Lean Transformation ~ A Journey

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Lean Transformation A Journey Anand Subramaniam

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  1. 1. Lean Transformation A Journey Anand Subramaniam
  2. 2.
    • You are here to enrich the world, and you impoverish yourself if you forget the errand.
      • -Woodrow Wilson
  3. 3. Origins of Lean
    • Lean concepts evolved from the JIT philosophy pioneered in Japan by Toyota and embodied in their Toyota Production System (TPS)
    • The emphasis of JIT is the elimination of waste throughout the supply chain
    • In the 1990's companies adopted the term lean in place of JIT
  4. 4. Basis of Lean Thinking
    • Lean means producing
      • What is needed
      • When it is needed
      • With the minimum amount of materials, equipment, labor, and space
    • The goal of an enterprise adopting lean
      • Make each process as efficient and effective as possible
      • Connecting those processes in a stream or continuous chain that is focused on flow and maximising customer value
  5. 5. Lean Principles
    • Specify value in the eyes of the customer
    • Identify the value stream and eliminate the waste
    • Make value flow at the pull of the customer
    • Involve and empower employees (there is no better source of insight than the employees who are performing the work)
    • Continuously improve (kaizen) in pursuit of perfection
    Control Measure Analyse Improve
  6. 6. Note..
    • It is a systematic approach to drive customer satisfaction and operational excellence
    • Be flexible and vary the approach depending on your organisations culture
    • It is a journey / endurance race for continuous learning and improving top & bottom line
    • It requires leadership, discipline, and buy in on lean philosophy
    • Process improvement and people development must go hand in hand
    • It is on the job, real time learning & training
    • Lean is 20% Technical and80% Behaivioral
  7. 7. Challenges
    • Viewed as technical transformation (not cultural transformation)
    • Looked upon as One-size-fits-all approach
    • Lack of commitment and understanding of effort required by C Level and All Levels
    • Most organisations never get deep enough into the lean process to achieve true success
    • Focus on departments rather than value streams
  8. 8. Internal Challenges Gap between enterprise resource planning (ERP) and factory floor Incompatible and Inconsistent systems Lack of timely information to make informed decisions Lack of strategy to unifyinformation across manufacturing Lack of funds and/orlack of perceived value
  9. 9. Best in Class Strategic Actions Improve processes that manage the flow of material and information Lean Initiative Optimise performance at Individual plants and factories Drive standards and consistency Across Global manufacturing networks Improve Sales and Operations Planning Processes
  10. 10. Improvements from Lean Implementation Adapted from: National Productivity Review, Industry Week, Deltapoint Actuals Total Cycle Time Revenues Inventories Invisible Inventories Blue-Collar Productivity White-Collar Productivity AvailabilityScrap Delivery Lead Times Time-to-Market Return-on-Assets 20 40 60 80 100 Ranges in % Improvement Best Practices from Actual Cases
  11. 11. Lean Transformation Implementation ImplementationWhat are the key lean principles and practices? How do I transform my enterprise to lean? How do I assess my progress? Process / Checklist Enterprise Level Roadmap Enterprise Transition to LeanLean Enterprise Self Assessment Tool
  12. 12. Lean Transformation - Enterprise Approach Information Technology Certified Suppliers Uncertified Suppliers Warehouse Sales & Marketing Warehouse Customers Customer Service Accounting Engineering Human Resources Factory
  13. 13. Enterprise Level Roadmap High Level Entry / Re-entry Cycle Adopt Lean Paradigm Decision to pursue Enterprise Transformation Enterprise Strategic Planning Long Term Cycle Focus on the Value Stream Develop Lean Structure & Behavior Create & Refine Transformation Plan Focus on Continuous Improvement Implement Lean Initiatives Initial Lean Vision Lean Vision Lean Transformation Framework Short Term Cycle Detailed Corrective Action Indicators Outcomes on Enterprise Metrics Environmental Corrective Action Indicators Enterprise Level Transformation Plan + Source: MIT Lean Aerospace Initiative Lean Impact
  14. 14. Enterprise Level Roadmap Detailed Scan the environment Segment the market Define leadership requirements Create leadership structures Define policies, objectives, targets and budgets Communicate! Communicate! Communicate! Play catchball with deployment teams Play catchball with action teams Use reliable, scientific methods at all levels Discover/correctperformance variances Perform corporate diagnosis with top Champions Assess/analyse performance Capture learning and make itreplicable Re-vision your strategy -- again Renew your business in real time Use advanced planning methods Celebrate Success! Mission Statement ValuesStatement Vision Statement P/O Matrices Focus Team Charter Kickoff Promotion P/O Matrices Deploy- mentPlans P/O Matrices ActionPlans Plan Summary CEDAC P/O Matrix Phase II:Pilot Phase I:Plan Phase III:Deploy Phase IV:Integrate Phase V:Excel business renewal strategy re-vision vision deployment implementation/adherence strategy re-vision Create mission; establish values Envisionthe future Study Missions Market Studies Product/ Market Matrix Technology Roadmaps Corporate Diagnosis Develop- ment Plan Relation- Ship Map Organi- graph Target/ means Analysis Finalise policies and budgets Target/ Means Analysis Target/ Means Analysis CEDAC JIT TPM CE Newsletter Website Progress Tables Site Visits CEDAC 5 Minute Meetings Weekly Meetings Monthly Meetings Study Missions Creative Thinking Bottom up Planning StrategicScenarios Game Theoretic Models analysis and reflection business renewal 2003 Productivity, Inc.adC IP0201wc
  15. 15. Example - Enterprise Level Roadmap Source: Productivity Inc.
