Operations Management: Lean Manufacturing
Terms in this set (37)
Tool based philosophy that focuses on eliminating waste so that all activities/steps add value from the customer's perspective.
Emphasizes the minimization of the amount of all the resources used in the various activities of the enterprise.
Benefits of Lean Manufacturing
On Time Delivery
Lean is based on 5 Principles
1. Specify Value
2. Map The Value Stream
3. Establish Flow
4. Implement Pull
5. Work To Perfection
Define value from the customer's perspective and express value in terms of a specific product.
Represented by those activities that add no value and just add cost and time.
The 7 Types of Waste (TIM WOOD)
5. Over Processing
Goal of all organizations
Getting cash and achieving profit, repeat business and growth: able to get this if it satisfy the needs and expectations of the customer that are low cost, high quality and availability or products/services.
Map The Value Stream
Map all of the steps- value added and non value added- that bring a product or a service to the customer.
When mapping, all activities required to bring a product from raw materials into the hands of the customer are considered and placed into the map.
Identify all of the steps currently required to move products from order to delivery.
Challenge every step.
Many steps are necessary because of the way firms are organized and b/c of previous decisions about assets and technologies.
After drawing the map, the team can identify areas and opportunities for improvement and prepare the map of the future ideal state that represents the goal to achieve next.
The flow is the continuous movement of products, services and information from end to end through the process.
In a lean process there is a flow of single pieces and each step of the process is as much close as possible to the next one in a continuous sequence.
For assuring a continuous flow along the overall process it is required that every step be
1. Capable- right every time
2. Available- the machine has to be always able to run (good maintenance is in place)
3. Adequate- with enough capacity to avoid bottlenecks and overcapitalization. (not too big machines that sit idles and are not fully used but just the right-sized tools and machines)
Nothing is done by the upstream process until the downstream customer signals the need.
Pull System is implemented along all process.
Each step has an "internal customer" (the step next to it) and an "internal supplier" (the step right before it).
A system of cascading production and delivery instructions in which nothing is done by the upstream supplier until the downstream customer signals the need.
Through lead time compression and correct value specification, let customers get exactly what is wanted exactly when it is wanted.
System of signals used is call KANBAN.
Work To Perfection
Perfection means the complete elimination of waste so all activities create value for the customer.
Perfection is achieved through a continuous process of improvements thinking that:
There is always some waste that can be removed.
It is important to involve employees in the process and training them.
Continuous improvement leads to innovation.
It is useful to use root cause analysis to solve problems promptly and permanently.
It is important to make objectives visible (using charts, diagrams, graphs).
Lean Manufacturing Methodology contains
Framework to create and maintain your workplace.
1. Sort (organization)- distinguish between what is needed and what is not needed.
2. Set In Order (orderliness)- establish an order for things in the workplace.
3. Shine (cleanliness)- cleaning and looking for ways for keeping the workplace clean.
4. Standardize (adherence)- clearly define tasks and procedures.
5. Sustain/Systemize (self-discipline)- stick to the rules scrupulously.
5 S's (CONT)
Implementing this is often the first step when an organization decides to implement lean manufacturing.
To perform analysts simply need a piece of paper, a pencil and good observing skills. They might observe what is happening and take notes. When detecting wastes it is possible to set a plan for reducing them through solutions and actions to perform.
Work and storage areas should be positioned whereby materials moves are short.
Tooling should be kept near its point-of-use.
Materials should only be moved as necessary.
Inventory In Excess
Costs associated with inventory:
a. Space used
d. Lagged defect detection
Administrative activities such as the negotiation of long-term contracts with suppliers to ensure a steady stream of high-quality parts also contribute by eliminating the need for safety stock to cover market-based material shortages.
Motion consumers time and energy.
This objective in reducing motion should guide workplace design, process planning, writing of detailed job procedures, and material handling.
Waiting Time (queuing)
Small lot sizes with planned order release and coordinated production of items can reduce cycle time and inventory costs.
A well-balanced system with coordinated order processing can achieve full capacity output without excessive WIP and throughput time.
Non-value added operations should be eliminated.
Wastes of energies should be detected so to optimize the use of resources (energy, machines).
Reducing cycle time and matching production schedules for parts that are assembled together reduce system costs.
Machines and humans should only be busy when they have useful tasks to accomplish.
We should balance the flow of parts toward final assembly to meet demand instead of working to keep resources busy and producing products that are not needed.
Defects (defective products)
Defective products incur cost, deplete resources and negatively impact customer perception.
Quality control goal is designing, monitoring, improving process yield.
Lean Manufacturing (CONT)
Arose as method to optimize auto manufacturing.
About Speed and Efficiency.
Principles exclude the advanced statistical tools often required to achieve the process capabilities needed to be truly "learn"
Evolved as a quality initiative to reduce variance in the semiconductor industry.
About Precision and Accuracy- leading to data-driven decisions.
Will eliminate defects but it will not address the question of how to optimize process flow.
Six Sigma (CONT)
Framework for addressing projects aimed to reduce the amount of defects and variance in processes: Called DMAIC.
Team defines clearly the problem to be solved or what is important to the customer.
Phases in this step are: project selection, team formation and goal definition.
Team collects data and information, constructs a process flow chart, and validates the measurement system.
Data are analyzed and then the team works for identifying root causes of the problem.
Root causes are prioritized and the team identifies solutions to implement for eliminating such root causes.
Team validates the improvement.
Ensure that the identified and implemented solution is sustained over time.
Organizations maintaining long-standing, comprehensive process improvement programs share common features that enhance their ability to sustain the efforts. They have:
Been inspired by a leader with business experience.
Experienced little leadership turnover.
Paved the way for the program's implementation by removing organizational barriers and modifying its culture.
Focused on certain underlying principles and maintain a consistent conceptual framework.
Begun by employing a full-time administrator to oversee the program's implementation.
Offered a guarantee to employees that have no layoffs will result from a process improvement project.
Made conscious effort to communicate program successes internally.
Maintained reasonable expectations- did not achieve success overnight, with most taking several years to create a culture that characterizes and sustains their program.
Organizations create an infrastructure supporting the combined Lean/Six Sigma program with attention to 4 goals
1. Deploy a sound, consistent and robust methodology.
2. Build trust by removing fear.
3. Initiate long-term culture change.
4. Communicate the vision to all stakeholders
Management creates a culture where:
1. Problems are recognized as opportunities for improvement.
2. It's okay to make legitimate mistakes.
3. Problems are exposed (and not hidden) b/c of increase trust.
4. People are not problems- they are problem solvers.
5. Emphasis is placed on finding solutions instead of "who did it"