ADAPTIVE MANUFACTURING: ENABLING THE LEAN SIX SIGMA Enabling lean manufacturing and six sigma...

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Transcript of ADAPTIVE MANUFACTURING: ENABLING THE LEAN SIX SIGMA Enabling lean manufacturing and six sigma...

  • ADAPTIVE MANUFACTURING: ENABLING THE LEAN SIX SIGMA ENTERPRISE

    SAP White Paper

  • © Copyright 2005 SAP AG. All rights reserved.

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  • Executive Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

    Real-World Awareness: Making Lean Leaner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 A More Pragmatic Approach to Lean Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

    Adaptive Manufacturing Enables the Lean Six Sigma Enterprise . . . . . . . . . . . . . . . . . . . . . . . 7 The Lean Enterprise Must Become Adaptive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Lean Manufacturing and Six Sigma Drive Management by Exception for Continuous Improvement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

    Leveraging Enterprise Applications to Enable the Lean Six Sigma Enterprise . . . . . . . . . . . 11 Leveraging ERP to Enable Lean Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 – The Challenge for Stand-Alone Lean Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 – Managing an Environment of High Product Variety and Demand Variability. . . . . . . . . . . . . . . . 11 – Balancing Push-Pull to Enable Lean Manufacturing for the Real World . . . . . . . . . . . . . . . . . . . . 11 – Higher Visibility: A Management by Exception Requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Leveraging ERP to Enable Six Sigma . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 – The Challenge for Stand-Alone Six Sigma . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 – The Need for Accurate Data and a Scalable, Zero-Latency Architecture . . . . . . . . . . . . . . . . . . . . 13 – Analyzing Complex Interactions with Business Intelligence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

    SAP: Enabling the Adaptive Lean Six Sigma Enterprise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 SAP Manufacturing: Lean Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 – Flow Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 – Just-in-Time and Just-in-Sequence Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 – Demand-Driven and Make-to-Order Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 – Advanced Repetitive Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 – Support for Kanban Techniques . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 – Safety Stock and Buffer Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 – Customer and Supplier Collaboration Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 SAP Manufacturing: Six Sigma Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 – The DMAIC Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 – Six Sigma Project Management Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 – Six Sigma Analytical Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 – Six Sigma Statistical Process and Control Chart Capabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 – Proactive Asset Maintenance Capabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

    Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

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    CONTENTS

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    Manufacturing continues to become a commodity within the value chain. That fact is indisputable. The greater the rate of manufacturing commoditization, the greater the focus on creating efficiencies that drive down product costs. From the world’s largest computer manufacturer to the world’s largest automotive manufacturer, companies that create value that are orders of magnitude greater than their competitors do so because they relentlessly focus on “leaning” their manufactur- ing operations without compromising their ability to adapt dynamically to the vicissitudes of their markets.

    Given the current pressure on product margins, lean manu- facturing principles provide an excellent framework for squeezing costs out of manufacturing. Lean manufacturing principles provide a strong foundation to support many manu- facturing methods, including make to order, assemble to order, repetitive manufacturing, and a host of other methods. How- ever, lean manufacturing by itself is not enough for success. With today’s volatile demand and fragmented supply environ- ments, you must combine lean manufacturing principles with the principles of six sigma so you can understand and address the causes of variability and better manage exceptions.

    However indisputable the benefits of lean manufacturing and six sigma, in today’s fast-moving, complex business environ- ment, you must continually adapt. You must do so by handling large amounts of data and executing complex workflows while electronically communicating any exceptions simultaneously to multiple locations. In an environment like this, you need en- abling software applications and a stable technology platform. Without IT, your organization can’t be a truly lean or six sigma enterprise. To create an adaptive manufacturing environment, you must be able to access real-time information from the plant floor and the supply chain and then use this information to manage exceptions with enterprise resource planning (ERP) and supply chain management (SCM) applications.

    Enabling lean manufacturing and six sigma principles to im- prove operations requires a nontraditional approach. The old idea that lean manufacturing and six sigma principles don’t require IT just isn’t valid anymore. ERP and SCM applications are critical for enabling a holistic, lean manufacturing opera- tion, and they work hand in hand to better enable consumption – not forecasts – to drive replenishment.

    SAP® solutions support both lean manufacturing and six sigma principles so you can intelligently adapt to exceptions and build a lean and six sigma–compliant enterprise that lays the foundation for value creation.

    EXECUTIVE SUMMARY

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    Since the start of the industrial age, every profitable manufacturer has done one t