Upload
lean-enterprise-academy
View
307
Download
2
Embed Size (px)
DESCRIPTION
By David Brunt of Lean Enterprise Academy shown at the Lean Summit 2011 - Solving Business Problems on 10/11 November 2011
Citation preview
www.leanuk.org
David Brunt November 10th 2011
Seeing the Whole: Creating Lean Supply Chains
UK Lean Summit: Solving Business Problems
Lean Enterprise Academy 1
www.leanuk.org Lean Enterprise Academy
Creating Lean Supply Chains Seeing the Whole Extended Value
Stream Plenary Theme: 3. What can we learn from compressing lean supply chains?
As low-wage globalisation unwinds how to rebuild and manage a lean supply base in each region to bring jobs back and respond to customers cost effectively in high wage locations.
This Session: How do you analyze the opportunities from compressing
value streams?
2
www.leanuk.org Lean Enterprise Academy
Objectives of Mapping Extended Value Streams
Seeing the Whole Extended Value Stream Raise consciousness in every firm & function touching the value
stream of the enormous waste of time, effort & movement Typical current state 9 out of 10 steps & 99% of elapsed time are
wasted Raise consciousness in every firm & function of the effect of its
actions on every other firm & function touching the value stream Learn how a value stream team with representatives from every
firm can envision a series of Future States & an Ideal State for their shared value stream
Learn how the team can progressively implement: A Future State 1 in which smooth, levelled pull & flow are introduced
within every facility touching the value stream A Future State 2 in which smooth, levelled pull & frequent replenishment
loops are introduced between every facility touching the value stream (eliminating warehousing & cross docking in the process)
An Ideal State (providing a North Star for collectively steering towards the perfect value stream with zero waste) by compressing the value stream & introducing right-sized technologies
Learn how value stream teams can share costs & gains to create win-win-win outcomes for every value stream participant
3
www.leanuk.org Lean Enterprise Academy
Agenda
Introduction Lean Thinking & starting the project Mapping the flows
Deciding what to map
Every Product Every Cycle Manufacturing Warehousing
Developing the Future State
4
www.leanuk.org
Lean Thinking A Refresher
Specify what creates value from the customers perspective
Identify all steps across the whole value stream
Make those actions that create value flow
Only make what is pulled by the customer just-in-time
Strive for perfection by continually removing successive layers of waste
Lean Enterprise Academy 5
www.leanuk.org Lean Enterprise Academy
The Essence of Lean Thinking
Where is the time in your value stream? e.g. A U.K. customer has to wait on average 48
days for their custom-built vehicle to arrive It takes under 30 hours to produce in the
factory!!!
“All we are doing is looking at the time line - from the moment the customer
gives us an order to the point where we collect the cash. And we are reducing that time line by removing the non-
value-added wastes” Ohno (1988-ix)
6
www.leanuk.org Lean Enterprise Academy
Value Stream Improvement & Process Improvement
Company 1 Company 2 Company 3
CUSTOMER
Raw Material
Finished Product
VALUE STREAM: All the steps, VA & NVA, required to bring the product from raw material to customer
Necessary but non value adding 35%
Value adding 5%
Non value adding 60%
7
www.leanuk.org Lean Enterprise Academy
Value Stream Improvement & Process Improvement
Company 1 Company 2 Company 3
CUSTOMER
Raw Material
Finished Product
PROCESS PROCESS PROCESS
VALUE STREAM: All the steps, VA & NVA, required to bring the product from raw material to customer
Necessary but non value adding 35%
Value adding 5%
Non value adding 60%
Focus of “traditional” efficiency improvements
8
www.leanuk.org Lean Enterprise Academy
Value Stream Improvement & Process Improvement
Company 1 Company 2 Company 3
CUSTOMER
Raw Material
Finished Product
PROCESS PROCESS PROCESS
VALUE STREAM: All the steps, VA & NVA, required to bring the product from raw material to customer
Necessary but non value adding 35%
Value adding 5%
Non value adding 60%
Focus of LEAN improvement
9
www.leanuk.org
“Seeing the Whole” Methodology
Seeing the Whole: Creating Lean Supply
Chains
Lean Enterprise Academy 10
www.leanuk.org Lean Enterprise Academy
Objectives of Mapping Extended Value Streams
Seeing the Whole Extended Value Stream Raise consciousness in every firm & function touching the
value stream of the enormous waste of time, effort & movement Typical current state 9 out of 10 steps & 99% of elapsed time
are wasted Raise consciousness in every firm & function of the effect of
its actions on every other firm & function touching the value stream
Learn how a value stream team with representatives from every firm can envision a series of Future States & an Ideal State for their shared value stream
Learn how the team can progressively implement: A Future State 1 in which smooth, levelled pull & flow are
introduced within every facility touching the value stream A Future State 2 in which smooth, levelled pull & frequent
replenishment loops are introduced between every facility touching the value stream (eliminating warehousing & cross docking in the process)
An Ideal State (providing a North Star for collectively steering towards the perfect value stream with zero waste) by compressing the value stream & introducing right-sized technologies
Learn how value stream teams can share costs & gains to create win-win-win outcomes for every value stream participant
11
www.leanuk.org Lean Enterprise Academy
Toyota Production System
Jidoka
-Andon
-Poka-Yoke
-Visual control
-5S, etc.
