Download - Lean Managment

Transcript
Page 1: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

1

S.NO INDEX

PAGENO

1) Introduction 3

2) History of lean management 4

3) What is lean management? 6

4) Goals of lean management 7

5) Lean management concepts 8

6) Flow value from demand 23

7) Benefits of lean production 24

Lean production tools

8) Just-In-Time(JIT) 25

9) Work cells 31

10) 5S Methodology 33

11) Total Productive Maintenance (TPM) 38

12) Single Minute Die Exchange(SMDE) 40

13) Kaisen 42

14) Kanban 45

15) Quality-At-Source 46

16) Cellular manufacturing 47

17) Value-Stream-Mapping 52

18) Takt Time 62

19) Advantages of Lean manufacturing 67

20) Why is Lean successful? 69

21) Uses of Lean management 73

22) Lean manufacturing in today's world 74

23)Challenges facing Indian textile and apparel industry 77

24) Conclusion 81

25) Reference 82

Page 2: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

INTODUCTION:

Lean production is an assembly-line manufacturing methodology developed originally for Toyota and the manufacture of automobiles. It is also known as the Toyota Production System. The goal of lean production is described as "to get the right things to the right place at the right time, the first time, while minimizing waste and being open to change". Engineer Ohno, who is credited with developing the principles of lean production, discovered that in addition to eliminating waste, his methodology led to improved product flow and better quality.

During the 1980s, the set of practices summarized in the ten rules of lean production were adopted by many manufacturing plants in the U.S. and Europe. The management style was tried out with varying degrees of success by service organizations, logistics organizations and supply chains. Since the demise of many dot.coms, there has been a renewed interest in the principles of lean production, particularly since the philosophy encourages the reduction of inventory. Dell Computers and Boeing Aircraft have embraced the philosophy of lean production with great success.

2

Page 3: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

HISTORY OF LEAN MANUFACTURING:

The origin of LEAN MANAGENT comes from the manufacturing methodology that TOYOTA PRODUCTION SYSTEM had taken. Du ring the initial years of WORLD WAR II, Japan had suffered a lot of problems. Toyota family had decided to their change their automatic loom manufacturing business to automobile business. But they had a few problems to overcome. They could not compete with the giants like FORD in foreign markets. Therefore Toyota had to depend on local markets. They had to bring raw materials from outside, produce in small batches, but had small capital.

TAICHI OHNO, the owner of Toyota had take-over the challenge of achieving the impossible. With his right hand man Dr. Sheigo Shingo for the next three decades, he built the TOYOTA PRODUCTION SYSTEM.

Although very successful during the initial years; with Henry ford being the richest person on earth, he had not understood the concepts of this system; their major drawback was the inability to change. This was due to the push strategy implemented by the Fords system. It relied on keeping the machine busy without thinking about the future outcome. They had huge stocks in the form of finished goods and in the form of finished goods and Work in Progress. This led to the inflexibility of the system and waste money unnoticed. Another major drawback was the poor handling of human resource. This les to less motivated set of people in the organization.

But in Japan, they studied very well and saw the problems that Ford system had. But the core concepts of the Ford were obeyed. This is a continuous flow of value system. Anything distracted from the

3

Page 4: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

growth of the system is treated as a waste. Various pioneered work from people like Deming and Juran in the field of quality improvement was used to the system. This brought quality to the system. More importantly Ohno and Shingo understood the drawback in the push system and understood the role played by the inventory. This led to Pull system rather than push system, where the parts are produced only when they are pulled by the process before that. This is similar to the concepts in the super markets. When the shells are being emptied (that is when people buy the product), they are refilled with new ones.

This system developed in Toyoto from 1949 to 1975 virtually unnoticed by the others even within Japan. But in the oil crises in 1973 Japans economy suffered and most of the industries had losses. But Toyoto overcame these problems. They stood out from the rest. This was the eye opener foe the Japanese firms to implement this system. But this system got popular in the western world with the book “THE MACHINE THAT CHANGED THE WORLD” written by James Womack in 1990. This book was aimed to give the history of the automobile with the plant details of some of these manufacturers. He gave the name “Lean Manufacturing to the system”. This was an eye opener for the western world about this system. Thereafter the concepts were practiced allover the world. Experiences and knowledge vastly improved the system.

But there were many people who just tried to use the tools in lean manufacturing without understanding the meaning of them. They eventually failed. But there are number of places this system is worked well. The complete elimination waste is the target of the system. This concept is vitally important since in today’s highly competitive world there is nothing we can waste.Even today this system adds to its history. Therefore there will be a lot to add to this chapter in the coming years.

4

Page 5: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

What is LEAN MANAGEMNT?

Lean manufacturing or lean production, which is often known simply as "Lean", is the practice of a theory of production that considers the expenditure of resources for any means other than the creation of value for the presumed customer to be wasteful, and thus a target for elimination. Lean manufacturing is a generic process management philosophy derived mostly from the Toyota Production System (TPS).

Lean is a practical and engaging way of breaking the overwhelming tasks into manageable ones and delivering the improvement. Lean is a way of working which identifies & eliminates waste to deliver improved value and services based on identified customer requirements.

Improves the existent process Creates a new process

Lean manufacturing defines the value of a product or a service with the customer point of view. Customers do not mind how hard you work or what is the technology you used to create the product or service you are selling them. They will evaluate your product or the service by looking at how well this is going to fulfill their requirements.

5

Page 6: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Customers do not need to pay for the quality defects removed from the production lines. They will pay for the fulfillment of their requirements with the product or service.

GOALS OF LEAN MANAGEMENT

The main goals of lean management are given below:

Eliminate the wastes, which are considered no value to the customers; reducing the WIP time.

Identify & map the value stream.

Creating goods in favor of the customer in small batches and not in large.

The ability to change to the customer requirement swings; understanding the pull strategy.

Efficient handling of human resources.

Creating an interest for the working environment for the employees in the company or factory.

A continuous improvement every day which therefore leading to new process everyday which is the flexibility of the organization.

6

Page 7: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Creating fool-proofing methods

Improving the overall performance, i.e., higher quality, higher profit, increase in customer service & satisfaction & increase the innovativeness.

LEAN MANGAEMENT CONCEPS

There are a few concepts to be discussed in detail so that the management can be come clear focused and lean thereby creating value for their products which fulfills the customers. Some among them are:

1. Value

7

Page 8: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

2. Value stream

3. Waste

4. Equipment reliability

5. Continuous Flow

6. Pull production

7. Continuous improvement

8. People involvement

VALUE:

This is the value we provide to the customers. Value is the complete package of products and services we use to serve the customers and penetrate the market from the point of view of the customer.

8

Page 9: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

In line with a target costing approach, this value translates into the price the customer is willing to pay and, in turn, to the product and service costs we must achieve in order to satisfy the customer and the company’s stakeholders.

CASE IN POINT: XEROX- BACK FROM THE BRINK

Xerox in the early 1980s was disaster, but by 1990 it had turned itself around and into a different company. Financial figures don’t tell in all, but they do say something about the size of Xerox’s turnaround: in 19984 revenues were $8.7 billion, in 1990 they were $13.6 billion; 1987 return-on-assets was 9%, in 1990 it was 14.6%; most significant was Xerox‘s market share gain in installed machines, 12% in 1984 versus 19% in 1990-all at the expanse of Xerox’s Japanese competitors (each point represents about $200 million).

In 1988, the Baldrige Award was the coveted industry prize. Although Xerox management had no idea whether it had done enough to have a chance at winning, Paul Allaire, president since 1986, thought the application process would be worthwhile as a company motivator and a measure of how good really the company was. Thus, Xerox’s goal was not much to win, but to use the process to energize the company and appraise its quality efforts.Xerox began the application process in November 1988 by forming a team of 20 members, mostly midlevel managers from the throughout the company. The process requires answering a detailed questionnaire which comprises 33 categories covering the 12 main categories. Even everything had to be quantified and substantiated based upon hard facts and 3 to 5 years of supporting data.

The team dubbed company flaws it encountered as “warts”. A total of 503 warts were found (not many, actually, for a company of Xerox’s size). Some were minor (paint hallways), some major (find

9

Page 10: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

better ways to transfer knowledge between teams). The team discovered that, despite the warts, Xerox was doing a good job. It was one of the only companies that benchmarked its products and processes and that tied marked its products and process as and that tired executive bonuses to quality. In May 1989, the application was completed and submitted. The July, Xerox received word that it had made the cut and was getting a site visit. Six examiners described on the company, meeting with senior managers in Rochester, NY, then visiting with senior managers in Denver and Los Angeles, where, in 4 days, they spoke to 450 people. They discussed with the employees such things as whether they were on teams, what quality tools they used, and what the company policy was on quality. In November, Xerox got the news: it had won. (By coincidence, Xerox Canada learnt a month later that it had won the Canadian National Quality Award.)

As for the warts, some were still there; some are there today. The management ream looked at the warts and came up with 50 recommendations, mostly managerial and most were adopted. The warts were organized into six principles upon which Xerox decided to base its quality efforts in the 1990s:

1) Customers define our business.2) Our success depends on the involvement and empowerment of

trained and motivated people.3) Line management must lead quality improvement.4) Management develops, articulates, and deploys clear objectives

clear objectives and directives.5) Quality challenges are met and satisfied.6) The business is managed and improved by using facts.

