1 deborah nightingale © 2002 massachusetts institute of technology fundamentals of lean professor...

1 Deborah Nightingale © 2002 Massachusetts Institute of Technology

Fundamentals of Lean

Professor Deborah Nightingale

September 9, 2002


Lean is a New Approach to Managing Enterprises

Origin and evolution of lean concepts

Core lean principles & practices

How lean differs from craft and mass production models of industrial organization

Lean implementation steps

Value stream mapping


Lean was Born out of Necessity: How to Withstand the Mass Production Behemoths

On August 15, 1945 --end of war with Japan --Toyota faced a daunting challenge: How to succeed against Western mass production auto giants poised to enter Japanese market?

Kiichiro Toyoda to Taiichi Ohno (father of lean production): “Catch up with America in three years.”

Ohno’s challenge: How to design a production system exploiting central weaknesses of mass production model

Japan faced many dilemmas: small & fragmented market, depleted workforce, scarce natural resources, little capital

Lean evolved as a coherent response to this challenge over a number of decades --a dynamic process of learning and adaptation later labeled as “lean production” by Western observers

4Deborah Nightingale © 2002 Massachusetts Institute of Technology

Lean Response: Use Less of Everything, Offer Greater Variety of Higher Quality & More Affordable

Products in Less Time Best Japanese auto companies developed a fundamentally different way of making things

These companies changed the dynamics of international competition New goals in manufacturing systems --combined benefits of craft and mass production

Improved quality

High productivity

Efficiency at low volumes

Production flexibility

Rapid, efficient development cycle Product mix diversity

Lean production contrasts with traditionalmass production paradigm

Systemic principles are transferable


What is Lean Thinking?

The removal of muda!

Muda-Is a Japanese word for waste

Waste-any activity that absorbs resources & creates no value!

Source : Lean Thinking by Womack & Jones


More Japanese Terms

Kaikaku-radical improvement

Kaizen-continuous incremental improvement


Taiichi Ohno (1912-1990) Toyota Executive

Types of Muda:

Mistakes which require recertification

Production of items no one wants

Processing steps which really aren’t needed

Employee or goods movement/transport from one place or another without any purpose


Taiichi Ohno (1912-1990) Toyota Executive

Types of Muda:

People in downstream activity waiting because upstream activity has not delivered on time

Goods and services that don’t meet the need of customer


Antidote to Muda: Lean Thinking

Provides way to specify value

Line up value creating actions in best sequence

Perform them more and more effectively

Provides a way to make work more satisfying

Conduct activities without interruption whenever someone requests them


Lean Thinking is the Dynamic Process of Eliminating Waste with the Goal of Creating Value for all

Enterprise Stakeholders

Knowledge-driven: Draws upon knowledge and innovation from everyone --workers, suppliers

Eliminating waste: Stresses elimination, not just reduction, of all types of waste

Creating value: Puts premium on “growing the pie”, not just reducing costs, to benefit all stakeholders

Dynamic and continuous: Pursues on-going systemic as well as incremental improvement --both innovation and continual improvement

Customer-focused: Customer needs and expectations “pull” enterprise activities


Lean Encompasses a Set of Mutually-Positively-Reinforcing Concepts, Practices and Tools Creating

a Virtuous Cycle

Synchronizing flow and pull: “Pull” based just-in-time production enabled by kanban system

Striving for perfect quality: Completely defect-free parts must flow to each subsequent process; variability reduction; quality designed-in, not based on inspection

Flexibility and responsiveness: Small lot sizes and quick set-up times; ability to respond to shifts in demand

Trust-based relationships: Mutual commitments and obligations, internally and externally with suppliers

Continuous improvement (Kaizen): Continuous improvement through work standardization, productive maintenance, error proofing, root cause analysis, and worker training & empowerment


5 Steps to

Becoming Lean

Northrop Grumman ISS


5 Steps to Becoming Lean

1. Define Value

2. Identify the Value Stream

3. Flow the Product

4. Pull

5. Strive for Perfection

Customer

Follow the Product

Eliminate Waste

Produce Just-in-Time

Continuously Improve


1. Define Value

Definition

Information/Material in a Form That the Customer Is Willing to Pay for

Value is Defined by the Customer Value is Created by the Producer


Who’s the Customer?

C

C C C

Who’s the customer?

Who’s the customer?