  16. 16. Benefits ofEnterprise Level Roadmap
    • Facilitates enterprise focus
    • Provides sequence for enterprise transformation
    • Increases understanding of what went wrong in previous transformation attempts
    • Focuses on people/leadership issues
    • Provides an organising framework for enterprise wide transition
  17. 17. Enterprise Transition to Lean Begins with a description of a Top Level Flow of primary activities referred to as The Roadmap Then, provides descriptions of key tasks required within each primary activity Finally, leads discussion of issues, enablers, barriers, case studies & reference material relevant to each task in a common structured framework
    • Focus on the Value
    • Stream
    • Map Value Stream
    • Internalise Vision
    • Set Goals & Metrics
    • Identify & Involve Key Stakeholders
    Source: MIT Lean Aerospace Initiative
  18. 18. LeanEnterprise Self Assessment Source: MIT Lean Aerospace Initiative Why Communicate lean enterprise-wide What A lean vision How Learn from successful lean implementations Who The Enterprise Leader When First step Where Enterprise-wide Information Technology Certified Suppliers Uncertified Suppliers Warehouse Sales & Marketing Warehouse Customers Customer Service Accounting Engineering Human Resources Factory
  19. 19. Checklist, Process & Procedure
    • Lean Structure & Behaviour
    • Organise for Lean Implementation (checklist)
    • Identify & Empower Change Agents (process)
    • Align Incentives (process & procedure)
    • Adapt Structure & Systems (process & checklist)
    • Create & Refine Transformation Plan
    • Identify & Prioritise Activities (checklist)
    • Commit Resources (process)
    • Provide Education & Training (procedure)
    • Implement Lean Initiatives
    • Develop Detail Plans (process & Checklist)
    • Implement Lean Activities (As-Is/To-Be process, checklist)
    • Enterprise Transition to Lean (process & checklist)
    • Measure Improvement / Self Assessment/ Lesson Learnt (checklist)
    • Adopt Lean Paradigm
    • Build Vision (process & checklist)
    • Convey Need (process & checklist)
    • Foster Lean Learning (procedure)
    • Make the Commitment (process)
    • Obtain Senior Management Buy-in (process)
    • Focus on Value Stream
    • Map Value Stream (process & checklist)
    • Internalise Vision (process & checklist)
    • Set Goals & Metrics (process & checklist)
    • Identify & Involve Key Stakeholders (process)
    • Focus on Continuous Improvement
    • Monitor Lean progress (process & checklist)
    • Refine the Plan (process)
    • Capture & Adopt New Knowledge (process)
  20. 20. Example Lean Structure
    • Phase Lean Structure Behaviour
    • Outcome Change Management Plan
    • Process
      • Strategic Alignment
      • Top Management support & commitment
      • Sense of Urgency and prorities
      • Stakeholder Involvement
      • Organisational Structure
      • Goals and Objectives
      • Transformation Plan
      • Monitoring and Nurturing
    • Checklist
      • Customer need assessment
      • Communication assessment
      • Readiness assessment
      • Training Needs Analysis
  21. 21. Example - Change - Checklist
  22. 22. Example - Convey Need
    • Phase Adopt Lean Paradigm
    • Outcome Build a Vision
    • Process review (culture, internal & external process, success criteria, stakeholder needs, training needs, case studies of successful lean implementation, research)
    • Checklist-
    Why Communicate lean enterprise-wide What A lean vision How Learn from successful lean implementations Who The Enterprise Leader When First step Where Enterprise-wide
  23. 23. Example - Implement Lean
    • PhaseImplement Lean Initiative
    • OutcomeBaseline and improvement level using 5 S -Increase productivity,product quality & safety at work : reduce manufacturing cost: improve on-time delivery
    • Process
      • Clearout and Classify - Clearing items no longer required : Tagging items that may be required and storing away from workplace
