VOLVO EATS LEAN TRANSFORMATION

1Helping Our Customers Be More Successful . . .

EATS LEAN TRANSFORMATION

July 15, 2014 Prepared by Julian Kalac, P.Eng

Lean Six Sigma Master Black Belt.

2

Overview EATS-Exhaust After Treatment System

• VOLVO Patented Design

• EATS-Exhaust After Treatment System

• EATS uses Selective Catalytic Reduction SCR and a Diesel

Particulate Filter DPF to filter & convert (treat) Nox into CO2,

which exits through the exhaust stack

• EATS Rack , made by Mancor Automotive, is the integrated

final product assembly of SCR and DPF

• EATS standard cost = $570/pc, (material=$180, Labour= $380)

• 2013 Annual volume = 2000 units (8/day, 40/week)

• 2014 demand increased to 3000 units, (12/day, 60/week)

3

EATS

RACK

Exhaust After Treatment System

SCR

AIR

COOLER

AIR

CLEANER

DPF

4

EAST (Exhaust After Treatment System)

EATS RACK

5

ISSUES/CONSTRAINTS1. Product design issues affecting quality/productivity

2. High Final Inspection Reject Rate (>30%)

3. Design drawings outdated, part modifications not tracked,

drawings not updated. Parts being modified daily

4. Max Production Capacity 8pc/day using 2 shifts (6 people)

5. Production Cycle Time= 4.5 Days, WO lead time = 3days

6. Batch Production with high WIP > 33

7. NO PFD, VSM

8. No Production Plan, No Production Order Tracking

9. No SOP’s, NO TRAINING

Helping Our Customers Be More Successful . . .

6

DESIGN ISSUES

• Product design Issues causing excessive Non-Value

Add (NVA) welding to fit parts. Only able to produce 8

sets/day on 2 shifts

• Increased customer demand in 2014 by ~50%

compared to 2013 (2780 pcs)

• Avg Monthly production in 2013 was 233pcs/month,

7.7/day

• YTD Avg monthly production is 358/month (12pcs/day)

• March productivity = 421 (14/day)

7

EATS Improvement Project

Problem Statement

1. Unresolved product/design issues causing 30% Internal Quality

reject rate , and limiting max throughput 8 sets/day on 2 shifts

2. Production unable to meet increased Customer demand from 40

to 60pcs/week, resulting in 2 day shut down in Volvo plant

3. Customer lead time = 4 days, WO lead time (internal) = 3 days +

1 safety. Currently the actual lead time for 1 EATS rack > 4 days,

Objective(s)

1. Redesign parts to eliminate profile gaps and standardize

2. Product quality by 80%, reduce reject rate from 42% to <5%

3. Product Lead time by 50% (from 4 to 2 days)

4. Productivity by 50%, from 8-12pcs/day

Estimated Savings= $600K to $800K

8

SO WHAT DID WE DO ?

• We formed a team, April 21, 2014 we kicked off the project

• Developed KPI target metrics, centralized KPI board, created

benchmarks, tracked progress by the hour

• Developed a project timeline plan, open issues list & with

weekly project review meetings

• We trained both shifts (42 operators) on Lean Six Sigma tools,

Batch vs Continuous Flow

• Developed Current & Future state VSM, identified key areas for

improvement,

• We reverse engineered, started to create new prototype parts,

measure them and develop as Built Drawings

9

Project Timeline


10

Measure Phase Metrics



PROJECT EATS OPEN ISSUES LIST 15-Jul-14

Project Owner- Julian K.,

Count open 13

PROJECT OBJECTIVE = Implement Lean Single Pc Continuous flow and reduce total processing cycle time by 75% (from 1pc/4 day down to 1pc/1 day )

#

Project Tasks Date Added Resp % Complete Status / Update

Original Due Date

Completed

Date

Actual Weekly

Savings $

1827/829/830/831 & 827 COMPLETED QA VERIFIED -->832 problems Roger to see

Victor on issues -->828 not programmed (75% COMPLETED1-May-14 Roger 75%

QA TO TO verify and ADVISE when the 828 are completed and

the 8325-May-14

2 Need a decision on DPF channel interefence with tubes. Overdue since Dec 2013 1-Dec-13 Brian B/ Cust 50% CAUSES 7 MIN/PC REWORK AND NVA WELDING 20-May-14

3 401 bracket on SCR side still causes intereference requiring "crow bar" to open 12-Dec-13 Brian B 0% CAUSES ADDITIONAL 5MIN/PC REWORK 20-May-14