Just-in-time
-Flow production
-Takt time
-Pull system
Customer service
Continuous Improvement
Through People
Lead Time Cost Quality
Heijunka Standardized Work Kaizen
Equipment Stability
Goal: Highest Quality, Lowest Cost, Shortest Lead Time
Purpose
12
Analysis
Countermeasures
Plan
Follow-up
Background
Goal
Purpose: What is the business reason for choosing this issue? Overall Situation: What is the strategic, operational, historical or organizational context of the situation?
Theme: Review Questions For Problem Solving A3s
Ref: Developed from Sobek & Smalley 2008 pp 50 & David Verble
Current Situation
What is the Problem or Need- the Gap in Performance? What is happening now versus what needs to be happening or hat you want to be happening? What are the specific conditions that indicate you have a problem or need, where and how much? Show the facts visually with charts, graphs, maps
Is there a clear goal or target (gap?) What, specifically, is to be accomplished? How will this goal be measured or evaluated? What will improve, by how much, and when?
What are the options for addressing the gaps & improving performance in situation? How do they compare in effectiveness, feasibility & potential impact? What are their relative costs and benefits? Which do you recommend and why? Show how your proposed actions will address the causes of the gaps or constraints in the situation.
What will be main actions & outcomes in the implementation process & in what sequence? What support & resources will be required? Who will be responsible for what, when & how much? When will progress & impact be reviewed & by whom? Use a Gantt chart to display actions, steps, outcomes, timelines & roles. How will you measure the effectiveness of the countermeasures? Does the check item align with the previous goal statement?
When and how you will know if plans have been followed & the actions have had the impact needed? What related issues or unintended consequences do you anticipated & what are your contingencies? What processes will you use to enable, assure & sustain success
What do the specifics of the issues in related work processes (location, patterns, trends, factors) indicate about why the performance gap or need exists? What conditions or occurrences are preventing you from achieving the goals? Use the simplest problem analysis tool that will suffice to show cause-effect down to root cause. From 5 Whys, to 7 QC tools (fish-bones, analysis trees, Pareto charts) to sophisticated SPC or other tools as needed.
What are you talking about & why?
Where do things stand now?
What specific outcome is required?
Why does the problem or need exist?
What do you propose & why?
Specifically how will you implement?4Ws1H
How will you assure ongoing PDCA?
www.leanuk.org Lean Enterprise Academy
Michigan Steel
Sales Manager
Gamma Stampers
Value Stream
Manager
Beta Wipers
Plant Manager
Product Line
Manager
Alpha Motors
Head of Supplier
Development (Team Leader)
One or two people from each organisation
Step 1: Select a Team from Across the Chain
14
www.leanuk.org Lean Enterprise Academy
Manufacturing Plant
Plant Manager
Lean Manager
European Distribution
Centre
Distribution Manager
Lean Manager
Retailer Head Office
Project Manager
Category Buyer
Retailer High Street
Branch Manager
Optician
Contact Lens Example
Planning Manufacturing
Outbound Logistics
Goods In Inventory Mgmt Order Processing
Pick/Pack/ Ship
Ordering Promotions
Ordering Delivery
Consumption
15
www.leanuk.org Lean Enterprise Academy
Who Should be on the Team?
