LEAN

TheSimplifiedBeginner’sGuidetoLeanSecondEdition

BenjaminSweeneyinpartnershipwith

Contents

ACCESSYOURFREEDIGITALASSETSINTRODUCTION|1|SIXCOMPONENTSOFLEANPHILOSOPHY

1.EliminationofWaste2.ABroadView3.Simplicity4.ContinuousImprovement5.Visibility6.Flexibility

|2|LEANPRODUCTIONThePullProductionSystemValueStreamMappingKanbanTaktTimeJust-in-TimeSmallLotProductionSingleMinuteExchangeofDieTotalQualityManagementTheHighCostofPoorQualityFacilityLayout&UniformProductionLevelingOtherTools:SixSigmaOtherTools:LeanSixSigma

|3|THELEANTOOLKITIshikawaDiagrams(FishboneDiagrams)ToolsOutsideofManufacturing:FishboneDiagramsSpaghettiPlotPoka-YokeTheDecisiontoOutsourceTheTheoryofConstraints

|4|IMPLEMENTATIONCONSIDERATIONSRespectForPeopleThe5SMethodThePathtoImplementationImplementationConcerns

CONCLUSIONAPPENDIX

GLOSSARYANSWERSREFERENCESABOUTCLYDEBANK

Termsdisplayedinbolditaliccanbefounddefinedintheglossary

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Introduction

The Leanmodel for production andmanufacturing is a collection of businesspractices,strategies,andmethodsthatfocusonwasteeliminationandcontinuousimprovement within an organization. Often referred to simply as “Lean,” thisbusiness model has applications in every industry, not just the world ofmanufacturing. All businesses, and many organizations outside the businessworld,canbenefitfromLean’srigorousandvigilantapproachtowastereductionandefficiency.Lean is a management philosophy with a holistic approach that was

interpreted from the Toyota Production System, an operations and corporateculture system developed by the popular and highly successful automobilemanufacturer,Toyota.AtthecenteroftheLeanbusinessconceptistheefforttoeliminate three types of manufacturing variation and waste: muda, mura, andmuri.Muda represents waste in its most physical form, and it directly translates

fromJapaneseas“futility”or“uselessness.”Theobjectivewithwastereductionand elimination is to clearly separate the value-added activities from theactivitiesthatareidentifiedaswastefulornon-value-added.Mudaistheeasiestformofwaste tounderstand. It iswhatmanyorganizationswould traditionallyclassifyaswaste:defectiveproduction, timespentperformingnon-value-addedactivities,unnecessaryinventory,etc.Thesespecificformsofwaste,aswellasseveral other sourcesofmuda, are identified andoutlined indetail in thenextsection.Muraiswasteinthesenseofunevenness.Distinctfrommudaandmuri,mura

islesseasilyquantified,thoughnolessimpactfulonoperations.Unevennessinworkflowcanresultinunnecessarydowntimesorperiodsofunnecessarystressonequipment,systems,andworkforce.Fromamanagementstance,unevennesscreates another element that all business practitioners seek to eliminate:uncertainty.Irregularintervalsaredifficulttopredict,andtherefore,forecastingbecomes difficult. A high degree of uncertainty can greatly reduce theresponsiveness of an organization’s supply chain. Mindfulness of mura isessential when determining facility layout or assembly protocol as well asunderstandingand improving the long-termforecastingabilitiesandshort-term

processesforanorganizationandtheabilitytorespondtofluctuatingdemand.Muri is a failure to understand capabilities or to succumb to the effects of

overburden. This is a tangible concept when applied to facility layout andassemblyandmanufacturingprocesses;toomuchofaworkloadonasystemcancause failure or increase rates of defective production. Overburden inconjunctionwithunevennesscanalsocreateexpensivebottleneckingwithinanorganization.Wearandtearonmachinesorrepetitivestraininjuriesamongtheworkforcecanbereducedoralleviated throughensuring thatonlyvalue-addedactivities are being performed, aswell as through reduction ofwaste in otherareas.

In conjunction with the overriding value of waste reduction throughidentification and elimination ofmuda,mura, andmuri lies the philosophy ofkaizen,orthecreationofacultureofcontinuousimprovement.Theconceptofkaizenisaspowerfulasitisversatileand,inpractice,canbeimplementedinamultitudeofwaysthatspandiverseindustries.Kaizenisamindsetasmuchasabusiness asset, and represents organizational culture more than a set ofmanufacturing tools.Permeatingall levelsof theorganization,kaizennotonlylays thegroundworkfor the implementationofLean,butalsoguidesdecision-making, innovation,and improvementatboth themicroandmacro levels.Theconceptofkaizenissopowerfulthatevenpersonaltrainersandlifecoachesusesimilar approaches with the individual lives of clients seeking to betterthemselves.ManyaspectsoftheLeanproductionsystembuildonthiscommonthreadof

kaizenandrigorous,continuousimprovement.AsweexploretheworldofLeanproduction,theconceptofkaizen,ifnotimplicitlystated,willbeevidentinbestpracticesandprescribedmethods.Though itsorigins lie squarely in themanufacturingsector, the less tangible

aspectsofLeanmeanthatitcanbetailoredtofitnearlyanyorganizationfromthe service sector, like healthcare firms, insurance agencies, governmentagencies, and beyond. Since Lean is a blend of keen, structured businessimprovementinsightsandefficient,impactfulmanufacturingtools,organizationsinother industrial sectorscanstretch theLeanmodel to fit theiroperations. Inadditiontothedata-drivenandday-to-dayproductivitytoolsthatareallpartoftheLeantoolkit,therealpowerofLeanliesinthecreationofavigilantmindsetamongtheentireworkforce,fromworkersontheassemblylineallthewayuptothe CEO’s office, that the elimination of waste, the need for continuousimprovement, and the idea that anyone can effect positive change within theorganizationareessentialforafirm’ssuccessandlongevity.What follows is a primer on the concepts and ideas that drive the Lean

business model and the key components of the winning mindset that keepscontemporarycompaniesonthemap.

|1|SixComponentsofLeanPhilosophy

InThisChapterThesixcomponentsofLeanphilosophyareexploredindetailTheD.O.W.N.T.I.M.E.sourcesofwasteareillustratedThePDCAmethodandA3problemsolvingapproachareexplored

Whiletheconceptsofwastereductionandcontinuousimprovementexistinallaspects of Lean, there are also six primary qualities that organizations shouldembody tomaintainacompetitive, responsive,and flexiblepositionwithin themarketplace.Inmanycases,managementguruspraisetonoendthemindfulnessof these qualities as keys to a successful business in today’s marketplaceregardless of their implementation of Lean. Prior to the “leap to Lean,”companies shouldalreadyhavea focuson thesecharacteristics inone formoranothertoestablishasolidfoundationonwhichtobuildtheLeanculture.Beforethe foundational pillars of Lean are addressed, let’s look at some basicdefinitionstobetterunderstandtherelationshipbetweenLeanandvalue.At its core, the Lean manufacturing system strives to differentiate between

value-added and non-value-added activities. Allmanufacturing activities incurcost; value-added activities incur cost that can be passed on to the customer.Theseactivitiesarenecessarytoproducegoodstothecustomer’sspecifications,thoughonlytheseactivitieswillgenerateresultsthatthecustomerwillpayfor.Any other activities are considered non-value-added, and are classified as

waste.Wasteeventsareactivitiesthatincurcost,butthatdonotgeneratemorevalue,utility,orsatisfactionforthecustomer.Awell-knownculpritofwaste(byanydefinition) isdefectiveproduction.Whenapart isgeneratedwithadefect,the customerwill not pay for that unit. Themanufacturer can’t insist that thecustomerpayjustbecausethemanufacturerincurredcostingeneratingthepart;thereisnovalue,andthepartmustbeconsideredaloss.A less obvious source of waste is carried inventory. There is no value

provided to a customer merely because a warehouse has kept units on the

shelvesformonths.Mostmanufacturedgoodsarethesameafteraweekasafterayear,butayear’sworthof inventorycostscan’tsimplybeaddedon toeachunitthatdoesn’tsell.Once the differentiation of what constitutes value-added activity and what

constituteswaste (non-value-added) iscomplete, theprocessof reducingwastecanreallybegin.Visibilityleadstoaction,andsourcesofwastethatareinvisibleor undetectablewill gowithout remedy indefinitely.A common theme amongLean tools is that theirultimategoal is thedetectionandexposureofwaste. IfkaizenistheenginethatdrivesLeanorganizationstonewheightsofefficiencyandproductivity,thenwastereductionisitsfuel.

1.EliminationofWasteAs we have discussed, the elimination of waste is a concept central to the

Lean framework. While we know that muda, mura, and muri are the threesourcesofwastewithinaproductioncycle, it isnecessary tonarrow the focusandaddresseachofthesesourcesindividually.Mudaistheeasiestofthethreemanufacturingvariationstocategorize.Almost

all of the physical sources of waste within production processes fall into theclassificationofoneofthefollowingeightsourcesofmuda.Together, the eight sources of waste encompass a very diverse number of

individualanduniquecircumstancesandthecostsassociatedwiththem.Whileeverypossiblewasteeventwouldbeimpossibletocataloghere,thislistcreatescategories used for identifying and addressing waste. The acronymD.O.W.N.T.I.M.E.canbeusedtoremembertheeightsourcesofwaste.

DefectiveProduction

Defects equal cost andwaste.Extra costsmaybe incurred through reworking,scrap,productionrescheduling,oradditional laborcosts. Insomecasesdefectscanmorethandoublethecostofproductionforapart.Defectiveproductionisclearlyanon-value-addedactivity;thecosttoproducedefectivepartscannotbepassedontothecustomerandmustbeconsideredaloss.

Overprocessing

Any timeapieceorproduct receivesmoreprocessingwork than is absolutelyrequiredbythecustomer,itisanoverprocessingwasteevent.Whileprocessingto the customer’s needs is certainly a value-added activity, customerswill notpaymoreforunnecessarywork.Additionally,furtherprocessingcouldresultinthecreationofnewwasteeventssuchaswastefulmotion,unnecessarywaiting,inventory and transportation costs, and the increased risk of defectiveproduction.Overprocessingpresentsachallengetoorganizationsthatdonothaveahigh

degreeof visibility in the supply chain or havepoorly established channels ofcommunication.That is to say that cooperation and coordination are often theobviousremediesforoverprocessingwasteevents.Ahighleveloffocusonthecustomer’sneedsandcustomerservice,alongwithcommunicationatall levelsof production, are effective methods of eliminating the root causes ofoverprocessing.Laterwediscussthepullproductionsystem,anothermethodofcombatingoverprocessingandwaste.

Waiting

In circumstances in which goods are not being processed, consumed, or intransport, they are assigned the “waiting” status.Waiting is not a value-addedconditionand representsahighdegreeofwasted timeandeffort thatcouldbebetterspentonvalue-addedactivities.Theeliminationofwaiting-relatedwasteeventsislargelybasedonchangesto

operations and logistics protocols. Effective plant loading and facility layout,too,canhighlyimpacttheamountoftimematerialspendswaiting.Aneffectiveproductionsystemmovesgoodsquicklyandefficientlyinasteadyflow;smart

facility layout is the first step in combating the frequency of “waiting”wasteevents.

Under-UtilizedEmployeeTalent

While the other seven sources of waste have concrete causes, outcomes, andconsequences, untapped employee talent is a harder resource to quantify. Inmanycases,theassociatedcostisbestdescribedasan“opportunitycost”andisdifficult to assign a price tag to.Determiningwhen employee talent has beenwasted in the first place also comeswith challenges, but by using the variouselements of Lean an environment can be developed in which employees canflourishandliveuptotheirpotential.WhiletheLeanmodelprovidesguidelinesforbusinesspracticesandtactical

decisions,itisbynomeansamethodofleadership.Allcompanieswouldliketobeabletosaythattheirmanagershaveasharpeyeforrisingtalentandthattheirworkforcedistributionisthemosteffectiveandefficientgivenitselements.Asdiscussed in the next section, Lean’s focus on visibility and creating anenvironment of continuous improvement can foster an atmosphere in whichemployeesareencouragedtoparticipate.Leanalsodevelopsacorporateculturethatprovidesguidanceandmethodsforemployeestospeakupandincentivizesthemtocontribute to their fullestpotential. If there isanexpectation thateachandeverymemberoftheorganizationwillvoiceconcernsinregardtomethodsof improvement, then the channels of communication shouldmake employeesequallycomfortableapproachingmanagementwiththeirinterestorskillsrelatedtootherdutiesandopportunities.Thehumanelementofanorganizationiseasilyitsmostvaluableandcertainly

themost difficult to replace. Creating andmaintaining programs that uncoverand leverage employees’ skills and interests will result in higher workforcemotivation.Employeeswill feelvalued(andtheyshouldbevalued).Theywillhave a higher level of job satisfaction and a higher overall respect for theirproduct,brand,andworkplace.

Transportation

Transportation is a non-value-added activity. Delivery is the only form oftransport for which a customer is willing to pay. Additionally, each time aproductismoved,itisexposedtoriskssuchasdamage,delay,orloss,andwill

incurcosts.Transportationisinevitablyanecessaryexpenditureinmanycases.TheLeanphilosophydoesnotprescribethatgoodsshouldstayinwarehousestoavoid transportation costs altogether, but rather advises that transportationshould be minimized and identifies it as a non-value-added activity. Sensibleproduction, focus on materials flow, and responding to the Voice of theCustomerarealleffectiveremediestocombattransportationmura.Transportation and waiting converge in the area of facility layout and the

production cycle. Many organizations could benefit from deconstructing theirproductionmethod,thenrebuildingitfromthegrounduparoundtheproductandaround theneedsof thecustomer,orevenbetter,aroundadesire tobeable toquicklychangetomeetthechangingneedsofthecustomer.Thefocus,however,willvaryfromindustrytoindustry.

Inventory

Inventoryinallforms(rawmaterials,workinprogress,finishedgoods,supplies,etc.) represents income that hasnotbeen realized and,more importantly, cost.Inventorythatisatanytimenotbeingactivelyprocessedisconsideredwaste,asanyotherproductionstateisanon-value-addedactivity(alsowaste).On-handinventorycanpotentially incurveryhighcosts,andthereforemany

organizations are employing methods such as small lot production, pullproductionsystems,andJust-in-Timeinventory,allofwhicharediscussedlaterin this text.Thetopicof inventory inregardtoreductionandrelatedcosts isapopularone.Anentireindustryofthird-partylogisticsprovidershasevolvedtohandlenotonlytransport,butinventorymanagement,warehousingandstorage,andevenorderfulfillmentanddistributioncentermanagement.In this manner, some companies choose to outsource their inventory

management and the warehousing of some or all of their finished goodsinventory, in addition to their distribution and delivery channels. This can bebeneficial especially in the realm of Just-in-Time inventory; however,interfacing with an outside company can potentially lead to communicationerrorsandschedulingissuesifexecutedincorrectly.In the instance of a company attempting to implement the Lean model, thetemptationtooutsourceand“clearyourplate”ofcostsandwastecanbehigh.Itis important to remember that if the third party logistics provider you choosehasn’t implemented their own waste reduction program or doesn’t have aclearly-establishedvaluechain,theywillpassthosecostsbackontoyouoryour

customers.Thiseffectivelynegatesthewastereductionattempts.Thedecisiontooutsourceshouldbethoroughlyinvestigatedandiscoveredindetaillaterwithinthistext.

Motion

Motionrepresentswastedworkintheliteralsenseoftheword.Non-value-addedmotion is any wear and tear, other than what is absolutely necessary forproduction,onmachinesthatproducevalue-addedactivity.Thisconceptisalsoapplicable to the workforce in the form of repetitive strain injuries or ofproductivitymaximizationprograms.Motionisaninterestingwastetoaddress.Inmanycircumstancestheconcept

of delegating repetitive or repeatable precision-focused tasks to machine orcomputer-integratedcomponentsinsteadofworkforcecomponentsisafavorableoption for reducingwasted humanmotion aswell as the risk of human error.ThisLeanconceptofwasteexaminesthetotalityoftheactionanditsroleasavalue-added activity regardless of bywhom it is completed. In this sense, thescalesaretippedbythecustomer’sneedsandtheroletheactionorprocesshasinfulfillingthoseneeds,andthereforetheactionisevaluatedwithoutbias.There are a variety of ways to determine levels of motion, from visual

observation to electronic monitors. Non-value-added motion can be reducedthrough the application of continuous improvement methods and processanalysistogeneratenew,moreefficientprotocols.

ExcessiveProduction

Wastefulproductionoccurswhenmoreproductsareproducedthanthecustomerrequires. Traditional manufacturing of large batches is a major culprit ofexcessive production, and with businesses needing to become increasinglyflexibletomeetchangingcustomerandmarketneeds,excessiveproductioncanrepresent largecircumstancesofwasteornumerouswaste events. In thisway,excessiveproductionisconsideredthemostseriousformofwasteduetothefactthatitgenerateswasteeventsinotheraspectsofproductionaswell.Excessiveproductionislinkedtowasteintheareasofinventory(storageand

liquidation), transportation,andmotion.And likedefects,excessiveproductioncan cause waste through reworking or through scrap, or prevent the timelydetection of defects within quality control systems. The uniform flow of

materialscanalsobedisrupted,causingotherwasteeventsintheareasofmuriand mura (overburden and unevenness). With the replacement of traditional“push” production systems and a focus on smaller batch production,organizationshavefoundmanufacturingandproductionprotocolstohelpreducewasteeventslinkedtoexcessiveproduction.

2.ABroadViewWhilethefirstaspectdealswiththeall-importantprocessofidentifying—and

reducing—waste,thesecondcomponentofLeanphilosophydealswithstrategyandplanning.Leanfocusesonthinkingstrategicallyandincorporatinglong-termplanningintoeverydayoperations.Anorganization’ssuccessshouldbeviewedwithafocusonthelongtermandinthecontextoftheindustry-at-large;short-termgainsarenotareliablemeasureofsuccess.Thisapproachisnotintendedtotrivialize short-term development, but rather to put it in perspective towardmaintainingacompetitiveadvantagewithinagivenindustry.If,forexample,afirm’sgoalistoacquirethelion’sshareofthemarketwithin

whichtheyoperate,thenalargevarietyoffactorsmustbetakenintoaccount.Ifthisfirm’s(FirmA)salesgoalsareconsistentlybeatenby9percenteachquarter,that iscertainlygoodnews.Whentakingabroadview,however, thefirmseesthat a competitor (FirmB) is consistently beating their own sales goals by 11percent. This is still not quite the big picture and doesn’t present instructiveinsight.FirmBownsasmallermarketsharethanFirmA,andthoughsalesareonthe

rise,thatsmallermarketsharetranslatesintoloweroverallprofits.WhileFirmBismakingaggressivesales,FirmAisstillontracktotheirstrategicgoals.ThiscontextualizestherateofFirmB’sgrowth,andcanhelpdecisionmakersatFirmAfurtherrealizetheirorganization’sgoals.Conceptually,thebroadviewapproachcanbeimplementedattheday-to-day

level by matching tactical and operational tasks and decisions with strategiclevel goals and avoiding tunnel vision style production. Tunnel visionproduction focuses on the product or the process and not on the customer,thereforemakingnon-value-addedactivitieshardertodetectand,inmanycases,leadingtoexcessiveproduction.FirmA’sstrategicgoalwastocontrol thelargestmarketshareineachofits

businesses’productlines,butperhapsthestrategicgoalofFirmBwastooffersuperiorserviceandquality.Thesebroadviewstrategiescanbereducedtotheir

simplesttermsbyworkingbackward—superiorservicemeanson-timedelivery,on-time deliverymeans tight scheduling on the factory floor, tight schedulingmeansexaminingprocesses,etc.Oncetheday-to-dayfunctionalbuildingblocksare established at the production level, their supervision and execution can betiedtothebroadviewstrategyandhelpalignbusinessactivitiesatalllevelsoftheorganization.Thepracticeofaligningdailyoperationswitha“broadview”mentality ensures that all decisions are matched appropriately to theorganization’slong-termgoals.This approach alsohelpsorganizations to avoidbecoming toogoal-focused,

which at face value doesn’t sound like a negative circumstance at all. Butconsider this: if a team or a department is too focused on simply reaching itsestablishedgoalsorconformingtoitsspecifiedbudget,thenthereisasignificantopportunity for those individuals to lose track of the company’s overallwastereduction goals. Work could be done toward goals that don’t fit into thecompany’sstrategicposition,creatingmorework,whichinevitablywillbenon-value-added waste. Work could be done to meet a deadline “at all costs,”creating waste through overburdening or production that is at high risk fordefects. At all levels of the organization, goals should be uniform and eachshouldrepresenttherealizationofanothersteptowardlong-termgoals.Thisprocesscreatesa“checksandbalances”environmentthatnotonlykeeps

the organization on track with its long-term strategy but also gives front-linemanagement a structure for decision-making. When implementing a newproductionscheduleorexaminingcurrentfacilityload,thedecision-makerneedstocomparehisorherplantotheoverallplanandaskthequestions:“Doesthisprogramreflectthecompany’sdesiretofulfill thesecriteria?”and“Howdoesmyplanconformtothecompany’swastereductionstandards?”Thisapproachminimizes waste created by the front line having to “change gears” as theirperformance fluctuates from the strategic level plan. The concept of a broadviewisdesignednotonlytokeepacompany’soperationsontrack,butalsotoreducewasteinallforms:overburden,unevenness,andwastefulproduction.In conjunction with visibility, another of Lean’s core philosophies, an

organization that utilizes a “broad view”mentality should consider its supplychain in the context of a network instead of a number of singular buyer andsupplierrelationships.Thisinclusivecontextreflectstherelationshipsthatthosesuppliers have with suppliers of their own, and reflects the relationship anorganizationultimatelyhaswiththedownstreamenduser,evenifthatcustomerisremovedfromtheorganizationbyotherfirms.