The Baldrige application process had indeed reenergized the company’s commitment to quality, and it showed the extent of quality gains made from the early 1980s to 1988; for example defects went from 10000 ppm to 300 ppm (parts per million), installed products performance went up by 40%, customer satisfaction went up to 38%, labor overhead went down by 50%, and material overhead went down by 40%.By 1990, Xerox had begun building long term relationships with its best suppliers, involving them in new product development and training them in quality leadership techniques, SPC, and JIT.

VALUE STREAM:

10

Page 11: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Value stream recognizes that the company’s processes create excellence and customer-driven performance. Traditional departmental control structures run counter to lean thinking. We must understand, control, and manage our business through the processes, or value streams, of the organization. This includes three top-level value streams in manufacturing companies; the "make product" value stream, the "design and problem solve" value stream, and the value stream that includes the company’s transactions and controls. These value streams often extend outside of the company itself into the suppliers, the customers, and partner organizations.

WASTES:

11

Page 12: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

There are a number of prominent wastes, and wastes, which does not so notable, which account about 70-95% of the resources wasted in the organization. Even the best lean manufactures waste about 30% of their resources.

12

Page 13: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

In lean manufacturing the wastes are defined as anything which does not add value to the end product. If customer sees the value with the end product, it is very much fair to define a waste in this way. Customer do not mind how much it costs you to damage, cost for the huge stocks and stores or other over heads. The first step is to identify the wastes and categorize them in to avoidable and unavoidable. Lean manufacturing always talks about removing, not minimizing. These two words have very different meanings. Whenever the word minimizing occurs it means, it implies that there are wastes in the system in different quality. But what lean

13

Page 14: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

manufacturing does is, it aims at removing the wastes from the system.

OVERPRODUCTION:

The word over-production can be used to describe a type of waste which is in most of the places and we never think this as a waste. This is producing something before it is actually required. This can be applied to the bigger picture or in more localized sense.

In the bigger picture, this is equivalent to create a product or a service before it is actually required. Lean manufacturing always trust on the pulling rather than pushing. This means that every product or a service must be pulled from the process immediately after that. Therefore a product or a service must be pulled by the customer. In simpler way, the customer must have the real requirement for the product or the service being produced. If goods are produced without any simulation from the market, then the product should be kept until the market for the product arises or create market stimulation with huge advertising campaigns etc. This is known as the push strategy. Still there will not guaranty that will be able to sell the products without wastages.

In much smaller picture, the word over production might mean producing a part of a product before it is required by the assembly line or the process after that. For an example there is no point of making more receivers than the phone intended to be produced. The extra amount will be a lost.

14

Page 15: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Over production accounts to many loses. One is the waste due to unnecessary parts. This also will make the WIP higher. Flow will not be smoother. This obviously leads to low quality products and defects as quality problems are hidden in the WIP maintained due to over production.

INVENTORIES –

The money and materials invested in by a company in order to create products for sale. In reality there are few areas that can yield more outstanding initial cost savings than the reduction of inventory in many, if not most companies. Inventory must be viewed as "MONEY" and treated accordingly.

The most common types of Inventory are

Raw Materials:

Processed components waiting for work to be done on them. This is the least expensive form of inventory especially if suppliers will wait for payment until you begin using these materials.

Work In Process (W.I.P.):

Materials that have had some work done to them but are not yet finished. This is the second most expensive form of inventory as "value" has been added to the materials. Finished Goods:

15

Page 16: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

This is the most expensive type of inventory as the materials have already traveled through the value stream and are now complete. Although most companies carry some Finished Goods Inventory it can be a serious waste and burden on cash-flow.

TOYOTO cells inventories the root of all evils. It implies that wastes stemming from inventories go far beyond items held in stock. It represents items waiting for something to happen, a waste in that there are costs associated with keeping items waiting and lost time since no value is being added to them. Inventory holding costs increase with size of inventory since it costs more to them. Holding costs include the charges for the storage space, paperwork and handling, insurance, security, and pilferage. Since the capital needed to acquire or produce the items in inventory cannot be invested elsewhere, there is an opportunity cost well. If inventory comprises items procured from borrowed funds, there is also an interest expense. The sum holding costs for all items in all inventories carried by an organization throughout the year can be sizable.

Inventory is also considered evil because it covers up other kinds of wastes and encourages, or allows, wasteful practices. Inventory has been called a just-in-case philosophy of management, meaning that managers use it all as a hedge against things that might go wrong. While many mangers recognize the costs of inventories, they still think of inventory as necessary to overcome other kinds of problems.

WAIT IN PROGRESS -

Work in progress or WIP is a direct result of over production and waiting. Every imperfection in the system will create a requirement for the WIP. Therefore WIP also known as the mirror of the wastes the system has. But WIP it self becomes a waste due to many consequences. It blocks money in the form of not finished products. It also reduces the flexibility of the production facility by increasing the change over time between different styles. It hides quality damages, and will only be revealing when a considerable damage is done. Higher WIP also requires large floor space. This will also affect the appearance of the work place badly. Therefore if you want to be perfect, just target for a system where there is no requirement for WIP.

MOTION –

This waste is often overlooked. When performing a certain task people have to repeat their motions again and again. Although we do not realize, in many places people will have to move,

16

Page 17: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

bend or reach to collect some part or to reach a machine. If a time study can be done to check the percentage of the time for these unnecessary movements, is actually very high than our thought. Even the other ergonomic conditions like correct lighting, tool arrangement, work process management is essential to achieve a good productivity from the people poor conditions are not good for the health of the worker obviously. Also this will waste large amounts of time. Workplaces will become very untidy. Workers will get tired easily. The reason for this is poor workplace organization. To overcome this problem, a detailed study has to be carried out about working conditions. Then they have to be re arranged to eliminate these problems. Even some simple equipment change like from normal chairs to movable and adjustable chairs will solve some problems. But some problems will need very good workplace engineering to overcome.

TRANSPORTION –

However well the product is transported, it does not add value to the end product. Therefore transporting is one of the wastes that have to be eliminated from the production system. This accounts for the quality defects, maintenance of a higher WIP, and additional cost of transporting the goods. Transporting is often caused by poor work place organization. In flexibility of the layout plays a big role here. This can be avoided with careful re-designing of the layouts.

RE-PROCESSING-INAPPROPRIATE PROCESSING –

This is the using incorrect tools for the job. This does not mean that you should use complicated or expensive tools to do the job. It is about using the correct tool for the correct job. Low cost automation is one program where Toyota found to be really effective. Developing such tools can be done with the aid of workers, because they know the job they do more than anyone. Then this will become a very good way of motivating people as well. The enemy for this system is the mind set of the people who work in the organization. People naturally think like best equipment for the job is expensive and complex. So how to overcome this problem, which will not only save money for you but also motivate people immensely. Very simple. Change the mind set of the people by education and training. Also create a culture of continuous improvement. Then people will always look for the better ways of doing things, which creates opportunity for these kinds of innovations. The improper usage of machinery, equipment and resources leads to rework, which again is a total waste of time, energy and labor.

17

Page 18: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

OVER PROCESSING –

Often in order to achieve the maximum quality or the best quality out of a process, we tend to stick on to the same process for its betterment, leading to the rest of the process in queue. This leads to delay in delivery and also waste of time and energy as these steps are not required, as the necessary quality had already been reached.

KEY FEATURES OF LEAN PRODUCTION

REDUCED SETUP COST & TIMES (for semi-versatile machinery such as big stamping presses)-

From months to hours thus making small-lot production economically viable; achieved by organizing procedure, using carts, and training workers to do their own setup. All setup practices are wasteful because they add no value to a product and they tie up labor and equipment.

SMALL-LOT PRODUCTION –

18

Page 19: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Allowing higher flexibility & pull production (or just-in-time manufacturing)

EMPLOYEE INVOVMENT & EMPOWERMENT –

19

Page 20: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Organizing workers by forming teams and giving them training and responsibility to do many specialized tasks, for housekeeping, quality inspections, minor equipment repair and rework; allowing also them time to meet to discuss problems and find ways to improve the process.

QUALITY AT THE SOURCE – total quality management (TQM) and control; assignment workers, not inspectors, the responsibility to discover a defect and to immediately fix it; if the defects cannot be readily fixed, any worker can halt the entire line by puling a cord (jidoka)

POKAYOKE FUNCTIONS:

Any kind of system or mechanism that prevents defects from happening can be called pokayoke. There are two broad functions that pokayoke serve: regulatory and setting.

There are 2 types of pokayoke. They are

REGULARATORY POKAYOKE:

These are devices that either control a process or give a warning about it. A control pokayoke is a device that shuts down an operation whenever it detects an abnormality, thereby preventing defects in a succession of time.

SETTING POKAYOKES:

These devices that check for ensure proper settings or counts in a process. These pokayoke apply where poisoning or orientation is important.

20

Page 21: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

CASE IN POINT: ERROR PROOFING AT MCDONNELL & MILLER

The following notice was posted on the shop bulletin board:

Recently a letter from a customer alerted a problem that existed in our diverter value assembly. The customer had received in order of the diverter values that contained a unit that was incomplete in its assembly.

The Focused Factory NO: 4 found that an operator had inadvertently forgotten to include a spring and thermostat in the unit’s body. Upon investigation, it was found that it was quite easy for an operator to forget these parts.