4 Need to add joining tubes to cycle count list and report count 3-Jun-14 Avinder 0% OVERDUE NO RESPONSE 6-Jun-14

5 Need to ensure that the same weekly schedule is posted at tacking/R7/joining & paint 3-Jun-14 Avinder 0%

Almost every week scheduling issues with WO not

matching schedule and wrong part numbers on

work orders

6-Jun-14

6 SUPERVISORS NOT DOING 5S AUDITS IN THEIR AREAS MIN OF 3X/WEEK- 3-Jun-14 MIKE/GLEN 50%

Supervisors not doing their audts 3/week as

required. None of the supervisors have done any

audits last week

6-Jun-14

7 SOME OPERATORS RUBBER STAMPING 5S CHECKS. SUPERVISORS RESPONSIBLE 1-Jul-14 BRIAN/MIKE/GLEN 0%Joining still not doing any 5S audits. Already

advised. Supervisor not supporting 5S2-Jul-14

8 PAINTLINE NOT TRACKING PRODUCTION PER WO 6-May-14 MIKE 50% No CUM Chart 8-May-14

9Need training plan to include cross training between robot and joining. Tacking used

as role model for other areas6-May-14 BRIAN/FERNANDO 0%

overdue supervisor fails/refuses to support cross

functional training4-Jul-14

10NEED TO START PAINTING ON 2ND SHIFT. CURRENTLY ONLY PAINTING ON DAY

SHIFT27-May-14 Glen/Brian 0%

MAJOR ISSUE -->EATS ASSY SHUT DOWN

BECAUSE NO PAINTERS ON 2ND SHIFT30-May-14

STATUS TASK OVERDUE CRITICAL TO QUALITY

TASK OVERDUE IMPORTANT TO PROCESS

TASK COMPLETED

12

EATS DESIGN IMPROVEMENTS

1. Redesigned 5 main SCR and DPF parts which reduced

profile gaps from 15mm to < 1mm

a) Reduced Non-Value Add welding by 54”

b) Reduced overall fit & tack cycle time by 70 min

2. Validated new design in production on 240 pcs, 4 different

runs with no issues.

3. Created an ECN, with As-Built/Red line drawings with

revised part profile dimensions and obtained Volvo

Engineering approval

4. Trained in-house design engineers on Design Validation

and Product Reliability testing, DFMEA and PFMEA

5. Developed DFSS templates for future use

13

Problem areas

14

BEFORE IMPROVEMENT Part# 21290534

¾” Fillet Weld

15

Part# 21290534

< 1MM GAP

16

EATS DESIGN IMPROVEMENTS

17

EATS VSM –BEFORE APRIL 21 -2014 (8 sets/day)

Customer Demand

Total Non-Value Add Time = 4.5 days

Value Added Time = 173 min (2.8Hrs)

2 operator

C/T = 34 min

C/O = 0.5 hr

Uptime = 61%

Joining &

Inspection

2 operator

C/T = 52 min

C/O = 0.5 hr

Uptime = 86%

1 operator

C/T = 47 min

C/O = 0 hr

Uptime = 78%

Manual

Weld

1 QC+ 1 welders

8 sets/day

47 min34 min52 min

1 day 2 day1 day 0.5 days

Production

Order

WK

D

Wk

INVENTORY

C/T = 40 min

C/O = 0 min

Uptime = 83%

Robot Weld

40

Customer

BLaser Break

Press

WIP WIP

VA Time

NVA Time

I

REWORK

Batch & Que Production

tacking

18

Lean Continuous Flow ProductionEATS VSM after April 23 2014, (12 sets/day 54% Improvement)