3.SimplicitySimplicityisagoldenruleinmanyfields.Ifcompanies“reapwhattheysow,”

thensimple inmeanssimpleout,andaprocess thatproducessimple is simplethroughout. Simplicity reduces the human error component inmany cases andcanmakefixingerrorseasieraswell.SimplicityalsospeakstotheLeanbusinessmodel’s waste reduction approach. Focusing energy and resources on acomplicated problem can be alleviated by reducing a complex scenario intosimplerparts,andsimpleproblemsgenerallyhavesimplesolutions.Simpleprocessesareeasiertoteach,andtheyareeasiertoimplement.Simple

configurations have lower chances of producing defects or errors due tomalfunctionsor“movingpartsyndrome.”Derivedfromtheno-nonsenseworldof engineering,movingpart syndrome is the theory that the chances of defectincreasewiththenumberofmovingparts.Simpleoperationsareeasiertomonitor,andsourcesofwastearemoreeasily

identified. In some production applications a simple approach may meanreducingthenumberofprocessesorcyclesataspecificworkstation.Thismaycreate more workstations but will improve flexibility, allowing the process ateachworkstationtobetweakedtocompensateforchangingproductionneedsortorectifydefectiveproduction.AnotheraspectofLean’ssimplisticapproachisapparentinwhatcreatingan

effective value stream strives to do in the first place: differentiate betweenvalue-added and non-value-added activities. This is certainly not necessarily asimple task, butwith the narrowing of focus comes a lessening of clutter andmixedsignals.ItisinthisspiritthatLeanfocusesnotondepartmentsandtheirfunctionsbutontheprocessesthemselvesthatcreatetheproductsandvalueforthe customer. If the process is established as the most important aspect ofproduction, then the departments will be restructured as needed or taskedaccordinglytomatchtheflowofvalue-addedactivities.Simplicityalsoreduceswasteful motion. If every activity and task at a workstation is as simple andproductiveasnecessary,thereislessroomforunneededmotion.

4.ContinuousImprovementThekaizenculturebuiltaroundcontinuousimprovementaffectsacompanyin

the most positive way possible. This concept makes for an “easier said than

done” situation, but it is essential for contemporary firms to maintain theircompetitiveedge.Inadditiontoallofthemeritsthathavealreadybeentouchedonaboutthecoreofkaizen,acultureofcontinuousimprovementalsocreatesacorporate environment that is receptive to change. This is essential in thecontemporarymarketplaceandisanassetforanyorganization.Change can come from a multitude of sources, changing customer needs,

market fluctuations, natural disasters, threats from competition, and regionalattitudesbeingjustafewexamples.Companiesthatdon’tchangegetleftbehind,and a companywith a healthy attitude toward change canmaintain a flexibleposition within its industry, which is another core component of the Leanphilosophy.The concept of continuous improvement is not only enabled by staff at all

levels but by company policy and practices. Many of the Lean componentsreflect the foundation thatanorganization requires to tirelessly self-improve—specifically a drive for simplicity and visibility, but also the focus on wasteeliminationandemployeecontribution.Astrongappreciationforemployeesandtheireffortsatimprovementwillhelptogenerategoodwilltowardthecompanyat the very least, and at the most will push the organization to new heightsthrough the most effective utilization of its employees. The original ToyotaProduction System innovation arose from time spent dedicated to kaizenactivities. These activities reflected brainstorming, process observation, andmandatoryimprovementsuggestionsfromalllevelsofstaff.In implementation, the kaizen system represents a cycle. Continuous

improvementisnotaone-timeactivitybuttheproductofongoingefforts.Thiscycle of process examination is also referred to as PDCA (Plan, Do, Check,Adjust), the Deming cycle, or the Shewhart cycle. In each iteration of theprocess, thespecificcomponentsareimplementedwithslightvariation,buttheobjective and method remain the same. These programs represent cyclicprocesses that strive for continuous improvement and provide a template forachievement. Within the Toyota Production System, kaizen activity can berepresentedasaseriesofstepsthatworkinconjunctionwithPDCA.

SetoperationsandactivitiestoauniformstandardMeasureoperationsandactivitiestoestablishabenchmarkComparebenchmarkstorequirementsorgoalsIncreaseproductivityandreducewastethoughinnovationRe-measuretoestablishanewbenchmarkandverifysuccessfulprogress

Restartthecyclewiththenewlystandardizedoperations

PDCA

PDCAfollowsthesameconceptofproductandprocesscontrolaswellascontinuousimprovement.Planningencompassesestablishingobjectivesandmethods for reaching those objectives or goals. If the changes needed aresweeping or far-reaching, it can be prudent to test methodology on a smallerscaleorincircumstancesinwhichtheconsequencescanbetrackedormitigatedasneeded.The“do”portionistheexecutionoftheplan.Datacollectionatthisstage is necessary for the next two stages and to measure goal achievementthroughout.

Checkingusesthedatacollectedfromtheprevious step compared against the results and, more importantly, the goalsestablishedintheinitialplanningstage.Herevariationfromtheplanshouldbeidentified as well as any differences. Variation is important in two ways.Primarily, variation can be deviation that falls short of established goals(failure), but it can also have unexpected positive consequences.While theseoutcomeswereneitherplannedfornoridentifiedfromtheoutset,variationthatgeneratespositiveoutcomesshouldbeidentifiedandloggedforuseinthenextstep.KeepinganopenmindwhenconductingperformanceevaluationssuchasthePDCAprocessisimportantandhelpsensurethatnosolutionisleft“onthetable.”Anopenmindandawillingness to listen tobrainstorm-style ideas is anecessitywiththeimplementationofkaizen-stylecontinuousimprovement.The final adjustment stage is the implementation of corrective action.

Corrective action should be implemented only after the sources of negativevariation can be identified to avoid wasteful action, and all corrective actionshould be precise and targeted specifically to work in tandem with goalachievement.ButwhatifthePDCAprocessdoesn’tproduceinnovation?InaninstanceinwhichthePDCAprocessproducesnovariationandnoroom

for improvement, the scope of the process can be scaled down to reducecomponents to their constituents. Decision makers should consider narrowingthe focusofPDCAefforts.OradeadendPDCAimprovementprocesscanbere-targeted to examine the problem from another angle. If that doesn’t workeither, perhaps the barrier lies at the workstation before, after, or within anunexpectedaspectofproduction.Covered later in this text, Ishikawadiagrams(aka fishbone diagrams) are effective cause-and-effect maps that get to thesourceoftheproblemanddirectimprovementefforts.

A3ProblemSolving

ApracticaladaptationofthePDCAprocesscycleistheA3approachtoproblemsolving.A3problemsolving—alsoknownasSystematicProblemSolving(SPS)—is a structured approach that uses a single ISOA3 (11”x17” size) sheet ofpaper to employ eight prescribed problem-solving steps.While the number ofstepscanvary,thefollowingdetailcoversabasicoutlinefortheA3method.

1. InitialPerceptionsThis is a description of the problem to serve as a background for theproblem-solvingeffortathand.Framedasabusinesscase,thebackgroundincorporates details such as strategic impact, financial impact, impactacross the organization, supply chain impact (both upstream and down),andanyotherpertinentdetails.While quantitative data may be useful at this stage, information that isselectedshouldprimarilybequalitative.

2. BreakdownoftheProblemThis isa statement thatconsistsof identifying thecausesandspecificsoftheproblem.Thiscouldbethroughstructuredanalysisusingsomethinglikethe 5W1H method (covered later in this text) or any other structuredinvestigativemethod.Thisstep isdefinedasanactionableclarificationof theproblem,and it

shouldincludemorequantitativethanqualitativedata.

3. TargetSettingEstablishingwell-definedgoalsthatseektoremedytheproblemdetailedinthe last step is the purpose of the target setting stage. Firm goals—goalsbasedonbothqualitativeandquantitativedata.Theoverallpurposeofthisstageistodeterminewhatthisundertakingisattemptingtoaccomplish.Itisimportanttonotethatthefewertargetsthataresetatthisstagethe

better. The purpose of the A3 problem-solving method is to narrow thefocusofeffortswhilesimultaneouslycompletelyscouringouttherootofaproblem. As is often stated, this is a common theme in Leanimplementation and is in line with the overriding concept of kaizen andwastereduction:continuousincrementalimprovementandthereplacementofinefficiency(non-value-added)withefficiency(value-added).

4. RootCauseAnalysisThis is the thoroughexplorationof themostbasiccausesof theproblem.Bybuildingonearlier investigationsandusing toolssuchas theIshikawa(fishbone) diagram, the root causes of the problem are discovered andrecorded.Depending on the complexity of the problem, this stage may vary in

durationandeffort.Ifthescopeofaproblemisfoundtobesystemic,ortoolargeinscopetobeaccuratelysummarizedusingasheetofA3-sizedpaper,

thennotonlyisthefocustoowidetoemploythismethod,butother,moredrastic,measuresshouldbetaken.

5. CorrectiveActionsBasedontherootcausesoftheproblemathanddeterminedinthelaststep,countermeasuresaredevisedtodothefollowing:

a.correcttherootcauseandremedytheproblemb.maintainafocusontheestablishedgoalsandaim

forthetargetsthathavebeensetThisstepshouldconsistofadetailedplanthatprescribestargetedaction.

Corrective action plans should specify resources to be allocated and thepeoplewhowillparticipateindeploymentandexecution.

6. ConfirmationofEffectOncethecorrectivemeasureshavebeenimplemented,monitortheresults.Wereyoureffortssuccessful?Didthisprogramcorrectlyascertaintherootcausesoftheproblemathandandreducetheimpactsstatedinthebusinesscaseoutlinedwithinthefirststage?The results of this stage are critical in determiningwhat the follow-up

actionwillbe.

7. Follow-UpAction

Thisistheappropriateactiontobetakenoncetheeffectofthecountermeasureshasbeendetermined.If theproblemhasbeensuccessfullyeliminated, then thecommunication of your success is in order. Termed “lateral deployment offindingstoothergroups”1thisfollow-upactioniscriticaltowastereductionandthe sustainment of gains. Once rolled out across the organization, this newstandardofefficientoperationbecomesthebenchmarkforcontinuedgrowth.Thereisnocommunicationofsuccesswithoutsuccess,however,sothereport

offindingscannotbemadewithoutalsosustainingtheachievementofthegoalsestablished within the target-setting stage. In true form to the PDCA system,eachoftheA3activitiesisbetterdescribedasaprocess,andtheproblemsolvingsystemiscyclicasaresult.This means that a failure to achieve goals means going back through the

processanddeterminingwhatadditionalcorrectiveactionisnecessary.Thismaymean further investigation into the root causes of the problem. Itmaymean anarrowerfocus,orselectingandmappingalternativecountermeasures.

fig.7:AsampleA3mastersheet.Notethattheterminologywithineachofthestepscanvary,thoughtheintentremainsthesame.

fig.8:TheA3problem-solvingmethodframedasanextensionofthePDCAcycle.NotehoweachoftheA3stepscanbeclassifiedascorrespondingtoaportionofthePDCAmethod.

5.VisibilityVisibilitywithinanorganizationandwithinanorganization’ssupplychainis

muchmorethanorganizationaltransparency.Wastecanonlybeeliminatedifitcanbeidentified,andinvisiblewastewillgoonuncheckedindefinitely.Inshort,visibilityleadstoaction.Thisphilosophypermeatesalllevelsofoperation,fromtheCEO’sdeskall thewaydown to themail room. Inapractical,operationalimplementation, facilities should be open and uncluttered. Software systemsshould likewise be clean and uncluttered. Company correspondence andcommunicationchannelsshouldneverbechaoticorgarbled.Thefreesharingofinformationbetweendepartmentspreventscrossedsignals

and provides more opportunities for problems to be spotted. It also promotesefficiency and reduces thewaste of overproduction or doublework. Clutteredworkenvironmentscanfosterstressandconfusion,aswellasdisrespectfortheworkplace. Itmaysound likesynergymumbo jumbo,butcreatingacultureofvisibility among your workforce means a better work environment and afoundational stepping-stone toward a culture of continuous improvement andorganizationallongevity.While each of the six Lean philosophies is integral to overall success,

visibility is unique in its enabling capacity. In a visible supply chain,waste iseasily identified and therefore eliminated. If operations are transparent to allmembersoftheworkforce,operatorandemployeeinputcanproducesimplifiedprocessesbasedonatotalexperiencegreaterthanthesumofitsparts.As a practice, visibility also ensures that the organization is maintaining a

broadviewstancethroughcarefulmatchingofoperationstolong-termstrategyandby the exposure of tasks that do not addvalue or do notmatch corporategoals.Additionally,staffalignmentwithgoalsandoperationalobjectives leadsto faster responses to changing conditions without losing sight of set targets.Thisenablesaflexibleresponsetochangingmarketconditionsandallowsforasmoother transition. The smoother the transition, the lower the chance ofcreating waste during the change. A high degree of visibility means that theorganizationwill havemore information andan earlierwarning that change isnecessary.Insituationsinwhichstayingthecoursemeanshittinganiceberg,anearlywarningcanmeansuccessfulnavigationtosaferwaters.Visibility alsoworkswith a broad viewmentality in the supply chain, both

upstream and down. When viewing a supply chain as a network, a level ofdynamic transparency is needed to ensure that goods and materials flowappropriately andwithoutwaste.However, this can be difficult, depending onthe relationships a firm has with its suppliers and customers. In some supplynetworks,complete integrationofsystemsexists so that supplierscangenerateordersautomaticallybasedonreal-timevisibilityofthebuyer’sinventoryofrawmaterials.Thisisobviouslyaveryadvancedandverybeneficialrelationshiptobothparties,butlevelsofvisibilityandcooperationshouldbepresentwithinallbuyerandsuppliernetworkstoensureaproductiverelationshipforbothparties.ThefocusonvisibilityisnotexclusivetoLean.Steppingoutsidetheframeof

Leanforamomentandexamining“bestpractices”forconventionalbusinessesin all fields and industries, we see the importance of visibility in the supplychain.Thisisacrucialcomponentofsuccessfulbusinessoperationsandlogisticsformaintainingacompetitiveadvantage.Theestablishmentofahigh-visibilitysupplychainisanimportantplatformtodevelopandimplementLean.Inorderforacompanytomaintainitscompetitiveedge,itiscrucialthateachdepartmentorfacetofthecompanythatisengagedinvalue-addedprocessescontributestotheinformationflow.Poorcommunicationcanresultincostforanycompanyandisarootcause,in

some form, of all of the sources of waste. Poor communication also causesdistortionwithin the supplychain, and, inaddition tocausingnumerouswasteevents, it can affect perception of brand and quality. If distortion occurs inregard to customer needs, then what the company delivers could be radicallydifferent from what the customer expected, which is the exact opposite of acustomer service focus. If too little information is sharedaboutcommongoalsand thecompany’soverridinggoals, thendepartmentsmaydefault toa“profitmaximizing”mode in which department heads focus only on results for theirown portion of the value-added process. This may sound like a productiveapproachatfirst,butthefactofthematteris,thistunnel-visionapproachusuallymeans that other departments suffer while one posts record productivity andprofit.Ifthefocusisinsteadplacedontheproductioncycleasaprocessandonvalue-addedactivities,thendepartmentsorbusinessunitsarenotincentivizedtodeviatefromthecompany’sproductionprotocolsandstandards.Visibilityandinformationsharingmustoccurtoensurealldepartmentsarein

line with the company’s short-and long-term goals, as well as to ensuredepartmentalcooperationandsuccessasateam.Inshort,visibilityisthekeytomakingacompanymorethanthesumofitsparts.

6.FlexibilityFlexibilityisanessentialcharacteristicinthebusinessworld,becausemarket

conditionsandcustomerneedsareconstantlychanging.Additionally,flexibilityandcontinuousimprovementgohandinhandinmakingemployeesandoverallcorporateculturetolerantofandevenhungryforchange.Thephrase“changeisinevitable” can now be extended in the business world to say “change isinevitableforsurvival.”Acompanythatisreadytochangeismorepreparedtosucceedinthecurrentbusinessclimate.A focus on flexibility alsomeans less friction when dealing with changing

customerneeds.Whilenotlistedasasourceofwaste,resistancetotheneedsofthe customer can result in intangibly damaging waste events in the areas ofreputationor service.Additionally,new ideas regarding the reductionofwastecanrequireradicallydifferentprogramswhoseimplementationcancreatehigherefficiency processes. A firm that’s ready to move to the next level will seesmoother transitions when adopting new programs and practices, meaningreductionsindowntime,bothliterallyandinD.O.W.N.T.I.M.E.wastereduction.

ChapterReviewTheLeanproductionmethodstrivestodifferentiatebetweenvalue-addedand

non-value-added activities (waste). Waste can be categorized into threeoverarching categories: physical waste, unevenness of flow, and overburden.Furthernarrowed, thesourcesofphysicalwastecanbecategorizedintooneormore of the following types of waste events: defective production,overprocessing, waiting, under-utilized (non-used) employee talent,transportation, inventory, motion, and excessive production. Together, thesesourcesformtheacronymD.O.W.N.T.I.M.E.In addition to vigilant waste reduction activities, the Lean philosophy

prescribesfiveotherpillars:theconceptofhavingabroadview,orfocusingonthe wide-reaching impacts of strategic decisions; the concept of constantsimplification to reduce“movingparts syndrome”; the cultureofkaizen,orofcontinuousimprovementandinnovationfromalllevelsoftheorganization;theconcept that visibility reduces effort and leads to action; and the idea that aflexiblepositionprovidesandsustainsanunbeatablecompetitiveedge.Problem solving tools that have a wide application across the Lean

methodologyandbeyondare thePDCAcycle,aPlan-Do-Check-Actcontinualfeedback process that builds a simple and structured approach to improvingprocesses. A practical application of this method is the A3 problem solvingapproach. A3 problem solving narrows the focus of investigative efforts andstandardizestheimprovementprocess.

ToRecapTheLeanproductionmethodstrivestodifferentiatebetweenvalue-addedandnon-value-addedactivities(waste).Waste can be categorized into three overarching categories: physical waste,unevenness of flow, and overburden. Further narrowed, the sources ofphysicalwastecanbecategorizedintooneormoreofthefollowingtypesofwaste events: defective production, overprocessing, waiting, under-utilized(non-used) employee talent, transportation, inventory,motion, and excessiveproduction.Together,thesesourcesformtheacronymD.O.W.N.T.I.M.E.In addition to vigilant waste reduction activities, the Lean philosophy

prescribesfiveotherpillars: theconceptofhavingabroadview,orfocusingon thewide-reaching impacts of strategic decisions; the concept of constantsimplificationtoreduce“movingpartssyndrome”;thecultureofkaizen,orofcontinuous improvement and innovation from all levels of the organization;theconceptthatvisibilityreduceseffortandleadstoaction;andtheideathataflexiblepositionprovidesandsustainsanunbeatablecompetitiveedge.AproblemsolvingtoolwithawideapplicationacrosstheLeanmethodologyand beyond is the PDCA cycle, a Plan-Do-Check-Act continual feedbackprocess thatbuildsasimpleandstructuredapproachto improvingprocesses.ApracticalapplicationofthismethodistheA3problemsolvingapproach.A3problemsolvingnarrowsthefocusofinvestigativeeffortsandstandardizestheimprovementprocess.

1InJapanese,theconceptoflateralfindingsdeploymentiscalledyoko-narabi-tenkai.

KeyQuestions(Answersonpg.137)

1. The Lean philosophy of manufacturing and production seeks todifferentiate value-added activities from those that do not add value.Non-value-addedactivitiesarealsoknownaswhat?

a)effortb)productionc)qualityd)waste

2. TheconceptofkaizenpermeatestheentireLeanmodel.Kaizenisafocusonwhatbusinessactivity?

a) financial accountability b) continuous improvement c) customerrelationsd)maximumproductiveeffort

3. Which of the following is not one of the core components of Leanphilosophy?

a)visibilityb)accountabilityc)abroadviewd)flexibility

4. An organization that employs the Lean methodology understands thatinnovation comes exclusively from management and research anddevelopmentendeavors.

a)trueb)false

5. ThePDCAprocessiswhichoneofthefollowingtypesoftools?

a)processimprovementtoolb)staffdevelopmenttoolc)manufacturingtoold)PDCAisnotatool

|2|LeanProduction

InThisChapterThecoreofLeanmanufacturing,thepullproductionsystem,isexploredindetailValuestreammappingisdiscussedOrganization,scheduling,andefficiencytoolssuchaskanban,Just-in-Time,andSingleMinuteExchangeofDieareallexplainedastoolswithinthecontextofLeanFacilitylayoutconfigurationsandothercompaniontoolstotheLeansystem,suchasproductionleveling,areexamined

While the first chapterof thisbook startedoffwith thebuildingblocksof theLeanmethod—its philosophy and guiding principles—this chapter focuses onthe nuts and bolts processes that comprise production within the Leanframework. While many of these methods can be used outside of the Leanmodel, they work best in concert with one another and in line with Lean’sguidingprinciplesofcontinuousimprovement,flexibility,andwastereduction.

ThePullProductionSystemOrganizational supply chains have traditionally been focused on forecasting

demandusingavarietyofstatisticalmodelsandgathereddata, thenproducingample goods tomeet the anticipated needs. In thismethod the anticipation ofdemand“pushes” theproductionofgoods through thesupplychain, forwhichthebatchrequiredwouldgeneratetheorderfortherawmaterialsrequired.Thisdemandcanbeclassifiedasartificial;thereisnoconcreteindicationthat

there are customers who have a utility or desire for the goods enteringproduction.Duetotheartificialnatureof thisdemand, thelevelsofgoodsthatareproducedcanvarywildlyfromactualdemand.Under the push method of production, when raw materials enter the

productioncycle,thenextmanufacturingprocessisappliedandthegoodsmoveon to thenext, and soonuntil theyare finished. Inmanycasesmanufacturers

employing the push production system also produce surplus goods as a bufferagainst shipping delays, damage, and loss or to insulate their anticipated(artificial) demand from fluctuation. Of course this method of productionviolatesmanyofthewastereductioncomponentsofLean,oftencreatingwaitingqueues,excessiveproduction,highinventorylevels,andunnecessarytransport.Leanmanufacturingisbasedonthe“pull”productionsystem,wherecustomer

demand“pulls”productionthroughthesupplychain.Inpractice,thismeansthatthe final steps of the productionprocess determine the levels of productionofeach station before it. The result, as opposed to the pushmethod, is customerrequests for goods creating orders for raw materials that work backward—backwardcomparedtothepushmethod—throughtheproductionprocess.Inatraditionalsystem,rawmaterialswouldbefedthrougheachprocesswith

eachworkstationproducingamorefinishedproductbasedonthepiecessenttoit.Bycontrast,inapullproductionsystem,eachworkstationrequests,fromthestagebeforeit,onlythematerialsorcomponentsneededtoperformitsprocess.If there isnoneed foraparticularmaterialorcomponent,no request ismade,and in this way excessive levels of inventory are prevented, along withreductionsinallareasofwaste,suchasmotion,wait times,transportation,andoverprocessing.When the final stages of production and the needs of the customer are the

focusofthepullproductionsystem,companiescantailortheirproductionlinestofitdemandinrealtime.Goodsareproducedasneededinrealisticbatchsizes,andbufferinventoryisgreatlyreducedalongwithon-handinventory.

