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Breakthrough Consultancy Enterprises Limited © 2012 1 A process is lean when it delivers products and services that the customer wants at an acceptable price to value ratio Lean this way This presentation is a run-through of what makes Lean Practice important for modern business

Lean practice an effort worthwhile

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Lean practice is not a lightweight version of Six Sigma but it cannot exist without it. Understand that Lean Practice is complex in execution if success is to be achieved.

Text of Lean practice an effort worthwhile

Slide 1

Breakthrough Consultancy Enterprises Limited 2012*

A process is lean when it delivers products and services that the customer wants at an acceptable price to value ratioLean this wayThis presentation is a run-through of what makes Lean Practice important for modern business

Breakthrough Consultancy Enterprises Limited 2012*

Essential Lean PracticeLean PrinciplesApproachMaking changeFormula for successMeet customer needsDesign and operate flexible processesMake value flow visiblyOperate to smoothed pull demandHead to simplicity and perfectionReap benefits for the businessCustomise Lean PracticeAdopt a flow approachUse simple methods firstAttempt Six Sigma analysisSee the Big PictureAddress social system change leversApply programme/project controlsUse change methods liberallyRecognise service differences

Breakthrough Consultancy Enterprises Limited 2012*

Whats stopping your business being the best?

Breakthrough Consultancy Enterprises Limited 2012*

Lean formulaLoadCapacityGapValue demandFailure demandRunner RepeaterStrangerWorkWasteValue addingNecessary non-value addingNon-value addingPositiveUnderload not greater than 80%NegativeOverload MuriActions and feedback loopsReduce failure demandReduce wastesSpread loadReduce variationUse slack capacity to improve efficiencyPrice to value ratio impact+++

Breakthrough Consultancy Enterprises Limited 2012*

Waste not - want a lotHuman systemNatural, unrecognised wastePush down, pop upTreat the whole, not the partsNot just tools and techniquesSelf disciplinePractice and trainingFat reductionMistakes are opportunitiesBeing greenFastFlexibleFit for purposeAdaptable in performanceLean is continuous learningLean fitnessApplying lean is not just driving out wasteValue addedNot inventoryNot delays or poor communicationNot wasteCustomer willing to pay for ...

Breakthrough Consultancy Enterprises Limited 2012*

Lean Principles

Breakthrough Consultancy Enterprises Limited 2012*

Journey to where Everything is Right

Lean PrinciplesSpecify value from the customer's viewpointDesign and operate processes to be flexible by identifying the value streamMake value flow avoid batches and queues, never delay a value-adding step by non-value addingOperate only when needed in response to short pull demand from customer no inventory or idle resourcesHead to perfection simplicity, defect free, delivering exactly what the customer wants, when, at a fair price with minimum wasteAnd there will be benefit for the business as well in increased productivity and lower cost

Breakthrough Consultancy Enterprises Limited 2012*

Lean themes

Breakthrough Consultancy Enterprises Limited 2012*

Lean Approach Options

Breakthrough Consultancy Enterprises Limited 2012*

Lean Enterprise HouseRight process gives right resultsValue from developing peopleOrganisational learningChallenge, GembaProcess mapping, value stream mappingPDCA, FAIRKaizen7 wastesJITParetoTeamwork5 whys5S

Systems thinkingPolicy DeploymentYour way

Breakthrough Consultancy Enterprises Limited 2012*

Intuitive LeanSimple and effective approachesPDCAFAIR

Breakthrough Consultancy Enterprises Limited 2012*

Flow Question FrameworkCreateCan we produce what the customer wants when it is needed?Can we deliver what the customer wants and prepare for the next according to real demand?MaintainOrganiseMeasureCan we keep the flow going so that it does not stop?Can we maintain a predictable flow rate in order to achieve planned performance?Are we organised to support flow through the whole process chain?Can we deal with variation?Can we react quickly to resolve problems and recover?Do we measure to promote actions which support flow?Do we know what it needed at each point in the process chain to achieve the overall goal?Are we developing the right resources and skills?VISIONREWARDCUSTOMER NEEDSSATISFACTIONDESIGNDELIVER

