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LESSON 1 : INTRODUCTION TO LEAN

PRODUCTION SYSTEM

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1. Javier Santos, Richard Wysk, Jose Manuel Torres, Improving Production with Lean Thinking, J Wiley & Sons, Inc. 2006

2. Peter L.King, Lean for the Process Industry, Dealing with Complexity, CRC Press 2009

3. Katsundo Hitomi, Manufacturing System Engineering, CRC Press, 1996

4. Taiichi Ohno, Toyota Production System, Productivity Press, 1988

5. Jeffrey K. Liker, The Toyota Way, McGraw-Hill, 2004

References

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Definition of Manufacturing1. Technical DefinitionManufacturing is the application of physical and chemical processes to alter the geometry, properties and appearance of a material to make parts or products

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Definition of Manufacturing

2. Economic DefinitionIs the transformation of material into items of greater value by means of processing or assembly operations – adding value to the material

5Source: Groover, Fundamentals of Modern Manufacturing

The PROCESSES AND METHODS  employed to transform • tangible inputs (raw materials, semi finished goods, or subassemblies) and • intangible inputs (ideas, information ,knowledge) into goods or services.

Definition of PRODUCTION SYSTEM

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Business Flow in a Manufacturing Company

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A. Craft Manufacturing

• Late 1800’s• Car built on blocks in the barn as workers walked

around the car.• Fixed position assembly• Built by craftsmen with pride• Components hand-crafted, hand-fitted• Excellent quality• Very expensive• Few produced

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B. Mass Manufacturing

• Assembly line - Henry Ford 1920s

• Low skilled labor, simplistic jobs, no pride in work

• Interchangeable parts

• Lower quality

• Affordably priced for the average family

• Billions produced - identical

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Ford Model T Mass Production Assembly Line 1908

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Ford Mass Production Manufacturing Assembly Plant - 1959

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C. Lean Manufacturing • Cells or flexible assembly lines• Broader jobs, highly skilled

workers, proud of product• Interchangeable parts,

even more variety• Excellent quality mandatory• Costs being decreased through process

improvements.• Global markets and competition.

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Modern Assembly Line at Nissan

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Fiat Plant - Welding Line : 2009

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The Nature of Lean Production

• What Lean Production is not– JIT– Kanban

• Characteristics– Fundamental change– Resources– Continuous improvement

• Defined– “A system which exists for the production of goods or

services, without wasting resources.”

Objective of Lean Production System

• Main objective of lean is to remove all forms of WASTE from the value stream.

• Waste includes » cycle time, » labor, » materials &» energy

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Toyota Way

Operational Excellence on a strategic weapon.

- Toyota invented “Lean production” (also

known as TPS) transformed a global

transformation in every industry to Toyota’s

manufacturing & supply chain philosophy &

method.

- Toyota is benchmarked by all peers and

competitors for high quality, high

productivity, manufacturing speed &

feasibility.

TOYOTA AUTOM OTIVE

HINOCom m ercial

PERODUA42%

Com pactAsean

DAIHATSU51%

Com pact

LEXUS100%

Luxury

SCION (US)100%Youth

TOYOTAAll Range

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•TOYOTA PRODUCTION SYSTEM• Lean Production System (LPS) is an assembly-line methodology

developed originally for Toyota and the manufacturing of automobiles.

• It is also known as the Toyota Production System or Just-In-Time production.

• Engineer Taiichi Ohno is credited with developing the principles of lean production after World War II. His philosophy were:

– focused on eliminating waste and – empowering workers,– reduced inventory and – improved productivity.

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TOYOTATOP 10 – RANK BY SALES VOLUME

Toyota –- #3 in 2003- #2 in 2004

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http://www.investortrip.com/3-global stocks-to-buy/

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TOYOTA WORLD MARKET SHARE

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USA MARKET SHARE in 2011

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-10

-8

-6

-4

-2

0

2

4

6

8

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Net Margin %

Porsche

Toyota

Nissan

Renault

Honda

Hyundai

BMW

PSA

DC

VW

GM

Suzuki

Ford

Mitsubishi

Mazda

Fiat

© autopolis/Economist Group/Cambridge University Press 2004. All rights reserved.

Toy

ota

Por

sch

e

Nis

san

GM

For

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TOYOTACAR COMPANY RANK Profit Margin % Returns

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Toyota’s Globalization Process

26Building a TPS House

WHAT MAKES TOYOTA SUCESSFUL & LEAN?

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What makes a PRODUCTION system Lean?

UNDERSTANDING WASTEWaste Often Hides in Plain View

• The chief obstacle to removing waste is that waste often hides in plain sight, or is built into activities.