Responsibility for part or all of supply chain activity People who can take a view beyond their
functional silo People who are sufficiently senior and have
sufficient authority & respect to drive through changes across functional boundaries
People who can take a strategic perspective People who have a ‘willingness to learn ’ The people who are going to do the improving – do
the mapping
16
www.leanuk.org Lean Enterprise Academy
Alpha Motors Platform A
Apex Wheels
Beta wipers
Epsilon Fuel Pumps
Cosmic Brakes
Eclipse Engine
Computers
Gamma Stampers
Ampersand Magnets
Utopia Castings
Michigan Steel
Odyssey Fasteners
Smith Heat Treatment
Step 2: Select a Key Value Stream for the
Pilot Improvement Project
The companies in the target value
stream
The specific product or
product family for analysis
17
www.leanuk.org Lean Enterprise Academy
Glenday Sieve & Product Family Analysis
Process Steps & Equipment
LH Steering Bracket
RH Steering Bracket
Instrument Panel Brace
Seat Rail
Bumper Brackets
Electronic Test Fixtures Assy Robot Weld Flash Remove Paint Manual Assy Spot Weld
X X X X
X X X X
X X X X
X X
X X X
Prod
ucts
BLUES 95%
6% 50%
Cumulative % Product Range Cumulative % of Sales
Last 1%
18
www.leanuk.org Lean Enterprise Academy
Lisbon
Birmingham
Milan
Rome
Stockholm
Helsinki
Vienna
Manchester
Warsaw
Madrid
Basel
2005 European Daily Volume
over 10,000 packages on 24/48 hrs delivery
Oslo
Athens
Paris
Marseille
Brussels
Osnabrück
Customer Distribution Chart
19
www.leanuk.org Lean Enterprise Academy
Step 3: Data Collection
Go and see ----- GEMBA All the team ---- Walk all of the chain Record all the steps in the process & the
time taken for each – Process Activity Map Classify each step as Value Adding (VA) or
Non–Value Adding (NVA) It may seem time consuming – but it is
invaluable Use the data collected to construct a
Current State map for each facility
20
www.leanuk.org
Global System Map
Lean Enterprise Academy 21
www.leanuk.org Lean Enterprise Academy
Steel mill
Stamping Company
Wiper Assembly Company
Car Assembly
Car Distributor
Current State Map For the Complete Value Stream
22
www.leanuk.org Lean Enterprise Academy
Objectives of Mapping Extended Value Streams
Seeing the Whole Extended Value Stream Raise consciousness in every firm & function touching the
value stream of the enormous waste of time, effort & movement Typical current state 9 out of 10 steps & 99% of elapsed time
are wasted Raise consciousness in every firm & function of the effect of
its actions on every other firm & function touching the value stream
Learn how a value stream team with representatives from every firm can envision a series of Future States & an Ideal State for their shared value stream
Learn how the team can progressively implement: A Future State 1 in which smooth, levelled pull & flow are
introduced within every facility touching the value stream A Future State 2 in which smooth, levelled pull & frequent
replenishment loops are introduced between every facility touching the value stream (eliminating warehousing & cross docking in the process)
An Ideal State (providing a North Star for collectively steering towards the perfect value stream with zero waste) by compressing the value stream & introducing right-sized technologies
Learn how value stream teams can share costs & gains to create win-win-win outcomes for every value stream participant
23
www.leanuk.org
Demand Amplification The Forrester Effect
Small changes in end-user demand become amplified as they are passed
upstream along the chain
Lean Enterprise Academy 24
www.leanuk.org Lean Enterprise Academy
Demand Amplification The Bull-Whip Effect
Customer Demand, Retailer Orders Distributor Orders Factory Production
Time
Demand [units]
40% increase
10% increase
25
www.leanuk.org Lean Enterprise Academy 26
www.leanuk.org Lean Enterprise Academy 27
www.leanuk.org Lean Enterprise Academy 28
www.leanuk.org Lean Enterprise Academy
Constructing a Demand Amplification Map
Major decision areas Customer forecast Your business plan - volumes Your forecast/schedule Your weekly plan
Final assembly Feeder operations
Actual production numbers Supplier forecast Supplier orders Actual deliveries
Produce line charts Date
29
www.leanuk.org Lean Enterprise Academy
Quality & Delivery
Demand Amplification
Consumption Map
Geography etc.