But if the pull production system is somuchbetter, and is such anobvioussolutiontosystemicproductionchallenges,whydiditonlyjustcomeaboutwiththeToyotaProductionSystem?Toanswer that,wehave to takeadeeper lookintowhy thepushproductionsystem is sowidelyused,and inwhatways thepullproductionsystemusesinnovationtoovercomeproductionchallenges.Pushproductionreliesoneconomiesofscale,orthemethodofspreadingout

costsovera largernumberofpartsproduced,specifically fixedcosts. Ifapartcostsfivedollarstoproduceatarateof10,000unitsperweek,withthreedollarsofthatfivededicatedtofixedcostsandtwodollarsdedicatedtovariablecosts,then economies of scale tell decision makers to simply make more parts toreducethethree-dollarportionoftheequation.Variablecostsareoftentiedtothevolumeofproduction.Theyincludeaspects

suchas thecostof rawmaterials—moreunitsmeanmorematerialsconsumed,butbecauseunitsaremass-producedtheamountofmaterialconsumedbyeachshouldbe the same—andother intermittent costs suchas laborand the rateofdegradation toequipmentandconsumables.Fixedcostsareoften tied to long-livedassets,whichaccountantsrefertoasPPE:property,plant,andequipment.Thesecostsincludeequipment,utilities,andthecostoflinechanges.By ramping up the number of units—otherwise known as increasing batch

size—between line changes, that three dollars’ worth of fixed costs from ourexample above could be squeezed down to one dollar per unit if the rate ofproductionwastripled.Calculatingtherateatwhichvariablecostsincreaseisabitmorecomplicatedthansimplydividingthecostbythenumberofunits,andthe particulars of that calculation are outside the scope of this text; however,experiencedproductionmanagerswouldscaleproductionsothattheincreaseinvariablecostdidnotoffsetthesavingsgainedthroughleveragingtheeconomiesofscaleandreducingfixedcosts.This additional production creates a savings in one area while incurring

potentiallymassivecost inanother.Because linechangescanbesoexpensive,largebatchesareutilizedtospreadcostsout,thoughinmanycasessavingsarechipped away by the costs of carrying additional inventory further down thesupply chain. This is clearly oppositional to Lean’s focus on waste reductionthroughnearlyeveryaspectofD.O.W.N.T.I.M.E.waste,anditalsoignoresthevoiceofthecustomerthroughrelianceonartificialdemand.The pull production system, on the other hand, relies on small batch sizes,

quicklinechanges,andotherinnovativemethodsdetailedwithinthischapterto

completelychangethewayflexiblemanufacturingisimplemented:inawaythatfocusesontheneedsofthecustomer(actualdemand).Alone,nocomponentofthepullproductionsystemwouldchangetraditional

pushmethods into the efficient and productiveLean configuration; onlywhenemployedsimultaneouslydoallthepiecesofthepullproductionsystemfallintoplace.

ValueStreamMappingValuestreammappingisaLeanmanagementtoolusedtoanalyzethecurrent

state of all activities and processes of a product or service, from absolutebeginningallthewaythroughtotheenduser(customer).Thistoolisalsousedtodesignnewprocessesandmethodsandcanbeavaluableassetinidentifyingwaste and differentiating it from value-added activities. The goal of effectivevaluestreammappingis to identifyopportunitiesfor improvement in theareasofcost,waste,andefficiency.Valuestreammapping takesanapproachdifferent from the traditionalmore

linear and isolated view of production and its supporting processes.While noproduction organization ever thought of production as existing in a vacuum,value streammapping takes the interdependent interpretation to a whole newlevel.Itisthisunderstandingofthewebofinputscreatingvalue,asopposedtoamore linear concept of production, that gives decision makers a morecomprehensiveoverviewoftheirproductionoperations.Value streammapping is not only a foundational element of understanding

production,butofimplementingthepullproductionsystemandofmakingrealprogresswithkaizen-relatedactivities.Onceprocessesaremapped,abaselineorbenchmarkisestablished.Then,futureimprovementeffortsandkaizenactivitiescanbemeasuredagainstthesystem’scurrentstate.Implementation requires identification of a particular product line, product

family,or service.Theprogramandgoalsare thenoutlinedalongwithknownissues.Thebestmappingisdoneontheproductionfloororduringtheexecutionof production activities.Thismeans that the data gathered is as true to life aspossibleandthatthevaluestreamisnotdistorted(remember,visibilityreducesdistortionandimproveswasteidentification).Importantelementstoincludearecurrent steps, delays or waiting queues, information flows, and flows ofmaterials. Value stream mapping is not exclusive to manufacturing andproduction.Theprocessbeingmappedcouldbetheproductionoffinishedgoods

—rawmaterialstothedeliveryoffinishedgoods.Inawiderapplicationitcouldbeadesignflowprocess—theconcept-to-launchprocess.Valuestreammappingisalsoapplicableforservicesupplychainsinthesensethattheycouldtrackalloftheactivitiesdoneinpreparationfortheexecutionoftheservice.Thiscouldinclude supplies, equipment preparation, space preparation, or creation of theserviceenvironmentoratmosphere.After the stream ismapped, an assessment process should begin to identify

waste, inefficiency, and opportunity for improvement. Information for thesedecisions comes from the methods outlined in the toolbox below, as well asobservationanddatagathering.Astheseareasarenoted,plansshouldbedrawnfor a new value stream map that takes into account the modifications to thecurrentsystemofprocesses.Thesenewconditionsshouldrepresentachievementofthewastereductionandefficiencygoalsinitiallysetforthwiththestartofthevalue stream mapping process and should, like all constructive goals, berealistic,achievable,andsustainable.Aswithanyimprovementprogram,performanceandgoalrealizationneedto

be checked to verify achievement. These lagmeasures are a follow-up to thedesignandimplementationofanewvaluestreammapthathasbeenmodifiedtomeetthegoalsforefficiencyimprovementandwastereduction.Likeallaspectsof continuous improvement, improvement through value streammapping is acycle;onceithasbeenimplemented,thenextstepistobegintheprocessagain.

ValueStreamMappingToolbox

Value stream mapping as a process is not entirely free-form. There is anestablished set of tools for a firm’s management seeking to implement valuestreammapping.Thetoolboxconsistsofthefollowingsevencomponents:

1. ProcessActivityMapping2. SupplyChainResponsivenessMatrix3. ProductionVarietyFunnel4. QualityFilterMapping5. DemandAmplificationMapping6. DecisionPointAnalysis7. PhysicalStructureMapping

ProcessActivityMapping

Processactivitymappingisavaluestreamtoolthathasitsoriginsinindustrialengineering.Itisanarrowermethodofdeterminingthecomponentsoftheentirevaluestreamand is similar indesign to theprogramofvaluestreammapping.Unlike the large-scale overview that value stream mapping presents, processactivitymappingfocusesonasingleprocessorsetofprocesses.Processactivitymappingcanbeausefultoolwhenbuildingacomprehensivevaluestreammap,aswellastakingadeeperdiveintoasingleprocessorbusinessactivity.Thisprocessisimplementedinthefollowingsteps:

1. Selectandstudyaspecificprocess2. Identifyareasinwhichwasteoccurs3. Determine if the process can be reconfigured and produce the same

outcome4. Determineiftheflowpatternwillimprovewithreconfiguration5. Determineifallassociatedtasksarestrictlyvalue-addedandnecessary

An observational and quantitative data collection ismade of the process. Theresult is a process map, showing the flow of materials and all value-addedactivities. Recordings of machine cycles, motion of people and machines,

distancemoved,andtimetakenareusedtocalculatetotalsineachcategory.Aprocess activitymap can serve as amodel for future improvement efforts andcan highlight areas of non-value-added activity. An example of a populartechnique for determining the characteristics of a task is the 5W1H analysisshownbelow.Itanswersthequestionswhy,who,what,where,when,andhow.

The goal of this process is to eliminate activities that are redundant orunnecessary. It also seeks to simplify or combine other activities and producechangesthatwillreducewaste.Aswithallvaluechainmapping,variousmodelsmaybeexploredbeforeselectingthefinalsolution.

SupplyChainResponsivenessMatrix

This visual tool is an analysis of an organization’s lead time and inventorylevels. The matrix is constructed by graphing lead time along the x-axis andinventorylevelsalongthey-axis.Theresultinggraphshowswhereslow-movingstock is located. The final product demonstrates the time constraints for aparticular process, and once underperforming areas are identified, correctiveactioncanbeimplemented.

ProductionVarietyFunnel

Thisvaluestreammapping tool isdesigned to identify towhichsetof internaloperationsmodels amanufacturing firmconforms.Eachmodelhas adifferentset of characteristics that are fairlyuniformacrossdifferent organizations, andeffectivedeterminationoftheappropriatedesignationcanassistwithforecastingand production scheduling. It can also provide plannerswith a comprehensivegraph of how the supply chain network and the firm operate and howcomplexities must be managed. This method is also referred to as an IVATanalysis,anacronymreferringtothedifferentdesignationsofproduction.Inthisinstance, the letters that form the acronym represent the physical shape of theproduction process as outlined below, not the first letter of their respectivenames.

“I”productionconsistsof themanufactureofmanyidentical itemswithfewvariations. This is a typical configuration for many consumer goods andcommodities.“V”configurationsconsistofawidearrayoffinishedproductsproducedfromasmallnumberofrawmaterials.Thisconfigurationiscommoninthetextilesindustry,orinmanyserviceindustriessuchasrestaurants.“A”configuredproductionistheoppositeof“V.”Itisanarrowassortmentoffinishedgoodsproducedfromalargenumberofvaryingrawmaterials.Thisconfiguration normally has several different value streams and can utilizemultiple facilities for production. An example of “A” production would beassemblymanufacturing,orthetypeofmanufacturingmostcloselyassociatedwithcomplexmachineryorautomobiles.“T” production configurations use various combinations of products made

fromspecificcomponents.Thecomponentsareproducedintosemi-processedparts that are held for commitment to final versions as demanded bycustomers. The household appliance industry is an example of “T”configuration processing; there may be a thousand washing machinesproduced, but only two hundred of them will be equipped with premiumfeatures.Thenumberof premiumunits couldbe the result of artificial pushdemandoractualcustomerdemand.Thetoolthatisusedtodeterminewhereandhowthisdemandimpacts theproductionprocess isknownasadecisionpointanalysis,andiscoveredlaterinthissegment.

BecauseproductionconformstooneoftheIVATconfigurations,thistoolcanbe used not only to research how a supply chain will react to differenthypothetical conditions, but IVAT analysis can also direct targeted inventoryreductionmethods.

QualityFilterMapping

Qualityfiltermappingisusedasavisualrepresentationofwherequalityissuesexistwithinanorganizationoravaluestream.Thistoolisusedtoidentifythreetypes of quality-related issues: product defects, service defects, and internalscrap.Product defects represent defective production of finished goods that is not

identified by quality control inspection. These defects are discovered by thecustomerand,likeallqualityissues,affecttheperceptionofanorganizationasone thatdoesordoesnotproducequalityproducts.Servicedefectsarequalityissuesnotrelatedtothefinishedgoodsthemselves.Thesecouldincludeearlyorlatedelivery,ordersthatareincorrectorincomplete,orlostpaperwork.Internalscrap is defective production that is caught by quality control inspection, andincludes the costs of reworking if necessary, or the possible salvaging ofdefectiveproduction.

The above graphic is an example of a thorough quality filtermap. Viewedwithoutcontext,thischartonlytellsdecisionmakersthestagesintheproductionprocesswheredefectsandrelatedcostsspike,butconsideringtheLeanfocusonvisibilityandwastereduction,aqualityfiltermapcanbecomeavaluabletooltouncoversourcesofwasteandconsistentlypoorquality.Forexample, thespikein service-related defects during the final stage production phase indicate thatsomethingiswrongoriscreatingwaste,butthatitisn’tmachineorproductionrelated.This“visibilityleadstoaction”mindsetisacommonthreadoftheLeanmethod,and would direct decision makers to investigate non-machine-related issueswithin the final stage production phase. This could be done through simpleobservationorthemorestructuredprocessactivitymappingtool.Thebottomlineisthatwhendirectedbyacomprehensivequalityfiltermap,

decisionmakersandproductionproblemsolverscanhoneinonareasofconcernwithamuchmoreguidedfocus.

DemandAmplificationMapping

AlsoknownasForresterEffectMapping,DemandAmplificationMappingisamethod of identifying production needs for demand within specific timeintervals.Forrester’sresearchshowedthatasdemandmovedfrominventorytoinventorywithinasupplychain, theamplificationordistortionof thatdemandwouldoccurwitheachtransfer.Distorteddemandcangenerateexcesslevelsofinventory, excessive production, waiting, motion, and transport. All of thesewaste events contribute negatively to a uniform flow ofmaterials through theproductionprocessandthroughthesupplychain.Inpractice,demandamplificationmappingisagraphplottedwithtwocurves.

Thefirstcurveisactualdemand.Thiscouldbepoint-of-saledata,salesrecords,orshippingrecords,theobtainingofwhichiseasierifthereisahighdegreeoftransparencybetweenmembersofasupplychainnetwork.Thesecondcurveisorders placed by the supplier tomeet actual demand.The resulting graph is atool to determine value stream configuration as well as to manage or reducefluctuation, and it can even be extended to map up or downstream within asupplychainnetwork.Understanding demand at the root—actual demand as opposed to artificialdemand—isakeycomponentofcuttingthroughdemandamplification.Whenamanufacturer and a retailer or dealer have a close relationship,POS (point-of-

sale) data can be helpful in establishing hard numbers to gauge demand.Additionally,ahighlydevelopedsupplychainthatusesJust-in-Timetechniquesandkanban-stylereplenishmentcancoordinatetogethertoreducetheeffectsofdemandamplification.

Whatdecisionmakerscan learn from thegraphingof theForresterEffect isthe disparity between actual demand and artificial demand that was not theproduct of incorrect pull production, but a communication failure. Visibilityleadstoaction,andifthispotentialsourceofwasteisnottrackedandaddressed,itcanquicklyspiraloutofcontrol.

DecisionPointAnalysis

Thedecisionpointanalysistoolisusedprimarilybyproductionfirmsusingthe“T” configuration production scheme, but it can apply to other productionmodels aswell. The analysis is designed to identify the decision point, or thepointinthesupplychainatwhichcustomerpulldemandgiveswaytodemandthathasbeenforecasted.Thedecisionpointisusefulinthesensethatassessingtheprocessesupstreamanddownstreamfromthatpointcanidentifyandreducewasteaswell asensure thatcurrentproductionprocessesare in linewithbothorganizational goals and customer needs. In addition, with an establisheddecision point, organizational planners can test hypothetical changes to thesystemwithoutdisturbingproduction.These“what if” scenariosactasmodelsfornewsystemsandcantestinnovationprograms.Ideally,aLeanorganizationwouldn’trelyonthepotentiallywaste-generating

effects of artificial demand, but the “T” configuration of production issusceptibleto“pushcreep.”Pushcreepisaconditionwhere, inanticipationoffluctuating demand, decisionmakers err on the side of overproduction and inturnrelyonsafetystocktocompensate.Tracking how production responds to demand, and at what point of the

production process pull gives way to push demand, can mark areas wherepotentialwastecanoccur.Thisvaluestreammappingtoolisparticularlyusefulinestablishingabenchmarkforproductionlevelingactivities,atopicdiscussedlaterinthischapter.

PhysicalStructureMapping

Physical structure mapping is a visual representation of the structure of anentiresupplychain.Thisprocessisdesignedtoprovideanoverviewor“bird’seye”viewofasupplychainnetworkandcanbeconstructed in twoways.Thefirst isavolume-basedstructuralmap.Thismethod iseffective for identifyingbottlenecks andnon-uniform flow—the shapeof themap is directly related tothevolumeofproductionthatpassesthrougheachelementof thesupplychainand value stream. The second method of construction is a physical structurebasedoncost,wheretheshapeofeachofthemap’scomponentsisrelativetoitsimpact on overall cost. This model is a direct visual representation of costcentersthroughoutasupplychain.Taken individually, each of the tools in the value stream mapping toolkit

provide valuable insight into operations and production activities.When usedtogether, they are powerful investigative tools to support the value streammappingprocess.Forasamplevaluestreammapandastep-by-stepguideseetheexampleonpg.129.

fig.18:Aphysicalstructuremapbasedoncost.Here,the1sttierofdistributionandthe3rdtierofproductionhavethelargestimpactoncostsandthereforearetheprimarycandidatesforwastereductionactivities.1sttierproductionand3rdtierdistributionarelowercostcenters.Thisisrepresentativeofproductionthathasintensivefinishingwork(3rdtierproduction)andusesoutsourceddistribution—thediminishingcostofdistribution.

KanbanKanban, translated from Japanese as “signboard” or “billboard,” is a

schedulingmethodforLeanmanufacturingandJust-in-Timeinventory(coveredin detail later in this chapter).Used to control the supply chain and inventorytogether, kanban scheduling is designed with a whole-system focus and isconducive to improvement. Using the rate of demand to inform production,kanbanschedulingisanexpressionofthepullproductionsystem.Kanban methods are derived from the shelf-stocking techniques of

supermarkets.Whenacustomerremovesanitemfromtheshelf,thestore’sstaffreplenishesthesalebyreplacingtheremoveditem.Ifacustomerremovessevenitems,andthenanotherremovesthree,thestockstaffreplacestenitemsontheshelf.While thesehumble rootsare justcommonsense, itwasa revolutionaryconcepttoimplementthisapplicationonthefactoryfloor.Thekanbanmethodaligns inventory levelswithconsumptionvia thepullof

demand. When units of material are consumed, a signal is generated to thesupplierthatinstructstheproductionanddeliveryofthequantityneeded.Thesesignals are tracked andmade visible to all partieswithin the supply chain forpurposes of efficiency, and the result is a very flexible and adaptive supplychain. Even in environments where demand can be difficult to forecast, thetravel timethroughthesupplychainforkanbansignals issoshortandsowellcoordinatedthatonlytrulymassivespikesindemandwillcausedisruptions.Inorder for akanbanprogram tobeeffective, there are sixprescribed rules

that must be continuously applied andmonitored. If these parameters are notconsistently met, the advantages produced through the kanban system arenegated in many cases, and the very system used to generate efficiency caninsteadproducewasteevents.Thesixkanbanrulesareasfollows:

1. Alllaterprocessesmuststartwiththesamenumberofunitsasearlierprocesses,asspecifiedinthekanbansignal.The integrity of the kanban system relies on the fact that only thematerialsneededfordemand(andthereforereplenishment)movethroughproduction. This means that additional materials aren’t addedunnecessarilyinthetransitfromworkstationtoworkstation,or,alongthe

same lines, that materials aren’t deducted. This is a failsafe measuredesignedtoensurethat100percentofneededmaterialsarereplenished;if materials are needed but unrecorded, then they will go withoutreplenishment.Thisisanexampleoftheoppositeofvisibilityleadingtoaction:invisibilityleadingtoinaction.

2. Allearlierprocessesmustproducethesamenumberofunitsasspecifiedinthekanbansignalbothinquantityandsequence.The kanban signal is the expression of demand and therefore theparameter by which material is pulled through production. This is acontinuationofthefailsafeincludedinthefirstkanbanrule.Justlikenounrecordedmaterialscanentertheproductionprocess,onlytherequisitenumberofunitsshouldtravelfromworkstationtoworkstation.Thisruleeffectivelycreatesanartificialconstraintonproductiontopreventwasteevents in the form of excessive production, or on the other side of thecoin,insufficientproduction.

3. Noitemsaretobemadeortransportedwithoutakanbansignal.This prohibitory constraint ensures that there are not waste eventsgenerated through the unnecessary transport of materials or theiraccidental introduction into production without corresponding demand.Withoutbeingcalledforbyakanbansignal,thereisnodemandforunitsofmaterial or goods and therefore no value to be added through theirtransportorproduction.

4. Allgoodsthathavebeencalledforviaakanbansignalmusthaveanattachedkanbancard.Kanbancardsarecovered in thenext section.Suffice it to say that thisparameter is a visibility and communication effort to ensure that goodsarenotlostortransportedunnecessarily.

5. Undernocircumstancesshoulddefectivegoodsbeattachedtoakanban.Defectiveproductionisnon-value-addedactivity,andcustomerswillnotacceptdefectivegoods.

6. Areductioninthenumberofkanbanwithinaproductionsystemincreasesthesensitivityofthatproductionsystem.

When there are less kanban in motion, there is less of a buffer betweenprocessesandthereforethesystemismoresensitivetodisruption.

Whenthe termkanbanorkanbancard isused, it isdescribingaspecific tagaffixed to goods or materials. Despite the prevalence of advanced softwaresystems, it is still common practice for contemporary Lean manufacturers toemploy kanban cards. In conjunctionwith electronic signals that originate thepull of materials (kanban triggers), a kanban card will travel with the orderthrough production while an order is dispatched to the supplier forreplenishment.Formanufacturerswhohavemadethejumptocompletelyelectronickanban

systems, the pitfalls associatedwith physical cards such as lost or incorrectlyentered cards are a thing of the past. All kanban triggers and subsequentmovement throughproductioncanbe trackedeasilyandwithahighdegreeofaccuracy. This information can then be integrated into an enterprise resourceplanning(ERP)softwaresuite,andthevisibility—andthereforeresponsivenessof the entire system—can be improved evenmore.Of course, implementationincurs cost, though new ERP software packages can be tailored to fit the e-kanbanmodelandtheorganization,meaningthatcostcanbejustifiedbygainsinvisibility,communication,andflexibility.

HeijunkaBox

The heijunka box is a visual scheduling tool used in conjunction with thekanban system of material replenishment. It’s a practical expression of thesmoothingofproduction(heijunka),andanessentialcoordinationtool.Mostcommonlyemployedasawallschedule,theheijunkaboxisagrid-style

layout of cubbies or pigeonholes. Kanban cards are placed in the holes tovisuallyorganizetheirflowthroughtheproductionprocess.Columns and rows represent periods of time and processes. Each of the

kanban cardsmoveswithproducts through theproductionprocess (remember,under the kanban system, no goods are to bemovedwithout a kanban card).Cardsarestored in theheijunkaboxfor retrieval.Ataglance,supervisorsandproduction staff can see exactly where product batches are in the productionprocess,whatremainstobedone,andwhatthestatusisofeachproductatanygivenpointintime.

fig.20:Amodelofaheijunkabox.Eachofthecardsrepresentsaproducttravelingthroughproduction.Therepeatingpatternsdemonstrateataglancethatproductionisevenandflowing.Thistimeintervalissettodaysoftheweek,butaboxcouldbeasmicroasthirty-minuteintervalsifneedbe.