A team was formed to address the problem and find a solution. Mr.Amaro ,the group leader in the diverter area, drew up a plan to install a limit switch to the holding fixture that would not allow the operator to remove the valve body from the fixture if any if any the internal components from the fixture if any of the internal components were missing.

The focused factory supervisor and lean leader listened to Mr.Amero’s idea and agreed that the switch would work. The approval to go ahead was given and within 1week the fixture was retrofitted with the limits switch. The cost for this work was minimal.

Tests were performed by the operators. The results were excellent the limit switch can sense the weight (or lack of weight)of the spring and thermostat. If any parts are missing in the body, the switch will not let the operator remove from the assembly fixture. This feature assures us that no incomplete assembly will leave the work area and be sent to our customers.

PULL PRODUCTION OR JUST-IN –TIME (JIT) –

The method wherein the quality of work performed at each stage of the process is dictated solely by the demand for materials from the immediate next stage; thus reducing waste and lead times, and eliminating next stage; thus reducing waste and lead times, and eliminating inventory holding costs.

CONTINUOUS EQUIPMENT MAINTAINENCE –

21

Page 22: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

As pull production reduces inventories, equipment breakdowns must also be reduced, thus empowered operators are assigned primary responsibility for basic maintenance since they are in the best position do detect signs of malfunction.

MULTI-SKILLED WORKFORCE -

As employees are empowered to do many jobs, they must be provided with adequate training.

SUPPLIER INVOLVEMENT –

22

Page 23: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

The manufacturer treats its supplier as long-term partners; they often must be trained in ways to reduce setup times, inventories, defects, machine breakdowns, etc.in order to enable them to take responsibility for delivering the best possible parts/services to the manufacturer in a timely manner.

Flow Value from Demand(Delay Commitment)

The idea of flow is fundamental to lean production. If you do nothing but add value, then you should add the value in as rapid a flow as possible. If this is not the case, then waste builds up in the form of inventory or transportation or extra steps or wasted motion.

23

Page 24: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

The idea that flow should be ‘pulled’ from demand is also fundamental to lean production. ‘Pull’ means that nothing is done unless and until a downstream process requires it. The effect of ‘pull’ is that production is not based on forecast; commitment is delayed until demand is present to indicate what the customer really wants. Pulling from demand can be one of the easiest ways to implement lean principles. The idea is to fill each customer order immediately. In mass-production days, filling orders immediately meant building up lots of inventory in anticipation of customer orders. Lean production changes that. The idea is to be able to make the product so fast that it can be made to order. True,Dell and Lens Crafters and LL Bean and Toyota have to have some inventory of sub-assemblies waiting to be turned into a finished product at a moments notice. But it’s amazing how little inventory is necessary, if the process to replenish the inventory is also lean. A truly lean distribution channel only works with a really lean supply chain coupled to very lean manufacturing.

The “batch and queue” habit is very hard to break. It seems counterintuitive that doing a little bit at a time at the last possible moment will give faster, better, cheaper results. But anyone designing a control system knows that a short feedback loop is far more effective at maintaining control of a process than a long loop. The problem with batches and queues is that they hide problems. The idea of lean production is to expose problems as soon as they arise, so they can be corrected immediately. It may seem that lean systems are fragile, because they have no padding. But in fact, lean systems are quite robust, because they don’t hide unknown, lurking problems and they don’t pretend they can forecast the future.

B ENEFITS F LEAN PRODUCTION

24

Page 25: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Establishment and mastering of a lean production system would allow you to achieve the following benefits:

Waste reduction by 80%

Production cost reduction by 50%

Manufacturing cycle times decreased by 50%

Labor reduction by 50% while maintaining or increasing throughput

Inventory reduction by 80% while increasing customer service levels

Capacity in current facilities increase by 50%

Higher quality

Higher profits

Higher system flexibility in reacting to changes in requirements improved

More strategic focus

Improved cash flow through increasing shipping and billing frequencies

However, by continually focusing on waste reduction, there are truly no ends to the benefits that can be achieved.

25

Page 26: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

LEAN MANAGEMNT TOOLS

There are a number of lean management tools given below.

JUST-IN-TIME MANUFACTURING

`Just-in-time' is a management philosophy and not a technique.

It originally referred to the production of goods to meet customer demand exactly, in time, quality and quantity, whether the `customer' is the final purchaser of the product or another process further along the production line.

History of JIT

JIT is a Japanese management philosophy which has been applied in practice since the early 1970s in many Japanese manufacturing organizations. It was first developed and perfected within the Toyota manufacturing plants by Taiichi Ohno as a means of meeting consumer demands with minimum delays. Taiichi Ohno is frequently referred to as the father of JIT.

26

Page 27: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Toyota was able to meet the increasing challenges for survival through an approach that focused on people, plants and systems. Toyota realized that JIT would only be successful if every individual within the organization was involved and committed to it, if the plant and processes were arranged for maximum output and efficiency, and if quality and production programs were scheduled to meet demands exactly.

JIT manufacturing has the capacity, when properly adapted to the organization, to strengthen the organization’s competitiveness in the marketplace substantially by reducing wastes and improving product quality and efficiency of production.

There are strong cultural aspects associated with the emergence of JIT in Japan. The Japanese work ethic involves the following concepts.

Workers are highly motivated to seek constant improvement upon that which already exists. Although high standards are currently being met, there exist even higher standards to achieve.

Companies focus on group effort which involves the combining of talents and sharing knowledge, problem-solving skills, ideas and the achievement of a common goal.

Work itself takes precedence over leisure. It is not unusual for a Japanese employee to work 14-hour days.

Employees tend to remain with one company throughout the course of their career span. This allows the opportunity for them to hone their skills and abilities at a constant rate while offering numerous benefits to the company.

These benefits manifest themselves in employee loyalty, low turnover costs and fulfillment of company goals.

DECISIONS AND ACTIONS IN JIT ORGANIZATIONS are guided by a set of principles. They are:

Simplification: Given multiple ways to achieve the identical results, simpler is better.

Cleanliness & Organization: A clean, organized workplace promotes discipline and caring attitudes about work and products, reduces waste, and helps pinpoint incipient trouble sports and workplace problems.

Visibility: Information that is immediate visible to everyone who needs it enables people to do their jobs better, motivates them

27

Page 28: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

to do the right thing and eliminates unnecessary and ineffective planning and control activities.

Cycle Timing: Regularity of workplace patterns reduces uncertainty, increases learning and improvement potential, and permits better planning and action toward meeting customer demand.

Agility: Daily, changing customer demand is a fact of life; companies must be able to react to changes, plan for them, and be able to respond even without plans.

It has now come to mean producing with minimum waste. "Waste" is taken in its most general sense and includes time and resources as well as materials. Elements of JIT include:

Continuous improvement:

28

Page 29: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Attacking fundamental problems - anything that does not add value to the product.

Devising systems to identify problems. Striving for simplicity - simpler systems may be easier to

understand, easier to manage and less likely to go wrong. A product oriented layout - produces less time spent

moving of materials and parts. Quality control at source - each worker is responsible for

the quality of their own output. Poke-a-yoke - `foolproof' tools, methods, jigs etc. prevent

mistakes Preventative maintenance, Total productive maintenance -

ensuring machinery and equipment function perfectly when it is required, and continually improving it.

Eliminating waste . There are seven types of waste:

Waste from overproduction. Waste of waiting time. Transportation waste. Processing waste. Inventory waste. Waste of motion. Waste from product defects.

Good housekeeping - workplace cleanliness and organization. Set-up time reduction - increases flexibility and allows smaller

batches. Ideal batch size is 1item. Multi-process handling - a multi-

29

Page 30: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

skilled workforce has greater productivity, flexibility and job satisfaction.

Leveled / mixed production - to smooth the flow of products through the factory.

Kanbans - simple tools to `pull' products and components through the process.

Jidoka (Autonomation) - providing machines with the autonomous capability to use judgment, so workers can do more useful things than standing watching them work.

Andon (trouble lights) - to signal problems to initiate corrective action.

Just-In-Time Processing

Just-In-Time (JIT) describes a process which is able to provide exactly what is needed when it is needed. This minimizes inventory stock or idle time while maintaining perfect delivery performance. Our JIT model is displayed graphically below.

As you move up the model, effort and materiel waste is reduced and processes become more predictable in producing the output. It is still important to perform a CPR analysis to insure that you are not just finding a faster way to make products that lose you money.

30

Page 31: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

JIT has been interpreted to mean many different things, such as a method, a system, and a philosophy. The most current interpretation, the one subscribed to here, is that JIT is a management philosophy that addresses not only production practices, but also expectations about the roles and responsibilities of managers, support staff, line workers, and suppliers, their relationships to one another and to customers, as well as broader issues about the conduct of business. At some other level, JIT principles apply to all organizations –large and small, services and manufacturing. Problems with implementing JIT tend to stem from lack of commitment, resistance to change, or simple misunderstanding about what JIT really means. JIT is a move back to basics, and there can be little argument over JIT from the perspective that the principles behind it make good business sense.