Current State Summary
Purpose Select Product Family Supply Chain Network & VS Selection
Alpha Motors Platform A
Apex Wheels
Beta wipers
Epsilon Fuel Pumps
Cosmic Brakes
Eclipse Engine
Computers
Gamma Stampers
Ampersand Magnets
Utopia Castings
Michigan Steel
Odyssey Fasteners
Smith Heat Treatment
Current State by Facility PRODN. CONTROL
Weekly Schedul
e Prod’n Plan
Forecast
Daily Call In
Forecast
Weekly Call In
Weekly
Suppliers Customer
Mon. + Wed.
PRESS ASSEMBLY SHIP
I I
C/T = 30 sec.
C/O = 30 min.
3 shifts
2% Scrap
C/T = 90 sec.
C/O = 5 min.
2 shifts
3% Scrap
600 pieces 2 Day
300 pieces 1 Day
30 sec 2 days
90 sec 1 day
Total lead time 3 days VA time
2 mins
LH Steering Bracket
RH Steering Bracket
Instrument Panel Brace
Seat Rail
Bumper Brackets
X X X X
X X X X
X X X X
X X
X X X
Prod
ucts
BLUES 95% 50%
Cumulative % Product Range Cumulative % of Sales
Last 1%
Supply Chain Current State
30
www.leanuk.org Lean Enterprise Academy
Workshop
For each of your firms: Describe your supply chain network Which product family would you select Has anyone in your organisation created:
A Consumption Map? Quantified Demand Amplification
What is the Quality & Delivery performance of the chain?
You have 15 minutes
31
www.leanuk.org Lean Enterprise Academy
Objectives of Mapping Extended Value Streams
Seeing the Whole Extended Value Stream Raise consciousness in every firm & function touching the
value stream of the enormous waste of time, effort & movement Typical current state 9 out of 10 steps & 99% of elapsed time
are wasted Raise consciousness in every firm & function of the effect of
its actions on every other firm & function touching the value stream
Learn how a value stream team with representatives from every firm can envision a series of Future States & an Ideal State for their shared value stream
Learn how the team can progressively implement: A Future State 1 in which smooth, levelled pull & flow are
introduced within every facility touching the value stream A Future State 2 in which smooth, levelled pull & frequent
replenishment loops are introduced between every facility touching the value stream (eliminating warehousing & cross docking in the process)
An Ideal State (providing a North Star for collectively steering towards the perfect value stream with zero waste) by compressing the value stream & introducing right-sized technologies
Learn how value stream teams can share costs & gains to create win-win-win outcomes for every value stream participant
32
www.leanuk.org Lean Enterprise Academy
Heijunka box
Forecast
1. Replenishment Pull System Concept
Key Points
Each process has a supermarket which holds the product it produces
The easiest of all pull systems to start with to implement
Each process replenishes the market in front of the process
Pace and order of replenishment at the pacemaker can be controlled by a Heijunka box (discussed later in more detail)
Scheduling needs to calculate average demand quantity, the right mix for the line to produce and continually watch inventory to reconcile what is actually taken away. (Caution: If you have the line produce exactly what is taken away you may wind up with an “un-level pull” system)
Customer
Production Control
33
www.leanuk.org Lean Enterprise Academy
Heijunka Box
Order Sequence
List
Supplier Parts
2. Sequential Pull System Concept
Key Points
1. The sequence of production is dependant upon actual orders from the customer
2. Production instruction is sent to an upstream process in the value stream, often in the form of a “sequence list" or instruction kanban
3. Each following process normally produces in the sequence of the item delivered
FIFO of individual products must be maintained throughout
Without WIP inventory to act as a buffer rigid adherence to lead-time and on-time delivery of supplier components becomes absolutely critical
Customer
F I F O F I F O
Production Control
34
www.leanuk.org Lean Enterprise Academy
Heijunka box
Order
Scheduling
3. Mixed pull system concept
Key Points
Both Supermarket replenishment and Sequential type pull systems may be used concurrently. Such a mixed system works well when and a small number (perhaps 20%) of parts comprise the majority (perhaps 80%) of daily production volume, and there are many low runners that are required at much less frequency
Demand segmentation analysis is required to break products up into high runners, medium, low, and infrequent (perhaps special order or service parts) orders
Two schedule points (i.e. pacemaker) exist which can cause problems which I will demonstrate later in the simulation game
Customer
F I F O F I F O
35
www.leanuk.org Lean Enterprise Academy
How will you level production mix at the pacemaker?
