1. © PTU's Gian Jyoti School of TQM & Entrepreneurship 1 Lean Manufacturing Vijay Kapoor – Principal Consultant Naresh K Chawla - Sr. Consultant

2. © PTU's Gian Jyoti School of TQM & Entrepreneurship 2 Eli Whitney (Interchangeable parts) Drawing conventions, Tolerances Modern machine tool development 1850 1900 Fredrick Taylor (Standardized work, time study & work standards) Frank Gilbreth (Process charts, motion study) Henry Ford (Assembly lines, flow lines, manufacturing strategy) Deming & Juran (SPC, TQM) 1990 1950 Eiji Toyoda, Taiichi Ohno, Shigeo Shingo Toyota production system, JIT Stockless production, World class manufacture Lean Manufacture American Civil War World War I World War II History & Evolution Before 1850 Craft manufacturing

3. © PTU's Gian Jyoti School of TQM & Entrepreneurship 3 Govt. Policies Global Competition Rising Cost of Input (Raw material, Energy) Accountability to shareholders & financers Industry’s Concerns Competency of employees Above all SUSTAINABLE Improvement

4. © PTU's Gian Jyoti School of TQM & Entrepreneurship 4 Create precise customer value - goods and services with higher quality and fewer defects – with less human effort, less space, less capital, and less time than the traditional system of mass production. Remove ‘waste’ – –Consume ‘just enough’ recourses – –Do more with less Survival Kit

5. © PTU's Gian Jyoti School of TQM & Entrepreneurship 5 Defining Value and Waste Defining value - an item or feature for which a customer willing to pay. Every thing else – waste Waste - activities that consume time, resource and/or space but do not add value. Lean - Production of product to meet demand on daily basis with minimum lead time & non value added activities eliminated or minimized

6. © PTU's Gian Jyoti School of TQM & Entrepreneurship 6 Focus on Waste

7. © PTU's Gian Jyoti School of TQM & Entrepreneurship 7 Value Added Activity Test for value added activities - Transforms product in some way - Customer sees & willing to pay - Will the customer know if eliminated

8. © PTU's Gian Jyoti School of TQM & Entrepreneurship 8 Overproduction Waiting Inventory Transportation Motion Over Processing Rework 1 1 6 6 7 7 5 5 4 4 3 3 2 2 To produce sooner,faster or in greater quantities than customer demand. Raw material, work in progress or finished goods which is not having value added to it. People or parts that wait for a work cycle to be completed. Unnecessary movement of people, parts or machines within a process. Unnecessary movement of people or parts between processes. Non right first time. Repetition or correction of a process. Processing beyond the standard required by the customer. is the Japanese word for WASTE. MUDA Seek it out and get rid! 1 2 34 5 6 7 An 8th waste is the wasted potential of people Seven Wastes

9. © PTU's Gian Jyoti School of TQM & Entrepreneurship 9 Eliminating Waste 7 steps 1. Reduce lead time 2. Cut operations costs 3. Improve business performance visibility 4.Speed time to market 5.Exceed customer expectations 6.Streamline outsourcing processes 7. Manage global operations

10. © PTU's Gian Jyoti School of TQM & Entrepreneurship 10 “Lean manufacturing is not a collection of best practices from which manufacturers can pick and choose. It is a production philosophy, a way of conceptualizing the manufacturing process from raw material to finished goods and from design concept to customer satisfaction. Lean is truly a different way of thinking about manufacturing.” - Running Today’s Factory: A Proven Strategy for Lean Manufacturing, Charles Standard. Lean manufacturing is a systems approach

11. © PTU's Gian Jyoti School of TQM & Entrepreneurship 11 Comparison of lead time Customer Order Waste Product Shipment Time Customer Order Product Shipment Time (Shorter) Business as Usual Waste Lean Manufacturing

12. © PTU's Gian Jyoti School of TQM & Entrepreneurship 12 Main Features of Lean Manufacturing Greater Product Variety Fast Response (Flexibility) Stable Production Schedules Supply Chain Integration Demand Management Broader jobs, highly skilled workers, proud of product Excellent quality Reduced costs Ability to meet global market & competition

13. © PTU's Gian Jyoti School of TQM & Entrepreneurship 13 Typical benefits of waste elimination initiative

14. © PTU's Gian Jyoti School of TQM & Entrepreneurship 14 Lean Thinking, Lean Tools & Supporting Strategies

15. © PTU's Gian Jyoti School of TQM & Entrepreneurship 15 Lean Tools to Lean Management Lean thinking “The basics of Lean Thinking is ‘the customer first” How do we do that? “By creating thinking people” And how do we do that? “By creating workplaces that are more human and encourage people to think”

16. © PTU's Gian Jyoti School of TQM & Entrepreneurship 16 Lean Thinking Principle #1 ……‘Define Value’ Quality Flexibility Service Variety Variability Response- Time Cost - - - - V A L U E - - - - - - - - V A L U E - - - - The critical starting point for Lean Thinking is value as defined by the ultimate customer. ???