TaktTimeTakt time isyetanother tool in theLeanpractitioner’s toolkit. ‘Takt’ isbest

translated as “measure time,” and it is ameasurement of unit production timerelevant to the rate of customer demand. Takt time is not a recording orcalculation of the actual duration of unit production, rather a metric thatidentifies production flow and prescribes production line parameters. Bestdescribed as thework time between two units, takt calculations are not solelyrelevanttotheworldofmanufacturingandproduction.Control functions such as testing, quality control, and sampling can be

described and measured with takt calculations. Administrative functions too,suchascallserviceoperationsorinquiryresponseoperations,canbenefitfromtakt calculations. In thisway, takt time is an evaluation tool used to examineprocesseswhilestayingdistinctfromothertools.Takttimeiscalculatedbasedonthefollowingformula:

Where:T=TakttimeTa=Worktimeperperiod(netavailableworkexpressedastime)D=Customerdemandorsimplydemand(expressedasproductionunits)

Considerthefollowingexample:

Amanufacturingfirmhasashiftlengthofeighthours(480minutes).Fromthis480-minute gross, lunch allotments and breaks are deducted along with otherbusinessrelatednonproductiontime.

Theresult,400minutes,isthenetavailabletimetowork.Ifcustomerdemandwas at 200 units per day (assuming one shift in a day), then the takt timebecomesT=400/200(T=Ta/D)oratakttimeof2minutesperpart.Onceatakttimecalculationisinplace,itcanbeappliedtoahostofbusiness

tasks,andthisconfersanumberofvisibilityandwastereductionbenefits.Whenmeasuredwithataktcalculation,productionatalllevelscanbematchedtothecalculatedstandard.Thismeansthatanyworkstationsorproductionstagesthatare underperforming are easily identified. Underperformance can stem from avarietyofsources,butnomatterthecause,itisbottleneckingproduction.Thesebottlenecks are generating waste events, and once they become visible,correctiveactioncanbetaken.Additionally, takt calculations focus solely on value-added activities.When

calculatingtakttimeforagivenprocess,thereislittleroomfornon-value-addedactivitiessuchaslinechanging,machinesetup,andretooling.Thisvalue-addedmindset encourages decision-making that best benefits the business and thecustomerandreduceswaste.In the same vein, the takt system leaves no room for the removal of

incompletegoodsfromtheproductionline.Thisisavalue-addedfocusfirst,butin a secondary capacity it also translates into fewer opportunities for transportandmotionwasteevents,aswellasshrinkageduetoinadvertentdamageorloss.As a standardizationmeasure, takt calculations ensure that production level

workers are repeating the same actions on a daily basis. This specializationbreedsmastery and efficiency.When front line employees have to spend lesstimeadaptingtonewprocessesonafrequentbasis,totalproductivityincreases.All of these benefits come with a word of caution, however: detailed time

calculationsproduceinflexiblethinkingandifnotexecutedcorrectlycancauseunanticipated issues.Forexample, if customerdemandsoars, anadjustment tothe takt calculationsmeans that some taskswill simply take too long in theircurrentconfiguration.One way to remedy the situation would be to split the same process over

multipleworkstations.Thisisadouble-edgedswordinthesensethatadditionalworkstations mean retooling and line-changing downtime, as well as timeconsumedbyproductionlineworkersadaptingtothechangeinprocesses.Thereis no prescribed right answer in this case; solutions should be developed on acase-by-casebasisandshouldbetailoredtofitthebusinessandtheindustry.

Taktplanningalsoplacesahighlevelofrelianceontheintegrityofmachinesand workstations. As a result, when one station breaks down, it can causedisruptionthroughouttheentireproductionline,andthisdowntimecoupledwithrecoverymeasurescanbeacostlyprospect.Thiscanbemitigatedbyfactoringin buffer time for each unit; however, buffer time can be difficult to justify,becauseit’snon-value-added(afirmcan’tchargetheircustomersmorebecausetheyhavetoinsulatetheirproductionlinesfromunforeseeninterruptions).Theresult is that decision makers and planners must strike a balance betweenfactoringinreasonablebuffertimesandmaintainingafocusonwastereductionandproductivity.Another consideration for takt implementation is the increased number of

cycles that are generated when takt time is shortened. Following the taktformula,asdemand(D) increaseswithoutnet timeavailable towork(Ta)alsoincreasing, then the final takt value (T)will be lower.Lower takt timemeansmorecyclesandhigherstressonsystems,machines,andpersonnel.Finally, takt timecalculationsaremost effectivewhenusedwithproduction

lines that have benefited from production leveling. Production leveling iscovered inmoredepth lateron in thischapter,but tosummarize thedownsidehere, production leveled processes can suffer from increased amounts ofinflexibility.

Just-in-TimeJust-in-Time (JIT) isaproductionstrategydesigned to reducecosts through

reducing in-process inventoryorrawmaterials inventoryforproductionfirms,which also reduces overall carrying costs. This concept can be extended toinclude the on-hand inventory for retail firms or any organization that holdsinventory.Just-in-Timeisawastereductionmethodandisacriticalpartofacultureof

continuous improvement (read “Lean”). The overriding theory behind JIT issimple:thecarryingcostsassociatedwiththestorageofunusedinventoryareawasteful use of resources. The JIT philosophy itself is a combination ofstatistics, behavioral science, management, industrial engineering, andproductionmanagement.Thesedisciplineshavecometogethertoredefinehowinventoryrelatestomanagementandhowitisdefinedonthebusinesslevel.JIT uses the carrying costs associatedwith inventory to expose issues with

manufacturing or excess production. The idea is that removing inventoryexposes preexisting manufacturing issues, and a focus on reducing on-handinventorywillnotonlyexposetheseissuesbutalsopreemptthemintheefforttoconstantly improve these protocols and procedures. Thismeans that firms arepushedtonotonlyrequirefewerinventoriesbuttogeneratefewerinventories.TheoverallfocusofJITistohave“therightmaterialattherighttimeatthe

right place in the exact right amount to fulfill business needs” without theinventory safetynetor thecreationofwastefulsafety stock.For firmsheavilyentrenchedinmoretraditionalmethods,amoreincrementalchangeisnecessaryto achieve the true cost savings associated with JIT methods. JIT requiressophisticated levels of cooperation and communication between suppliers andbuyerstocoordinatedeliveryandproductionand,assuch,isnotacost-effectivesolutionforsomeorganizations. InmanycasesrelationshipsbetweenmembersofasupplychainnetworkneedtobeimprovedbeforeJust-in-Timeproductionandinventorycanbeimplemented.

SmallLotProductionSmall lot production is the production implementation of flexibility. It

shortensleadtimes,meaningmanufacturingfacilitiescannotonlyrespondmorequickly to changing demand but also produce awider array of products. This

also helps reduce wastes associated with excess inventory, motion,transportation, and overprocessing. Small lot production is also a criticalcomponentofJust-in-Timeinventory.Conceptuallyaswellasinpractice,thereis theoverriding focusonwaste elimination and the reductionof cost throughthereductionofinventoryandassociatedcarryingcosts.Small lot production is a core component of the pull production system.

Coupled with the line changeover shortening practices covered in the nextsegment, it becomes clear how Lean production overcomes the traditionalbarriers associatedwith push production.Large batches and long line changeswere so inhibitive to production that the entire process was shaped aroundconformingtoandreducingtheimpactofsuchobstacles.Allofthetoolsexplainedthusfar,andtheremainingportionsofthischapter,

together inunisonrewrite the rulesofproductionandpresentahighlycapableand responsive alternative. Small lot productionmeans not only that wastefuloverproduction and safety stock is eliminated, but also that fluctuations indemandcanbeaddressedmorereadily.Push production practices are slow to respond to unanticipated changes in

demand,whilepullproduction,employingsmalllotproductionpractices,simplyceasesproductionoftheunneededgoodsandchangesovertotheproductionofthoseindemand.Thereis,however,anunavoidablenegativeconsequenceintheareaofsetup

time. This could be represented as line changing, cutting head replacement,workstation staging, etc. Companies that have decided to switch to small lotproductionneedtoanalyzetheirsetuptimesinregardtobestpractices,facilitylayouts, and production scheduling to determine the best course of action inminimizingdowntimeduetoproductionsetupchanges.Setuptimevarieswildlyduetothetypeofproduction,materials,typeofprocess,andprocessinglevel,sothere is no one formula for determining setup time optimization. Theimplementation of single minute exchange of die (SMED) measures (nextsection)addressestheinevitableincreasesofsetuptimeandlinechangeovers.

SingleMinuteExchangeofDieWith the reduction in batch sizes and increase in flexibility that the pull

production method provides, new issues are brought to the forefront. Duringmassproductionthatutilizeslargebatches,theeconomiesofscaleareleveragedto spread the cost of inevitable line changeovers out over as many units as

possible, and line changes are scheduled to be as minimally disruptive aspossible. When the size of the batch production shrinks, the number of linechanges that are necessary increases substantially, and in the kaizen spirit ofreducing both downtime and D.O.W.N.T.I.M.E. waste, methods of efficientchangeoverfollowthedecisiontoswitchtosmallbatchproduction.“Singleminute” does not literallymean that all line changes should have a

duration of only one minute; rather it means that they should not exceed tenminutes(singledigitminuteduration).Whilethereisnoprescribedsolutionthatfitsallindustries,products,andproductionlines,theSMEDconceptencouragesthecriticalexaminationoflinechangeproceduresandfocuseswasteeliminationeffortsontheprocessesthatsurroundproductionandnotjusttheproductionlineitself.The history of the SMED program also serves as the concept’s most

instructivemodel.Duringthe1960s,Toyotawasfindingthatthemostdifficultline changes to perform were those of the die used in their largest car bodytransfermachines.Thesemassive stampingmachinesutilizeddie thatweighedmultiple tons and had to be installed with millimeter scale tolerances. Firstattemptswerenot promising.Thediehad to cool before it couldbe removed,then it was transferred via overhead crane out of the stamping machine. Thereplacement die was then lowered back down—also via crane—and set firstusing operator eyesight and then a series of measurements around the entireassembly.Theprocesscouldtakedaystocomplete,andthroughoutthistimethelinewascompletelydown.Toimprovetheprocess,anumberofinnovationswereapplied.First,precision

measuringdeviceswereinstalledonthetransferassemblyitself.Thismeantthattheoperatorsnolongerhadtousetheireyesighttosetmultipletonsofsteelintomillimeterscaletolerances.Thougharelativelyminorchange,thismodificationto the die-swapping process reduced the overall time to less than two hours.Furtherobservationyielded further innovation,and theprocesswas reduced tolessthantenminutes.Schedulingandstagingthecraneandreplacementdieforefficientswap,aswellasotherchanges,resultedinthedrastictimesavings.In addition to the obvious reduction in changeover time, a host of other

benefitsareassociatedwithproperimplementationofSMED.

Evenifthenumberofchangeoversincreases,machineworkratesstillincreaseduetothereductioninsetuptimes(netgain).Standardizedandaccuratesetupeliminatesdefectiveproductionduetosetup

error.Thedefectrateisalsodecreasedduetothedecreasedneedfortrialrunsandcalibratingruns.Quality is improved due to fully regulated operating conditions in advance(machines“hitthegroundrunning”andrequirelesstweaking)Simpler setups improve safe working conditions and necessitate fewertools/laborcosts.

The key benefit, however, remains the ability to respond to changes inproductionneedsquicklyandflexiblywithoutincurringprohibitiveamountsofcostandthuslosingcompetitiveedge.WhilethespecificsofsuccessfulSMEDimplementationvaryfromproduction

linetoproductionline,thekeyistodifferentiateinternalsetupoperationsfromexternal ones. Internal setup operations are those that require the completeshutdownofmachines.Internalsetupoperationsstopproductionbyhaltingtheline.Externalsetupoperationsarethosethatcanandshouldbecompleted,andshould be, completedwhile themachine is running. External setup operationscanbeperformedwithoutanyimpactonproduction;themachinekeepsrunningandthelinekeepsmoving.When implementing SMED methods across the production processes,

decisionmakersshouldattempttoconvertasmanyinternalsetupoperationsaspossible into external ones instead.While thismay not necessarily reduce theactualsetuptimeintermsofminutes,itdoesreducetheimpactofchangeoversontheproductionlinethroughtheabilitytomakechanges“onthefly.”

TotalQualityManagementTotalqualitymanagement(TQM)isacompanytop-to-bottompracticethatis

designedtoimprovequalityateverylevel.TQMcameaboutasaparalleltotheLeanmethod,andwhile it isadistinctprogram, it fits theLeanmodel.Asweknow,Lean strives for continuous improvement and for producing the highestqualityproductatthebestcostwhileeliminatingwaste,andthesearealsocoreconcepts of TQM. The customer’s needs are the final determining factors inquality, and therefore the customer’s “voice” is coupledwith the demand thatpullsgoodsthroughtheproductionprocess.VoiceoftheCustomer(VOC)thendefinesqualityasmeetingorexceedingcustomerexpectationsinallareas.Thisincludes not only production of goodsmatching the customer’s specifications,

buton-timedelivery,service,andvalue.It isclear that theTQMprogramis incompatiblewith the traditional“push”

production systems that produced products based on anticipated demandwithinventorytechniquessuchassafetystockandexcessinventorydesignedtocoverdelivery shortfalls. In understandingVOC as a component ofTQMprograms,weseemanyofthecomponentsofLean-likepracticesworkinginunison.TQMisageneralizedqualitycontrolsystemthatmanyreadersmayalreadybe

familiarwith. It prescribes the practical aspects of the tools andmethods thatLeanalsoencourages.ForanumberofAmericanorganizations,TQMwasafirstbrush with the concepts of customer-centric planning and supply chaincoordination. An overview of TQM could, in many cases, stand in for anoverviewofLean, anddemonstrateshowsimilar the twoquality improvementprogramsare.WhenutilizingtheTQMmethod,allstagesofthesupplychainmustinteract

with one another in the broad view capacity. Two departments cannot haveconflictinggoals,asthislackoffocusontheoverallgoalcancreatewasteintheformof non-value-added activities and a decrease in quality for the customer.Miscommunication between elements of the supply chain can also distortperception of the customer’s needs so radically that the goods produced nolongermatchthecustomer’sneeds.The supply chain andmanufacturing departmentsmust be flexible, because

the needs of the customer can change. The entire process must be visible tomanagement as well as to employees at all levels to prevent misinformation,allowfortheidentificationofwaste,andpreventinstancesofthebullwhipeffector themagnification of non-value-added activities, errors, andmisinformationthroughout the supply chain. And of course, a culture of continuousimprovement means that the drive for consistent and always higher qualitymeansthatthevoiceofthecustomerwillalwaysbethefocus.

TheHighCostofPoorQuality“Thebitternessofpoorqualitylingerslongafterthesweetnessoflowpricehasfaded.”

–BrianThomas,managementprofessionalThecostofpoorqualityisaseriousconcernforanyorganizationstrivingto

maintainacompetitiveedge.Itcanalsobeaconcernforcompaniesattemptingto cut costs; the lowest-cost option should never compromise quality. An

understanding of the costs associated with poor quality is most immediatelypertinenttothemanufacturingindustry,butthecostofpoorqualityisaconceptthatpermeatesallfields.Quality-relatedissuescanbedividedintofourgeneralcategoriesthatidentifythecostsassociatedwithlowquality(Figure24).Incurring somecosts to suppressothers is not anovel concept, and in these

cases it is almost an essential one. The level of quality monitoring andprevention of defects is dependent on many factors: the complexity ofmanufacturingorassembly,theneedsofthecustomer,difficultyinsamplingorassessing raw materials, work in progress, or finished goods. If the costs ofreworkingapart,retooling,reschedulingproduction,orscraparecostingtwentypercent,fortypercent,orinsomecomplexreworkingscenariosonehundredandfifty percent of the product’s original cost of production, then institutingmonitoringandpreventionplansisessential.Whilecoststomitigatedefectsarenotdirectlyvalue-added(thecustomerwill

spend thesameonapart froma lot thatwassampledasone thatwasnot) thelack of serious quality control measures can be considerably harmful to acompany’s operations. If customers cannot receive a part or a productmanufacturedtothespecificationstheyrequested,thentheirbusinesswillfollowthem elsewhere. Likewise, if a company cannot determinewhat the source ofdefectsiswithintheproductionlineorcannottracksuccessinimprovementstodefectreduction,thentherecanbenocertaintyofthequalityoffinishedgoods.

FacilityLayout&UniformPlantLoadingIn respect to facility layout for production there aremany considerations to

takeintoaccount.Itisalsoimportanttorememberthatfacilitylayoutisnotsetin stone; it is a concept that must be revisited periodically in the spirit ofcontinuousimprovement.Eachelementoftheproductionprocesshasanimpactontheothers,sochangingthecharacteristicsorpositionofasingleworkstationcan impact the entire production line. There are four types of facility layoutsdetailedinthefollowinggraphic.

FixedPositionLayout

Fixedpositionfacilitylayoutsareanappropriatechoiceforthemanufactureofproductsthatcannotbemovedduringtheproductionprocess.Thiscouldbedueto size or to the installation nature of the product. Some examples of staticproductsarecivilengineeringprojects,oceangoingvessels,airplanes,spacecraft,oilrigsorderricks,andsomeminingequipment.Herethechallengesassociatedwith the supply chain are twofold.Not only do the assembly components andrawmaterialshavetobeattheappropriatesiteattheappropriatetime,buttheymustarriveintheappropriateorder.

fig.25:Fixedproductlayoutsaremostapplicabletotheproductionofgoodsthatcannotbefeasiblymovedthroughaproductionline(suchasaircraftorlargestructures).Thisfacilitylayoutfocusesinsteadonmovingworkstationsasneededaroundastaticproductuntilproductioniscomplete.

Inthislayout,workstationsareoftenorganizedaroundtheproductduringtheproduction process. Unlike traditional production inwhich the productmovesthroughtheprocessphysicallyaswellasinthesenseofprocesscompletioninafixed layout facility plan, it is instead the workstations that physically movearound the productwhile it is “moving” through the production process. Thisalso presents challenges in the formof logistics, setup time, and supply chainresponsiveness. Because of the size and often the complexity of productsmanufactured using this layout, the volumeproduced is usually very low, andthereisahighlevelofcustomizationavailabletothecustomerduetothe“madetoorder”natureoftheprocesses.

ProductLayout

Product facility layout is more in line with what is normally consideredtraditional production.This is akin to the assembly linemodel inwhichmanysimilar or nearly identical products are produced rapidly. The production ofautomobiles,electronics,groceryitems,andcountlessconsumerandcommercialgoodsareproducedusingaproductlayoutfacilityplan.Thislayoutexcelsatproducingoneortwoproductsathighvolumewithvery

littledifferentiation.Thisconfigurationalsosimplifiesqualitycontrol,planning,scheduling, and supervision. It is the most easily automated method ofmanufactureduetoitshighlyrepetitivenature.Althoughspeedandcostarestrongattributes,thisfacilitylayoutsuffersfrom

alowlevelofresponsivenessandvaryingleadtimes.Setuptimescanbelong,and reactions to changing customer needs can be sluggish.Additionally, eachworkstation relies on the one before it, so waste in the process can be easilyamplified if a defective part is pulled (pull production system) through eachworkstation causingwasteful transportation andmotion throughout, ultimatelyproducingaproductthatrequiresscraporrework.Inthissamevein,stoppagesorbottlenecksatoneworkstationdirectlyaffecttheproductivityofworkstationsfurtherdowntheline.Theworst-casescenarioofthisdomino-styleeffectwouldbecompletelinestoppageorentirebatchproductionofdefectiveproducts.

ProcessLayout

Process facility layouts are the best choice for low volumes of products thathavehighlevelsofdifferentiation.Inthistypeofproduction,differentproductshave such varying needs that the creation of a line process or sequentialproductionprocesswouldbedifficultandcostly.Inafacilitylayoutthatutilizesthe process design, workstations and resources are grouped by productionprocess. In this way individual products may begin the process at differentworkstationsandfollowdifferentpaths,dependingonthespecificationsfortheircompletion. This results in the ability to produce a wide range of variousproducts.Thisconfigurationisevidentinserviceindustriesaswell.Consideradepartmentstoreorgrocerystore.Productsarestoredonshelves,anddifferentcustomers will move to different departments (read “process workstations”)dependingontheirneeds.Differentcustomerswilltraveldifferentpaths,andthedepartmentstorewillbeabletoprovidealargeassortmentofvaryingproducts.Customerscantravelfromareatoareaatwill;eachdepartment issetuptobereadyfortheirshoppingneeds.There are, however, numerous challenges anddisadvantages associatedwith

this method of facility layout. Because of the diverse nature of the differentworkstation groups,work in progress, inventory, and processing timeswill behigher on average than dedicated production lines. Products will spend moretimewaitingorintransitfromonedepartmentorworkstationgrouptothenext.This alsomeans thatmaterial handling costswill be higher and productswillneed to be in transit from one workstation group to the next more often.Scheduling and planning, too, becomes more complicated considering thatmultipletypesofproductsmaybequeuedtoasingleworkstationorworkstationgroup. This canmean significant and varying downtime during setup changesand line adjustments. In the visual example below, each workstation grouprepresentsaprocessordepartmentfortheproductionofadifferentproduct.

fig.27:Eachproductenterstheproductioncyclebasedonwhichworkstationsarerequiredtoproducefinishedgoods.Notallworkstationswillbeneededforeachproduct.

CellularLayout

Cellular facility layouts strive to maximize both flexibility and efficiency bypairingtheproductlayoutconceptwiththatoftheprocesslayout.Inthislayout,productsaregroupedintocategoriesbasedonprocessingcharacteristics.Thesecategories, or product families, determine the arrangement of small productlayoutgroups,orgroupsofproduct-orientedworkstations,calledcells.Thecellsthen utilize the product layout that is tailored to the production needs of thatcell’sassignedproductfamily.Inthiswaythediversityaffordedbytheprocesslayoutcanstillbetappedintheformoftheindividualcells.