Key concept Leveling concept & SMED Leveling options
36
www.leanuk.org Lean Enterprise Academy
Level Production Mix Concept & Effect
Days 0 10 20 30
X Y Z
1,200 per lot
3 lots of 1,200 3 changeovers 10 day build
10 day avg. inventory 10 to 21 day lead time
"Large batch"
Case - 1
30
40 per lot
0 10 20
X
Z
Y
90 lots of 40 90 changeovers 3 items per day build (EPED)
1 day avg. inventory 1 day lead time
"Small batch"
Case - 3
Repeat schedule
0 10 20 30
X Y Z
400 per lot
9 lots of 400 9 changeovers 3.3 day build
3.3 day avg. inventory 3.3 to 6.6 day lead time
"Medium batch"
Case - 2
Repeat schedule
Illustrative example
37
www.leanuk.org Lean Enterprise Academy
Change Over Reduction (SMED)
= External = Internal
10 minutes E I 6. Standardize and improve the new
changeover procedure over time
E I 10 minutes 5. Reduce the external elements
E I 20 minutes 20 minutes 4. Reduce and eliminate the internal elements, adjustments, etc.
E I 40 minutes 20 minutes 3. Strip out external elements and pull them forward before the machine stops
2. Identify internal vs. external elements and calculate individual time
I 10
I 10
I 5
I 5
Step Pre-work During machine
shutdown 60 Minutes 1. Measure total changeover time
20 minutes
10 minutes
E 4
I 10
E 3
E 3
E 7
E 3
E I
38
www.leanuk.org Lean Enterprise Academy
Leveling Options – Two Scenarios
1. Batch Machines: Set number of changeovers and determine best EPEI interval
2. Flexible Assembly: Calculate pitch Intervals
Time available ÷ Pitch = Intervals
450 min. ÷ 9 min. = 50 intervals
35 30
Machine 1 Machine 2
40 hours
Run Time
Allowable C/O Time
39
www.leanuk.org
Determine Time Available for non-production Work
(1 Machine)
Lean Enterprise Academy 40
Total 1-shift production time available (net breaks and lunch)
450 min.
Number of shifts x 2
Time available for production on 1 machine 1 day = 900 min.
Time required per day to meet average demand* - 703 min.
Net time available for set up and changeovers per day = 197 min.
* Taken from above chart on basic machine data
703 min. 1,000
1.5% 55 min. 339 min. 40 sec. 500 15489
1.3% 55 min. 228 min. 45 sec. 300 15488 1.5% 55 min. 136 min. 40 sec. 200 15487
Average scrap rate
Average changeover
time
Required run time per day
Cycle time
Per piece
Average demand per day* (pieces)
Part #
*Your situation may require calculating demand per week or month as required
www.leanuk.org Lean Enterprise Academy
Set the Number of Change Over Events per Interval
30 min. - Average downtime (not including set-up and changeover times)
197 min. Non-production time available
3.04 = Possible number of changeovers per day
55 min. ÷ Average changeover time
167 min. = Time available for changeover work on 1 machine 1 day
With 3 part numbers and 3 possible changeovers per day - Every part every day (EPED) is a good interval to start with in this instance
41
www.leanuk.org Lean Enterprise Academy
50 intervals = 9 min. ÷ 450 min.
Possible intervals (on a Heijunka Box) = Pitch ÷ Time available
Leveling Demand with Respect to Pitch Intervals
Pitch (54” x 10 items) = 540 seconds (9 minutes)
Assume in this example: 60% of production equals high-runner A items
(of which there are 5). 20% of production equals medium-runner B items
(of which there are 5). 20% of production equals low-runner C items
(of which there are 15).