Breakthrough Consultancy Enterprises Limited 2012*

Lean TechniquesTechniques can be sophisticated

Breakthrough Consultancy Enterprises Limited 2012*

Those Japanese and other wordsMudaWaste: the one to concentrate on Muri and mura cause wasteWhere else does it come from? Human systemsMuriOver-burden: near capacity resources do not work optimallyMuraUnevenness: fast uninterrupted flow not possible with uneven demand queues and lead time build up Could the root cause of everything but probably its circularGembaSee for yourself what is happening in the workplaceHeijunkaLevel to schedule the secret weaponSMEDSingle (digit) Minute Exchange of Die true for service tooPokayokeFailsafing and mistake proofingGenchi GenbutsuFacts for correct decisions and consensus from the sourceHanseiRelentless reflectionKaizenContinuous improvementTRIZTheory of Inventive Problem SolvingJidoka - AndonAutomation with human intelligence with signalling to stop process

Breakthrough Consultancy Enterprises Limited 2012*

Making change

Breakthrough Consultancy Enterprises Limited 2012*

Methods and skillsLevers in the social systemTodays problems come from yesterdays solutionsBehaviour grows better before it gets worseThe cure can be worse than the diseaseFaster is slowerThe areas of highest leverage are often the least obviousProgramme and project managementBusiness case link to corporate objectivesGovernance who is in charge?Plan, agree, monitor and re-planManaging issues and risksBusiness changeKotterLewin: Unfreeze, Alter, Re-freeze4Cs: commitment, communication, co-production, consistencyNudging behaviour in the direction of LeanBenefit realisation: need for long-term measurement of progress

Breakthrough Consultancy Enterprises Limited 2012*

Service dimensionsService characteristicsInvisibility IntangibilitySimultaneous production and consumption Consumer involvement Complexity and variability Measurement difficulty Lean for better serviceMaking sure there is a customerThere is no inventory just inactivityServices come in types which behave differentlyAdapt techniques for the service industryDo not forget soft areas

Breakthrough Consultancy Enterprises Limited 2012*

Where is Six Sigma in Lean Practice?Is it possible to have Lean without Six Sigma?NoUnless the Lean project is light touchSame infrastructureManagement awarenessCommunicationGovernanceSkills and resourcesCoaching, support and trainingOversightUnique initiativesProgramme managementProject managementEspecially monitoring, control and reportingShared approach and techniquesUse Six Sigma DMAIC or DFSSDescriptive data analysisStatistical analysis e.g. hypothesis testing

Breakthrough Consultancy Enterprises Limited 2012*

A good readThe Lean Toolbox:The Essential Guide to Lean Transformation by John Bicheno and Matthias HolwegPICSIE Books 4th Edition 2009

*Runner a product or service having sufficient volume and familiarity to justify dedicated resources and standard processesRepeater a product or service at intermediate volume and regularity which is handled by reconfiguring existing resources and processesStranger a product or service which is required intermittently and at low volume but still profitable or necessary to satisfy customers which is disruptive to resources and processes*Six Rights (Peter Hines): Right product, place, time, quantity, quality, costPrinciple 4 is important to service management in happens naturally or should in simultaneous production and consumption99% of a product becomes waste within 6 weeks of sale*25 themes and more?What classification input, process, output, policy, etc*A more rigorous approach*WORMPIT (variant on Ohno) : Waiting, Over-production, Rework, Motion, Processing, Inventory, Transport Other wastes: making wrong product, untapped human potential, excessive information/communication, time, systems, natural resources, knowledge

Six Sigma techniques should be used:Measles chartFishbone Lead and takt time calculationsBox and whiskerFrequency plotsConfidence intervalsCorrelationRegression and trendsFailure mode and effect analysis (FMEA)

*Waste: anything other than the minimum amount of equipment, material, parts, space and human resource which are absolutely essential to add value to the product [or service]*More Peter Senge:The easy way out usually leans back inCause and effect are not closely related in time and spaceSmall changes can produce big results - but the areas of highest leverage are often the least obviousYou can have your cake and eat it but not all at onceDividing an elephant in half does not produce two small elephantsThere is no blame**