31

Page 32: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

WORK CELLS:

Work cell concept is another concept developed with the JIT. Work place is arranged in to a cell which is in the shape of English letter “U”. in a work cell there will be 3-12 people depending on the job task performed by this cell. There will be many cells which will complete the total product by working together. People who are in this cell are multi skilled and can perform multiple tasks according to the requirement. One of the main advantages of the work cell is the less movement and lesser transportation. Also this will reduce the over production considerably. This will also give very high flexibility to the entire production system since changing from one product to another is very easy. Sometimes it may require changing one work cell to produce a completely new product. Team working culture is very important in a process like this. Therefore good leadership is very much required. Every performance is measured in the team basis. Therefore motivation must be there for all the people working in the cell to work for a common objective.

Kanban tooling

32

Page 33: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Kanban is one of most popular tools in lean manufacturing. This is a simple concept, but very effective. Kanban mainly focus on the reduction of overproduction. There are mainly two types of kanbans.

They are Withdrawal kanban Production kanban

Withdrawal kanban is the common type, which is actually a request from the process before that. This specifies the quantity that the succeeding processshould take from the process before that. On the other hand production kanban specifies the amount of products to be made in the next process with the goods created in the process before that.This might take a form of a simple card which has the details of the product, qty and the storage location of that particular product. This even may be a sophisticated electronic data exchange process. No matter what, the final objective must be achieved and it should be an efficient process.

Various standardization techniques

One of the main problems will be faced by any lean manufacturer in the initial stage is preventing of line stoppages. One main reason for this is the system containing none standardizes work. Therefore any lean manufacturer has to make the processes standard and tooling and arrangements standard to achieve the goals of lean manufacturing. Instead of having many tools and many different adjustments, it is very useful to have narrow range of adjustments and tools which matches these precisely. Also there should be a good workplace arrangement so that it will be very easy to take and replace

33

Page 34: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

what exactly you need without even looking at that. This will save lot of time and prevent lots of silly problems.

5S (methodology)

5S is a reference to a list of five Japanese words which, transliterated and translated into English, start with the letter S and are the name of a methodology. This list is a mnemonic for a methodology that is often incorrectly characterized as "standardized cleanup", however it is much more than cleanup. 5S is a philosophy and a way of organizing and managing the workspace and work flow with the intent to improve efficiency by eliminating waste, improving flow and reducing process unreasonableness.

What is 5S?

5S is a method for organizing a workplace, especially a shared workplace (like a shop floor or an office space), and keeping it organized. It's sometimes referred to as a housekeeping methodology, however this characterization can be misleading workplace goes beyond housekeeping (see discussion of "Seiton" below).

The key targets of 5S are workplace morale and efficiency. The assertion of 5S is, by assigning everything a location, time is not wasted by looking for things. Additionally, it is quickly obvious when something is missing from its designated location. Advocates of 5S

34

Page 35: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

believe the benefits of this methodology come from deciding what should be kept, where it should be kept, and how it should be stored. This decision making process usually comes from a dialog about standardization which builds a clear understanding, between employees, of how work should be done. It also instills ownership of the process in each employee.

In addition to the above, another key distinction between 5S and "standardized cleanup" is Seiton. Seiton is often misunderstood, perhaps due to efforts to translate into an English word beginning with "S" (such as "sort" or "straighten"). The key concept here is to order items or activities in a manner to promote work flow. For example, tools should be kept at the point of use, workers should not have to repetitively bend to access materials, flow paths can be altered to improve efficiency, etc.

The 5S's are:

Phase 1 - Seiri (Sorting):

Going through all the tools, materials, etc., in the plant and work area and keeping only essential items. Everything else is stored or discarded.

Phase 2 - Seiton (Straighten or Set in Order):

35

Page 36: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Focuses on efficiency. When we translate this to "Straighten or Set in Order", it sounds like more sorting or sweeping, but the intent is to arrange the tools, equipment and parts in a manner that promotes work flow. For example, tools and equipment should be kept where they will be used (i.e. straighten the flow path), and the process should be set in an order that maximizes efficiency.

Phase 3 - Seiso (Sweeping):

Systematic Cleaning or the need to keep the workplace clean as well as neat. At the end of each shift, the work area is cleaned up and everything is restored to its place. This makes it easy to know what goes where and have confidence that everything is where it should be. The key point is that maintaining cleanliness should be part of the daily work - not an occasional activity initiated when things get too messy.

Phase 4 - Seiketsu (Standardizing):

36

Page 37: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Standardized work practices or operating in a consistent and standardized fashion. Everyone knows exactly what his or her responsibilities are to keep above 3S's.

Phase 5 - Shitsuke (Sustaining):

Refers to maintaining and reviewing standards. Once the previous 4S's have been established they become the new way to operate. Maintain the focus on this new way of operating, and do not allow a gradual decline back to the old ways of operating. However, when an issue arises such as a suggested improvement, a new way of working, a new tool, or a new output requirement then a review of the first 4S's is appropriate.

A sixth phase "Safety" is sometimes added. Purists, however, argue that adding it is unnecessary since following 5S correctly will result in a safe work environment.

There will have to be continuous education about maintaining standards. When there are changes that will affect the 5S programme

37

Page 38: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

-- such as new equipment, new products or new work rules -- it is essential to make changes in the standards and provide training. A good way to continue educating employees and maintaining standards is to use 5S posters and signs.

CASE IN POINT: FIVE Ss AT CANON

Canon Corporation has an ongoing, workplace improvement program called the Five Ss referring to Japanese names for five dimensions of workplace organization. The five Ss roughly translate into

(Seiri) Proper Arrangement and Organization: Do things in proper order; eliminate unnecessary things

(Seiton) Orderliness, i.e., Straighten or Set in Order: Specify a location for everything; designate location by number, color coding, name, etc.; put things where they belong.

(Seiso) Cleanup, i.e., Sweeping: Specify recommended procedures for cleanup; follow the procedures; check over all work.

(Seiketsu) Cleanliness: Dust, wash, and maintain equipment and workplace in the best possible condition.

(Shitsuke) Discipline: Scrutinized practices; expose the wrong ones; learn correct practices and be careful to use them.

(At some Canon factories, the English word “safety” is added as a sixth S)

The Five Ss are implemented through frequent grading of each work area by check sheets. In some factories, Five-S committees conduct regular inspections of plants and departments using Five S criteria. Problems areas are photographed and the plant or work area must come up with a solution and a plan. In other factories, the work areas evaluate themselves on a weekly basis. Foremen and managers review the evaluation and make recommendations to assist in developing plans. Works areas that show good housekeeping practices may be awarded recognition plagues. Regardless of performance, all work areas are expected to continuously find ways to improve. Results of evaluation are posted to foster responsibility and pride.

The Five-S movement has helped change attitudes, and employees readily follow workplace rules that previously were difficult to enforce (such as keeping parts and tools in the right place). Performance measures the number of accidents, equipment breakdowns, and defect the rates have all been improved.

38

Page 39: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Relation to other concepts

5S is used with other Lean concepts such as SMED, TPM, and Just In Time (JIT). The 5S discipline requires clearing out things which are not needed in order to make it easier and faster to obtain the tools and parts that are needed. This is the foundation of SMED, which in turn enables JIT production. The first step in TPM is operator cleanup of machines, a mandate of 5S.

TOTAL PRODUCTIVE MAINTAINANCE (TPM)

Maintenance function is very important aspect which ensures smooth running of a production facility. In lean manufacturing one machine breakdown will not be just another breakdown since it can hold the entire production flow as there is no WIP to consume in the time of the machine breakdown. Therefore it is very important to have a correct

39

Page 40: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

maintenance process to become a lean manufacturer. TPM has three main areas. They are

Preventive maintenance Corrective maintenance Maintenance prevention

Preventive maintenance is to continuous checking and prevention of major maintenance. Regular checkups are planed and carried over. Each and every person who is working in a work station might be responsible for checking up and cleaning etc in order to prevent any problems from occurring.Correction of the problems when they occur is very important to run the production units smoothly. These corrective maintenances can vary from very simple to very complex. People who are working with these machinery might be able to fix most of the simpler problems

40

Page 41: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

while a team of specially trained people might be required to do the complex jobs.Maintenance prevention is one of the key aspects which makes the path to become lean. This is the process where the decisions are made in order to prevent maintenance. This process might include decisions like buying correct machinery for the job, training people to overcome most common problems etc.

SINGLE MINUTE DIE EXCHANGE (SMDE)

One of the most complicated problems this industry faced was overcoming the time taken to change the style in the production line. This took days and therefore made the production lines inflexible. The idea was to reduce the setup time of the machinery. This is why SMDE born. With the aid of careful planning and coordination it was possible to reduce the time taken to change the line into minutes from days. This made an immense flexibility in the production line. Although started in automobile industry these concepts are very important since still for any organization one of the main problems is facing continuous changes styles in production.

41

Page 42: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Again how to do this changes from industry to industry. This might have something to do with strategic planning, choosing correct machinery, having correct layouts, having trained people and correct mindset of the people. Achieving SMDE require very good analysis and creative solution making.

42

Page 43: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

KAIZEN

Kaizen means "improvement". Kaizen strategy calls for never-ending efforts for improvement involving everyone in the organization.

Kaizen Mindset is Kaizen's Starting Point. It sets the right mindset and business environment in a Continuous Improvement Firm (CIF).

Kaizen Mindset

Everything can and should be improved. (Some Japanese managers go as far as to say to their subordinates, "Regard whatever you do now as the 'worst' way to do your job.")

Not a single day should go by without some kind of improvement being made somewhere in the company.

Don't just criticize, suggest an improvement.