42
www.leanuk.org Lean Enterprise Academy
Leveling Demand with Pitch Intervals (Continued)
Step 1 – Basic Level
90 min. / 100 items 10 reserved for Cs = 20% x 50
intervals
90 min. / 100 items 10 reserved for Bs = 20% x 50
intervals
270 min. / 300 items 30 reserved for As = 60% x 50
intervals
Equivalent time & quantity Intervals per item = % of production
mix x Total interval
Assume average order quantity of 50 units the best you would practically accomplish is making:
Each of the 5 A items in quantity of 60 (or every part every day)
2 of the 5 B items per shift in quantity of 50 (or every part every 2.5 days)
2 of the 15 C items per shift in quantity of 50 (or every part every 7.5 days)
43
www.leanuk.org Lean Enterprise Academy
Leveling Demand with Pitch Intervals (Continued)
Step 2 – More Detailed Level (EPES)
6.6 pieces per C part number = 15 Cs ÷ 100
20 pieces per B part number = 5 Bs ÷ 100
60 pieces per A part number = 5 As ÷ 300
Intervals per product number =
Number of products per
category ÷ Category
44
www.leanuk.org Lean Enterprise Academy
Objectives of Mapping Extended Value Streams
Seeing the Whole Extended Value Stream Raise consciousness in every firm & function touching the value
stream of the enormous waste of time, effort & movement Typical current state 9 out of 10 steps & 99% of elapsed time are
wasted Raise consciousness in every firm & function of the effect of its
actions on every other firm & function touching the value stream Learn how a value stream team with representatives from every
firm can envision a series of Future States & an Ideal State for their shared value stream
Learn how the team can progressively implement: A Future State 1 in which smooth, levelled pull & flow are introduced
within every facility touching the value stream A Future State 2 in which smooth, levelled pull & frequent replenishment
loops are introduced between every facility touching the value stream (eliminating warehousing & cross docking in the process)
An Ideal State (providing a North Star for collectively steering towards the perfect value stream with zero waste) by compressing the value stream & introducing right-sized technologies
Learn how value stream teams can share costs & gains to create win-win-win outcomes for every value stream participant
45
www.leanuk.org Lean Enterprise Academy
Future State 1 Flow & Pull within Plants
Create Cells Level orders
Link through Pull
46
www.leanuk.org Lean Enterprise Academy
Impact of Internal Changes on Whole Value Stream KPI’s
Current State Future State 1
Total Lead Time 44 days
23.9 days
Value % of time 0.08% 0.16%
VA Steps as % of total steps 12% 15%
Inventory Turns 5 9
Quality Screen 400 200
Delivery Screen 8 8
Demand Amp’ Index 7 6
Product travel distance 5300 5300
47
www.leanuk.org Lean Enterprise Academy
Objectives of Mapping Extended Value Streams
Seeing the Whole Extended Value Stream Raise consciousness in every firm & function touching the value
stream of the enormous waste of time, effort & movement Typical current state 9 out of 10 steps & 99% of elapsed time are
wasted Raise consciousness in every firm & function of the effect of its
actions on every other firm & function touching the value stream Learn how a value stream team with representatives from every
firm can envision a series of Future States & an Ideal State for their shared value stream
Learn how the team can progressively implement: A Future State 1 in which smooth, levelled pull & flow are introduced
within every facility touching the value stream A Future State 2 in which smooth, levelled pull & frequent replenishment
loops are introduced between every facility touching the value stream (eliminating warehousing & cross docking in the process)
An Ideal State (providing a North Star for collectively steering towards the perfect value stream with zero waste) by compressing the value stream & introducing right-sized technologies
Learn how value stream teams can share costs & gains to create win-win-win outcomes for every value stream participant
48
www.leanuk.org Lean Enterprise Academy
What makes the Extended Value Stream Lean?