3x Week

Market Forecast

Total Non-Value Add Time = 1.5 days

Value Added Time = 114 min ~2 Hrs

Customer

A

Customer

B

0.5 operator

C/T = 44 min

C/O = 5 min

Uptime = 70%

0.5 operator

Tacking

C/T = 30 min

C/O = 0.5 hr

Uptime = 85%

1 QC+ 1 welders

C/T = 40 min

C/O = 0 min

Uptime = 95%

Joining &

Inspection

12 sets/day

Production

Control

Laser Break

Press

Robot 7

D

40 min44 min30 min

0.5 days 1 days0 days

INVENTORY TURN-

OVER RATE

NVA Time

VA Time

1 Pc continuous flow

PAINT


TYPEPART#

SHORT/LONG

TUBESETUP TIME (MIN) PICKING TIME

TOTAL

TIME

SETUP OR

CHANGEOVER

A 22214829 LONG TUBE 30 45 75 SETUP

A 22214830 LONG TUBE 5 15 15 CHANGEOVER

B 22214827 SHORT TUBES 30 45 75 SETUP 3 SETUPS

B 22214828 SHORT TUBES 5 15 20 CHANGEOVER



C 21721770 SPECIAL 60 60 120 MAJOR SETUP

D 10MCC88-83 SERVICE PART

LOST TIME (MIN)= 210 345

LOST HRS= 3.5 5.75

SETUP = 1 HR CHANGEOVER= 30 MIN

TYPEPART#

SHORT/LONG

TUBESETUP TIME (MIN) PICKING TIME

TOTAL

TIME

SETUP OR

CHANGEOVER


C 21721770 SPECIAL 120 120 240 SETUP

B 22214831 SHORT TUBES 45 60 105 SETUP 8 FULL SETUPS


B 22214828 SHORT TUBES 45 60 105 SETUP

B 22214829 LONG TUBE 45 60 105 SETUP

B 22214832 SHORT TUBES 45 60 105 MAJOR SETUP

D 10MCC88-83 SERVICE PART

LOST TIME (MIN)= 480 765LOST HRS= 8 12.8

NUMBER OF SETUPS= 8

PRODUCITON SCHEDULING RULES

1 MIN RUN QTY= 4 PCS (1 CART)

2 KEEP NUMBER SETUPS =< 2 /DAY AND INCREASE CHANGEOVER TIME INSTEAD

3 SCHEDULE THE ABOVE SETUP AND CHANGEOVER TIME INTO THE PRODUCITON SCHEDULE

4 KEEP THE LONG TUBE AND SHORT TUBE ORDERS TOGETHER IN ORDER TO MINIMIZE SETUP TIME

5 ALWAYS SCHDULE 770 AS THE LAST OR FIRST ORDER OF THE WEEK, NEVER MIX IT WITH OTHER ORDERS

6 ENSURE CYCLE COUNT OF CRITICAL COMPONENTS IS DONE EVERY WEEK BEFORE SCHEDULING

7 KEEP SAFETY STOCK OF CRITICAL COMPONENTS 10 PCS ALWAYS IN STOCK TO PREVENT SHORTAGE

8 GIVE PRODUCTION MIN 1 WEEK (7 DAYS) NOTICE BEFORE INCREASING TAKT TIME

9 ALWAYS FOLLOW THE SEQUENCE A->B->C->D

A=LONG TUBE, B= SHORT TUBE, C-770, D-LONG TUBE

NOT RECOMMENDED EATS SCHEDULE B->C->A->D

A=LONG TUBE, B= SHORT TUBE, C-770, D-LONG TUBE


WEEK OF DATE EATS PRODUCTION SCHEDULE

START TIME= 7:00

WORK ORDERPART

NUMBER QTY TAKING COMPLETED ROBOT 7 COMPLETED JOINING COMPLETED

PAINT LINE

COMPLETEDFG

1ST CART 1ST CART 1ST CART 1ST CART 4PCS

WOXXXXXX 222148XX 4PCS 9:00 11:30 14:00 17:00 17:00

2ND CART 2ND CART 2ND CART 2ND CART 8pcs

8PCS 11:00 14;00 16:30 19:30 19:30

3RD CART 3RD CART 3RD CART 3RD CART 12PCS

12PCS 13:00 17:30 20:00 22:30 22:30

1 CART= 4PCS EVERY 3HRS

22

LEAN TRANSFORMATION

We maintained ZERO WO LATES (since April 21, 2014)

We reduced quality reject rate from 30% down to 3%

We reduced total lead time from 4.5 down to < 2 days

We reduced total cycle time from 3Hrs to 0.7Hrs/pc

We reduced our WIP from 33 pcs to 12pcs in < 2 weeks

We achieved our project objectives in a 3 month period, ,

something that was considered not possible before !!