ProductionLeveling

Production leveling is a method of reducing the waste generation ofunevenness in production flow. As the name implies, production levelingactivities are designed to allow the production of goods at a predictable andconstantrate.Thetaskofproductionlevelingisasimpleoneduringperiodsofconstantdemand,butinrealitycustomerdemandoftenfluctuates.Productionanddemandare twosidesof thesamecoin.Whenimplementing

production levelingmethods, decisionmakers can either target the productionside of the coin or the demand side. When leveling production from theproductionside,theapproachcanbefurtherrefinedto“levelingbyvolume”or“levelingbyproductmix.”

LevelingbyVolume

Productionlevelingbyvolumeoperatesonthekeyassumptionthatifvolumesofproduction are altered to meet fluctuating demand, then unevenness isincorporatedintothesystem,andthereforewasteisgeneratedduringperiodsof“forced” capacity production. Instead of tailoring production to short-termshipments, manufacturers maintain their expected production output,overproducingwhenordersdon’toutput (causing themtocarry inventory)andunderproducingwhenshort-termordersexceedoutput.These latter periods of underproductionwould be offset—in theory—by the

carriedinventorythatwasgeneratedbytheproductionthatexceededshort-termdemand. This intentional production of surplus (and associated costs) iscounterintuitivetomanyaspectsoftheLeanmodel.Takingabroadview,however,thecarriedinventorysimplifiestheproduction

process, and simplicity is a corecomponentofLean. It creates anevenness toproduction so that the rate of production isn’t fluctuating, and even thoughcarryinginventorydoesincurcosts, it is theroleofdecisionmakerswithintheorganization to determine which activity costs more: fluctuating productioncapacityorcarryinginventory.Additionally, while leveling by volume does ignore short-term demand, the

organizationisfulfillingtheaveragedemandinthelongrunbyrollingincarriedinventory to cover shortages when demand is high, and carrying that sameinventoryasaformofsafetystockwhendemandislow.

fig.30:Cyclicdemandshownovertime.Theshadedarearepresentsthefulfillmentofoveralldemand,throughexcessproductionandinsufficientproductionthroughoutthatperiod.Theblacklineatthe800-unitlevelindicatestheleveledaveragevolumeofproduction.

LevelingbyProductMix

Though inpracticeproduction levelingbyproductmix is adifferent approachthanlevelingbyvolume,thetwomethodsmaybeusedtogetherascostsdictate.Levelingbyproductmixislargelyuniquetoorganizationsthatemploythepullproduction system and that benefit from short line changeovers such as thosegained from aSMEDprogram.The flexible nature of small batch production,coupledwith the ability to change lines frequently for a low cost, compoundsflexibilityfurtherstill.Duetothehighdegreeofflexibility,awidervarietyoffluctuatingdemandfor

variousgoodscanbefedintoproductionwithoutthesignificantincreaseincostsassociated with more traditional production lines. To handle the complicatedscheduling, a kanban production system guided by a detailed heijunka boxmaintainsevennessofflowthroughouttheentireproductionlineandefficientlycoordinatescomplexproductionschedules.

ImplementationTechniques

Toensurethatproductionlevelingeffortsareproductiveandimpactful,thereisaprescribedmethodofbringingproductiontothesummitofresponsivenessandvalue.Agradualreductioninbatchsizeandincreaseintheabilitytomeetshort-termchangesincustomerdemandareslowlyfactoredintotheproductionsystemandtheresultsbuildononeanother.The following tiers of production organization are incrementally introduced

intotheproductioncycle.

Fixed Sequence/Fixed Volume (Green Stream/Red Stream): Products inthe mix with predictable or constant demand are added to productionaccordingly with fixed sequence production (green). Red stream (fixedvolume) products are those with demand that regularly fluctuates. Thisdifferentiationensuresthatthepropertreatmentisgiventoeachaspectoftheproductmix.Onceagreenstream/redstreamprogramisintroduced,itbenefitsfromtheeconomiesofrepetition,andcanbefactoredintonormalproduction.FixedSequence/UnfixedVolume:Thestreamsequencesaremaintained,butactual sales data, (short-termdemand changes) are factored in to impact theproductioncycle.

Unfixed Sequence/Fixed Volume: This method employs small batch sizes(fixedvolume),andadiverseproductmix(unfixedsequence).UnfixedSequence/UnfixedVolume:Herewehavean ideal statewhere theproductionlineissoresponsiveandflexiblethatthebatchsizeonallproductsis one. This is termed “single piece flow” and is the pinnacle of Leanmanufacturing. Essentially on-demand manufacturing, customer demand isalwaysmetwith100percentaccuracy,productionisalways100percenteven,andtheproductionlineisaLeanmachinethatgeneratesnothingbutvalue.

It is worth noting that the Toyota Production System never achieved singlepieceflowproduction.

DemandLeveling

Ontheothersideofthecoinisproductionanddemand,andproductionlevelingthrough the influence of demand deals with a radically different set ofapproachesandpractices.Oneapproachisforthemanufacturertocarefullycontrolthesalespipelineall

the way down to the customer. This “door to door” approach ensures anextremelyhighlevelofpredictabilitywithdemandwhilebuildingthelong-termvalue of the customer. Sales staff are agents of the manufacturer or licenseddealers,andateverylevelofthesalesmixthemanufacturerhassomemeasureofcontrol.During the development of theToyotaProductionSystem,Toyota used this

method to high-impact effect. Sales staff worked closely with customers andbuilt lasting and valuable relationships. On the production side of things,customer orders (demand)weremet almost on a vehicle-by-vehicle basis, andToyota was in control of the production-to-sales-to-delivery process, meaningthat not only was the Voice of the Customer loud and clear, but the rate ofdemandwashighlypredictable.Another similar—though distinct—approach to production leveling through

demandmanagementinvolvesacloserelationshipwith the sellers or retailers, and a deep understanding of their systems andprocessesaswellastheirsalesdataandtrendsrelatedtosame.Thinkingbacktodemand amplification planning, POS (point of sale) data can be a particularlyhelpfulresourceinthisrespect.

OtherTools:SixSigmaThoughnotafacetof theLeanmethod, theSixSigmaquality improvement

system is common within the sphere of the production industry and can bepairedwithLeanwithimpressiveresults.The statistical basis for the Six Sigma quality improvement program is too

exhaustivetodelveintohere;rather,aplainEnglishoverviewisoffered.InhisbookWinning, JackWelch, giant conglomerateGE’s former CEO, states thatSixSigmawas“adoptedfromMotorolain1995andcontinuesto[be]embracedtoday.” He also goes on to laud its abilities to enhance an organization’soperationalefficiency,improvingproductivityandloweringcosts.The program, like Lean, is a top-to-bottom design of an organization’s

operations and structure that strives to improve customer satisfaction, lowercosts,andcreatebetter leaders. Italsofocusesonproduct linesandproductionprocesses to reducewaste,variation, anddistortionor errorswithin the supplychain.Allofthesecharacteristicsaresettothegoalofcreatingthehighestlevelofcustomersatisfactionand,therefore,themostcompetitiveedge.Six Sigma adherent Jack Welch goes on to discuss Six Sigma’s practical

applications and results. Six Sigma excels at removing variation and defectsfrom repetitive tasks. This is a basic but effective application and applies tomany industries other than manufacturing and production. Service industries,too,canbenefitfromSixSigmauniformityinreducingdefectsinareassuchasbilling,customerservice,andsupplychainresponsetime.Thismorebasiclevelofapplicationhasapositivesideeffectontheorganizationaswell:ittrainstheranks of management to become high-level critical thinkers and improvesdiscipline.SixSigmaisalsoapowerfultoolfortheplanningandproductionofmassively

complexprojectssuchasturbinesandaerospaceassemblies.Itisusedtoidentifyinconsistencies and irregularities before large amounts of resources arecommitted to the project. This application is certainly more advanced andrequires the expertise of scientists and engineers well-versed in the statisticallanguage of Six Sigma. Expert Jack Welch cautions, though, that it is not aprogram that is designed to be applied to the creative process or to one-timetransactions. Statistical inspection of the product design process, for example,wouldbe farmoreofahindrance thanahelpandwouldgenerateunnecessarycost.

OtherTools:LeanSixSigmaAstheelementsthatmakeupLeanandSixSigmaareexplored,thepairingof

thetwobecomesanobviousinevitability.Bothmethodologieselevatethefocuson the customer to the level of guiding principle, and both focus on quality,wastereduction,andcostsavings.ThoughthebasicsofLeanSixSigmawillbecoveredhere,afullexplorationof thisdynamicpairing isbeyondthescopeofthistext.Both methodologies offer a diverse range of tools: Lean offers a flexible

approach, a broad view, a culture of continuous improvement, and a vigilantmindset.SixSigmaoffersabevyofhigh-poweredstatisticaltoolsandanalyses,acoreobsessionwithquality,afocusonstaffhierarchy,andacriticalthinkingmindsetsecondtonone.Whendeployedintandem,thehybridapproachofLeanSixSigmacantruly

elevate an organization to new heights of productivity, quality assurance, andcustomersatisfaction.Decisionmakerscanpickandchoosewhichtoolsarebestfor their organization,while adhering to standardization protocols that lay outwhichelementsbestaugmenteachother.Whilesometimesdoublingthesizeofa toolboxmeans finding the right tool for the job, Lean Six Sigma has beenstreamlinedanddevelopedinsuchawaythat toolsandprocessesdovetail intooneanother.Withthewealthofinformationavailable,andtheextensivehistorythatbothsystemshave,decisionmakersareabletoeasilyascertainwhatworksandwhatdoesn’tintermsoftoolsandprocesses.Although Lean Six Sigma is sometimes criticized for requiring massive

amountsofadministration,training,andplanning,implementingitnotonlypaysfor itself many times over, but also makes a bold investment in processes,people, and quality that builds and preserves a lasting competitive edge. Thegainstobehadintheareasofprocessimprovement,organizationalthinking,andunprecedentedqualitycontrolaremorethanworththetrade-off in time,effort,anddisruption.

ToRecapThe pull production system is a core element of Lean manufacturing. Incontrast to traditional push production, where demand is forecasted and“pushes”materials through the production cycle, pull production focuses onactualdemand.

Toevaluatethecurrentstateofsystems,andtobenchmarkcurrentconditionsforlatercomparisonsofprogress,thevaluestreammappingcollectionoftoolscan be deployed. Consisting of a variety of technical analysis tools, valuestream mapping seeks to differentiate value-added and non-value-addedaspectsofprocesseswithinthevaluestream.Tocoordinateandcontrolthereplenishmentandtrackingofproductsthroughtheproduction cycle, theuseof a systemof kanban cards ensures that oncematerials are used for production, an order is generated for theirreplenishment.Wheninplace,akanbansystemmaintainslevelproductionaswellasconsistent replenishmentandavailabilityofmaterials forproduction.Toschedulethecomplexkanbansystem,aheijunkaboxisdeployed.Thisisawallschedulebrokenintoagridpatternthatorganizesproductsinrelationtotimeintervalsofproduction.To determine a flowof production, the calculation of a takt time is used todetermineaproductionrate.Just-in-Timemethodscanalsobeusedtocreateanevenflow.Just-in-Timeistheschedulingofgoodsandmaterialstoputtheexact right amount in the right place at exactly the right time. JITmethodsreduce waste by eliminating the costs of carrying unneeded inventory andunnecessarytransportandwaiting.Alloftheseconceptssupportandenablethepullproductionsystem’srelianceon small lot production. Small lot production is a flexible and responsiveproduction system that focuseson smallerbatches thatmeetdemandanddonotcreatewasteintheformofexcessiveproductionorunneededinventory.Additionally, Single Minute Exchange of Die (SMED) programs strive toreduce line downtimes due to changeovers. Together, all of these conceptscontributetoeffectiveandvalue-addedsmalllotproduction.Ifvalueforthecustomerisafocusofoperations,thensotooshouldbequalityof finished goods. Not only is quality an important aspect of value, poorquality is often costly and generates significant amounts of waste. TotalQuality Management and a focus on the Voice of the Customer are bothaspects that an organization should embody if customer value is at theforefront.SixSigma is aqualitycontrol and systems improvementmethod thatvaluesstatisticalanalysisandcanbecombinedwiththeLeanframeworktoproducethe hybrid program, Lean Six Sigma. Lean Six Sigma draws from bothmethodologies to produce a quality-focused management program thatrelentlesslyattacksinefficiencyandwaste.

No matter the field of manufacturing, facility layout contributes to overallprocess efficiency. Facility layout can be broken into four rough categories:fixedposition,product,process,andcellularlayouts.Eachoftheselayoutshasstrengths and weaknesses based on the goods being produced. Once aneffective facility layout is implemented,production levelingcanbe initiated.Attempting production leveling activities without first optimizing theefficiency of production will result in significant amounts of unnecessaryadditionalwork.Production leveling is the process of reducing variance in the productionprocess, and two approaches exist: production leveling through production(volumeandproductmix)orproductionlevelingthroughdemand.

KeyQuestions(Answersonpg.137)

1. The pull production system differs from traditional push production inwhatway?

a)pullproductionrequiresmuchhighercyclespeedsb)pullproductionrequires less labor c) pull production paces productionwith demand d)thereisnodifference

2. Whichofthefollowingstatementsbestdescribesvaluestreammapping?

a)valuestreammappingisamethodoftricklingvalueacrosstheorganizationb)valuestreammappingisatoolusedtoanalyzethecurrentstateofprocessesandtoidentifywastec)valuestreammappingisatoolusedtocalculatetheproductiontimeperunitbasedontotalavailabletimed)valuestreammappingisamanagementtoolusedtoassistdecisionmakersinefficientemployeedeployment

3. Kanbanisacultureofcontinuousimprovement.

a)trueb)false

4. When employing Just-in-Time inventory and supply chain protocols,whichofthefollowingstatementsistrue?

a) goods and materials are scheduled in such a manner that only theamounts thatareneededaremoved throughout thesupplychain,whichreduceswasteandcarriedinventoryb)goodsandmaterialsarescheduledin such a manner that only the amounts that are needed are movedthroughoutthesupplychain,whichincreaseswasteandcarriedinventoryc) Just-in-Time drivers and warehouse workers are mandated to worktwice as fast to keep upwith tightened scheduling techniques d) visualscheduling techniques enable a more level product flow using Just-in-Timemethods

5. Whichofthefollowingisanadvantageofsmalllotproduction?

a) smaller lot sizes increase the flexibility of production b) smaller lotsizesreducewastethroughtheeliminationofsafetystockc)smaller lotsizesareveryresponsivetochangesindemandd)alloftheabove

6. What is thepurposeofexecutingaSMED(SingleMinuteExchangeofDie)program?

a) to increase the capacity of all transfer and stampingmachines b) toreduce the duration of downtime due to line changeovers c) to reducematerialsinventorythroughoutthesupplychaind)tolevelproductionbyfocusingonthedemandcomponent

7. SixSigmaisaLeanplanningtoolthatisusedtomeasurevisibility.

a)trueb)false

8. Theconstructionofahigh-capacitypassengeraircraftwouldprobablybebestcarriedoutunderwhichofthefollowingfacilitylayouts?

a)productlayoutb)cellularlayoutc)fixedpositionlayoutd)processlayout

|3|TheLeanToolkit

TheLeanToolkit

InThisChapterCause-and-effect tool Ishikawadiagramandphysicalpathwaymapping intheformofaspaghettiplotareillustratedPoka-yokemistake-proofingmethodsarecoveredindetailThedecisiontooutsourceandtheOutsourceDecisionMatrixarepresentedTheTheoryofConstraintsisdiscussed

Designed to augment the production processes laid out in the Leanmanufacturingmodel detailed in the previous chapter, the following series ofdiagnostic and problem-solving tools are useful for improving business andproductionoperations.Eachof these toolshaswideapplicationsoutsideof theworldofmanufacturingandcanbeadaptedtofitnearlyanybusinessinnearlyanyindustry—eventheserviceindustry.

IshikawaDiagrams(FishboneDiagrams)The versatile cause-and-effect diagrams developed by Kaoru Ishikawa are

commonly known as fishbone diagrams or herringbone diagrams because oftheir distinctive repeating chevron shape. Ishikawa diagrams are generallysuitedtotheprocessofidentifyingfactorscontributingtoanoveralleffect,andthateffectcanbeaslargeasthemacroscaleorassmallasthemicro.KaoruIshikawafirstdevelopedthefishbonediagraminthe1960saspartofa

trailblazing quality control program while he was with the now-famousmanufacturerKawasaki. Though fishbone diagramswere not a product of theToyota Production System per se, they were rapidly adopted, and are now acommonplacetoolintheLeanpractitioner’stoolkit.More distinct applications find the Ishikawa diagram in use through the

process of product design diagramming and quality defect prevention.As youwill see, theconstructionand implementationofaneffective fishbonediagramcan be a time-consuming process. Multiple rounds of brainstorming andinvestigationshouldbeplannedanddeployedcarefully.Whentherootcausesofa problem are fairly clear—machine inefficiency due to poor maintenanceprotocols, for example—a fishbone diagram is completely unnecessary andwouldcausemoreharmthangood.Fishbone diagrams are best used to disrupt a team’s thinking and add a

structuredapproachtoacomplexproblem-solvingprocess.Whenitseemslikepersonnel are spinning their wheels tackling a complex effect on operations,that’stheidealtimeforapplicationofafishbonediagram.Foundationally, theIshikawadiagramgroupstogethercontributingfactorsor

causes into categories that take a variety of production aspects intoconsideration. Known as the 5Ms of manufacturing, the primary causalcategoriesareasfollows:

Machine

Themachine category encompasses any equipment related to the process orneededtoaccomplishthejob.Thisincludescomputersystems,productiontools,methodsofconveyance,etc.

Method

Methodsaredefinedasthespecificprotocolsthatgovernaprocessoroperation.Thiscouldbeas tangibleasproductionspecs,oras intangibleasdepartmentalpolicy.Evenorganizationalpolicycouldhaveatrickledowneffectonday-to-dayoperations,sothemethodologycategorycanbecomplextoevaluate.

Material

Materials include all of the material aspects associated with a process. Rawmaterials, work in progress, and finished goods are obvious for themanufacturing sector, but less obvious are finishing materials, fasteners, andotherancillarycomponents.Suppliesandinventoriesshouldalsobeconsideredundertheheadingofmaterials.

Manpower

Manpowerencompasseseverypersoninvolvedintheprocess,fromthesetsofhandsontheproductionlinetoforemen,supervisors,management,andbeyondifapplicable.Contractors—thoughnotemployees—maystillhaveahandinthefactors that bring about a certain effect, so they should not be left out of theequation.Likewise,criticalstafffromsuppliersandcustomerscanhaveaneffecton an organization’s operations. While recourse or corrective action may belimitedinthesecases,understandingthesourceofanimpactmeansthatdecisionmakersaren’tentirelypowerless.

Measurement

Measurementdescribesthetotalofthedatathatisgeneratedfromorabouttheprocess. This not only includes normal, day-to-day business metrics, butmonitoringandinspection-generateddataaswell.Dataisonlyasaccurateasthemeans by which it was gathered. A critical look at the tools and systems bywhich the data that is used in critical decision-making is an essential part ofunderstandingtheunderlyingcausesofdiscreteeffects.Itisworthmentioningthatthereisanotherwidelyrecognizedbroadcategory

that may be factored into causal classification: environment. Environmentconstitutesaspectssuchastemperature,geographiclocation,culturalnorms,andallothermiscellaneousaspectsofproduction.Some interpretationsof the5Msincludeasmanyaseightgeneralcausecategories,thoughtheprevailingtheoryisthatstickingtothebasicsisasaferandsimplerapproach.As with all aspects of Lean, especially expressions of Lean outside the

manufacturingandproductionsectors,thebusinessshouldneverbestretchedtofit theLeanmodel.TheLean frameworkprovidesaguideandabestpracticesprotocol system thatgivesdecisionmakers the tools theyneed tobuildhighlyefficientbusinesses.Theproposedcausesofaneffectaredeterminedthroughaseriesofbrainstormingsessionsandthroughrigorousinvestigation.Ifacauseisdetermined that is unique to an industry or to an organization that defiesclassificationasoneofthe5Msofmanufacturing,thatdoesnotmeanthatit isinvalid.

Adaptability and flexibility are core components of the Lean philosophy;industry leaders that truly understand these concepts should never shy awayfrom repurposing the Lean toolkit to fit the needs of their business. In thisrespect, the 5W1Hmethod can be particularly helpful in determining the rootcause of a problem and shaping a fishbone diagram to fit the needs of thebusiness.Ifasixthcategory,environment,isappropriateforaparticularindustryor organization, then those fishbone diagrams should include an environmentcategory.Thesameistrueifthereisarealneedforsevenoreightcategories.

ToolsOutsideofManufacturing:FishboneDiagramsLean can be utilized across a wide spectrum of industries and business

applications,manyofwhichwouldhavelittleuseforthe5Msofmanufacturing.Asaresult,someotherfieldshaveadoptedamorecontextuallyappropriatesetofcausalcriteriafortheirownfishbonediagrams.

The8P’sofMarketing

Product/ServicePricePlacePromotionPeopleProcessPhysicalEvidencePublicity

Sometimescondensedintoasmallerlistofcoreelementsknownasthe4P’sofMarketing(product,price,place,promotion),conventionalfishbonediagramwisdom tells us that expanding the scope to include other, often overlookedaspectsof themarketingmixcanhelpdecisionmakersdetermine the true rootcausesofissues.

The4S’sofService(nottobeconfusedwiththe5SMethodfoundlaterinthistext)

SurroundingsSuppliersSystemsSkills

As evidenced by their application across a broad variety of industries,fishbone diagrams are highly effective tools for the structured investigation ofcauseandeffect.

