Vpmep vsm gaining traction
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Value Stream Mapping –Value Stream Mapping –Gaining Traction, Gaining Traction, Getting ResultsGetting Results
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1 – Obstacle to Traction - 1 – Obstacle to Traction - WASTEWASTE
2 2 – Benefits of Value Stream Mapping3 3 – What is Value Stream What is Value Stream Mapping?Mapping?
4 4 – A Road Map for A Road Map for ImprovementImprovement
AgendaAgenda
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4
What is WASTE?
Any Activity that DOES NOT increase the Market Form or Function of the Product or Service based on the Critical Customer Requirements.
These are things the customer is NOT willing to pay for.
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Definition of Value Definition of Value AddedAdded
Value Added
Any activity that increases the market form or function of the product or service. (These are things the customer is willing to pay for.)
Non-Value Added
Any activity that does not add market form or function or is not necessary. (These activities should be eliminated, simplified, reduced, or integrated.)
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Lean = Eliminating the Lean = Eliminating the WastesWastes
Value Added
Typically 95% of all lead time is non-value added
Non-Value Added
• DDefectsefects
• OOverproductionverproduction
• WWaitingaiting
• NNot Utilizing Employeesot Utilizing Employees
• TTransportationransportation
• IInventorynventory
• MMotionotion
• EExcess Processingxcess Processing
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Where is the Waste?Where is the Waste?• DDefects – incomplete or incorrect information efects – incomplete or incorrect information
• OOverproduction – releasing work before next process verproduction – releasing work before next process can work on them, unbalanced work loadscan work on them, unbalanced work loads
• WWaiting – unbalanced work loads, slow system response, aiting – unbalanced work loads, slow system response, incomplete information, approvalsincomplete information, approvals
• NNot Utilizing Employees – old guard thinking, politics, high ot Utilizing Employees – old guard thinking, politics, high turnover, low investment in trainingturnover, low investment in training
• TTransportation – poor layout, poor flowransportation – poor layout, poor flow
• IInventory – large batches, complexity to complete tasknventory – large batches, complexity to complete task
• MMotion – poor organization, no standard workotion – poor organization, no standard work
• EExcess Processing – excess communication, lack of xcess Processing – excess communication, lack of communication, unnecessary approvals, customer communication, unnecessary approvals, customer requirements are not clearly understoodrequirements are not clearly understood
All processes have waste.
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Without Change There Can Be No Improvement
“The definition of insanity is doing the same thing over and over and expecting different results.”
Albert Einstein
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Identify waste
Measure&
Adjust
Current state
Future state
Implement
ContinuousIncrementalImprovement
The Lean Process
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•Understanding the Process
•Information and Material Flow
•Data Driven Decision Process
Benefit of Value Stream Mapping
94% if Failures are due to Poor Systems
6% are caused by Worker Mistakes
Deming
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“Whenever there is a product or service for a customer, there is a value stream.
The challenge lies in seeing it.”
Examples:Raw Materials to Customer - ManufacturingConcept to Launch - EngineeringOrder to Cash – Services including Support Processes
Look for Value Streams
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Value Stream Mapping is a Value Stream Mapping is a Key Process Diagnostic ToolKey Process Diagnostic Tool
Quick Changeover
Standardized Work Batch Reduction Teams
Quality at Source
5S System Visual Layout
POUS
Cellular/FlowPull/Kanban TPM
ValueStreamMapping
Continuous Improvement
Kaizen
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Value Stream Mapping Value Stream Mapping StepsSteps
• Select product / service Select product / service familyfamily
• Draw Current State map. Draw Current State map. Understanding how the Understanding how the process currently operates. process currently operates.
• Identify opportunities for Identify opportunities for elimination of waste and elimination of waste and areas of improvement to areas of improvement to meet customer’s needs.meet customer’s needs.
• Draw the Future State map. Draw the Future State map. Design a lean flow using lean Design a lean flow using lean techniques.techniques.
• Develop action plan and Develop action plan and implement it.implement it.