      • Configure - A place for everything & everything in its place
      • Clean and check - Identify cleaning zones, establish cleaning routines
      • Conformity -Roll out across the organisation
      • Culture and practice- Monitor process adherence & continually validate
    • Checklist
    Level Sort Simplify Shine Standardise Sustain Baseline0 Unsafe items in workarea. Placement of itemscauses unsafeconditions. Spills, waste, trash, etc.produce unsafeconditions. No methods orprocedures documented. No routinereview/correction ofunsafe conditions. Beginner1 Needed and un-neededitems found in work area. Needed and un-neededitems are placedrandomly throughout theworkplace. Work area and machinesare not cleaned on aregular basis. Methods of work notcompletely documented. Occasional, unscheduled5S activity. Basic2 Needed /un-neededitems separated, un- needed tagged. Needed items stored inan organised manner. Area and equipmentcleaned daily. Methods of workdocumented but notconsistently used. 5S activities conductedon regular basis. Visual3 Red tag area created, allun-needed itemsremoved. Needed items havededicated positionswhich are clearlyindicated. Standard work layoutposted and maintained. Methods of work postedand consistently used bysome cell teammembers. 5S assessmentconducted occasionallyand results posted. Systematic4 List of needed itemsdeveloped, maintained,posted. Needed items can beretrieved within (celltarget) seconds and (celltarget) number of steps. Daily inspections of plantand area occurs. Methods of workconsistently used by allcell team members. 5S assessmentconducted on a regularbasis and recurringproblems are identified. Preventive5 Un-needed items are notallowed in area. Method foradding/deletingindicators for neededitems Root cause sources ofdirt, grease & spillagehave been eliminated. Methods of work areregularly reviewed andimproved. Root causes of problemsrevealed by 5Sassessment areidentified and eliminated.
  24. 24. Example - Value Stream Map
  25. 25. Lean Building Blocks Value Stream Mapping Continuous Improvement Performance Measurement Performance Management Quick Changeover Standardised Work Batch Reduction Teams Quality at Source 5S System Visual Plant Layout POUS Cellular/Flow Pull/Kanban TPM POUS point of use storage Source: Techhelp
  26. 26. Waste Elimination Source: John Willey & Sons -2009 97% NVA 3% VA Most Process ImprovementTeams Attack this . . . . . . Achieve this 97% NVA Typical Value Stream Ratio Value-Added (VA) to Non-Value-Added Activity (NVA) . .and Ignore this Source: C. Fiore; Lean Strategies forProduct Development ,ASQ, 2003
  27. 27. Reference - Lean
    • www.lean.org
    • www.productivityinc.com
    • www.productivitypress.com
    • www.leanadvisors.com
    • Building the Lean Machine,Advanced Manufacturing , January 2000.
    • Fiore, Clifford,Accelerated Product Development: Combining Lean and Six Sigma for Peak Performance , Productivity Press, NY, NY, 2005.
    • Hamilton, Bruce, Toast Kaizen, An Introduction to Continuous Improvement & Lean Principles, Greater Boston Manufacturing Partnership, University of Massachusetts, Boston, MA, 2005 (DVD).
    • Insights On Implementation-Improved Flow: Collected Practices and Cases , Ralph Bernstein, Editor, Productivity Press, 2006.
    • Jacobs, Robert F. and Chase, Richard B.,Operations and Supply Management: The Core , McGraw-Hill/Irwin, NY, NY, 2008.
    • Nahmias, Steven,Production & Operations Analysis , 5 thEdition, McGraw-Hill/Irwin, NY, NY, 2005.
    • Nave, Dave, How to Compare Six Sigma, Lean, and the Theory of Constraints, Quality Progress, March 2002, pgs 73 78.
    • Thinking Beyond Lean - How Multi-Project Management is Transforming Product Development at Toyota and Other Companies (Cusumano, M. A. & Nobeoka, K. 1998)
  28. 28.
    • To improve is to change. To be perfect is to change often.
      • -Winston Churchill
  29. 29.
    • Good Luck
    • http://www.linkedin.com/in/anandsubramaniam