17. © PTU's Gian Jyoti School of TQM & Entrepreneurship 17 Lean Thinking Principle #2 ……‘Identify the Value Stream’ All the actions required to bring a specific product or service through the three critical transformation processes: Idea transformation: concept to market launch Information transformation: order-take through scheduling to delivery Physical transformation: raw materials to final customer Value-add time (Hours) InventoryWaiting Typical value-add to lead-time ratio ~ 1% Waste Value-add activity SetupTransportationWaitingInspect

18. © PTU's Gian Jyoti School of TQM & Entrepreneurship 18 Lean Thinking Principles #3,4,5 #3: Make the work flow Every time the flow of work stops we consume resources that adds costs but generates no value #4: Respond only when the customer pulls work Overproduction is the worst form of waste as it generate all other waste types e.g. transportation, inventory, waiting,….. #5: Strive to seek perfection The real benchmark is zero waste, not what your competitors are doing!

19. © PTU's Gian Jyoti School of TQM & Entrepreneurship 19 Lean Tools & Supporting Strategies 5S Visual control Team building Problem solving Standardised processes Value stream mapping

20. © PTU's Gian Jyoti School of TQM & Entrepreneurship 20 Lean Tools & Supporting Strategies Pull system Kanban Takt time – rate of customer demand Manufacturing Cells Heijunka 5Ws & 1H

21. © PTU's Gian Jyoti School of TQM & Entrepreneurship 21 Kaizen Total Productive Maintenance SMED (setup reduction) Poka-Yoke or mistake-proofing Cycle time reduction Andon – signalling system to stop line Lean Tools & Supporting Strategies

22. © PTU's Gian Jyoti School of TQM & Entrepreneurship 22 5S A method for organizing a workplace, and keeping it organized. Benefits 1.Improve safety 2.Decrease down time 3.Raise employee morale 4.Identify problems more quickly 5.Develop control through visibility 6.Establish convenient work practices

23. © PTU's Gian Jyoti School of TQM & Entrepreneurship 23

24. © PTU's Gian Jyoti School of TQM & Entrepreneurship 24 Visual Control Any communication device used in the work environment that tells us at a glance how work should be done and whether it is deviating from the standard Benefits 1. Increase productivity 2. Improve quality 3. On-time delivery 4. Reduce inventory 5. Increase equipment reliability 6. Boosts bottom-line profits

25. © PTU's Gian Jyoti School of TQM & Entrepreneurship 25 Visual controls show Where items belong? How many items belong there? What is the standard procedure for doing something? Status of work in process. Many other types of information critical to the flow of work activities.

26. © PTU's Gian Jyoti School of TQM & Entrepreneurship 26 Visual management Visual management maintains an orderly work environment. Employees have quicker and safer access to items that are needed. Colour-coding is often used to remind employees of where items belong. If order is not continually stressed, disorder will result and create an unfriendly work atmosphere.

27. © PTU's Gian Jyoti School of TQM & Entrepreneurship 27 Lean ToolIntroductionBenefits Team Building An active process by which a group of individuals with a common purpose are focused and aligned to achieve a specific task or set of outcomes 1.Improves morale and leadership skills. 2.Finds the barriers that thwart creativity 3.Clearly defines objectives and goals 4.Improves processes and procedures 5.Improves organizational productivity 6.Identifies a team’s strengths and weaknesses· 7.Improves the ability to problem solve Team Building

28. © PTU's Gian Jyoti School of TQM & Entrepreneurship 28 Lean ToolIntroductionBenefits Problem Solving The Problem Solving is a systematic approach with a sequence of sections that fit together depending on the type of problem to be solved. These are: 1. Problem Definition 2. Problem Analysis 3. Generating possible Solutions 4. Analyzing the Solutions 5. Selecting the best Solution(s) 6. Sustaining the gains 1.Leads to identify root cause(s) of chronicle problems Problem Solving

29. © PTU's Gian Jyoti School of TQM & Entrepreneurship 29 Lean ToolIntroductionBenefits Standardized Process Standardization is the process of developing and agreeing upon technical standards. 1.Better decision making 2.Cost reduction and increase in efficiency 3.Effective information sharing 4.Easier international transfer of marketing skills 5.Simplifying the coordination and control between subsidiaries and business functions Value stream Mapping A tool for guiding improvements by identifying waste & isolated processes 1.Enable Visualizing the production process 2.Identifies waste in each step of the production process. 3.Provides a plan for implementing improvements to the production process to reduce costs. Standardized Process & Value stream Mapping