Think beyond common sense. Even if something is working, try to find the ways to make it work even better.

Customer-driven strategy for improvement – any management activity should eventually lead to increased customer satisfaction.

Imagine the ideal customer experience and strive to provide it.

43

Page 44: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Quality first, not profit first – an enterprise can prosper only if customers who purchase its products or services are satisfied.

Recognize that any corporation has problems and establish a corporate culture where everyone can freely admit these problems and suggest improvement.

Think of how to improve it instead of why it can't be improved.

See problem solving as cross-functional systemic and collaborative approach.

Emphasis on process – establish a way of thinking oriented at improving processes, and a management system that supports and acknowledges people's process-oriented efforts for improvement.

Start with scarcity. It's hard to see the need for Kaizen when resources are plentiful.

When there is a worker or supplier performance problem, don't replace them. Keep them and help them improve instead.

The Process

The quick and easy kaizen process works as follows:

1. The employee identifies a problem, waste, or an opportunity for improvement and writes it down.

2. The employee develops an improvement idea and discusses it with his or her supervisor.

3. The supervisor reviews the idea within 24 hours and encourages immediate action.

4. The employee implements the idea. If a larger improvement idea is approved, the employee should take leadership to implement the idea.

5. The idea is written up on a simple form in less than three minutes.

6. Supervisor posts the form to share with and stimulate others and recognizes the accomplishment.

44

Page 45: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Three Key Characteristics

1. Permanent method changes . Change the method. Once the change is made, you can’t go back to the old way of doing things.

2. Continuous flow of small ideas . The smaller ideas, the better. Kaizen is small ideas. Innovation takes time and is costly to implement, but kaizen is just day-to-day small improvements that when added together represent both enormous savings for the company and enormous self-esteem for the worker.

3. Immediate local implementation . Be realistic. Kaizen is done within realist or practical constraints.

45

Page 46: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

KANBAN

Kanbans are “self-evident signals” that indicate what work is to be done and when. Many of the benefits of becoming Lean can be tracked back to the implementation of Kanbans. Kanbans clearly identify needed work, reduce the number of defective parts produced, allow for job-sharing, give instant visual indicators of productivity and constrains, along with many other benefits.

Ultimately, most Kanbans evolve into what is known as “One Piece Flow” where parts are literally passed from one operation to the next, with no wait time between work stations.

Kanban scheduling systems are among the most simple, effective and inexpensive means for manufacturing production and inventory control.

46

Page 47: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

QUALITY-AT-SOURCE

Quality-at-the-source begins with quality-at-the-supplier. When supplier. When suppliers guarantee 100% quality, the customer can eliminate inspection of arriving material. Incoming materials can be moved directly to points of use, and buffer inventory to cover defects can be minimized. High quality requires high process capability, and the customer helps its supplier achieve high capability by sharing its own experience and expertise (assuming it has already high capability its own high capability). As described later, companies, continue to work with only the few suppliers who are able to continuously meet tough requirements.

47

Page 48: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

CELLULAR MANUFACTURING

Cellular Manufacturing is a model for workplace design, and is an integral part of lean manufacturing systems. The goal of lean manufacturing is the aggressive minimization of waste, called muda, to achieve maximum efficiency of resources.

Cellular manufacturing, sometimes called cellular or cell production, arranges factory floor labor into semi-autonomous and multi-skilled

48

Page 49: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

teams, or work cells, who manufacture complete products or complex components.

Properly trained and implemented cells are more flexible and responsive than the traditional mass-production line, and can manage processes, defects, scheduling, equipment maintenance, and other manufacturing issues more efficiently.

Design

An example of a cellular manufacturing layout. Each product is manufactured in its own work cell.

The goal of cellular manufacturing is having the flexibility to produce a high variety of low demand products, while maintaining the high productivity of large scale production. Cell designers achieve this through modularity in both process design and product design

Process Design

The division of the entire production process into discrete segments, and the assignment of each segment to a work cell, introduces the modularity of processes. If any segment of the process needs to be changed, only the particular cell would be affected, not the entire production line. For example, if a particular component was

49

Page 50: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

prone to defects, and this could be solved by upgrading the equipment, a new work cell could be designed and prepared while the obsolete cell continued production. Once the new cell is tested and ready for production, the incoming parts to and outgoing parts from the old cell will simply be rerouted to the new cell without having to disrupt the entire production line. In this way, work cells enable the flexibility to upgrade processes and make variations to products to better suit customer demands while largely reducing or eliminating the costs of stoppages.

Product Design

Product modularity must match the modularity of processes. Even though the entire production system becomes more flexible, each individual cell is still optimized for a relatively narrow range of tasks, in order to take advantage of the mass-production efficiencies of specialization and scale. To the extent that a large variety of products can be designed to be assembled from a small number of modular parts, both high product variety and high productivity can be achieved. For example, a varied range of automobiles may be designed to use the same chassis, a small number of engine configurations, and a moderate variety of car bodies, each available in a range of colors. In this way, a large variety of automobiles, with different performances and appearances and functions, can be produced by combining the outputs from a more limited number of work cells.

In combination, each modular part is designed for a particular work cell, or dedicated clusters of machines or manufacturing processes. Cells are usually bigger than typical conventional workstations, but smaller than a complete conventional department. After conversion, a cellular manufacturing layout usually requires less floor space as a result of the optimized production processes. Each cell is responsible for its own internal control of quality, scheduling, ordering, and record keeping. The idea is to place the responsibility of these tasks on those who are most familiar with the situation and most able to quickly fix any problems. The middle management no longer has to monitor the outputs and interrelationships of every single worker, and instead only has to monitor a smaller number of work cells and the flow of materials between them, often achieved using a system of kanbans.

Implementation

The biggest challenge when implementing cellular manufacturing in a company is dividing the entire manufacturing system into cells. The issues may be conceptually divided in the "hard" issues of equipment,

50

Page 51: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

such as material flow and layout, and the "soft" issues of management, such as upskilling and corporate culture.

The hard issues are a matter of design and investment. The entire factory floor is rearranged, and equipment is modified or replaced to enable cell manufacturing. The costs of work stoppages during implementation can be considerable, and lean manufacturing literatures recommend that implementation should be phased to minimize the impacts of such disruptions as much as possible. The rearrangement of equipment (which is sometimes bolted to the floor or built into the factory building) or the replacement of equipment that is not flexible or reliable enough for cell manufacturing also pose considerable costs, although it may be justified as the upgrading obsolete equipment. In both cases, the costs have to be justified by the cost savings that can be realistically expected from the more flexible cell manufacturing system being introduced, and miscalculations can be disastrous.

The soft issues are more difficult to calculate and control. The implementation of cell manufacturing often involves employee training and the redefinition and reassignment of jobs. Each of the workers in each cell should ideally be able to complete the entire range of tasks required from that cell, and often this means being more multi-skilled than they were previously. In addition, cells are expected to be self-managing (to some extent), and therefore workers will have to learn the tools and strategies for effective teamwork and management, tasks that workers in conventional factory environments are entirely unused to. At the other end of the spectrum, the management will also find their jobs redefined, as they must take a more "hands-off" approach to allow work cells to effectively self-manage. Instead, they must learn to perform a more oversight and support role, maintaining a system where work cells self-optimize through supplier-input-process-output-customer (SIPOC) relationships. These soft issues, while difficult to pin down, pose a considerable challenge for cell manufacturing implementation; a factory with a cell manufacturing layout but without cell manufacturing workers and managers is unlikely to achieve the cell manufacturing benefits

Benefits and Costs:

There are many benefits of cellular manufacturing for a company if applied correctly. Most immediately, processes become more balanced and productivity increases because the manufacturing floor has been reorganized and tidied up.

51

Page 52: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Part movement, set-up time, and wait time between operations are reduced, resulting in a reduction of work in progress inventory freeing idle capital that can be better utilized elsewhere. Cellular manufacturing, in combination with the other lean manufacturing and just-in-time processes, also helps eliminate overproduction by only producing items when they are needed. The results are cost savings and the better control of operations.

There are some costs of implementing cellular manufacturing, however, in addition to the set-up costs of equipment and stoppages noted above. Sometimes different work cells can require the same machines and tools, possibly resulting in duplication causing a higher investment of equipment and lowered machine utilization. However, this is a matter of optimization and can be addressed through process design.

52

Page 53: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

VALUE STREAM MAPPING

Value Stream Mapping (VSM) is a visualization tool oriented to the Toyota version of Lean Manufacturing (Toyota Production System). It helps to understand and streamline work processes using the tools and techniques of Lean Manufacturing.

A Present State Map shows work processes as they currently exist. This is vital both to understand the need for change and to understand where opportunities lie.

While Value Stream Maps appear complex, their construction is easy, taken in logical steps. The instructions and illustrations below show how to construct a Present State Map.

53

Page 54: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

54

Page 55: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

55

Page 56: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

PRESENT STATE VALUE MAP:

FUTURE STATE VALUE STREAM MAP:

A Future State Value Stream Map helps with the larger process of developing your Lean Manufacturing Strategy. It requires significant knowledge of Core Disciplines and other specific topics.

Designing a Future State requires more art, engineering and strategy than Present State mapping. On this page, we show mapping, but the background knowledge is in these other parts of our site.