Product / Service family
Future state
drawing
drawingCurrent state
Plan and Implementation
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IncomingOrders
Receive Order
Fax
Check Credit
FIN
Review & Enter Order
MRP
Reconcile Order
MRP
Confirm Order
Phone
Finalize Order
MRP
MRP MRPProductionSchedule
Semi-WeeklyShip Schedule
.5 days .5 days .2 days .2 days .25 days 1 day
½ min 1 min 10 min 1 min 7 min 5 min
Total Lead Time = 2.65 daysTotal Processing Time= 24.5 min
Order Entry ProcessCurrent State - Sept. 2007
First Pass Yield = 34.4%
P/T = ½ minBatch = 4hours
IN
P/T = 1 min% Accept = 90%Batch = 4 hours
IN
P/T = 10 min% C&A = 60%Batch = 1.6 hours
IN
P/T = 1 min%C&A = 75%Batch = 1.6 hours
IN
P/T =7 min%C&A = 85%Batch = 2 hours
IN
P/T = 5 minBatch = 1day
IN
Weekly FaxInformation
Material
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Future State QuestionsFuture State Questions
1.1. What does the customer really need?What does the customer really need?2.2. How often will we check our performance to customer needs?How often will we check our performance to customer needs?3.3. Which steps create value and which are waste?Which steps create value and which are waste?4.4. How can we flow work with fewer interruptions?How can we flow work with fewer interruptions?5.5. How do we control work between interruptions? How will work How do we control work between interruptions? How will work
be prioritized?be prioritized?6.6. Is there an opportunity to balance the work load and/or different Is there an opportunity to balance the work load and/or different
activities? activities? 7.7. What process improvements will be necessary?What process improvements will be necessary?
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IncomingOrders
Receive Order
Fax
Check Credit
FIN
Review & Enter Order
MRP
Reconcile Order
MRP
Confirm Order
Phone
Finalize Order
MRP
MRP MRPProductionSchedule
Semi-WeeklyShip Schedule
.5 days .5 days .2 days .2 days .25 days 1 day
½ min 1 min 10 min 1 min 7 min 5 min
Total Lead Time = 2.65 daysTotal Processing Time= 24.5 min
Order Entry ProcessCurrent State - Sept. 2007
First Pass Yield = 34.4%
P/T = ½ minBatch = 4hours
IN
P/T = 1 min% Accept = 90%Batch = 4 hours
IN
P/T = 10 min% C&A = 60%Batch = 1.6 hours
IN
P/T = 1 min%C&A = 75%Batch = 1.6 hours
IN
P/T =7 min%C&A = 85%Batch = 2 hours
IN
P/T = 5 minBatch = 1day
IN
Weekly Fax
What does the customer really need?
How often will we check our performance to customer needs?
All orders will be processed within one hour of receipt (6 orders processed each hour).
Each hour.
460 minutes46 Orders = 10 minutes/orderTakt Time =
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IncomingOrders
Receive Order
Fax
Check Credit
FIN
Review & Enter Order
MRP
Reconcile Order
MRP
Confirm Order
Phone
Finalize Order
MRP
MRP MRPProductionSchedule
Semi-WeeklyShip Schedule
.5 days .5 days .2 days .2 days .25 days 1 day
½ min 1 min 10 min 1 min 7 min 5 min
Total Lead Time = 2.65 daysTotal Processing Time= 24.5 min
Order Entry ProcessCurrent State - Sept. 2007
First Pass Yield = 34.4%
P/T = ½ minBatch = 4hours
IN
P/T = 1 min% Accept = 90%Batch = 4 hours
IN
P/T = 10 min% C&A = 60%Batch = 1.6 hours
IN
P/T = 1 min%C&A = 75%Batch = 1.6 hours
IN
P/T =7 min%C&A = 85%Batch = 2 hours
IN
P/T = 5 minBatch = 1day
IN
Weekly FaxStop walking to the FAX that’s waste!!!
PhoneOr WEB
Which steps create value?
Which are waste?