SpaghettiPlotSpaghetti plots are versatile visual representations of data in the context of

flowthroughasystem.TheyareaclearcompaniontotheLeanmethodwithitsfocusonflowandevennessofproduction.Thenamecomesfromthelongandwavydatadepictions; the trendsresemble longnoodles laidout.Whenappliedin a business environment, these visual charts are often known as workflowdiagrams.With statistical applications across all fields of science, from biology and

zoology to meteorology and climatology, even the fields of medicine andpharmacology implement spaghetti plots to track flows.When the concept isapplied to business, it can become a valuable tool that demonstrates exactlywherewasteeventsoccur,notonly in flow,but in inefficient transport, travel,and facility layout. In a more abstract sense, the flows of information andfinancials can also be fit to a spaghetti plot, and trend information aswell asefficiencycanbemeasured.Aswith somany of the tools in theLean toolkit, the goal of implementing

spaghetti plots is to identify waste through the clear differentiation of value-addedandnon-value-addedactivity.Whenusedtotrackaproductthrougheachproductionworkstation,orforthelayoutofanoffice,workshop,orstoragearea,the overlaying lines can be instructive to decisionmakers in regard to wherestreamliningshouldoccurandhowtoaddresslayoutstoconsolidateefforts.Tobuildaspaghettiplotofaworkspace,followthesesteps:

1. Maptheworkspaceasitphysicallyoccurs.2. Merge the stepsof a processwith themapbyplotting each step in the

appropriatelocationonthemap.3. Connecttheplottedpointswitharrowstoindicatedirectionofflow.

Theresultingchartisavisualdisplayoftheflowofworkthroughthemappedspace and can serve to inform layout andworkflow decisions. Look for areaswhere linescrossoneanother frequently.Theseareasshouldbeaddressedandredesigned for a cleaner flow and to eliminate the additional labor ofbacktracking. If there is a single station that sees paths coming backmultipletimes,theworkthatiscompletedthereshouldbeinvestigatedtoseeifitcanbedoneatthesametimetosavewastedlaborandmovement.

Poka-YokeWhile many of the Leanmanufacturing tools focus onmechanical systems

andmethods of production, the concept of poka-yoke is a tool to correct thebehaviorofthehumanelementwithintheproductionprocess.DerivingfromtheJapanesetermyokurupoka(looselymeaning“avoidmistakes”),apoka-yokeisaprocess,protocol,ordesignthatdrawsattentionto—andreduces—therateofhumanerror.Asabroaderconcept,apoka-yokemeasuremaynotbeatangibledesign; it could be a behavioral conditioning or training protocol that has thesame effect. In colloquial English, poka-yoke measures could be considered“foolproofing.”A poka-yoke measure is an intentional constraint, most often found in the

formofaprocess step.The ringpullof a fire extinguisher is anexampleof apoka-yokemeasure.Inordertodischargeafireextinguisher,theringpullmustfirstberemoved.Thisensuresthatthecanistercannotbeaccidentallydischargedsothatthefiresuppressantinsideisalwaysreadyintheeventofafire.In the world of manufacturing and production, poka-yoke measures are

implemented to reduce the rate of defective production right at the source.Successful poka-yoke design results in the immediate recognition and simpleresolution of common human error. In practical applications, poka-yokemeasuresaretailoredtotheenvironmenttheyareintendedtoimpact.Modifyingproductionmachinerytoonlyacceptproductioncomponentsinthe

correct orientation is a simple, yet effective, poka-yoke measure. Operatorssimplycannotloadpartsincorrectly;anyattempttodosoismetwithimmediatefeedback(thepartdoesn’tfit).Digitalcountersthattrackactionstoensuretheirconformitytospecifications

aremorecomplicatedpoka-yokemeasures.Preventingawelderfrommovingonto the next part unless a certain number of welds have been completed, forexample, ormodifying aworkstation so that its tools canonlybe used in oneway,arebothpoka-yokemeasures.

TheDecisiontoOutsourceOutsourcing is fast becoming a smart strategy for businesses in every

industry.Outsourcingisthedecisiontoworkwithathirdpartyvendor,supplier,orserviceprovidertocarryoutbusinessactivities.Inmanycases,thisissimply

amatterofcontractingafirmthatspecializesinonebusinessareatoleveragetheeconomies of core competency. This third party firm could be in the sameneighborhood, across the country, or across the globe.Common activities thatareoutsourcedincludetransportation,warehousemanagement,ITservices,andcustomerserviceadministration.When an organization simply isn’t competent in a business area, a serious

examinationofcostandvalueshouldariseinregardtotheoperationsthatmakeup the area of deficiency. Sometimes decision makers find that while theorganizationisn’tequippedtohandletheseactivitiesintheircurrentstate,orthatthecoststoreachastatewheretheorganization’slevelofcompetencywillmakefinancialsenseinthelongrun.Other times, decision makers find that deficiencies in these areas are

impossible to overcome in any manner that makes financial sense, and thedecisiontooutsourceorkeeptheseactivitiesin-houseisputonthetable.Effective and successful outsourcing can provide a host of benefits. New

talentandfreshmindsareexposedtoyourorganization,alongwithnewwaysoflookingatoperationsandnewefficiencymethods.Onceareasofdeficiencyorhighcostareoutsourced,theorganizationnowhasmoreresourcestodevotetoareasofcorecompetencyandinnovation.Outsourcing can be a double-edged sword, however; poor outsourcing can

leadtoalossofproprietaryinformation,intellectualproperty,andtheinclusionof components into the value chain that are below organizational qualitystandards. This makes the outsourcing decision a tricky one, and carefulconsiderationshouldbetakenthroughouttheprocess.To aid in the determination of which operations or activities should be

outsourced, theOutsourcingDecisionMatrix is avaluable tool.Thismatrix isbasedontwocriticalpiecesofinformation:

Criticality

How strategically important is this activity to maintaining the business’competitiveedgeandachievingstrategicgoals?

Impact

Whatistheimpactofthisactivityonoperations?Thecombinationofthesetwofactorsproducesfourpossibleoverallcategories

forbusinessactivities:

HighCriticality,HighImpactHighCriticality,LowImpactLowCriticality,HighImpactLowCriticality,LowImpact

HighCriticality,LowImpact :Forma strategicalliance.Theseactivitiesarevitaltothesuccessoftheorganization’slong-termplans,buthavelittleimpacton the success of operations. This means that it is in the organization’s bestinterest toretain thehighestdegreeofcontrolpossible,whileallowinganotherfirm with a competitive advantage in their own field to handle the specifics.High criticality, low impact (HCLI) operations often include marketing andadvertising,salesandpromotion,andvariousdistributionmethods.

HighCriticality,High Impact :These activities should be retained in-house.Dueto thepotentiallycatastrophicoutcomeof theseactivitiesbeingperformedincorrectly, they should be kept in-house regardless of financial instability orcost deficiency. Operational and strategic health depend on on them, andtherefore they are large contributors to competitive edge and in many casesconstitutecorecompetencies.

LowCriticality,HighImpact:Activitiesthatfallintothisquadrantareprimecandidates for outsourcing. These activities do not impact the strategicpositioningofthecompanyandthereforecompetitiveedge,buttheydohaveahigh impact on the way in which operations are carried out. Thatmeans thattransferring theseactivities toa thirdpartyvendor that specializes in themcanfreeuptimeandresourcesforhighcriticality,highimpactactivities.Activities such as distribution fall neatly into this category. Distribution of

finishedgoodsisahighimpactactivity;ifgoodsdon’treachdownstreamsupplychainentities,thentheorganizationhasaproblem,butasfarasaspirationsandcore competencies are concerned, distribution has only a small role. It issomething that must be done for the day-to-day operational success of thebusiness,butitplaysalimitedroleintheorganization’sstrategicgoals.

LowCriticality,LowImpact :Activities thathaveneitheramajor impactonoperations nor a role in strategic planning should be examined closely.Whileyou may not be able to eliminate these tasks completely, they should bescrutinized as potential sources of waste. Questions regarding LCLI activitiesshouldincludethefollowing:

Whyarethesetasksundertaken?What,ifanything,dotheyaccomplish?What operations, activities, or processeswould be affected if these LCLIactivities were either eliminated or combined with higher criticality andhigherimpactactivities?

TheOutsourceDecisionMatrixisnotatoolthatisuniquetoLean.Itcanbeinstructivefordecisionmakersacrossavarietyof industrieswhoareassessingwhether or not to outsource certain activities. For those adhering to Leanphilosophy, the outsourcing decision is made more complex by some of themore rigorous Lean scheduling and production components. Based on thepossible introduction of waste into the system, Lean organizations have an

additionalsetofcriteriabywhichtojudgepotentialthirdpartycontractors.Itisimportanttorememberthatsimplyhandingoffcostandpotentialsources

of waste to another company does not remove that cost and waste from theoverall value stream.A reduction in value for the customer—whether as cost,quality,or someothervaluecharacteristic suchas timelinessofdelivery—willalwaysoccurifwasteandinefficiencyexistsomewhereinthevaluestreamandsupplychain.TheLeanprincipleofanalyzingsystemswithabroadviewaimstokeepthisaspectintheforefrontofthemindsofdecisionmakersinallaspectsofstrategicdecision-making.

TheTheoryofConstraintsThe Theory of Constraints (TOC) is a management and production

philosophy geared toward continuous improvement and goal-orientedachievement. While the TOC was developed in the Western world,contemporary Lean practitioners use it as a structured approach to continuedimprovementandproductionanalysis.TheTheoryofConstraintsisbasedonthepremisethatasystemisalwaysinhibitedbyatleastoneconstraint.Thispremiseis achieved through the following rationale: if therewas nothing stopping thesystem from operating at full capacity (no constraints) then the systemwouldgeneratevalueinincreasingamountsadinfinitum.Thisisofcourseimpossible;thereisaphysicalceilingtotheperformanceofanysystem.The Theory of Constraints seeks to find that physical ceiling through the

focused and systematic elimination of artificial ceilings—constraints—that areimpedinggoalachievement.Thisisdonethroughaseriesofstructuredfocusingsteps. As with all expressions of continuous improvement, the TOC focusingstepsaredesignedtobeappliedcyclically.TOCemploysitsownformofLean’skaizen,termedPOOGI—processofongoingimprovement.TOCFiveFocusingSteps

1. Identifythesystem’sconstraint(s).2. Decidehowtoexploitthesystem’sconstraint(s).3. Subordinateeverythingelsetotheabovedecision(s).4. Elevatethesystem’sconstraint(s).5. Ifinthepreviousstepsaconstrainthasbeenbroken,gobacktostep1).

Thefivefocusingstepsexisttonarrowtheapproachtoconstraintreduction.In

the modern business world, it can be easy to become overloaded withinformation,andthefivefocusingstepsaimtocutstraighttotheissues.Whilethe list of steps is simple enough, in practice quite a bit of planning andinvestigationcangointoeachstep,especiallyiftheprocesshasbeencompletedandthesystemhasbeenelevatedseveraltimesalready.Aconstraint is anything that is preventing consistent goal achievement.The

TOCoperatesontheprinciplethattherearenotthousandsofconstraintswithina system, but that the overreaching effects of constraints can be reduced to ahandful.Constraintsarebrokendownintotwocategories:internalandexternal.Internal constraints consist of subcategories such as equipment, people, andpolicy. An equipment constraint could be a mechanical threshold that ispreventinghigherlevelsofproduction.Aconstraintinregardtopeoplecouldbea prevailing attitude or systemic lack of skill and understanding. Policy-basedconstraintscome in the formofeitherwrittenorunwrittenprotocols that limitthesystem’soutput.Externalconstraintsarethosethathaveanimpactontheabilityofthesystem

toconsistentlyachievegoals.Thesecouldberegulatorystatutes,culturalnorms,orpublic infrastructureshortcomings.While insomecasesexternalconstraintscan be elevated and “broken,” the TOC methodology focuses primarily oninternalconstraintsasbeingthemostproductivetotarget.Whenaconstraint iselevated to thepoint that it is reducedcompletely, it is

considered to be “broken.” Once a constraint has been broken, the TOC’soverridingpremiseisthatthereisalwaysatleastoneotherpartofasystemthatislimitingorbottleneckingit.Thefivefocusingstepsshouldbeappliedtothatsystemonceagainandtheprocessstartsover.Itisimportanttonotethatthebroadconstraintcategoriesofferamultitudeof

sources of productivity and output loss, but in many instances these are notconstraints in theTOCsenseof theword.Aconstraint isa limitingfactor thataffects a system or a process. When a production line employee requiresretraining, that is not a constraint. When the entire production line staff isinsufficientlytrained,thatisaconstraint.Likewise,amachinethatsuffersfromfrequent malfunction due to improper preventative maintenance is not aconstraint.Whentheentireproductionlineismadeupofmachinesthatareill-suitedtotheirtasks,thatisaconstraint.Constraintscanbeseenasbottlenecks,andthisisakeypointtounderstandin

regard to how the Theory of Constraints interactswith the Leanmodel. TOCfocuses on the current system and what is limiting it. The goal of the five

focusing steps is always to improve the system and raise the ceiling ofproduction.This goal is in linewith theLean system, thoughTOCemploys adifferentapproach.

Additionally, TOC differs from the Lean method in the sense that it iscenteredonprocessesandnotproducts.TheLeanmanufacturingmodelandthepull production system are value-driven and, as a result, focus on products.Though distinct from the path of Lean philosophy, TOC still has practicalapplications in determining bottlenecks within a system and determiningpracticalandsustainablewaystoincreaseproductioncapacity.

ToRecapTheLean toolkit isacollectionof techniques thatcanbeapplied toexistingprocesses to gain insights or to spur innovation. All of the tools thataccompany the Lean framework strive to uncover areas of waste, highlightpotentialincreasesinefficiencyandproductivity,anddeterminetherootcauseofproblemsplaguingtheproductionprocess.The Ishikawadiagram, alsoknownas the fishbonediagram, is a cause-and-effect mapping tool designed to investigate the causes of an effect at theirmostfundamentallevel.Aspaghettiplot,orworkflowmap,visuallydetailsthepathstakenbypeopleor goods. Spaghetti plots are highly applicable across a wide variety ofindustriesandcanbeusedtomapanyactivitythatcanbeexpressedasaflow.Poka-yokemeasures, anotherLean tool, are artificial constraintsdesigned toturnactivities intoprocessesandtoreducethe impactofhumanerrorontheproductionprocess.TheOutsourceDecisionMatrixmatrixisaquadrantmatrixthathelpsdecisionmakers determinewhich activities are candidates for outsourcing andwhichshould be kept in-house. The tool also highlights those activities—lowcriticality, low impact activities—that should be addressed to determinepotentialsourcesofwasteandinefficiency.TheTheoryofConstraintsisaprocessimprovementmethodthatusesaseriesof focusing steps to identify and elevate constraints causing expensivebottleneckswithinasystem.Basedonthepremisethatthereisalwaysatleastone constraint that is limiting a system, the Theory of Constraints seeks togrowproductioncapacity,efficiency,andproductivity.

KeyQuestions(Answersonpg.137)

1. Ishikawadiagrams,alsoknownasfishbonediagrams,areusedforwhatpurpose?

a) fishbone diagrams are a productivity mapping tool b) fishbonediagramsareacostevaluationtoolc)fishbonediagramsareaschedulingtoold)fishbonediagramsareacause-and-effecttool

2. Aspaghettiplotcanbeusedtomapwhichofthefollowing?

a) the path thatmaterials take across the factory floor b) the path thatemployees take during production activities c) the path that employeestakewithinanofficesettingd)alloftheabove

3. Poka-yoke measures are designed to reduce which of the followingwithintheproductionprocess?

a)costlyemployeeovertimeb) defects caused by human error c)machine deterioration due to poormaintenanced)wasteeventslinkedtotransportation

4. The decision to outsource is complex and focuses on the relationshipbetweenimpactandcriticality.

a)trueb)false

5. TheTheoryofConstraintsisasetofprocessimprovementtoolsfoundedonwhichofthefollowing?

a) the assumption that demand changes in a predictablemanner b) theassumptionthatproductioncanbescaledtofitfluctuatingdemandc)thepremise that there is always at least one constraint that is limiting asystemd)thepremisethatasystemstartsoutwithnoconstraints,butthatconstraintsaretheproductofhumanerror

|4|ImplementationConsiderations

InThisChapterThe Lean focus on respect for people and the value of the workforce isdiscussedThe5SmethodformaintainingaLeanworkplaceisexplainedindetailThe path to implementation and concerns for organizations attemptingimplementationaremappedoutfororganizationsanddecisionmakers

The implementation of Lean across a large organization is amassive task. Inmany cases it requires an entire restructuring of organizational culture.Whilemany firms claim to value the input of employees on all levels; claim tovigilantly seekoutandeliminatewaste throughoutoperations;andclaim tobeagile, flexible, andvisible, the reality is that the rigorsof theLean frameworkreflectanight-and-daychange.Just like the evaluation process for operations and processes, adoption and

improvementismeasuredagainstresultsandhigh-levelormacrotargets.Thisisdistinct from the framework of other adoption programs, which focus on thenumberofprogramadoptionactivitiescarriedout.Eveninimplementation,theLeanprogramdifferentiatesbetweenvalue-addedactivitiesandwastefulones.This “hit the ground running” value differentiationmindset complicates the

already complicated nature of Lean adoption within an organization.Implementation does not happen overnight. The extensive execution of pilotprogramsandtrainingcanbeacostlyprocess,andthesestepsrepresentahighbarrierthatmustbeovercomebeforetheLeanculturecanbespreadacrosstheorganization.

RespectforPeopleA common thread that runs throughout the Lean business model is a firm

commitment to respect for people. This is not a facility layout, value stream

evaluation, or production method, and it is more than simply a culture ofcontinuous improvement. It is apparent in business practices and decisions aswell as interactions between management and employees on the productionfloor.Many companies claim that their greatest assets are their people, but areview of their policies and procedures would reveal that there is room forimprovement.Thereisanentireindustryofliteraturedevotedtomanagementtechniquesand

methodsofimprovingefficiencyandproductivityamongaworkforce.TheLeanbusinessmodeldoesnotstrivetoprovidetheanswerstothosequestions,butadedicated kaizen mindset ensures that everyone has a seat at the table. Thedevelopersof theToyotaProductionSystem identified the fact that innovationsprings fromall levelsofanorganizationand that respect forone’sworkforcegarnersrespectfortheworkplaceinreturn.While it would stand to reason that an increased level of freedom,

participation, and respecton thepartofmanagement towardemployeeswouldbeasmoothtransitionforaworkforce,somewhatsurprisingly,individualsmustbe trained tocontributemeaningfully. Innovationandcontinuous improvementare the twin engines of the Lean methodology; to achieve this, employeeinvolvement at all levels and a competitive atmosphere of trialing andexperimentationareessential.In addition to management-employee relations barriers that may exist, a

commitment to respectingpeople alsomeansplacing a highdegree of trust inthem.Whenmanagementtransferstrusttotheiremployees,theyloseameasureof control, but employees gain a high degree of autonomy within theorganization. That is to say, employees are empowered to make appropriatedecisions on their own. Operational and low-level strategic decisions aredelegated,asaresystemsdevelopmentefforts.Toprime theorganization foradesire to change and to adapt, a less risk-averse position must also beencouraged.For some firms, all of these aspects can be terrifying prospects, but with a

broadviewmentalityandaninvestmentintheirpeople,thedevelopmentofstaffasanorganization’sgreatestassetispossible.

The5SMethodRespectforpeopleandrespectfortheworkplacearegoalsthatareasloftyas

theyarenebulous. Inorder toensure that these two importantaspectsofLean

implementationaresufficientlymet,the5Smethodisprescribedasaclearwaytomeasureexpectationsforbothemployeesandmanagement.Often hailed as the guidelines that enabled the timeliness of JIT

manufacturing,the5Smethodcancomeacrossashumbleorunderwhelmingatfirst look, but is in fact a powerful workplace organization method. The 5SmodelderivesitsnamefromthefiveJapanesetermsseiri,seiton,seiso,seiketsu,and shitsuke.Oncewritten inRoman script, each of thewords startswith theletter‘S,’hencethename.The5S’s translate looselyassort,segregate,shine,standardize,andself-discipline.

Sort

The sort portion of the 5Smethod can be quickly summarized by the phrase“everythinghasaplace.”Sorting isapracticalextensionof theLean focusonwaste reduction.When aworkstation or an employee’swork area is “sorted,”everything is in its place. Unnecessary items, or items that are not needed athand,arestoredproperly.Ifdisposalisrequired,thentheseitemsaredisposedofproperly.These simple concepts can expand to encompass a diverse range of

circumstances,objects,andmaterials.Asortedworkplaceisonethatdefiestheaccumulationofunwantedorwastematerials.Thismeans that there are fewerobstaclestoproductiveflow—aworkstationthatisfreeofdebrisisanefficientworkstation—and that wastematerial is removed from the production stream.This macro-scale concept trickles down to the very micro scale of employeeworkstationsandevenareaswhereemployeesmaystorepersonaleffects,suchaslockersandbreakareas.Properandthoroughsortingdoescomewithanadministrativecost,however:

it is necessary to constantly evaluate which items and materials are in factnecessaryandwhichshouldbestoredordisposedof.Theseevaluationactivitiesareoftencarriedoutbyadedicatedsupervisororfrontlinelevelleaderandcantake time away from other value-added activities. Additionally, if items aredeemed“unnecessary”butarenotwasteorarenotinneedofdisposal,thentheymustbestoredcorrectly.Thisconsumesspace, timefortransport,andtimeforthecoordinationofstorage.Storage areas should be red-tagged as necessary to prevent the accidental

reintroduction of unnecessary materials and items back into the productionstream,ortoreinforcethefactthattheyareonlyneededinsomecircumstances.The rationale for these costs and additional work, of course, is that overall

productivity is increased and workflow is undisturbed through obstacle-freeproduction.Sortingstrives toreducewasteeventsacross theboardbut focusesonreducingunevennessinworkflow.

Segregate

The segregate aspect of the 5S method is the next logical step after sorting.Whilesortingidentifieswhichitemsarenecessary,segregationisthepracticeof

organizing those items in suchaway that theywillproduce themost efficientbenefit.Segregationactivitiesmeanarrangingtoolssothatthehighest-usetoolsare closest at hand. Itmeans ensuring that the peoplewho have a constant orconsistentneedfortoolsandmaterialscaneasilylocateandaccessthosetoolsormaterials, and that all of theirwork can be done in themost efficientmannerpossible.Just like every other aspect of Lean, segregation is not a onetime activity.

SegregationactivitiesshouldregularlybesubjectedtoPDCA-stylereview,andthoseemployeesresponsibleforsegregationactivitiesshouldbeempowered tomakechangesastheneedarises.Sortingandsegregationareinterrelatedprocesses,asaresegregationandthe

next“S,”shine.Inoneinterpretationofthe5Smethod,segregationandshinearecombinedintoasingleactivity,effectivelyproducinganalternative4Smethod.This is reflective of the kaizen approach thatmakes up the backbone ofLeanmethodology:alwaysbeimproving,alwaysbelearning,andalwaysbeflexible.If,inimplementation,itmakesmoresensetoaggregate5Smethodologiesinto

single, hybrid activities, then that is what should be done. Stretching anorganization to fit the Lean model is a backward approach and a losingproposition. Instead, Lean—and the 5S method—should be stretched andtweakedtofittheorganizationanditsproductionactivities,culture,andspecificproductionprocesses.