Everyone in the entire VS should be aware of the rate of end-customer demand
Very little inventory - & the inventory that does exist is the right amount, in the right place in the VS, for the right reasons
As few transport links as possible between the steps in the production process
As little information processing as possible with pure signal and no noise in the information flows that remain
Shortest possible lead time Changes introduced to smooth flow, eliminate
inventories /transport/lead-times should involve the least possible or even zero cost
49
www.leanuk.org
Assembly Wipers Stamping
Steel Dist. Centre
Amplification
GO GP BO BP AO AP
%
40
30
20
10
0
Quality & Delivery ppm
2000
1500
1000
500
0 M-G G-B B-A A-A
%
10
5
0
Future State 2
Eliminate Non Value Adding Facilities Intermediate warehouses
& handling points
50 Lean Enterprise Academy
www.leanuk.org
Assembly Wipers Stamping
Steel Dist. Centre
16d 55m
39 8
Steps
Time
Amplification
F E D C B A
%
40
30
20
10
0
Quality & Delivery ppm
2000
1500
1000
500
0
F E C A
%
10
5
0
F E D C B A
DELTA STEEL
GAMMA STAMPING BETA WIPERS ALPHA MOTORS
Future State 2 Flow and Pull between Plants
Levelled Pull system between
plants with Kanbans
Frequent Milk round
logistics
51 Lean Enterprise Academy
www.leanuk.org
Assembly Wipers Stamping
Steel Dist. Centre
Amplification
F E D C B A
%
40
30
20
10
0
Quality & Delivery ppm
2000
1500
1000
500
0
F E C A
%
10
5
0
Future State 2 Flow and Pull between Plants
Simplify & straighten order flows
Disconnect MRP from
daily planning
52 Lean Enterprise Academy
www.leanuk.org
Future State 2: Value Stream KPI’s
Lean Enterprise Academy 53
Current State
Future State 1
Future State 2
Ideal State
Total Lead Time
44 days
23.9 days
15.8 days
Value % of time 0.08% 0.16% 0.6%
VA Steps % 12 % 15% 21%
Inventory Turns 5 9 14
Quality Screen 400 200 50
Delivery Screen 8 8 3
Demand Amp’ Index 7 7 5
Product travel distance 5300 5300 4300
www.leanuk.org
Seeing the Whole: Creating Lean Supply Chains
Examples
Lean Enterprise Academy 54
www.leanuk.org
Global System Map Current State
Lean Enterprise Academy 55
www.leanuk.org
Global System Map Future State
Lean Enterprise Academy 56
www.leanuk.org
Wiper Current State Map
Lean Enterprise Academy 57
www.leanuk.org
Wiper Future State Map
Lean Enterprise Academy 58
www.leanuk.org
Candyman Current State Map
Lean Enterprise Academy 59
www.leanuk.org
Candyman Future State Map
Lean Enterprise Academy 60
I. BASIC CONCEPT JIT: RIGHT QUANTITY OF THE RIGHT PARTS AT THE RIGHT TIME The ideal state of JIT physical distribution is where high frequency replenishment is carried out at the speed determined by consumers purchases
TMC
DIS
T
DLR
1pc/day
1pc/day 1pc/day
Par
ts
Sup
plie
r
New parts logistic concept: Target
Order Taking
Inventory Control
Storage Pick-Check Pack-Dely
Stock Replenishment
Receiving Binning
OEM
Dealer Retail Needs
Service Needs
Stock Policy
+
=
Small lot & frequent & periodical due date ordering
Small lot periodical due date ordering
Frequent Planned Delivery
Due Date Diagrammed
Shipment
Desired State
Small lot frequent receiving Prioritisation of receipt P to P processing Planned cyclic ops Implementation of PULL system
6 points of Toyota storage technique Enhanced regularity control Reserve location control Empty location control
Small lot frequent & staggered order receipt Irregularity check & control Planning order separation
Diagrammed, staggered high frequency operations based on delivery diagram Establishment of small lot standard batch cyclic ops based on PULL
High frequency, small lot staggered delivery based on delivery diagram Consideration of loading efficiency Shortest & most economic transportation