Waste
Over Processing
Waste
Rework
460 minutes46 Orders = 10 minutes/orderTakt Time =
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460 minutes46 Orders = 10 minutes/orderTakt Time =
IncomingOrders
Receive Order
Fax
Check Credit
FIN
Review & Enter Order
MRP
Reconcile Order
MRP
Confirm Order
Phone
Finalize Order
MRP
MRP MRPProductionSchedule
Semi-WeeklyShip Schedule
.5 days .5 days .2 days .2 days .25 days 1 day
½ min 1 min 10 min 1 min 7 min 5 min
Order Entry ProcessCurrent State - Sept. 2007
P/T = ½ minBatch = 4hours
IN
P/T = 1 min% Accept = 90%Batch = 4 hours
IN
P/T = 10 min% C&A = 60%Batch = 1.6 hours
IN
P/T = 1 min%C&A = 75%Batch = 1.6 hours
IN
P/T =7 min%C&A = 85%Batch = 2 hours
IN
P/T = 5 minBatch = 1day
IN
Weekly Fax
Finance Cross Train
Link Finance / MRP
On-Line Order Entry How can we flow work with
fewer interruptions?
Total Lead Time = 1.25 daysTotal Processing Time= 11.5 minNEW
METRICS! First Pass Yield = 90%
Auto Confirm
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Receive / CreditCheck / ReconcileConfirm
MRP/FIN
MRP MRPProductionSchedule
P/T < 10 min% accept = 90%Batch = 1
Order Entry ProcessFuture State - Sept. 2007
Phone / Web
Semi-WeeklyShip Schedules
How can we control work between interruptions?
ScheduleProductionvia FG Kanban
ImplementKanban
Kanban will:Schedule Production to real time demand.Optimize (level) and Control Inventory.Link Production to Customer Demand.
IncomingOrders
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Receive / CreditCheck / ReconcileConfirm
MRP/FIN
MRP
P/T < 10 min% accept = 90%Batch = 1
Order Entry ProcessFuture State - Sept. 2007
Phone / Web
Semi-WeeklyShip Schedules
IncomingOrders
ScheduleProductionvia FG Kanban
Shipping Training
DirectSchedule Shipping
If FG Kanban is implemented what improvements can be made to Shipping?
I.T. Link to Order Entry
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Receive / CreditCheck / ReconcileConfirm
MRP/FIN
MRP
P/T < 10 min% accept = 90%Batch = 1
Order Entry ProcessFuture State - Sept. 2007
Phone / Web
IncomingOrders
ScheduleProductionvia FG Kanban
Shipping
Total Lead Time < 10 Minutes
Total Processing Time < 10 MinutesFuture State Metrics!First Pass Yield > 90%
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Implementation Road Implementation Road MapMap•Clarify Business Drivers and Key Customer MetricsClarify Business Drivers and Key Customer Metrics•Assess and Map Current Capabilities (Baseline)Assess and Map Current Capabilities (Baseline)•Identify Opportunities for Improvement including Identify Opportunities for Improvement including
the elimination of WASTEthe elimination of WASTE•Create a Vision for the Future Based on Voice of the Create a Vision for the Future Based on Voice of the
Customer and Voice of the BusinessCustomer and Voice of the Business•Analyze Gaps and Create Action Plan to SucceedAnalyze Gaps and Create Action Plan to Succeed
- Use Robust Set of Tools (i.e. Lean Six Sigma)Use Robust Set of Tools (i.e. Lean Six Sigma)•Determine Priorities and Resources NecessaryDetermine Priorities and Resources Necessary
- Structured Process ImprovementStructured Process Improvement•Track Impact through MetricsTrack Impact through Metrics•Celebrate WinsCelebrate Wins
- With CustomersWith Customers- With EmployeesWith Employees- With SuppliersWith Suppliers
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ALL processes have WASTE that cost you MONEY.
Improvement requires change. To change a process you have to understand the process.
Process Excellence will not be Process Excellence will not be achieved without involving people achieved without involving people at all levels of the organization.at all levels of the organization.
Summary:Summary:
It is Not about Starting. It is Not about Starting.
It is about Getting Things DoneIt is about Getting Things Done!
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Questions?Questions?
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Parting ThoughtParting Thought
Learning is not compulsory …Learning is not compulsory …
neither is survival.neither is survival.
Dr. DemingDr. Deming