Shine

Shineembodiestheconceptthatcleanlinessisnexttogodliness(sotospeak).Itissometimesreferredtoas“sweep”or“scrub.”Notonlydoemployeeswhoworkinacleanandwell-maintainedworkplacehavemorerespectfortheiremployerandtheirresponsibilities,butthereareanumberofpracticalbenefitsofacontinuouscommitmenttocleanliness.

Regular cleaning of workstations and equipment means that there are nobarriers to efficient production and labor. Just as the 5S practice of sortingeliminates unnecessary objects and materials to ensure an even workflow, aclean and orderly workstation is always ready and easy to navigate. Regularcleaningisapreventativemeasureaswell;itreducestheeffectsofwearandtearonequipmentandcanprolongthelifeofcriticalproductioncomponents.

Acleanworkenvironmentisalsothefoundationofasafeworkenvironment.From thevery rudimentarypracticesofcleaningspillsandclearingdebris thatcancauseslips, trips,andfalls to themoreadvancedactivities thatensure thatsafetyequipmentcanworkwithoutimpediment,cleanlinessisavitalcomponentofsafety.Cleaning activities can serve another purpose: cleaning as inspection.

Thoroughcleaningalreadytakesadeepdiveintoequipmentandworkstations—why retrace your steps a second time for a follow-up inspection? Schedulingcleaningroutinestocoincidewithmaintenanceinspectionssavestimeandeffort.Cleaning routines can also be employed to maintain and monitor other 5Smethodactivitiessuchassortingandsegregation.The effectiveness of a rigorous shine program is often evaluated using the

followingphrase:“Anyonenotfamiliarwiththeenvironmentshouldbeabletodetectproblemswithin5secondsfromwithin50feet.”

Standardize

Standardization is a common theme within the Lean framework. Standardsprovidebenchmarksbywhichperformancecanbemeasured,andifperformancecanbemeasured, areasof opportunity for improvement canbe identified (andimprovement must be continuous). The standardize portion of 5S serves toensurethatallother5Sactivitiesaretargeted,productive,andgoal-oriented.Just as all the tools and equipment on the production line and at employee

workstationsmustbeintheirplaces,sotoomustthe5Sactivitiesbeorganizedand monitored. Standardization codifies best practices and maintains theorganization’sintentandstandardsinallaspectsofdeployment.

Self-Discipline

Self-Discipline, also known as “sustain”, ties all of the other 5S activitiestogetherinamannerthatischaracteristicoftheLeanframework.Thedefinition,and therefore translation,ofshitsuke, the fifth“S” inJapanese, isnuancedandcomplex.As a result, sustaining and self-discipline are both only parts of theconceptbehindtheword.Shitsukecanbedefinedintwoways.Thefirstismoreakintodisciplineinthe

forceful sense of theword—it takes force to align all of the 5Smethods intoplace. In thissense, thebarriersofchangeareunderstoodanddescribed.Once

thesechangesare inplace, thesecondandmoreprevalentmeaningofshitsukebecomesrelevant.Thisistheprocessofself-disciplinethatismoreinlinewiththeEnglishdefinition:thestructuredandconsciousefforttomaintainstandardsandpractices.Todowhatisnecessary“withoutbeingtold.”The aim of this text is far from an exploration of Japanese language and

culture,buttheaboveexampleisinstructivetostudentsoftheLeanphilosophyin the idea that Lean is far more than simply a rulebook for productive andefficientmanufacturing. Examples like the one above underscore the fact thatLeanisacompleteoverhaulofanorganization’scultureandperspective,anditshouldbeviewedassuch.AcommitmenttotheletterofLeanwhilefailingtocommittothespiritwill

onlyproducehalf-measuresofsuccess.

ThePathtoImplementationThe organization-wide implementation of Lean is not an undertaking to be

considered lightly. While the tremendous gains that can be had through theadoption of Lean are enough to entice themanagement of anymanufacturingconcern, the process requires total organizational commitment, and in manycases a completely new way of thinking, a revised mindset, and a radicallydistinctcorporateculture.It is no surprise, then, that the checklist for Lean manufacturing

implementation is a lengthyone.What follows is abroad strokesguide to thekey components of an organizational shift to the Lean manufacturingframework. Keep in mind that, as with all dramatic change, benefits are notrealizedovernight.Thekaizenmethodofimprovementsubscribestothenotionthat the most impactful changes are executed in an incremental fashion withinnovation in mind. Once the foundation is established, constant and vigilantincremental improvement and waste reduction measures achieve ToyotaProductionSystemlevelsofLeanachievement.

TheLeanManufacturingImplementationRoadMap

1. KeyPeople:Formateamtoleadthecharge.ThereshouldbeamixofLean manufacturing specialists and those with general businessexperience. If no specialists exist within the organization, there is an

entireindustryofLeanconsultantswaitingtofillthisrole.2. Open Channel of Communication : Establish an open channel of

communicationforeveryoneinvolved.Thislevelofvisibilityisessentialto successful implementation efforts and coordination of the “leap toLean.”Visibilitywithin the initiativeand transparency fromoutside theimplementationteamwillhelpbuildtrustthroughouttheranks.

3. FoundationalTraining:ThisisthefirstroundofimmersionintheLeanphilosophy. Focus first on the structure that makes up the Leanframework: the culture of kaizen; the elimination of muda, mura, andmuri; the principles of PDCA; flexibility; etc. While more thoroughtrainingwillbenecessaryforkeyplayers,everyemployeeatalllevelsoftheorganizationshouldbefamiliarwiththefoundationalconceptsoftheLean framework.The innovativeproperties of kaizen canonly truly beimplemented if staff from all levels understand their role within thecontributionprocess.

4. FacilityAnalysis:Analyzeexistingfacilitiesandlayoutswithafocusonthe principles of Lean. Identify the difference between the productionline’spresentstateandaLean-optimizedstate.Thisisanimportantstep,asitinformsfuturedecisions.

5. 5S:Beginapplicationofthe5Smethodology.The5Smethodisapillaroftheworkplace,anditsdeploymentwillbuildthehabits,mindset,andbestpractices thatareexpandedupon for smoothLeanoperations.ThisbasiclevelofworkplaceorganizationhelpslaythegroundworkforfuturetrainingandLeanbestpractices.

6. ValueStreamMapping:Mapthecurrentsystemasitisanddeterminepointsofwastethroughoutthesystem.Usingvaluestreammappingtools,constructacomprehensivedatapictureofcurrentoperationssothatgoalsforinnovationmaybeset.ClassifythiswastewiththeD.O.W.N.T.I.M.E.eight sources ofwaste.Once identified and classified, future correctiveactionmaybeapplied.

7. ProcessMapping :Whileallprocessesmayalreadybemapped,revisitthe maps and remap processes with an eye for waste elimination.Extensiveprocessmappingbuildsabenchmarkagainstwhichall futureinnovationismeasured.

8. Takt TimeCalculation : Now that the processes aremapped and thevalue stream is mapped, some changes may already be underway.Calculateatakt timeforeachproduct.Asoperationsimprove, this time

willshrinkandproduceconsistentresults,butaswithprocessmapping,takttime—anditssubsequentchange—isavaluablebenchmarkmetric.

9. DetermineEquipmentEffectiveness:Assessexistingequipmentwithastructuredandinvestigativeapproach.Undertakelinebalancingactivitiestoworktowardmoreevenproduction.

10. SMED:Basedondatagatheredsofarandoninsightsfromthelaststep,applySingleMinuteExchange ofDie practices to bring down the costanddurationofchangeovers.

11. Kanban : Develop and introduce a kanban system into the productionprocess.Analyzethecontinuousflow—replenishmentofmaterialsatthepaceofproduction—andcoordinateschedulingwithaheijunkabox.

12. TQM:Analyzeproductiontoensurethatqualitycontrolmeasuresareinplaceandareeffective.Implementpoka-yokemeasurestoerror-prooftheproductionline.

13. Cellular Flow : Through informed innovation,move toward a cellularfacility layout and uniform flow, sheddingwaste and inefficiencywitheachiterationofkaizenandinnovation.

14. Standardize : Develop standardized operations to leverage theeconomiesofrepetition,andtosimplifytrainingandmaximizeefficiencyand productivity. Standardization codifies gains and ensures thatoperationsrunsmoothly.

15. ContinuousImprovement :By thispoint it shouldbeobvious that thepath toLean implementation is not a onetime activity.Kaizen, and thedrive and need for innovationwithin a dynamic and fluidmarketplace,should spur constant improvement and encourage organizations towelcomechange.

ImplementationConcernsTheLeanbusinessmodelisgainingpopularityasaneffectiveproductiontool,

but it is not without downsides in implementation. Asmore companies beginimplementation,someissueshavearisen.AfrequentcriticismisthatplannersimplementingLeanfocusonthetoolsand

qualitativemethodsasopposed to theculture.TheLeanbusinessmodel is the“total package” in implementation, and while the tools and methods can beeffectively used piecemeal, the true value of Lean exists in the kaizen culturethat tirelessly strives for improvement. This scenario is often accompanied byimplementation that has been attempted by firm management not entirelyfamiliarwiththetop-to-bottomprocess.Anotherissuethathasbecomeapparentisthedecisionbymanagementtouse

a solution that theyhavedeterminedwithout uncovering the true problemandwithout input frommembersof theproduction staff.This seems tobean“oldhabitsdiehard”scenario.Truevisibilitywithinanorganizationandcommitmentto thepracticeofkaizenwouldutilize the inputof the frontlineworkforceandobserve the process at the production level, not from the boardroom. Theseconditions result in sound decision-making on paper, but solutions can fail toimprovetheproblemorhavetheintendedreductionresult.Additionally, practitioners ofLean tend to use themodel as a “one size fits

all” waste reduction program. This is usually not the case as the specificimplementation changes from application to application.While the culture ofkaizenand theconceptsofdifferentiatingbetweenvalue-addedandnon-value-added activities are powerful enough to span diverse industries, some firmssimply find thatnotevery tool isneeded. ImplementationofahybridprogramthattakesallofthebeneficialpartsofLeanandpairsthemtothespecificneedsoftheorganizationisthemosteffectiveuseoftheLeanmodelasopposedtoaheadfirst“leaptoLean.”The most significant implementation concern is the disruption of business

activities due to systemic change. When an organization undergoes such amassive overhaul of people, processes, and values, the old ways of doingbusiness are significantly disrupted. This disruption is a positive thing; ifshedding wasteful and shortsighted business practices produces a morecompetitiveLeanmachine,thenthenetgainsaresignificant.This forward-looking mindset does not change the fact that Lean

implementationcanbecostlyandlong,andcanbeaccompaniedbyasignificantlearningcurvewhilestaffmembersacclimatetothenewwayofdoingthings.Intheshortterm,operationscansufferhugedisruptionwhiletheprocessisbeingimplemented,butthelong-termgainsarewellworththecostifmanagementiswillingtorideouttheshort-termcosts.

ToRecapThe Lean method places a high importance on respect for people. Thisdovetails cleanlywith the concept of kaizen and the idea that the spark forinnovationcantrulycomefromanyleveloftheorganization.The 5S method is a process that helps clarify and codify the Leanorganizationalaspectsofawell-organizedworkplace.Itputsemployeesintheright mindset to carry out Lean activities and provides a process-basedfoundationforfutureLeanactivities.The path to Lean implementation is not an easy one; often Leanmethodologies represent a significant departure from traditional businesspractices. Concerns and barriers to adoption arise in the form ofmisplacedexpectationsonthepartofmanagement,costsofdisruptionduetochange,andthemismatchingofLeantoolsandLeanphilosophy.TheLeanframeworkisbestdeployedalltogether,becauseeachofthetoolsandprinciplesbuildsontheothers.

KeyQuestions(Answersonpg.137)

1. Althoughanorganization-widerespectforpeopleisapositivegoal,itisnotanassetofkaizenculture.

a)trueb)false

2. The5Smethodincludeswhichofthefollowingprocessactivities?

a)sampleb)substitutec)standardized)supportproduction

3. The5Smethodisaprocess-orientedmethodofworkplaceorganization.

a)trueb)false

4. WhenimplementingLeanacrossanentireorganization,managementcanexpecttoseeimmediatereturnontheirinvestment.

a)trueb)false

5. WhichofthefollowingisaconcernwhenimplementingLeanacrossanorganization?

a) the cost of retraining staff b) a disconnect between the Leanphilosophyand itspractical tools c) the impact andcost thatdisruptionduetochangecanbringd)alloftheabove

Conclusion

Themarketplaceischanging.WhatwasoncetheToyotaProductionSystemhasevolvedintocompetitive-edge-generatingprotocol.Itisdifficulttoforeseewhatthenextlevelofbusinessevaluationandproductionstrategywilllooklike,butitis safe to say that the Lean business model and business models like it havepavedtheway.Thepowerofkaizencultureandconstantwastereductionspansa multitude of industries and has made its way into personal lives as well.Whether service oriented, manufacturing focused, financially motivated orconstruction minded, kaizen empowers each level and every member of anorganizationtopromoteandintroduceinnovationintoeverydayoperationsandbusinesspractices.A focus on communication, visibility, and broad view strategy is also a

powerfulasset toanyorganization’scorporateculture,bothwithinandoutsideof the manufacturing sector. These tools help streamline “business as usual”operations and encourage examination of the enterprise’s market positionrelative to competitors.This, coupledwith avigilant examinationofprocessesfor innovation and change, provides organizations with a “change is good”mindset. In a business environmentwhere it is increasingly true that the onlyconstant is change, an innovation-and change-focused enterprisewill not onlysurvive,butthrive.Inmanyways the globe is shrinking; competition is becoming fiercer, new

marketsaremoreaccessible,andnewcustomersarepresentingopportunitiestobewonorlosteveryday.Consideringthenatureofthemodernbusinessmarket,itistheopinionofthisauthorthattheconceptsLeanusestoempowerbusinessesare the foundation for effective, efficient, and harmonious commerce for theentireworldandwillbeforyearstocome.

Appendix

ValueStreamMappingSampleValue streammapping was touched on starting on page 55. The process canbecomequitecomplexandisverytime-consuming.Itisimportanttorememberthat effective value stream mapping requires a high degree of coordinationbetween different workforce elements and a thorough understanding of andpracticalcompetenceintheLeanmethodology.Value streammapping isnot fornoviceLeanenterprises.Awell-developed

leveloftrustbetweenandamongsupervisors,operators,anduppermanagementis necessary for effective and impactful value stream mapping. It is alsoimportanttokeepinmindthatvaluestreammapping—intheinstancesofbothstrategic and tactical use—may prompt decisionmakers tomake a number ofchangestoprocesses,laborclassifications,andexistinglayouts.Sowhyuseavaluestreammapatall?Value stream maps are first and foremost visibility and efficiency analysis

tools.Areasofwasteandinefficiencycannotbeaddressediftheyarenotmadevisible, and an effectivevalue streammapdoes just that; it reveals challengesand barrierswithin a process or family of processes. In this capacity, a valuestreammapisadiagnostictoolthatformsthebasisofanimprovementplanforaprocess.Likeablueprint,decisionmakerscan referback toavaluestreammapasa

sort of common language or starting point to inform their improvementendeavors. In this way, the VSM tool serves to increase the visibility andcommunicationbetweendifferentworkforceelementsaswell;withaunifiedandcommonpointofreference,collaborationisasmootherprocess.Valuestreammapsareeffectiveattheorganizationalanddepartmentallevels

for the aforementioned reasons; this macro-level visual representation alsocontainsasnapshotofrelevantmetricsandabird’s-eyeviewoftheprocessasawholefromstarttofinish.Onamoremicroscaletheycanalsohelpindividualoperators, supervisors, and decision makers understand the relationships andflows of materials, labor, and information, and the work-in-progress thatrespondstocustomerdemand.

Whenanalyzingaprocessandidentifyingthegoalsofvaluestreammappingefforts,commonprocessissuesthatrequireeliminationorreductionincludethefollowing:Excessive DOWNTIME waste such as waiting, motion, or inventory. This

muda could be in the form of toomany handoffs, unneeded approvals, or thewasteful duplication of work—all of which can be identified through theanalysisofaneffectivevaluestreammap.Deadzones in theprocess flowcanalsobeidentified.Deadzonesareareasthroughouttheprocesswhereworkgetshelduporlost,orwhereoverallprocessflowisdisrupted.Intotal,anylosttime,wasted effort, andother non-value-added activities becomemuchmorevisiblethroughthevaluestreammappingprocess.VSMs are both strategic and tactical tools. When created to analyze and

designanideal“futurestate”ofaprocess,themapitselfisastrategictool.Heredecisionmakersandmembersofmanagementcanmakeawishlistofwhattheywouldliketoseeintheimprovedversionoftheprocess.Oncethevaluestreammaphasbeenanalyzed, the resulting implementationplans aiming to arrive attheidealfuturestateoftheprocessaretacticaltools.BasedoninterpretationsofthedatarecordedintheVSM,theseplansareoftentailoredinthemicroscale.

Step1:SelectaProductorServiceFamilyTheproduct/service familygrid canbe ahelpful toolhere.Theobjectiveof

step one is to set the ground rules for all of themapping efforts to follow. Inadditiontoselectionoftheproductfamily—andthereforetheprocessesthatwillbe mapped—the scope of mapping efforts, roles and responsibilities of thoseinvolved,andwhichgeneralgoalsshouldbeachieved.Examiningthe“futurestate”ofaprocessalsomeansdefiningitscurrentstate.

Thesefuturestateconceptionscanbedrawnupontoinformthescopeandgoalof value stream mapping efforts. In short, a business case must be made forvaluestreammappingefforts—itis,afterall,anexpensiveandtime-consumingprocess.Inaddition to identifying thescope,processboundariesshouldbe identified,

aswellasdifferencesinvalueandwastebetweenthecurrentstateandtheidealfuture state.This examination can be classified overall as a design phase, anddesigntools(suchasDMADV)maybeapplicableforsometeams.When defining boundaries—both the boundaries of the entire process and

thoseof itscomponentsteps—alogicalstartingpoint is toselectpointswithin

the processwhere inputs (rawmaterials or thework-in-process from the priorworkstation)cannotbereturnedtothepreviousstep.Correctlyandsatisfactorilydefiningeachstepoftheprocesswillsimplifymattersdowntheroad.

Step2:StartwiththeProcessFlowTomaptheprocessatitsbasis,theprocessflowisfirstrecorded.Everyeffort

shouldbemadetoensurethattheprocessiscapturedastruetolifeaspossible.Thisoftenmeansdoingthingstheold-fashionedway:withgraphpaper,apencil,andastopwatch.Agood rule of thumbwhen capturing process data formapping is to never

record informationnotpersonallyseen.Lookataverageperformance,andruleout clear exceptions that could skew overall interpretation of the process as awhole.It is important to startwithanaccurate foundation for this stageand for the

stagesthatfollow.Itisalsoimportanttouseakeyofstandardizediconslikethelegend pictured below to make the final product truly part of the commonlanguage of value streammapping. If a finished VSMwas constructed usingiconsandflowchartsymbolsthatonlythemappingteamunderstood,theneachnewpersonwhohadtointerpretthemapwouldneedalessononwhichsymbolsrepresentedwhatcomponentsofthemappedprocess.Agoodruleofthumbistosticktothecommonlyacceptedsymbols—butalwayskeepakeyhandy.

The process map is constructed in the same direction that demand travelsthrough the value stream itself—starting with the customer and working“backward” toward suppliers. To verify that the process has been completelycaptured, a SIPOC diagram of the process is a useful checklist, both in theprocess mapping stage and throughout the remaining stages of the VSMconstruction.Essentiallyablank flowchart for theprocessathand, theprocessmapstageispicturedbelow.

Step3:AddtheFlowofMaterialsTheprocessflowactsasafoundationandbasisforthefinishedvaluestream

map.Thematerialflowstepandthefollowingstepsareconstructedasoverlaysfortheoriginalprocessmap.Thisfactservestofurtherunderscorethenecessityofproducingaprocessmapthatisanaccuratecaptureofthetrue-to-lifeprocessasitisactuallycarriedout.Here the flowsof allmaterials are added to theprocessmap. In thecaseof

complexproduct familieswithdivergent andconvergentmaterial flows,grouptheflowsofsimilarmaterialstogetherforthesakeofsimplicity,butdon’tlosedetailintheprocess.Ifamaterialflowisdivergentintheactualprocess,thenonthevaluestreammapitshouldalsoberepresentedassuch.Thismappingstepalsoincludestheactivitiesthatareassociatedwiththeflow

ofmaterials and interact with it directly; this could include sampling, testing,qualitycontrolpoints,andotheranalysismeasures(seefigure39).

Step4:AddtheFlowofInformationOverlayAdded as another overlay, the visual representation of the flows of

information across the value stream is the next component in the mappingprocess.Allformsofcommunicationandinformationflowsarerelevanttothismapping stage, but especially themethods bywhich different elements of thevaluestreamcommunicatewithoneanother,specificallyhowthewholeprocesscommunicateswithsupplier(s)andcustomer(s).Scheduling,schedulingmethods,andthewayinwhichtheyinteractwiththe

workstations and flows that they impact are also critical components of theinformation flow overlay. Despite the fact that the “flow of information” cansometimes be an abstract concept, it can still be mapped, visualized, andanalyzed. Activities thatmeet those three criteria are also visible, and true toLean,LeanSixSigma,andthepracticeofvaluestreammappingvisibilityleadstoaction(seefigure40).