Cellular Manufacturing Takt Time Kanban Setup Reduction Implementing Kaizen Group Technology Lot Sizing

STEPS TO MAP THE FUTURE STATE:

56

Page 57: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

1. Calculate Takt Time

Takt time is the average time between production units necessary to meet customer demand. We use the available time divided by the required number of units. From the example TAKT TIME

= 460 min/504 pcs=0.91 min=55 secs

2.  Identify Bottleneck Process

The bottleneck process is the operation with the longest cycle time. In the example, this is machining at 44 seconds. The bottleneck is important because it:

Determines total system output. Becomes the primary scheduling point

The work balance chart given above is helpful for steps 2 and 3. Cycle time is plotted on the vertical axis for each operation.

The large improvements in Lead Time, productivity and inventory reduction are to be noted.

You can expect much discussion about details of implementation and feasibility of various options. This is normal Here the goal is to establish general feasibility.

57

Page 58: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Value Stream & Process Mapping

Value Stream Mapping SymbolsValue Stream Mapping symbols are not standardized and there are many variations. Here are the most common symbols.

VSM Process Symbols

Customer/Supplier

This icon represents the Supplier when in the upper left, the usual starting point for material flow. The customer is represented when placed in the upper right, the usual end point for material flow.

Dedicated Process

This icon is a process, operation, machine or department, through which material flows. Typically, to avoid unwieldy mapping of every single processing step, it represents one department with a continuous, internal fixed flow path.

In the case of assembly with several connected workstations, even if some WIP inventory accumulates between machines (or stations), the entire line would show as a single box. If there are separate operations, where one is disconnected from the next, inventory between and batch transfers, then use multiple boxes.

This is a process operation, department or workcenter that other value stream families share. Estimate the number of operators required for the Value Stream being mapped, not the

58

Page 59: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Shared Process number of operators required for processing all products.

Data Box

This icon goes under other icons that have significant information/data required for analyzing and observing the system. Typical information placed in a Data Box underneath FACTORY icons is the frequency of shipping during any shift, material handling information, transfer batch size, demand quantity per period, etc.

Workcell

This symbol indicates that multiple processes are integrated in a manufacturing workcell. such cells usually process a limited family of similar products or a single product. Product moves from process step to process step in small batches or single pieces.

VSM Material Symbols

Inventory

These icons show inventory between two processes. While mapping the current state, the amount of inventory can be approximated by a quick count, and that amount is noted beneath the triangle.  If there is more than one inventory accumulation, use an icon for each.

This icon also represents storage for raw materials and finished goods.

Shipments

This icon represents movement of raw materials from suppliers to the Receiving dock/s of the factory.  Or, the movement of finished goods from the Shipping dock/s of the factory to the customers

Push Arrow

This icon represents the? Pushing? Of material from one process to the next process. Push means that a process produces something regardless of the immediate needs of the downstream process.

Supermarket

This is an inventory? Supermarket? (Kanban stockpoint). Like a supermarket, a small inventory is available and one or more downstream customers come to the supermarket to pick out what they need. The upstream workcenter then replenishes stocks as required.

When continuous flow is impractical, and the upstream process must operate in batch mode, a supermarket reduces overproduction and limits total inventory.

Supermarkets connect to downstream processes with this "Pull" icon that indicates physical removal.

59

Page 60: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Material Pull

FIFO Lane

First-In-First-Out inventory. Use this icon when processes are connected with a FIFO system that limits input. An accumulating roller conveyor is an example. Record the maximum possible inventory.

Safety Stock

This icon represents an inventory? Hedge? (or safety stock) against problems such as downtime, to protect the system against sudden fluctuations in customer orders or system failures. Notice that the icon is closed on all sides. It is intended as a temporary, not a permanent storage of stock; thus; there should be a clearly-stated management policy on when such inventory should be used.

External Shipment

Shipments from suppliers or to customers using external transport.

VSM Information Symbols

Production Control

This box represents a central production scheduling or control department, person or operation.

Manual Info

A straight, thin arrow shows general flow of information from memos, reports, or conversation. Frequency and other notes may be relevant.

Electronic Info

This wiggle arrow represents electronic flow such as electronic data interchange (EDI), the Internet, Intranets, LANs (local area network), WANs (wide area network). You may indicate the frequency of information/data interchange, the type of media used ex. fax, phone, etc. and the type of data exchanged.

Production Kanban

This icon triggers production of a pre-defined number of parts. It signals a supplying process to provide parts to a downstream process.

This icon represents a card or device that instructs a material handler to transfer parts from a supermarket to the receiving process.  The material handler (or operator) goes to the

60

Page 61: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Withdrawal Kanban

supermarket and withdraws the necessary items.

Signal Kanban

This icon is used whenever the on-hand inventory levels in the supermarket between two processes drops to a trigger or minimum point. When a Triangle Kanban arrives at a supplying process, it signals a changeover and production of a predetermined batch size of the part noted on the Kanban. It is also referred as? One-per-batch? Kanban.

Kanban Post

A location where kanban signals reside for pickup. Often used with two-card systems to exchange withdrawal and production kanban.

Sequenced Pull

This icon represents a pull system that gives instruction to subassembly processes to produce a predetermined type and quantity of product, typically one unit, without using a supermarket.

Load Leveling

This icon is a tool to batch kanbans in order to level the production volume and mix over a period of time

MRP/ERP

Scheduling using MRP/ERP or other centralized systems.

Go SeeGathering of information through visual means.

Verbal Information

This icon represents verbal or personal information flow.

VSM General Symbols

Kaizen Burst

These icons are used to highlight improvement needs and plan kaizen workshops at specific processes that are critical to achieving the Future State Map of the value stream.

Operator

This icon represents an operator. It shows the number of operators required to process the VSM family at a particular workstation.

61

Page 62: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Other

Other useful or potentially useful information.

Timeline

The timeline shows value added times (Cycle Times) and non-value added (wait) times. Use this to calculate Lead Time and Total Cycle Time.

Limitations of Value Stream Mapping:

Value Stream Mapping (VSM) is a visualization tool, oriented to the Toyota version of Lean Manufacturing. As with any tool, it has limits. This situation sets up unrealistic expectations and diverts attention from important aspects of complex problems.

Non-Technical Aspects of Lean:

Value Stream Mapping is a technical tool that examines the physical system, processes and interconnections. Equally important for Lean Manufacturing success is the people side. Factories are complex socio-technical systems that require an integrated approach.

For example, Lean Manufacturing requires high teamwork for motivation, coordination and problem solving. It requires an effective mobilization of the collective intelligence of the organization.

There may also be quality issues that the company could address through Six Sigma or TQM techniques. Five-S can clean up the plant, improve safety and further raise productivity. Value Stream Mapping addresses none of these directly.

This is especially important in manufacturing where many managers have a technical bent and limited awareness of the human issues.

62

Page 63: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

TAKT TIME

Takt Time- It is desired time between units of production output synchronized to customer demand.

63

Page 64: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

The concept carries backward through a process stream. Ideally, every step synchronizes with the final output. Takt Time is fundamental to Lean Manufacturing.

History of Takt Time:

Takt is a German word which refers to the beat of music. It can also mean cycle, rhythm or repetition time. Sometimes it refers to the baton of an orchestra leader.

During the 1930's, Germany and Japan were part of the Axis and German engineers helped organize the Japanese aircraft industry. They used the analogy of a conductor's baton setting rhythm for the entire orchestra. After the war, Toyota picked up the word and concept for its Just In Time or Toyota Production System.

Takt time can be defined as the maximum time allowed to produce a product in order to meet demand. It is derived from the German word taktzeit which translates to clock cycle. There is logic therefore to setting the pace of production flow to this takt time. Product flow is expected to fall within a pace that is less than or equal to the takt time. In a lean manufacturing environment, the pace time is set equal to the takt time.

64

Page 65: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Takt Time is defined as:

Where:

Ta = Net Available Time to Work e.g. [minutes of work / day] Td = Total demand (Customer Demand) e.g. [units produced /

day] T = TAKT Time e.g. [minutes of work / unit produced]

Net available time is the amount of time available for work to be done. This excludes break times and any expected stoppage time (for example scheduled maintenance, Team Briefings etc).

As an example, if we have a total of 8 hours in a shift (gross time) less 30 minutes lunch, 30 minutes for breaks (2 x 15 mins), 10 minutes for a Team Brief and 10 minutes for basic Operator Maintenance checks, then;

Net Available Time to Work = (8 hours x 60 minutes) - 30 - 30 - 10 - 10 = 400 minutes.

If Customer Demand was, 400 units a day and you were running one shift, then our line would be required to spend a maximum of one minute to make a part in order to be able to keep up with Customer Demand.

In reality, people can never maintain 100% efficiency and there may also be stoppages for other reasons, so allowances will need to be made for these instances and thus you will set up your line to run at a proportionally faster rate to account for this.

TAKT TIME Implementation:

Takt time has direct implications concerning the allowable time for completing individual steps in a production process. This is the case for both steps that modify (form, assemble, finish…) the product and also the steps that observe and control (test, measure, adjust…) the process. Similarly steps which require a part or assembly of the product to have been put into an accurately fixtures position must be completed in less than the total takt time so that time is allowed for loading and unloading or positioning the part in addition to the time for actually performing the production step. The quicker that a measurement or test step can be completed, the less constraint is placed upon product motion between steps. For example, a measurement process that captures the entire information about a

65

Page 66: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

part at once will permit shorter total takt time and a higher pace of production flow. Elimination of the need to measure reduces this step best (SMED).