Receiving Storage Order Taking Pick/Check/Pack Delivery
61
www.leanuk.org
The Ideal State
So far we have been looking at how to improve the process with existing assets, facilities & systems
Dare to Dream What would a really lean chain look like if we were
not constrained by existing assets, in existing locations etc
What would be the gains? Would it be worth fundamentally changing the structure
of the chain to avoid the on-going costs of a sub-optimal process
It may not all be feasible – but it gives a North Star towards which to aim
Lean Enterprise Academy 62
www.leanuk.org Lean Enterprise Academy
Compress the Value Stream in Time & Space
Locate all manufacturing facilities as close together as possible
Locate production as close as possible to the consumer
If close location involves extra cost – this should be weighed against time savings
63
www.leanuk.org
Ideal State Value Stream Compression
Dist. Centre
3d 55m
30 8
Steps
Time
Amplification
F E D C B A
%
40
30
20
10
0
Quality & Delivery ppm
2000
1500
1000
500
0
F E C A
%
10
5
0
F E D C B A
Assembly
ALPHA MOTORS SUPPLIER PARK
Wiper Cell
Stamping Cell
Suppliers co-located
Flow & Pull
Frequent Water-spider
loops
Right sized equipment Capacity
proportional to VS needs
64 Lean Enterprise Academy
www.leanuk.org
Ideal State Value Stream Compression
Dist. Centre
3d 55m
30 8
Steps
Time
Amplification
F E D C B A
%
40
30
20
10
0
Quality & Delivery ppm
2000
1500
1000
500
0
F E C A
%
10
5
0
F E D C B A
Assembly
ALPHA MOTORS SUPPLIER PARK
Wiper Cell
Stamping Cell
Steel
NEW JERSEY Steel Service Centre
Alternative closer raw
material supplier
65 Lean Enterprise Academy
www.leanuk.org
Ideal State Value Stream Compression
Dist. Centre
3d 55m
30 8
Steps
Time
Amplification
F E D C B A
%
40
30
20
10
0
Quality & Delivery ppm
2000
1500
1000
500
0
F E C A
%
10
5
0
F E D C B A
Steel
NEW JERSEY STEEL
Assembly
ALPHA MOTORS SUPPLIER PARK
Wiper Cell
Stamping Cell
66 Lean Enterprise Academy
www.leanuk.org
Ideal State: Value Stream KPI’s
Lean Enterprise Academy 67
Current State
Future State 1
Future State 2
Ideal State
Total Lead Time
44 days
23.9 days
15.8 days
2.8 days
Value % of time 0.08% 0.16% 0.6% 1.5%
VA Steps % 12 % 15% 21% 27%
Inventory Turns 5 9 14 79
Quality Screen 400 200 50 2.5
Delivery Screen 8 8 3 1
Demand Amp’ Index 7 7 5 1
Product travel distance 5300 5300 4300 525
www.leanuk.org Lean Enterprise Academy
The Ideal State
The next new product generation may be the time to introduce the Ideal State
68
www.leanuk.org Lean Enterprise Academy
Supply Chain Ideal State
Future State by Facility
Summary
Quality & Delivery
Demand Amplification
Consumption Map
Geography etc.
Purpose Select Product Family
Supply Chain Network & VS Selection
Alpha Motors Platform A
Apex Wheels
Beta wipers
Epsilon Fuel Pumps
Cosmic Brakes Eclipse Engine
Computers
Gamma Stampers Ampersand Magnets Utopia Castings
Michigan Steel
Odyssey Fasteners
Smith Heat Treatment
Current State by Facility
PRODN. CONTROL
Weekly Schedule
Prod’n
Plan
Forecast Daily
Call In
Forecast Weekly Call In
Weekly
Suppliers Customer
Mon. + Wed.
PRESS ASSEMBLY SHIP
I I C/T = 30 sec.
C/O = 30 min.
3 shifts
2% Scrap
C/T = 90 sec.
C/O = 5 min.
2 shifts
3% Scrap
600 pieces 2 Day
300 pieces 1 Day
30 sec 2 days
90 sec 1 day Total lead time 3 days VA time
2 mins
LH Steering Bracket RH Steering Bracket Instrument
Panel Brace Seat Rail Bumper
Brackets
X X X X X X X X
X X X X X X X X X Pr
oduc
ts
BLUES 95% 50%
Cumulative % Product Range
Cumulative % of Sales
Last 1%
Supply Chain Current State
Supply Chain Future State Action Plan
69
www.leanuk.org
David Brunt November 10th 2011
Seeing the Whole: Creating Lean Supply Chains
UK Lean Summit: Solving Business Problems
Lean Enterprise Academy 70