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Lean methodology

• Definition: To achieve a manufacturing cycle time of 5 days or less for standard products over 90% of the time.

• Key metrics:– Average Manufacturing Cycle Time– % of Units with an MCT of 5 days or less

• Scope: – Manufacturing Cycle Time (MCT) = Order release to

operations through shipment from manufacturing dock– Sales orders for standard end products

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Lean methodology

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Lean methodology / 4 quadrant chart

Action Plan Resp. Date Root Cause Analysis

1) Implement single piece flow to improve the A. Halteman 1/31/08 1) Batch processing is causing the cycle time in operations to be speed and repeatabiltiy through the greater than 5 days. production line

2a) Update published lead times to 2 weeks A. Halteman 1/18/08 2) The published lead time of 3 weeks has caused the delivery to reflect current process capabilities & J. Dillon expectations from our customers to be > 5 days.

2b) Reevaluate published lead times for A. Halteman 3/14/08additional potential reductions & J. Dillon

Sho-Rate Manufacturing Cycle Time - Dec FY08Four Quadrant Chart Analysis

Reasons for MCT > 5 days

0 100 200 300 400 500 600

Resources

Machined Part Shortage

Non-stock Tube

Other

Purchase Part Shortage

Shipped in 5 days

Req Date > 5 days

Number of Meters

Sho-Rate MCT by Unit

02468

101214161820

Jan-

07

Feb-

07

Mar

-07

Apr

-07

May

-07

Jun-

07

Jul-0

7

Aug

-07

Sep

-07

Oct

-07

Nov

-07

Dec

-07

Bus

ines

s D

ays

ActualTarget

LT distribution- Line #1

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2007M1 2007M2 2007M3 2007M4 2007M5 2007M6 2007M7 2007M8 2007M9 2007M10 2007M11 2007M12

%

Mon

th

Over 2 weeks

2 weeks

1 week

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Lean methodology / Report out

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Lean methodology / CPI

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Lean methodology / Pictures

Lean trainings – everyday examples

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I. Visual Control - No what is going on without anyone telling you o Highway and street signs o Traffic signal - red, yellow , green o Airport signs and display boards o Soccer game score board

II. Five S - Work place organization

o Performing and sustaining Spring Cleaning o See paper on the floor - add to it o See paper on the floor - leave it o See paper on the floor - pick it up o Personal involvement and encouraging to establish and maintain great

housekeeping o Inspecting areas for good housekeeping

III. Standardized Work - Finding the best routine and repeating it

o Your travel to work - the same way each day o Your daily routine - rise up from bed, brush your teeth, shower, dress

yourself o Your weekly routine - work, chores on Saturday and Church on Sunday o McDonald Restaurant - French fries taste the same regardless of location

IV. Kanban - Sell one, buy one

o Grocery store cereal o Milk in your refrigerator o Gas in your car