C

C

C

Cuser

shareholder

employee

environmental


2. Identify the Product’s Value Stream

The Value Stream Consists of the Actual Tasks Required to Bring a Specific Product Through Three Critical Processes:

Design –Problem-solving From Concept Through Detailed Design and Engineering to Production Launch

Order –Information Management From Order-taking Through Detailed Scheduling to Delivery

Make –Physical Transformation from Raw Materials to Finished Product In the Hands Of the Customer

CUSTOMER

Example: Structural Design Value Stream Map

Change / Rework

Analyze ReworkRoot Cause

Pre-Contract Req’m’nts & Concept’l Des.

Product: Component

Procurement

Supplier: XXX

ComponentProcurement Spec Structure Specs ICDs

Manage Program Program Req’m’nts

Systems EngineeringAllocate Requirements to Component

Allocate Requirements to Structure SEMP

Req’m’nts

Manage TeamApply Program PlansApply Technical PlansApply Processes & ToolsApply Resources

To All Processes Shown

-Specs-Environmental Criteria -Standard Parts -Standard Designs -Design Handbook -Geometric Design & Tolerancing -Mfg. Process Capability -Etc.

Des. Ref. Library

-Design for Manufacturing -Design for Assembly -Design to Cost -Design for Key Characteristics -Design for Supportability -Design for 6 Sigma -Design for ..........

Des.Proc. Guidance

Prime System Spec

Prime Contractor/

Team Process

Product: Vehicle

Customer: U.S. Government

Value: – Affordable – High Quality – High Performance Product – On Time Delivery

Define Structural Arrangement

• Finalize Conceptual Design • Conduct Structural Configuration/Cost/Mfg. Trades • Perform Airframe Analysis -Weights -Finite Element Model -Environmental Model -Internal Loads -Observability Model • Develop Material Allowables • Define Arrangement -Production Breaks • Develop ICDs

Prepare Prelim.Design• Develop Layouts • Create Assemblies • Create Sub -Assemblies • Perform Structural Analysis -Stress -Environmental -Weight • Production Factory Requirements Analysis • Develop Adv. Mfg. Plan Tooling & Mastering Concepts

Perform Detail Design

• Design Parts & Details • Perform Structural Analysis

Release BTP

• Build to Package• Buy to Package • CDRLs • Reports

Procure Suppliers • Build and • Assemble

Produce Product

• Fab Tooling • Build & Inspect• Deliver

Test System

• Development• Verification • Validation

Iterate

Iterate

System Req’m’ts Review

System Design Review

Prelim. Design Review

Critical Design Review

@ 80% BTPRelease0 xx yy zz

months months months monthsJ. Wessels 4/27/2001 Rev. 4


3. Flow the Product

4. Focus on actual object and never let it out of sight from beginning to completion

5. Ignore traditional boundaries of jobs, careers, functions, and organizations to form a Lean enterprise removing all impediments to the continuous flow of the product

6. Rethink specific work practices and tools to eliminate backflows, scrap, and all stoppages

1. Eliminate Activities That

Are Waste

2. Prefer One Piece Flow

Where possible

3. Focus on the Product and Its Needs Rather

Than the Organization or the Equipment


What Is a Value-Added Activity?

Definition

A value-added activity is any action that transforms information/material into a capability for our ultimate customer at

the right time and the right quality.


Waste

Definition

Any Activity That Consumes Resources Yet Adds No Value


Batch Production Example

Processes -Oriented Layout With Transfer Lot Size of Five Throughput Time (5 Units)

=

5x1 + 5x1 + 5x1 + 5x1 =

20 Min.

Work in Process

5 + 5 + 5 + 5 =

20 Units

ELAPSED

TIME

MIN

0

5

10

15

20

= Different Processes

Processing Time = 1Min./ Unit


Batch Production Example

Processes -Oriented Layout With Transfer Lot Size of Five Throughput Time (5 Units)

=

5x1 + 5x1 + 5x1 + 5x1 =

20 Min.

Work in Process

5 + 5 + 5 + 5 =

20 Units

ELAPSED

TIME

MIN

0

5

10

15

20




One -Piece Flow Example

Throughput Time (5 Units) =

1x4 + 1x1 + 1x1 + 1x1 + 1x1 =

8 Min.

Work in Process

1 + 1 + 1 + 1 =

4 Units

Product-Oriented Layout With Lot Size Of One

ELAPSED

MIN

TIME

0

1

2

3

4



5

6

7

8


4. Pull

Definition

Letting the Customer Pull Value from the Enterprise

Don’t Make Anything Until It Is Needed

Then Make It As Quickly As Possible


Pull

Concept of letting the customer pull product from as needed instead of pushing it on them

Reduces inventories and produces one time cash windfall & return on investment


5. Strive for Perfection

Definition

Continuous Process Improvement

Pursue Perfection, Not the Competition

There Is No End to the Process of Reducing Efforts, Space, Costs and Mistakes


Perfection

Continuous radical and incremental improvement

Continuous banishment of muda


Seven Categories of Waste

Over Production …………...…

Waiting ………………………...