23

Control Phase We created a Master Sample, approved by Engineering &

Quality, which is used as a quality control reference

Implemented process control checks in all upstream and

downstream operations

We identified WIP as being the leading indicator to our

performance, and continue to track it daily

Developed training videos for Tacking, Joining & Welding

We implemented cross functional 5S audits, with

supervisors/managers and workers

We empowered the operators to lead & make decisions



EATS RACK SCHEDULE

Day Date WO # Time # Check

MON July 14, 2014 WO137798 22214831 7:30-8:15 1 J8:15-9:00 2 J

Break 9:15-9:25 9:00-10:00 3 J√ TACKED 10:00-10:45 4 JJ JOINED LUNCH (11:30-12) 10:45-11:30 5 ❼

❼ ROBOT 7 WELDED 12:00-12:45 6 ❼

12:45-1:40 7 ❼

1:50-2:30 8 ❼

2:30-3:15 9 ❼

3:15-4:00 10 ❼

4:00-4:45 11 ❼

4:45-5:30 12 √Tuesday July 15, 2014 WO137799 22214831 7:30-8:15 1 √

8:15-9:00 2 √Break 9:15-9:25 9:00-10:00 3 √

10:00-10:45 4 √LUNCH (11:30-12) 10:45-11:30 5 √

WO137800 22214829 1 √12:45-1:40 2 √1:50-2:30 3 √2:30-3:15 4 √3:15-4:00 5 √4:00-4:45 6

4:45-5:30 7

Wed July 16, 2014 WO137801 22214830 7:30-8:15 1

8:15-9:00 2

Break 9:15-9:25 9:00-10:00 3

10:00-10:45 4

LUNCH (11:30-12) 10:45-11:30 5

12:00-12:45 6

12:45-1:40 7

1:50-2:30 8

2:30-3:15 9

3:15-4:00 10

4:00-4:45 11

4:45-5:30 12

Thursday July 17, 2014 WO137802 22214830 7:30-8:15 1

8:15-9:00 2

Break 9:15-9:25 9:00-10:00 3

10:00-10:45 4

LUNCH (11:30-12) 10:45-11:30 5

12:00-12:45 6

12:45-1:40 7

1:50-2:30 8

2:30-3:15 9

3:15-4:00 10

4:00-4:45 11

4:45-5:30 12

Friday July 18, 2014 WO137803 22214829 7:30-8:15 1

8:15-9:00 2

Break 9:15-9:25 9:00-10:00 3

10:00-10:45 4

LUNCH (11:30-12) 10:45-11:30 5

12:00-12:45 6

12:45-1:40 7

1:50-2:30 8

2:30-3:15 9

3:15-4:00 10

4:00-4:45 11

4:45-5:30 12

Break (1:40-1:50)

Break (1:40-1:50)

Break (1:40-1:50)

Break (1:40-1:50)

Break (1:40-1:50)

EATS RACK SCHEDULE

Day Date WO # Time # Check

MON July 14, 2014 WO137798 22214831 7:30-8:15 1 J8:15-9:00 2 J

Break 9:15-9:25 9:00-10:00 3 J√ TACKED 10:00-10:45 4 JJ JOINED LUNCH (11:30-12) 10:45-11:30 5 ❼

❼ ROBOT 7 WELDED 12:00-12:45 6 ❼

12:45-1:40 7 ❼

1:50-2:30 8 ❼

2:30-3:15 9 ❼

3:15-4:00 10 ❼

4:00-4:45 11 ❼

4:45-5:30 12 √Tuesday July 15, 2014 WO137799 22214831 7:30-8:15 1 √

8:15-9:00 2 √Break 9:15-9:25 9:00-10:00 3 √

10:00-10:45 4 √LUNCH (11:30-12) 10:45-11:30 5 √

WO137800 22214829 1 √12:45-1:40 2 √1:50-2:30 3 √2:30-3:15 4 √3:15-4:00 5 √4:00-4:45 6

4:45-5:30 7

Wed July 16, 2014 WO137801 22214830 7:30-8:15 1

Break (1:40-1:50)

Break (1:40-1:50)

ew


0 0 0 0 0 0 0 0 0 0 0 0 00

0.2

0.4

0.6

0.8

1

1.2

EATS WO LATES BY WEEK

WO LATES YTD WO LATES


0

5

10

15

20

25

0 2 4 6 8 10 12week

% Rejects/week(Internal)