30. © PTU's Gian Jyoti School of TQM & Entrepreneurship 30 Lean ToolIntroductionBenefits Pull system A method of controlling the flow of resources by replacing only what has been consumed 1.Reduce lead times 2.Minimize work in process 3.optimize floor space usage 4.Simplify production signals and improve on-time delivery to customers. Pull system

31. © PTU's Gian Jyoti School of TQM & Entrepreneurship 31 Lean ToolIntroductionBenefits Kanban A system of continuous supply of components, parts and supplies, such that workers have what they need, where they need it, when they need it 1.Reduces waste and scrap 2.Provides flexibility in production 3.Increases Output 4.Reduce Preventing Over Production 5.Minimizing Wait Times and Logistics Costs 6.Reduce Stock Levels and Overhead Costs 7.Save Resources by Streamlining Production 8.Reduce Inventory Costs Kanban

32. © PTU's Gian Jyoti School of TQM & Entrepreneurship 32 Lean ToolIntroductionBenefits Takt time – rate of customer demand The rate that a completed product needs to be finished in order to meet customer demand 1.Gives the rhythm at which system should operate 2.Smooth production planning & reduced interruptions in operations 3.System synchronization with customer requirement 4.Enable pull scheduling 5.No over production 6.No rush hours in work 7.WIP reduced Manufacturing Cells Comprises a group of equipment, that is dedicated to the complete production of a family of similar parts 1.Flexible Operation 2.Setup Time Reduction 3.Process Simplification 4.Schedule Variety Takt time – Rate of customer demand & Manufacturing Cells

33. © PTU's Gian Jyoti School of TQM & Entrepreneurship 33 Lean ToolIntroductionBenefits Heijunka the leveling of production by both volume and product mix 1.Stability of manpower 2.Reduction of unnecessary overtime 3.Reduction in inventory levels 4.Reduction of stress levels in the production area 5Ws & 1 H It is a method of questioning that leads to the identification of the root cause(s) of a problem 1.Identify root cause 2.Identify current and future needs for organizational improvement. 3.Develop a logical approach to problem solving; using data that already exists in most operations. Heijunka & 5Ws & 1 H

34. © PTU's Gian Jyoti School of TQM & Entrepreneurship 34 Lean ToolIntroductionBenefits KaizenContinuous Improvement 1.Increased Space utilization 2.Increased product quality 3.Better Use of capital 4.Communications 5.Production capacity 6.Employee retention Total Productive Maintenance A maintenance philosophy designed to integrate equipment maintenance into the manufacturing process. The goal is to keep equipment producing only good product, as fast as possible with no unplanned downtime. 1.Improve Productivity 2.Reduce breakdown leading to Zero breakdown concept 3.Leads to multi-skilling of workers 4.Better safety 5.Improve quality of products Kaizen & Total Productive Maintenance

35. © PTU's Gian Jyoti School of TQM & Entrepreneurship 35 Lean ToolIntroductionBenefits SMED (Set up reduction) The practice of reducing the time it takes to change a line or machine from running one product to the next 1.WIP and lot size reduction 2.Finished goods inventory reduction 3.Improved equipment utilization/yield 4.Increased profitability without new capital equipment purchase Poka-yoke or mistake proofing A techniques that help operators avoid mistakes in their work caused by choosing the wrong part, leaving out a part, installing a part backwards, etc. 1.Better safety 2.Reduce breakdown 3.Improve Productivity SMED (Set up reduction) & Poka- yoke or mistake proofing

36. © PTU's Gian Jyoti School of TQM & Entrepreneurship 36 Lean ToolIntroductionBenefits Cycle Time reduction Reduction of total time taken from start of the production or service to its completion. It includes processing time, move time, wait time, and inspection time 1.Reduced costs 2.Increased throughput 3.Streamlined processes 4.Improved communications 5.Reduced process variability 6.Schedule integrity 7.Improved on-time delivery Cycle Time reduction

37. © PTU's Gian Jyoti School of TQM & Entrepreneurship 37 Lean ToolIntroductionBenefits Andon – Signaling system to stop line A Japanese term refers to the warning lights on an assembly line that light up when a defect occurs. When the lights go on, the assembly line is usually stopped until the problem is diagnosed and corrected. 1.Bring immediate attention to problems as they occur in the manufacturing process. 2.Provide a simple and consistent mechanism for communicating information on the plant floor. 3.Encourage immediate reaction to quality, down time, and safety problems. 4.Improve accountability of operators by increasing their responsibility for “good” production and empowering them to take action when problems occur. 5.Improve the ability of supervisors to quickly identify and resolve manufacturing issues. Andon–Signaling system to stop line