An implication of using takt time can be that work packages get reorganized. If worker one performs actions A1 through A5 and worker two performs actions A6 through A8 then a reduction in takt time may mean that there are now three work packages required to fit the new shorter/faster pace. They might be package 1 (A1 to A4), package 2 (A5

to A6) and package 3 (A7 to A8). So now we will have three people working to do the work that used to be achieved by two. This subdivision of work packages rather than parallel working on unchanged packages of actions is a new idea to many. This way of working requires:

a very flexible workforce, that is willing to accept changes in their routines and workplace

requires a multi-skilled workforce, since now people may be asked to 'pick-up' actions currently performed by others

flexible workcells, since what is being done by two people today may need to accommodate three people tomorrow

increases hand-offs, so these must have no significant overhead keeps the workflow simple and easy to manage, so whether the

process will deliver is clear to all has been observed to speed up individual steps in production,

because the new context of each action encourages innovation.

It will be obvious that this kind of capacity re-planning is not something that will be desirable every week. It is therefore important that the varying part of Takt time, the customer demand, should have been leveled before this kind of work re-planning is undertaken. That leveling is looked at elsewhere and that therefore this style of capacity modification should be undertaken to meet long term customer demand changes and not weekly forecasts.

CASE IN POINT - A Bomber An Hour--Takt Times At Willow Run Bomber Plant

66

Page 67: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

The figure ABOVE illustrates the concept for the B-24 aircraft built at Willow Run during World War II. The final assembly rate was established at "a bomber an hour" so the Takt time for Final Assembly is 60.0 minutes.

The aircraft requires one Forward Fuselage sub-assembly and the Takt time for this production area is also 60.0 minutes.

Four propellers per aircraft generate a Takt time at Propeller Dress of 15.0 minutes.

Each ship needs two rudders, so Takt time for Rudder Sub-Assembly is 30.0 minutes. Each rudder requires six ribs. Takt time for Rib Forming is, therefore, 5.0 minutes.

Benefits of Takt Time

The simplicity of the concept belies its extraordinary effects. Among these are:

Production Stability- by limiting overproduction, it stabilizes the system and prevents buildups of inventory and the subsequent stops and starts.

67

Page 68: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Workcell Design- Takt time helps cell designers. In an ideal workcell, all tasks are balanced, they all require the same time to execute and that time equals the Takt time. If any operation requires more than the Takt time, the cell cannot produce at the necessary rate.

In the first illustration, below the cell cannot make the necessary quantity because operation #4 exceeds the Takt time. In the second chart, the work has been balanced at Takt time or slightly below. This, however, is not the only way to balance workcells.

Psychological- immediate feedback of performance is a powerful motivator. When a workcell team tracks takt time, they have a heightened awareness of output rates and potential problems. They attempt to achieve the Takt time on each cycle and immediately make necessary corrections.

When Charles Sorensen conceived and built the Willow Run Bomber plant, he designed it for "A bomber an hour".  He did not say "nineteen ships per day" or "120 per week." Sorensen understood the value of steady, repetitive output.

At one point in planning a subordinate asked Sorensen how they should schedule such a complex operation. "Cast Iron Charlie" shot back- "Your schedule is to build a bomber an hour!” The result was a very simple and effective scheduling system using broadcast and kanban. There were no computers in 1940.

ADVANTAGES OF LEAN MANUFACTURING:

68

Page 69: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Lean Manufacturing is a buzzword. More often it is used with the terms like benefits, cost reduction, lead-time reduction etc. but if you have not started implementing lean manufacturing yet and if you have not started benefiting from lean manufacturing yet, you will need some numbers to be motivated.Some quantified benefits of lean manufacturing where the principles of lean are implemented successfully. Lean manufacturing is normally known to reduce the

Lead time by 50% at least (some reports says stories where lead time is being reduced up to 90%)

Reduced WIP up to 80% Floor space savings around 30 %( sometimes more than 50%) Increased productivity at least by 30%. (even more than 100% in

some cases) Quality improvement by a factor of two Overall cost reduction

69

Page 70: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Above are only the quantified and most common advantages. But there are more and more other advantages come with lean manufacturing. Among them are

Good team spirit which will drive your organization to the excellence

Innovative culture in the organization Self driven people Pleasant working conditions Worker involvement and improved worker satisfaction Longer machine life Systematic approach to work Improved flexibility Environmentally friendly Built in quality

There are many other advantages which are not listed here. Even these advantages are not listed in any order. These will be more or less important to you according to your immediate requirements.

Some successful lean manufacturers claim that they have achieved some unexpected good result when they shifted to lean

70

Page 71: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

manufacturing. The reason for this is the chain effect created by the lean manufacturing implementation.

WHY IS LEAN SUCESSFUL

Lean manufacturing talks about optimizing and eliminating wastes, rather than minimizing. When we are trying to minimize one type of waste another will go high. For an example if we are trying to minimize the machine idling time it can increase the Work In Progress as machines are on over production. At the end of the day the net out come on the organization will be negative. This is why Lean promotes Elimination and Optimization. This may be the Core Concept of Lean Manufacturing.

71

Page 72: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

An Organization which applies Lean Manufacturing must understand clearly what is a waste? What is meant by improving? Etc. therefore it is very important to have a Clear cut definitions about the Key Words in Lean Manufacturing. This is clearly done in the Lean Manufacturing. It Answers the questions like, what is a waste.

One of the major concerns of the Lean Manufacturing is the WIP. But there are no techniques appear to eliminate WIP directly. This is a very important example to show the Lean Thinking of Treating the Cause Not the Effect. In Lean Manufacturing WIP has understood as an effect of imperfections in the system. It searches for the imperfections with the tools in Lean Manufacturing and fix these causes. Then the WIP will automatically go down.

Lean Manufacturing believes in making the process of manufacturing correct, instead of expecting a good result. Generally the Asian way of management is process oriented unlike the western way of management which is result oriented.

72

Page 73: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Lean believes that a correct process of work will give correct results. This is quite a contradictory with the conventional way of thinking in management, which is always focused to produce results by any means.

Lean Manufacturing believes in continuous and steady improvement, rather than in Rapid improvements. This introduces the process sustainability and the involvement of all level of people. In Lean Manufacturing there is a role to be played by the workers in the improvement and innovation. This is not so in the conventional ways of management where the innovation and decision making are completely a responsibility of Managers.

Continuous improvements in the organization and involvement of the employees in the process of management decision making will motivate the employees. This will release the Organizational Synergy into work. This at the end will become the driving force of the organization.

Culture of team working is one of the major improvements Lean Manufacturing promotes for an organization. Two people can collectively give more out puts than the sum of their individual out puts. This is the Asian way of thinking about work. This is promoted through team incentives and team recognition, unlike in the

73

Page 74: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

western way of management where individual performances are given more emphasis.

Participation of the all levels of employees in the process of decision making is one of the major improvements made by the Lean Manufacturing. This drive out the fear among the workers and made it easier to work with the decisions as they are a part of the process of making decisions.

People often have more to offer than their physical strength, to the organization. They have a brain and a heart as well. This philosophy really worked in the organizations where Lean Manufacturing was practiced.

Systematic approach to the reduction of wastes in every form is the base of lean manufacturing. Finding out the wastes and evaluating them and solving the problems that generates those wastes are working in a system it self. Within the bigger picture there are lots of smaller systems appear for the specific tasks. Some of them are quality circles, and set up teams etc.

Lean Manufacturing promotes simpler methods and tools to do the job. It often causes the low cost automation, very simpler methods of handling and even very simpler ways of managing the organizations. This can save larger amounts of money as they are low cost them selves and they are effective in and efficient in the use. Having high value machinery promotes higher maintenance, higher level of training and fear of break downs.

Therefore low cost automation is quite good from the workers point of view as well. On the other hand low cost applications are home made and therefore exactly meets the demands of the work stations. Toyota production system is very well known for these low cost automation processes, which gave them the flexible low cost solutions for their problems.

In Lean Manufacturing it believes people who does the work actually has the ability to find solutions for the problems in the work. Managers always play a supporting role. Therefore it is always better to say the workers what to do but not how to do. This requires better and thinking workforce unlike in an ordinary organization where the managers are suppose to do the thinking part and workers are supposed to work accordingly.

The single most Important Effect of Lean Manufacturing is the Cyclic Effect of All Its Interconnected Processes. They work in

74

Page 75: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

harmony and improvement in one place will improve the system as whole. Therefore with the time Processes quires Momentum and will start to Run On Their Own. Therefore they become self driven. These are few of the identified advantages of lean manufacturing.

USES OF LEAN MANAGEMENT

Lean Business System is used for organizing and managing product development, production and logistics operations, suppliers, and customer relations. Business and other organizations use lean principles, practices, and tools to create precise customer value - goods and services with more variety in lower volumes with higher quality and fewer defects - with less human effort, less space, less capital, and less time than the traditional system of mass production in which only large volumes can cause profits.

75

Page 76: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Leaders today in a wide range of industries, nonprofit organizations, government agencies, healthcare, and other areas are finding ways to apply the principles of lean as a means of producing goods and delivering services that creates value for the customer with the minimum amount of waste and the maximum degree of quality.