0

5

10

15

20

25

30

35EATS WIP BY WEEK

TOTAL WIP UCL WIP LCL WIP


11.5

18.3

12.4

9.3

7.3

9.7

14.3

13.0

14.0

17.0

19.6

26.0

28.0

30.0

22.0

27.0

28.6

24.0

28.027.3

24.0

27.3

30.5

23.0

26.7

29.5

26.4

21.0

25.7

16.0

23

28

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0EATS CELL EARNED HRS

TOTAL HRS Target HRs

New target= 7.5hrs x 3


148176 179

213

261

180

JAN FEB MARCH APRIL MAY JUNE

EATS 2014 YTD FG/Month


11.5

18.3

12.4

9.3

7.3

9.7

14.3

13.014.0

17.0

19.6

26.0

28.0

30.0

22.0

27.0

28.6

24.0

28.027.3

24.0

27.3

30.5

23.0

26.7

29.5

26.4

21.0

25.7

16.0

23

28

5.8

9.2

6.2

4.73.7

4.9

7.26.5 7.0

8.5

15.1

20.0

21.5

23.1

16.9

20.822.0

18.5

21.521.0

18.5

24.8

27.7

20.9

24.3

26.8

24.0

19.1

23.4

14.5

21.0

16

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

EATS DAY v TOTAL HRS

TOTAL HRS Day Shift Hrs Target HRs


7.4

8.8 8.95

10.65

13.05 12.86

Jan Feb March April May June

EATS PCS/DAY

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EATS PROJECT SAVNGS


BASED ON SHIFT HRS REDUCTION

MIN/PC Hrs/Pc PCS/SHIFT DAY SHIFT DAY SHIFT DAY SHIFT AFT shift AFT SHIFT AFT shift

DEPARTMENTS Capacity Capacity 7.5 Hrs PCS/SHIFT HRS PCS/HR PCS HRS PCS/HR

TACKING 30 0.5 12 11 7.5 1.507 1 0.5 1.1ROBOT 7 WELDING 44 0.7 12 10 7.5 1.333 2 1.2 1.2

JOINING 45.0 0.8 12 10 7.5 1.333 2 1.5 1.33TOTAL= 119 1.98 12 10.43 22.5 1.3911 1.4 3.2 1.2

Hrs/Pc

TOTAL HRS USED/12PCS= 25.7 2.14

TOTAL HRS BEFORE FOR 8 PCS= 45.0 5.625

Labour hrs saved per day (12pcs) = 3.49

REDUCED SHIFT HRS

ACTUAL

35

BEFORE & AFTER PRODUCTIVITY SAVINGS


BEFORE IMPROVEMENTS Pcs/Day Hrs Shift Operators Total Hrs Hrs/Pc QTY REQUIRED HRS REQUIRED

8 7.5 6.0 45 5.625 2,000 11250

AFTER IMPROVEMENTS Pcs/Day Hrs Day Operators Total Hrs Hrs/Pc QTY REQUIRED HRS REQUIRED

12 7.5 3.43 25.7 2.142 2,000 4283

HRS SAVED= 6966.67

30.00$

ANNUAL LABOUR SAVINGS =209,000.00$

LABOUR RATE


EATS PROJECT SAVNGS

BASED ON SHIFT HRS REDUCTION

MIN/PC Hrs/Pc PCS/SHIFT DAY SHIFT DAY SHIFT DAY SHIFT AFT shift AFT SHIFT AFT shift

DEPARTMENTSCapacity Capacity 7.5 Hrs PCS/SHIFT HRS PCS/HR PCS HRS PCS/HRTACKIN

G30 0.5 12 11 7.5 1.507 1 0.5 1.1

ROBOT

7 44 0.7 12 10 7.5 1.333 2 1.2 1.2

JOINING 45.0 0.8 12 10 7.5 1.333 2 1.5 1.33TOTAL= 119 1.98 12 10.43 22.5 1.3911 1.4 3.2 1.2

Hrs/Pc

TOTAL HRS USED/12PCS= 25.7 2.14

TOTAL HRS BEFORE FOR 8 PCS= 45.0 5.625

Labour hrs saved per day (12pcs) = 3.49

BEFORE IMPROVEMENTS Pcs/Day Hrs Shift Operators Total Hrs Hrs/Pc QTY REQUIRED HRS REQUIRED

8 7.5 6.0 45 5.625 2,000 11250

AFTER IMPROVEMENTS Pcs/Day Hrs Day Operators Total Hrs Hrs/Pc QTY REQUIRED HRS REQUIRED

12 7.5 3.43 25.7 2.142 2,000 4283

HRS SAVED= 6966.67

30.00$

ANNUAL LABOUR SAVINGS = 209,000.00$

Rework cost reduction 22214829 EATS

Reject Rate Units/yearUnits

reworked

Rework

HRS/pc Rework cost/pc Annual Rework cost

30% 2000 600 0.5 22.50$ 13,500.00$

222,500.00$

REDUCED SHIFT HRS

ACTUAL

LABOUR RATE

TOTAL ANNUAL PROJECT SAVINGS

37

Next Steps

• Develop a transition hand-off plan with production

• Continue to lead/drive & audit activities as needed

• Daily KPI meetings with the team members until transition

• Continue with weekly project review meetings until

transition

• Continue to support the cell and use the best

practices/lessons learned in other areas

VOLVO EATS LEAN TRANSFORMATION

Engineering

Transcript of VOLVO EATS LEAN TRANSFORMATION