Drawbacks

   If not fully implemented, may result
    in “Jive S”
       Store things
       Stick to the rules
       Superficially clean
       Switch to new fixtures
       Serve reluctantly

   Can not be considered an end goal
    – must be part of a continuous
    improvement movement
Single Minute Exchange of Dies (SMED)

   Method that focuses on the rapid conversion
    from manufacturing one product to the next
SMED Examples
Benefits of SMED

   Increases throughput by reducing
    setup times
   Eliminates setup errors
   Increases safety
   Reduces the cost of setups
   Reduces waiting times and
    inventory buildups
   Decreases the required skill level of
    the operators
    Kanban

   A system that uses replenishment
    signals to simplify inventory
    management
       Signals (usually cards) hold product details
            What to make, when to make it, how much to
             make, and where to send it
       Cards stay attached to a bin that holds the
        product
       When bin is empty, it is returned to the start
        of the assembly line for replenishment
       Full bins are returned to the customer, and
        the cycle continues
Kanban Example

  Supermarket Ordering System
Benefits of Kanban

   Highly visible systems
   Simple, effective, and inexpensive
   Reduces inventory and eliminates
    stock-outs
   Improves the quality of service
   Improves lead times
Cellular Manufacturing

Dividing the manufacture of products
   into semi-autonomous and multi-
   skilled teams known as work cells
Cellular Manufacturing Example

Functional Layout   Cellular Layout
Benefits of Cellular Manufacturing

   Simplifies material flow and
    management
   Reduces interdepartmental travel
   Reduces throughput time
   Reduces lot sizes
   Simplifies scheduling
    Lean Manufacturing
    Advantages and Disadvantages

   Advantages:                    Disadvantages:
        Increased overall             Difficulty involved
         productivity                   with changing
        Reduced amount of              processes to
         floor space required           implement lean
        Reduced                        principals
         manufacturing lead            Long term
         time                           commitment required
        Improved flexibility          Very risky process -
         to react to changes            expect supply chain
        Improved quality               issues while changing
                                        over to lean
    People

   Transition to Lean is
    difficult since a
    company must build a
    culture where learning
    and continuous
    improvement are the
    norm.
   Success of lean
    requires the full
    commitment and
    involvement of all
    employees and of the
    company’s suppliers.
How People Benefit from Lean

  Element         Traditional              Lean             Improvement

Communication   Slow & Uncertain      Fast & Positive          Quality &
                                                              Coordination

  Teamwork           Inhibited           Enhanced            Effective Teams


  Motivation    Negative, Extrinsic   Positive, Intrinsic   Strong Motivation


 Skill Range         Narrow                 Broad            Job Enrichment


 Supervision       Difficult and      Easy & Localized      Fewer Supervisors
                   Fragmented
How Customer’s Benefit from Lean

  Element         Traditional           Lean           Improvement

  Response           Weeks              Hours             70-90%


Customization        Difficult           Easy           Competitive
                                                        Advantage
Delivery Speed   Weeks-Months            Days             70-90%


   Delivery          Erratic       Consistent & High     Up to 90%
  Reliability
   Delivery      Large Shipments    JIT as Required     Locks in JIT
  Quantities                                            Customers
   Quality           Erratic       Consistent & High     Delighted
                                                         Customers
House of Lean
Economics

   Reduction of Inventory
       Less space necessary to hold inventory
   Reduced Waste
       Decreased Production Cost
   Increased market share
       Able to provide what the customer wants
        quickly
   Increased competitive advantage
       Faster response to the customer
       Lower Cost
       Higher Quality
Changes in Lean since the beginning
Inventory Comparison
   Inventory Turnover – annual cost of
    goods sold from the income statement
    divided by the value of inventory from
    the balance sheet
Quality Control
   6 sigma process
       Combination of old and new ideas
   6 ingredients
       Genuine focus on the customer
       Data- and fact-driven management
       Process focus, management, and improvement
       Proactive management
       Boundarlyless collaboration
       Drive for perfection, tolerance failure
Lean Maintenance
A Simultaneous Approach
6 Tools for Lean Maintenance

   Visual Controls
   5S
   Seven Wastes
   Single Minute Exchange of Dies
   Poka-yoke
   Total Productive Maintenance
Other impacts of Lean

   Bell South – service industry
       Management system and operations
        Control
           Process management, work
            measurement, management control, and
            people development
       Combines lean and 6 sigma
   Woburn Safari Parks
       Feed logistics
       Animal Resource Planning
    Background
   Poli-film America Inc. a division of a German owned
    company.
   Manufactures protective masking that prevents
    abrasion and staining of exposed surfaces during
    manufacturing and delivery
   Industries Using Material:
       Plastics
       Automotives
       Construction
       Electronics
       Laminates
       Furniture
       Textiles
   High demand product
   24/7 production
    Problems
   An enterprise resource planning system that
    encompassed an unstable database
       The database was untrustworthy account of inventory,
        hand counts were necessary to confirm the numbers
        counted by computers
       Led to many employees spending many hours and led
        to low processing and limit of work utilization
   Lack of frequency in supplies and storage – errors in
    production and set limits
   Unable to trace items
   Main concern – program’s ability to adapt to
    changing processes and production goals while still
    maintaining inventory traceability real time data
    with multiple distribution sites
    Results
   Chose a new program to implement in later 2003

   Greatest impact on company’s inventory flow and order
    distribution
        Real time traceability allowed him to cut down on the 2 mil
         lbs of film and other materials by more than half and
         maintain a sufficient safety stock for when its time to
         reorder and restock

   Benefits through Lean
        Time and money has seen dramatic cuts
             Instead of 20 min to fill an order, takes less than 5 min
              currently
        Allowed company to expand for more regional coverage
        Been simplified for reports
        Reduce time taken to accomplish certain tasks and add
         more responsibilities
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