Step5:AddRelevantProcessDataProcess data is critical to understanding the actual characteristics of flow

throughtheprocess.Thedatacollectedinthisstagewillinformthenextone,sojustaswitheachoneoftheprecedingstages,accuracyandatrue-to-lifecaptureofdataisofparamountimportance.Thespecificprocessdatathatisrelevanttothegoalsofvaluestreammapping

canvaryslightlywithdecisionmakerpreference,thenatureoftheprocess—forexampletemperaturemaybearelevantmetricforsomeprocessesandirrelevantforothers—andthecomplexityofoperations.A good rule of thumb is to collect data regarding the following process

aspects:

Trigger(whatinitiatesthestepasdefinedbyitsboundaries)SetuptimeProcessingtimeperunitTakttime(thisisameasurementofcustomerdemand)Scraprate(themeasureofdefectrateordefectiveproduction)NumberofpeopleDowntime(expressedasapercentage)Work-in-progressbothdownandupstreamCostoflinks(examplesincludelinkstothesupplier,thewarehouse,toIT,etcetera)Batchsize

Step6:AddProcess&LeadTimeLead timehassuchanoutsized impactonbusinessdecisionsandoperations

thatitsimportancecannotbeoverstated.Leadtimeimpactsdeliverytime,whichimpactsthecreationofvalueforthecustomer(latedeliveryisnotvaluable)andcustomer satisfaction. Lead time is a massive factor in scheduling, andcontrolling lead time is the core of Just-in-Time production and inventorymethods.Themostwidelyacceptedconventionfor recordingprocessand lead time is

withthesawtoothtimeline(figure41).Here,productionleadtimeisshownonthe“peaks”of the timeline,andtheprocessingtimeperunit is recordedin the

“valleys”oftheline.Thereis,however,nouniversallyacceptedstandardtothiscomponent of a value stream map, and therefore some organizations anddecisionmakershavedevelopedtheirownmethods.

Duetosomeconfusionoverthesawtooth-styletimelines,someorganizationssimplyuseastraightlinewithleadtimelistedonthetopofthelineandprocesstimelistedbelow(withthetwovaluesverticallyaligned).Thispreventspotentialinstances of team members accidentally transposing the two values. Otherdecisionmakershavechosen tosimply focusondifferentmeasuresaltogether,suchasproductionleadtimeandVAT(value-addedtime).

Step7:VerifytheMapwithNon-FamiliarStaffThe last step of the value stream mapping process is the independent

verificationstage. It’samandatory“extrasetofeyes,”especiallyeyes thatarenot familiarwith theprocess.Here it is absolutely critical that universal valuestreammappingsymbolshavebeenused,becausethetestofaneffectivevaluestreammapisthatuninitiatedstaffcanreadandcorrectlydrawtheappropriateinsightsfromthecompletedmap.Suppliersandcustomers shouldalsobeconsulted, ifpossible, toensure that

theVSMisasaccurateandtruetolifeaspossible.Iferrorsaredetectedinthisstage, the problem must be resolved before tactical improvement plans areformulatedthatrelyonthedataincludedinthefinishedvaluestreammap.

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Glossary

5M—The5M’sofmanufacturing.The5M’srepresenttheprimarycategoriesofcausaleffectsthatshouldbeconsideredwhenbrainstormingpotentialcausesforinclusioninafishbonediagram.The5M’sareasfollows:machine,method,material,manpower,andmeasurement.

5SMethod—Aprocess-orientedprogramofworkplaceorganization.The5Smethodstandardizesbestpracticesfortheefficientexecutionofday-to-dayactivities.The5S’sareasfollows:sort,segregate,shine,standardize,andself-discipline.

5W1H—Astructuredinvestigativemethodusedtodeterminetherootcauseofanissue.Theprocessusesasuccessiveseriesof“why”questionstobringhiddencausaleffectstothesurface.

A3ProblemSolvingMethod—ApracticalapplicationofthePDCAprocessimprovementandproblemsolvingmethod.UsingasinglepieceofISOA3-sizedpaper(11”x17”),thefocusofproblemsisnarrowed,andastructuredinvestigativeapproachcanbeapplied.

BufferInventory—SeeSafetyStock.

BullwhipEffect—Theconceptthatmiscommunicationamplifiesdisruptionandvariationthroughoutthesupplychainandthroughoutanorganization.Whenonedepartmentgetsagarbledmessage,theyarelikelytodistortittothenextdepartmentandsoonuntilitreachesthefinalrecipient,wherethemessageiscompletelydistorted.

CellularFacilityLayout—Afacilitylayoutthataimsformaximumflexibilityandefficiencybycombiningaspectsoftheproduct-orientedfacilitylayoutandtheprocess-orientedfacilitylayout.Clustersofworkstationsareorganizedinto“productfamilies”andthendesignedtofittheprocesslayout.

CoreCompetency—Asetofbusinessoperationsatwhichaparticularorganizationexcels.Acorecompetencyisthefoundationalcomponentofcompetitiveedge.

D.O.W.N.T.I.M.E.-Anacronymusedtohelpremembertheeightsourcesofphysicalwaste(muda):defectiveproduction,overprocessing,waiting,non-usedemployeetalent,inventory,motion,andexcessiveproduction.

DecisionPointAnalysis—Atoolprimarilyusedbyorganizationsutilizinga“T”configurationproductionscheme.Thismappingtoolidentifiesthepointatwhichpulldemand(actualcustomerdemand)giveswaytodemandthathasbeenforecasted(artificialdemand).

OutsourceDecisionMatrix—Atoolusedtoidentifyprocesses,activities,andtasksthatarecandidatesforoutsourcingthroughthecomparisonofcriticalityandimpact.

DemandAmplificationMapping—AlsoknownasForresterEffectMapping,demandamplificationmappingisavisualtoolusedtoidentifythedistortionthatoccursbetweendifferentsupplychainentitieswithinthevaluestream.

EconomiesofRepetition—Theconceptthattherepetitionofspecificactivitiesandprocessesincreasesefficiencyovertime.

EconomiesofScale—Themicroeconomicconceptthatasthesizeandoutputofamanufacturingoperationincreases,costscanbespreadoutovermoreunits,therebyreducingthecosttoproduceeachunit.Economiesofscaleisalargecostreductiondriverofpushproductionandlargebatchmanufacturing.

E-Kanban—Theelectronicintegrationofakanbansystemintoanorganization’sERP(enterpriseresourceplanning)software.E-kanbansystemsgenerallycostmoretoimplement,buthaveunprecedentedlevelsofvisibilityanddonotsufferfromthedisruptionsoflost,illegible,ordamagedkanbancards.

ExternalSetupOperations—Linechangeoversetupoperationsthatcanbeperformedwhiletheproductionmachineisstillrunning.Thisismuchmoredesirablethanchangeoversthatrequiremachineshutdown(internalsetupoperations)becausetheproductionlinecancontinuetomovewhileadjustmentsaretakingplace.

FixedPositionFacilityLayout—Afacilitylayoutmethodbestemployedwhentheproductinquestionissolargeorheavythatworkstationsmovearoundtheproductratherthantheproductmovingaroundtheworkstation.

ForresterEffectMapping—SeeDemandAmplificationMapping.

HeijunkaBox-Avisualschedulingtoolthatusesagrid-likeconstructiontoorganizevariouskanbancontrolcardsbytheirvariousstageswithintheproductionprocess.Anessentialtooltopromoteevenproductionflow,heijunkaboxesareacriticalschedulingcomponentofkanbanimplementation.

InternalSetupOperations—Linechangeoveroperationsthatrequirethattheproductionmachinebeshutdown,thuscausingstoppageontheproductionline.TheSingleMinuteExchangeofDiemethodseekstoreducethisdisruptionbyconvertinginternalsetupoperationsintoexternalones.

Inventory—Thetotalon-handstoreofgoods,materials,andsupplies.Forproductionoperations,productioninventoryisbrokenintothreestages:rawmaterials,workinprogress,andfinishedgoods.

IshikawaDiagrams—Cause-and-effectdiagramsthatareusedtoinvestigateanddeterminetherootcausesofaspecificeffectimpactingaprocessathand.Alsoknownasfishbonediagrams.

IVATAnalysis—SeeProductionVarietyFunnel.

Just-in-Time—Amethodofcostreductionthroughtheeliminationofcarryinginventory.Just-in-Timeprotocolsensurethatonlytheamountofmaterialsneededforproductionaretransported,andthattheyarriveexactlywhenneeded.Onthefinishedgoodssideofproduction,JITmethodsproducesmallbatchesthatareaclosematchforcustomerdemand,andarescheduledandproducedinsuchawaythatthemanufacturerneverhastocarryinventory.

Kaizen—Theimplementationofacultureofconstantimprovement,andacentralthemeoftheLeanphilosophyandbusinessmodel.Kaizenisbuiltonthepremisethatcontinual,incrementalchangecausestheleastamountofdisruption,andthatchangecanbuilduponother,previouschangestocreateinnovationandcompetitiveedge.Kaizenvaluestheinputofemployeesatalllevelsoftheorganization,recognizingthatthesparkofinnovationcancomefromanywhere.

Kanban—Aflow-orientedmethodofmaterialandgoodscoordinationandreplenishment.Basedontheshelf-stockingmethodsofsupermarkets,kanbanoperationssimultaneouslymoveproductsthroughthevaluestreamwhilereplenishingthematerialsthatwereconsumedthroughproduction.

LagMeasures—Metricsandinsightsthatcanbegatheredafterthefact.Lagmeasuresrepresentthefeedbackportionofaclosed-loopsystem.

LeanSixSigma—AhybridbusinessmanagementsystemthatincludescomponentsfrombothLeanManufacturingandSixSigmaQuality.LeanSixSigmaoffersatotalpackageofproductionoptimization,qualitycontrol,wastereduction,andcompetitiveedge.

Machine(5M)-Acausalcategoryfortheconstructionoffishbonediagrams.Themachinecategoryencompassesanyequipmentrelatedtotheprocessathand.Thisincludescomputersystemsandproductiontoolsprimarily,butalsoextendstoalltoolsthatmaybeapartoftheproductionprocess.

Manpower(5M)-Acausalcategoryfortheconstructionoffishbonediagrams.Themanpowercategoryencompassesanypeoplewhomighthaveacausalimpactontheprocessathand.

Material(5M)-Acausalcategoryfortheconstructionoffishbonediagrams.Thematerialcategoryencompassesanyandallmaterialsthatareinvolvedintheproductioncycleandthatmayhaveacausalimpactontheprocessathand.

Measurement(5M)-Acausalcategoryfortheconstructionoffishbonediagrams.Themeasurementcategoryencompassesanyandallmeasurementsanddatacollectionthatmayoccurinregardtotheprocessathand.Thisincludestheaccuracyofobservations,thoroughnessofinvestigations,andthecalibrationofdata-gatheringequipment.

Method(5M)-Acausalcategoryfortheconstructionoffishbonediagrams.Themethodcategoryencompassesthetotalsumofprotocols,processdesign,andmethodologyemployedfortheexecutionoftheprocessathand.

Muda—Oneofthethreeoverallsourcesofwaste,mudarepresentsphysicalwasteevents.AllphysicalwasteeventscanbetracedbacktotheD.O.W.N.T.I.M.E.eightsourcesofwaste.

Mura-Oneofthethreeoverallsourcesofwaste,murarepresentswasteintheformofunevennessofproduction,orunequalproductionloading.

Muri—Oneofthethreeoverallsourcesofwaste,murirepresentswasteintheformofoverburdenorafailuretounderstandproductioncapacity.

NetAvailableTimetoWork—Acomponentoftakttimecalculation.Thetotalamountoftimethatisavailableforproductionactivities,lessbreaksandothernonproductiontimesetasideforbusinessactivities.

Non-Value-Added—Activitiesthatdonotproducevaluethatcanbepassedalongtothecustomer.Non-value-addedeventsareconsideredwaste,andtheLeanphilosophyrelentlesslyworkstonotonlydifferentiatevalue-addedfromnon-value-addedactivities,buttoreducetheimpactthatnon-value-addedactivities(wasteevents)haveonbusinessprocesses.

Outsourcing—Theprocessofassigningbusinessactivitiestoathirdpartyvendororbusinesswiththeintentofleveragingtheeconomiesofcorecompetencyorcostreduction.

PDCA—Aproblem-solvingandprocess-improvementprocessthatfocusesoncreatingactionablefeedback.Plan,Do,Check,Adjust(orAct),alsoknownastheDemingCycle,hasawidevarietyofapplicationsnotonlyacrosstheLeanbusinessmodelbutacrossavarietyofindustries.

PhysicalStructureMapping—Anoverviewofanentiresupplychainthatisgeneratedbasedonitsphysicalstructure.Thephysicalstructuremapcanbeconstructedeitherbyvisualizingcostcentersorthroughvolume-basedmapping.

Poka-Yoke—Intentionalconstraintsthatareintroducedintooperationstoreducedefectiveproductionduetohumanerror.These“foolproofing”measuresturnnormaloperationsactivitiesintoprocesses,improvingteachabilityandleveragingtheeconomiesofrepetition.

ProcessActivityMapping—Anarrowerlookatthecomponentsofavaluestream.Thistooldissectsandmapsindividualprocessesasopposedtotheentirevaluestream.

ProcessFacilityLayout—Afacilitylayoutthatfavorsproductswithlowvolumesandhighlevelsofdifferentiation.Underthisfacilitylayoutprotocol,workstationsandresourcesaregroupedbasedonthevariouspathsthatproducetheproductvariants.

ProductFacilityLayout—Afacilitylayoutthatisidealformassproduction—highvolumesofproductswithlittleornodifferentiation.Thisfacilitylayoutismostcloselyassociatedwithtraditionalmanufacturing,thepushproductionsystem,andtheeconomiesofscale.

ProductionLeveling—Theprocessofreducingthecreationofwasteeventsduetounevennessofproductionflow.Productionlevelingcanbeperformedontheproductionsideoftheequationaswellasthedemandsidetointroduceevennessintoproduction.

ProductionVarietyFunnel—AlsoknownasanIVATanalysis,theproductionvarietyfunnelanalysisidentifieswhichsetofmanufacturingmodelstheproductionofaparticularproductconformsto.Oncethemodeofproductionhasbeenidentified,specificandknowntraitsandprotocolscanbeappliedtotheproductionofgoods.

PullProductionSystem—Theoppositeofthepushproductionsystem,thepullproductionsystemfocusesoncustomerdemand.Asdemandisgenerated,materialsandgoodsare“pulled”intotheproductioncycle,andinthiswayproductionmatchesdemandasdemandchanges.Thepullproductionsystem,whenworkingintandemwithmanyofLean’sflexiblemanufacturingmethods,createsaresponsiveproductionprocessthatmatchesdemandanddoesnotcarryexcessinventoryorgeneratewastethroughtheproductionoflargebatches.

PushProductionSystem—Thetraditionalapproachtomanufacturingwherebyartificialdemandis“pushed”throughtheproductioncycle.Largebatchesofgoodsarestoredinanticipationofforecastedsales.Leveragingtheeconomiesofscale,costsarespreadoutoverahighnumberofunits,bringingtheunitcostdownandpickinguptheslackofthishigh-wastesystem.

QualityFilterMapping—Avisualtoolthatidentifiesareaswherequalityissuesexistwithinavaluestream.Withthedeploymentofthismethod,threesourcesofinsufficientqualitycanbeidentified:productdefects,servicedefects,andinternalscrap.

RawMaterials—Thebasicmaterialsfromwhichfinishedgoodsaremade.Thisunfinishedmaterialis

generallyassumedtobehomogeneousandcomprisestherawmaterialsportionofproductioninventory(rawmaterials,workinprogress,finishedgoods).

SafetyStock—Abuffertoinsulateinventorylevelsfromfluctuationsindemand.Safetystockisacharacteristicofthepushproductionsystem,whereartificialdemandis“pushed”throughtheproductionprocess.Conversely,thepullproductionsystem’sflexibilityandfocusonactualdemandeliminatestheneedfor,andcostofcarrying,safetystock.

Segregate(5S)-Acomponentofthe5Smethod,segregationisthenextlogicalstepaftersorting.Oncematerialsandtoolshavebeenexaminedanddeterminedtoberelevanttotheprocessathand,theyareorganized(orsegregated)toensurethattheyareavailableinanefficientmanner.

Self-Discipline(5S)-acomponentofthe5Smethod,self-discipline(alsoknownas“sustain”)isthestructuredandconsciousefforttomaintaintherigorsofthe5Smethodandsustainthegainsaffordedbyitsimplementation.Shine(5S)-Acomponentofthe5Smethod,shinereflectsallofthepositiveaspectsofmaintainingacleanandorderlyworkplace.Fromemployeeconfidenceandrespecttoreducedsafetyhazards,acleanworkplaceisanefficientone.

SingleMinuteExchangeofDie(SMED)-Aflexibilityandcost-cuttingprogramthatstrivestoreducethelinechangeovertimetoasingledigitnumberofminutes.Thisradicallyincreasestheflexibilityandresponsivenessofproductionandreduceslevelsofwaste.MasteringSMEDwithinanorganizationisacriticalcomponentofahighlydevelopedandflexiblepullproductionsystem.

SixSigmaQuality—Aprocess-improvementandquality-focusedbusinessmanagementmethodthatusesstatisticaltoolstoimproveproductivityandqualitythroughout.ManyofthetoolsavailablewithintheSixSigmasystemcanbeusedintandemwiththeLeanphilosophyandtoolkit,producingthehybridbusinessimprovementmethodLeanSixSigma.

SmallLotProduction—Afeatureofthepullproductionsystemthatfocusesonwastereductionandflexibilitythroughtheproductionofbatchesthatmeetdemandinsteadoflargebatchesthatarebasedonartificialdemandandare“pushed”throughproduction.

Sort(5S)-Apartofthe5Sframework,theconceptofasortedworkspacedeterminesthemostexpedientandusefulplacesforobjects,tools,materials,andgoods.

SpaghettiPlot—Avisualmapofdatathatcanbeexpressedasflows.Alsoknownasworkflowcharts,spaghettiplotsareusedtotrackthemovementsofpeopleandgoodstodeterminemoreefficientlayouts.

Standardization(5S)-Apartofthe5Sframework,standardizationseekstotransformactivitiesintoprocessessothattheycanbenefitfromtheeconomiesofrepetition.

SupplyChainResponsivenessMatrix—Avisualtoolthatanalyzesanorganization’sleadtimeandinventorylevels.Theresultinggraphhighlightsareaswhereslow-movingstockisconcentrated.

TaktTime—Ameasureofunitproductiontimerelevanttotherateofcustomerdemand.Whiletheproductofatakttimeisexpressedasacertainnumberofpartsperperiod,thisisameasureofflowandmaynotreflecttheactualdurationofproductionforeachunit.

TheoryofConstraints(TOC)-Asystemsimprovementmodelthatisbuiltonthebasicassumptionthat

everysystemissubjecttoatleastoneconstraintthatcreatesabottleneck.Oncethisconstrainthasbeenbroken,thesystemwillbecomemoreefficient,butisnowsubjecttoanother,newlimitingfactor.Thissystemishelpfulfordeterminingareasofinefficiencywithinoperations,andassessingthebestmethodstoeffectchange.

TotalQualityManagement(TQM)-Aunifyingprinciplethatunderscorestheinterdependentrelationshipbetweenthevoiceofthecustomer,thetoolsandprocessesusedtomanufacturegoods,andthemannerinwhichdemand“pulls”goodsthroughproduction.

ToyotaProductionSystem—Thesetofprinciples,methods,andtoolsestablishedbytheJapanesevehiclemanufacturerToyota.ThestridesmadebytheToyotacompanyrevolutionizedandsuperchargedtheJapaneseeconomy,andtheeffectivemethodsemployedbyToyotahaveevolvedintotheversatileLeanManufacturingsystemthatweknowtoday.

TunnelVision—Asingularfocusononegoalattheexpenseofvisibilityofothersorthewholepicture.

ValueStream—Thetotalsumofeffort,operations,processes,andproductionthatcontributestothecreationofvalueforacustomer.Valuestreamdoesn’tbeginandendwiththemanufacturingorganization.Itbeginswiththecustomerandworksbackwardthroughthesupplychain,allthewayupstreamtothepointoforigin.

ValueStreamMapping—ALeantoolkitthatisusedtoassessthecurrentstateofallactivitiesandprocessesassociatedwithproductionoperations.Theapplicationofvaluestreammappingisdesignedtohighlightareaswhereimprovementispossible,andtodifferentiatevalue-addedactivitiesfromwaste,allwhileestablishingabenchmarkagainstwhichallimprovementactivitiescanbemeasured.

Value-Added—Activitythatincurscoststhatcanbepassedontothecustomer(createsvalue).TheLeanmethod’sfocusontheVoiceoftheCustomerisacoredriveroftheneedtodifferentiatevalue-addedandnon-value-addedactivities.Throughvariousimprovementmethods,operationsaretrimmedofnon-value-addedactivities(waste)andstreamlinedtoonlythenecessaryvalue-addedprocesses.

Waste—Non-value-addedactivity.Wasteincurscostbutdoesnotproducevalue,sothesecostscannotbepassedontothecustomer.WasteisrepresentedwithintheLeanmanufacturingsystemasfallingunderthecategoriesofphysicalwaste,unevennessofproduction,oroverburdenofproduction.InallaspectsofLean,theeliminationofwasteisafocalpointofimprovementactivities.

Answers

ChapterOne1d,2b,3b,4b,5a

ChapterTwo1c,2b,3b,4a,5d,6b,7b,8c

ChapterThree1d,2d,3b,4a,5c

ChapterFour1b,2c,3a,4b,5d

References

Fantin, Ivan. 2014. Applied Problem Solving. Method, Applications, RootCauses,Countermeasures,Poka-YokeandA3.Milan,Italy:Createspace.George,MichaelL.,DavidRowlands,MarkPrice,andJohnMaxey.2005.TheLeanSixSigmaPocketToolbook.NewYork:McGraw-Hill.Hirano, Hiroyuki. 1995. 5 Pillars of the Visual Workplace. Cambridge:ProductivityPress.Ishikawa, Kaoru. 1976. Guide to Quality Control. Asian ProductivityOrganization.Jacob, Dee, Suzan Bergland, and Jeff Cox. 2010. Velocity. New York: FreePress.Laraia,AnthonyC.,PatriciaE.Moody,andRobertW.Hall.1999.TheKaizenBlitz:AcceleratingBreakthroughsinProductivityandPerformance.NewYork:JohnWileyandSons.Lubben,R.T.1988.Just-in-TimeManufacturing:AnAggressiveManufacturingStrategy.NewYork:McGraw-Hill.Ohno, Taiichi. 1988. Toyota Production System: Beyond Large-ScaleProduction.ProductivityPress.Rother, Mike. 2009. Toyota Kata: Managing People for ContinuousImprovementandSuperiorResults.NewYork:McGraw-Hill.Rother,Mike,andJohnShook.2003.Learning toSee:Value-StreamMappingtoCreateValueandEliminateMuda.Brookline:LeanEnterpriseInstitute.Shingo,Shigeo.1989.AStudyoftheToyotaProductionSystem.ProductivityPress.

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