It is now proven that Lean is applicable in any sphere of human activity, and a variety of industries – small and large from Retail, Office and Service industries have begun to appreciate the benefits of Lean Management and are transforming themselves. Many companies from Banking & Financial Services, Healthcare, Retail, Hospitality, BPOs, Call Centre & ITES and Software Industries have already embarked on a Lean Programme or are evaluating and seriously considering one. This is apart from Manufacturing Industries realizing that Lean Management is more than applying tools and techniques in the factory operations.

LEAN MANUFACTURING OF TODAY’S WORLD

76

Page 77: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Most of the people think lean manufacturing is the best way to earn more profit. Yes it is true. Lean manufacturing will save you costs, increase the productivity, improve the quality and will shorten the lead time. All of these will save and money and obviously give you more profits. But lean manufacturing can do much more than this to specially today’s world. In this world there are more than six billion people. This population increases very rapidly.

77

Page 78: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

But the resource this world has is limited. Even these limited resources are consumed and degraded very rapidly. When closely looked at the problems the world is facing today like wars and environmental problems most of these problems are due to the limited availability and in appropriate use of the resources the world has. Think how much of energy is wasted in an engine. Only 30% of the heat generated is used to generate mechanical energy. Even this energy is wasted in many forms. How much of raw materials are wasted in the process of a fiber becoming a finished garment. It is said that cost for the fiber in a finished garment is less than 1% of the value of the garment. Still much of the garment weight is consist of the fiber. Where have all other value additions have gone. Most of them are wasted in many forms. In some countries more than 25% of vegetables get wasted in transportation.

If car engine is made 60% efficient the gulf war might have been avoided. If the way of garment manufacturing can be changed, most of the environmental problems in the manufacturing countries will end. If

78

Page 79: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

we transport the vegetables carefully, war for the land and hunger in many countries will end.

When thought deeply we will find millions of examples. We waste these precious resources. Lean manufacturing is a system that must be practiced worldwide. At least the core concept of waste elimination must be obeyed in each and every organization in this world. Therefore wasting of the resources has to be stopped. There are no resources can be wasted for any reason. Lean manufacturing concepts will show the way how to achieve a world without waste.

79

Page 80: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

CHALLENGES FACING INDIAN TEXTILE AND APPAREL INDUSTRY

Textile supply chains compete on low cost, high quality, accurate

delivery and flexibility in variety and volume. Several challenges stand

in the way of Indian firms before they can own a larger share of the

global market:

Scale: Except for spinning, all other sectors suffer from the problem of

scale. Indian firms are typically smaller than their Chinese or Thai

counterparts and there are fewer large firms in India. Some of the

Chinese large firms have 1.5 times higher spinning capacity, 1.25

times denim (and 2 times gray fabric) capacity and about 6 times more

revenue in garment than their counterparts in India thereby affecting

the cost structure as well as ability to attract customers with large

orders. The central tendency is to add capacity once the order has

been won rather than ahead of the demand. Customers go where they

see both capacity and capabilities. Large capacity typically goes with

standardized products. These firms need to develop the managerial

capabilities required to manage large work force and design an

appropriate supply chain. For the size of the Indian economy, it will

have to have bigger firms producing standard products in large

volumes as well as small and mid size firms producing large variety in

small to mid size batches (the tension between the organized and un-

organized sectors will have to be addressed first, though). Then there

is the need for emergence of specialist firms that will consolidate

orders, book capacities, manage warehouses and logistics of order

delivery.

Skills: Three issues must be mentioned here:

80

Page 81: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

(a) there is a paucity of technical manpower – there exist barely 30

programmes at graduate engineering (including diploma) levels

graduating about 1000 students – this is insufficient for bringing about

technological change in the sector;

(b) Indian firms invest very little in training its existing workforce and

the skills are limited to existing process (Chandra 1998);

(c) there is an acute shortage of trained operators and supervisors in

India. It is expected that Indian firms will have to invest close to Rs.

1400 bn by year 2010 to increase its global trade to $ 50 bn. This kind

of investment would require, by our calculations, about 70,000

supervisors and 1.05mn operators in the textile sector and at least

112,000 supervisors and 2.8mn operators in the apparel sector

(assuming a 80:20 ratio of investment between textiles and apparel).

The real bottleneck to growth is going to be availability of skilled

manpower.

Cycle Time: Cycle time is the key to competitiveness of a firm as it

affects both price and delivery schedule. Cycle time reduction is

strongly correlated with high first pass yield, high throughput times,

and low variability in process times, low WIP and consequently cost.

Indian firms have to dramatically reduce cycle times across the entire

supply chains which are currently quite high (Chandra, 2004).

Customs must provide a turnaround time of ½ day for an order before

Indian firms can they expect to become part of larger global supply

chains. Indian firms need a strong deployment of industrial

engineering with particular emphasis on cellular manufacturing, JIT and

statistical process control to reduce lead times on shop floors.

Penetration of IT for improving productivity is particularly low in this

sector.

81

Page 82: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

Innovation & Technology: A review of the products imported from

China to USA during January–April 2005 reveals that the top three

products in terms of percentage increase in imports were Tire Cords &

Tire Fabrics (843.4% increase over the previous year), Non-woven

fabrics (284.1% increase) and Textile/Fabric Finishing Mill Products

(197.2% increase) (FICCI, 2005). None of these items, however, figure

in the list of imports from India that have gained in these early days of

post-MFA. Entry into newer application domains of industrial textiles,

nano-textiles, home furnishings etc. becomes imperative if we are to

grow beyond 5–6% of global market share as these are areas that are

projected to grow significantly. Synthetic textiles comprise about 50

per cent of the global textile market. Indian synthetic industry,

however, is not well entrenched. The Technology Upgradation Fund of

the government is being used to stimulate investment in new

processes. However, there is little evidence that this deployment in

technology has accompanied changes in the managerial regimes – a

necessary condition for increasing productivity and order winning

ability.

Domestic Market: The Indian domestic market for all textile and

apparel products is estimated at $26 bn and growing. While the

market is very competitive at the low end of the value chain, the mid

or higher ranges are over priced (i.e., ‘dollar pricing’). Firms are not

taking advantage of the large domestic market in generating

economies of scale to deliver cost advantage in export markets. The

Free Trade Agreement with Singapore and Thailand will allow overseas

producers to meet the aspirations of domestic buyers with quality and

prices that are competitive in the domestic market. Ignoring the

domestic market, in the long run, will peril the export markets for

domestic producers. In addition, high retail property prices and high

channel margins in India will restrict growth of this market. Firms need

82

Page 83: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

to make their supply chain leaner in order to overcome these

disadvantages.

Institutional Support: Textile policy has come long ways in reducing

impediments for the industry – sometimes driven by global competition

and, at other times, by international trade regulations. However, few

areas of policy weakness stand out – labor reforms (which is hindering

movement towards higher scale of operations by Indian firms), power

availability and its quality, customs clearance and shipment operations

from ports, credit for large scale investments that are needed for

upgradation of technology, and development of manpower for the

industry. These are problems facing several sectors of industry in India

and not by this sector alone.

In conclusion, LEAN MANAGENT are developed by sector level firms

and their individual and collective initiatives that secure higher market

share in global trade. While one has to be ever vigilant of non-tariff

barriers in the post MFA world, the new market will be won on the basis

of capabilities across the supply chain. Policy will need to facilitate this

building of capabilities at the firm level and the flexible strategies that

firms will need to devise periodically.

83

Page 84: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

CONCLUSION:

Lean cannot be sustained long-term without changing the traditional measurement and management accounting processes. This paper has presented the basic elements of an approach that supports the goals of lean manufacturing and that provides information to maximize the financial benefits from lean. By implementing the methods in conjunction with a well designed lean manufacturing initiative, managements can be assured that lean will become more than an initiative but a way of managing the enterprise for growth and profitability.

84

Page 85: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

REFERENCE

BOOKS:

Competitive Manufacturing Management – by Nicholas (third reprint 2005)Tata McGraw-Hill Edition 2001Publishing Company Limited7 West Patel Nagar, New Delhi-110 008Pages refered-13,15,75,80,90,101,131,186,222,267,269,338,412,555,679

WEBSITES:

www.leaninstitute.com -lean definition, lean principleswww.answers.com -lean principles, kaisen. kanban, TQMwww.industryweek.com- lean managementwww.collegescam.com - lean management, lean productionwww.searchCIO.com - lean production, JIT, cell manufacturingwww.tyslean.com - cell manufacturing, workcells, lean productionwww.whatis.com -lean production

85

Page 86: Lean Managment

PRODUCTION METHODS - LEAN MANUFACTURING

www.stategosinc.com - kaisen, value stream mappingwww.smthacker.com - kaisen, kanban, TQMwww.lean.org - lean management, lean production, lean

thinking lean principles

www.aircad.com - kaisen, kanbanwww.isixsigma.com - lean principleswww.inventrysolution.com - lean- 7wasteswww.leanmanufacrutingconcepts.com - lean manufacturingwww.1000ventures.com - lean management, lean

manufacturing, lean thinking, kaisen, kanban, set-up-cost reduction

www.maskell.com - lean thinkingwww.wikipedia.com - lean managementwww.sdmagazine.com - kaisen, kanban, workcellswww.ifm.eng.can.al.uk - lean managementwww.wiki.hmccentral.com - lean management, lean principleswww.stumbleupon.com - lean production www.leanconstruction.org -lean principles

86


Top Related