• We cannot eliminate the waste of material, labor, or other resources until we recognize it as waste.

• A job can consist of 75 percent waste (or even more).• Classic example: brick laying in the late 19th century

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Pre-Gilbreth Bricklaying

Real Example in 1911

• Top: "The usual method of providing the bricklayer with material" (Gilbreth, Motion Study, 1911).

• Bottom: "Non‑stooping scaffold designed so that uprights are out of the bricklayer's way whenever reaching for brick and cement at the same time."

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Post-Gilbreth Brick Laying

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The solution is obvious (in retrospect), but first we have to know that we have a problem!

Material Waste Hides in Plain Sight

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CleaningTank 1

CleaningTank 2

Dirty parts Clean parts

CleanWater

Discard water

CleanWater

The parts get clean, so no one questions this. What is wrong with this picture?

Why Not Make the Water Work Twice?

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CleaningTank 1

CleaningTank 2

Dirty parts Clean parts

Discard water

CleanWater

The almost clean water from the second tank is good enough for use in the first tank. Water usage can be cut 50 percent.

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Definition of “Lean” – according to womack, jones & roos 1990

• Half the hours of human effort in the factory

• Half the defects in the finished product

• One-third the hours of engineering effort

• Half the factory space for the same output

• A tenth or less of in-process inventories

Source: The Machine that Changed the World Womack, Jones, Roos 1990

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Lean Manufacturing is a manufacturing philosophy which shortens the time line between the

customer order and the product shipment by eliminating waste.

CustomerOrder

Waste ProductShipment

Time

CustomerOrder

ProductShipment

Time (Shorter)

Business as Usual

Waste

Lean Manufacturing

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COMPARISON OF LEAN TO TRADITIONAL MANUFACTURING SYSTEM

Case Studies – Boeing Manufacturing Business Unit -

Issues

• Average job moved to 30 different

stations

• Pieces travelled miles throughout the

shop

• Most space was used for storage of

work in progress

• Large inventory

Changes and Results

• Product based cells• Wheels on equipment for flexibility• Storage spaces stocked to

max/min

• Overall travel was reduced between 1 and 3 miles

• Reduced need for forklifts and trucks

Changes and Results

• Reductions of bulk purchasing• Manufacturing occurs in ship sets• Just-in-time scheduling

• 100,000 square feet of storage space reduced

• Off-site storage no loner needed

Boeing - Overall results

• Reduced total cost of 30%

• Productivity improved by 39%

• Defects reduced from 12% to 3%

• Production flexibility increased 40-

50%

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BENEFITS OF LEAN PRODUCTION TO MANUFACTURING PLANT

1. Improved workstation layouts.2. Connected processes with reduced work in progress between

them. 3. Line-side inventory reduction. 4. Warehouse inventory reduction. 5. Improved operational availability on equipment. 6. Change over techniques increase throughput. 7. Make work stations visible, to show up problems, clearly

showing the status of work orders or batches of work. 8. Improved safety in the workplace. 9. Line side storage systems with self managing

replenishment. 10. People will be able to manage these systems for you on the

floor with a very minimum of supervision

Benefits of Lean Manufacturing to the Organization

Lean manufacturing delivers an insurmountable competitive advantage over competitors who don't use it effectively.

(1) Lower production cost higher profits and wages– Cost avoidance flows directly to the bottom line.

(2) Supports ISO 14001 and "green" manufacturing– Reduction of material waste and associated disposal costs

higher profits

(3) Shorter cycle times: make-to-order vs. make-to-stock

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Lean Manufacturing: waste elimination as a

continuous process

The process change are ergonomic improvements and continuous reduction of packaging sizes and lots.

1

2 3

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Current Situation- high non valueadded activities

1. Rack unnecessarily oversized taking up too much space on the line.2. Example of wasted non-value-creating space.3. Onerous operator task.4. Unnecessary motions.5. Operator idleness.

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STEP 11. New logistics2. Small containers3. Compression of spaces4. “Zoning” of cleared spaces: nothing happens here - no mudas.5. Parts within immediate reach of the operators.

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STEP 2:1. Integration of a new model and its parts on the existing line.2. Compressed line side, elimination of a several mudas: Flexibility of the production tool with a considerable increase in productivity.

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The Lean Factory

Summary1. Business activities can contain enormous quantities

of built-in waste (muda, friction).

2. The greatest obstacle to the waste's removal is usually failure to recognize it.

3. Lean manufacturing includes techniques for recognition and removal of the waste.

4. This delivers an overwhelming competitive advantage.

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