Transportation ………………..

Over Processing ……………..

Inventories …………………….

Movement ……………………..

Making Defective Products …

Delay From Previous Processing Steps

Making Ahead of Demand

Unnecessary Transport of Materials

Doing More Than Is Necessary

More WIP Than the Absolute Minimum

Unnecessary Movement of People During the Course of Their Work

Products Do Not Meet Customer Requirements


Some General Product Definition Wastes

Seven Types of Waste

Inventories


Making Defective Products (Rework)

Products Do Not Meet Customer Requirements Over Processing


Over Production


Transportation


Movement

Unnecessary Movement of People During the Course of

Their Work

Waiting


• Task to Be Accomplished (New, In-work, etc.)

• Undocumented Information • Prioritization • Too Much Information

• Required to Stop a Given Task Due to Unavailable, Inaccurate, And/or Late Information • Jobs in Queue Waiting for Resources• Setup Time (Computer Logon, Printers, Xerox, etc.)

• Access to Data Storage • People Are Not Co-located • Walk to Tools (Printer, Copier, CADAM, Etc.) • Hand Carry Product for Signatures • Travel to Meetings • Transferring Data From One

Database to Another • Physical Movement of Product • Unnecessary Movement of Data (Physical or Electron Flows)

• Inaccurate / Incomplete Information • Inadequate Analysis • Requirements Creep • Change / Multiple Tools • Inadequate Testing

• Generating More Info Than Required • Excessive Iterations, Don’t Stop at Good Enough • Fine Tuning Beyond Required • Over Designing • Unnecessary Interim Drawings for Build • Over Analysis • Excessive Test Points • Duplicate Tasking

• Tasks Finished Before Required, e.g. Making Drawings Before They Are Needed


Seven Types of Waste

Inventories


Making Defective Products (Rework)

Products Do Not Meet Customer Requirements Over Processing


Over Production


Transportation


Movement

Unnecessary Movement of People During the Course of

Their Work

Waiting


Exercise – Specific Examples You Encounter


Apply Five Simple Principles:

Specify value from the standpoint of end customer

Identify the value stream for each product family

Make the product flow

So the customer can pull

As you manage toward perfection


Lean Thinking Differs Sharply from Craft and Mass Production in Important Ways

Source: Lean Aerospace Initiative

FOCUS CRAFT MASS PRODUCTION

LEAN THINKING

Improvement Master-driven continuous improvement

Expert-driven periodic improvement

Workforce-driven continuous improvement

Product

Batch and queue Operations

Focus

Overall aim

Quality

Business strategy

Task Customer

Synchronized flow and pull

Reduce waste and add value

Prevention (built in by design & methods)

Single items

Economies of scale and automation

Inspection (a second stage, after production)

Flexibility and adaptability

Reduce cost and increase efficiency

Mastery of craft

Integration (part of craft)

Customization


Value Stream Mapping

Deborah Nightingale © 2002 Massachusetts Institute of Technology 35

Lean/Value Stream Philosophy

SUPPLIERS

The CUSTOMER’S CUSTOMERS

CUSTOMER

VALUE VALUE

STREAM

PERFECTION

FLOW PULL

The EXTENDED ENTERPRISE

NORTHROP GRUMMAN


What is a Value Stream Map?

A Visual Representation of Every Process in the a Product’s Path from Order to Delivery

Includes:

Information and Materiel Flow Integration

Product Through-Put and Cycle Times

Resources Utilized

Value Added Times

Location of Significant Waste


Why Value Stream Map?

Systems Approach To:

Systems Approach To:

Identifies the Sources of Waste

Basis of an Lean Implementation Plan

Determine Future Operating State


Using the Value Stream Mapping Tool

Product

Current-State Drawing

Future-State Drawing

Work Plan

Business Case Justification

Understanding how the product currently flows

Designing a lean flow

How to get there

1 deborah nightingale © 2002 massachusetts institute of technology fundamentals of lean professor...

Documents

lean thinking

production system

mass production behemoths

little capital lean

japanese market

toyota executive types

removal of muda

japanese word