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Copyright© Demand Flow Institute, LLC. DBA JCIT International 2005. All rights reserved. Demand Flow Technology The Leader in Demand Flow ® Technology.

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Presentation on theme: "Copyright© Demand Flow Institute, LLC. DBA JCIT International 2005. All rights reserved. Demand Flow Technology The Leader in Demand Flow ® Technology."— Presentation transcript:

1 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology The Leader in Demand Flow ® Technology Providing the proven tools of Demand Flow  Technology (DFT) and Supply Chain Management to manufacturing professionals through cost effective training and technology transfer services.

2 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Traditional Manufacturing

3 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Demand-Driven Manufacturing

4 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology S CHEDULED & F UNCTIONAL M ANUFACTURING T ECHNIQUES D EMAND D RIVEN F LOW M ANUFACTURING TraditionalDemand Flow FUNCTIONAL TEST AREA ICT-TEST AREA STORES PRODUCTION SCHEDULING EXPEDITING & D/L REPORT MATERIAL STAGING AREA (KITS) PRINT CIRCUIT AREA STAGING PICK/PLACE WAVE REWORK SMT AREA RE-FLOW INSPECTION SPRAY CURE WAT JIT/LEAN COMPLETED ASSEMBLIES SHORTAGE AREA INSPECT FINAL STAGING AREA CABLE ASSEMBLIES SUB-ASSEMBLY AREA FLOW CELL CNC 1 CNC 2 CNC 3 TEST BAY TEST WORKSTATION A WORKSTATION B WORKSTATION C WORKSTATION D WORKSTATION E MECHANICAL AREA PRODUCT BURN-IN GOVERNMENT CERTIFICATION 173 HRS. DIP OVEN SALES ORDER DEMAND FEEDER PROCESS MACH ASMBLY TQC CUT SEQ. VCD ASMBLY WAVE ASSEMBLY TAKT OPERATIONAL CYCLE TIME LINE 1- DEMAND FLOW ® PROCESS BACKFLUSH PULL Two Forms of Manufacturing DEMAND-DRIVEN INV TURNS IS NORMAL ZERO WORKING CAPITAL FORECAST-DRIVEN 6-8 INV TURNS IS WORLD CLASS $$$ WORKING CAPITAL

5 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Certified and Non Certified (6) (3) (100) (20) (50) (1) F E D C B A SCH.QUEUE W/C SCHEDULED MRP II FAB SUB-ASSEMBLIES (5) (1) B A A B C D E F W FORECAST FGI $ $ $ SALES ORDER SKU W $ Foundation for Flow

6 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology A B C D E F W FORECAST RAW $10M $2M (5) (1) B A $2M 14.3 HOURS $10 M 10 DAYS (6) (3) (100) (20) (50) (1) F E D C B A $10M SALES ORDER SKU W $ FGI CUSTOMER Zero Working Capital Objectives BALANCE SHEET ASSETS LIABILITIES INCOME STATEMENT CURRENT ASSETS Cash $500,000 Accounts Receivable 17,500,000 Prepaid Expenses 500,000 Inventories: Raw Material 5,250,000 Work in Process 7,500,000 Finished Goods11,250,000 Average Inventory24,000,000 Total Current Assets (less Cash)42,000,000 Current Liabilities Accounts Payable14,988,000 Accrued Expenses 3,000,000 Accrued Employment Costs 2,000,000 Total Current Liabilities19,988,000 Simple Working Capital26,512,000 Sales 238,000,000 Cost of Goods Sold 170,027,200 Gross Margin67,972,800 Sales, General & Admin42,506,800 Operating Margin25,466,800 Total Inventory Turns 7.1 In-Process Inventory Turns 22.7 The DFT Model RAW

7 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Information Technology Certified Suppliers Uncertified Suppliers Warehouse Sales & Marketing Warehouse Customers Customer Service Accounting Engineering Human Resources Factory Demand Flow Environment

8 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Response Time Variability µ = 8-12 days µ = 14.3 hours 

9 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Value Stream Maps - Proceed with Caution Reference: Learning to See -Mike Rother, John Shook, Jim Womack, Dan Jones

10 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Future State Value Stream Map Reference: Learning to See -Mike Rother, John Shook, Jim Womack, Dan Jones

11 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology MODEL #OPERATION # PROCESS I.D. PAGE __of_ _ FIND PART# DESCRIPTION QTY 1400OP 120 SYSTEM DRIVE ASSEMBLY TQC WORK CONTENT VERIFY SDA120P2 Rev. E 1/21/ Disk Frame /8” Pan Head Screw 4 P.C.O. # DATE 2 Product P/N Vacuum Brake Process I.D. Valve Assembly Quality Info. Move Desc. Set-Up Se q. # Task Machine Labor V.A. Machine Labor D/S Qty. Int./Ext. Machine Lab or D/S Qty. Int./Ext. Dist. TQC 15.0Check bracket assembly with valve body Load Stacker with springs Install eject spring in valve 18.0Install eject button on spring 20.0Pressurize valve body assembly * Confirm eject mechanism works freely. * * Verify TQC on green tag Verify bezel slot signs with body TQC bezel against valve face Verify 40 PSI S 50 E Install bezel onto valve body Time Volume Dc ?? Peak Demand Avg. Demand Max Capital Min Inventory Min Capital Max Inventory OT., Temps, 2 nd Shift/Line, 3 rd Shift/Line, Outsource 1 - Shift 2 - Shift 6 - Months = = 11.3 PRODUCT SYNCHRONIZATIONS OPERATION SHEETS SEQUENCE OF EVENTS DEMAND AT CAPACITY Tools & Methodology KANBAN TOOLS TP c/t

12 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Product Synchronization Definitions

13 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Dc x Q x R H R x P H E (S)  Dc ATw TAKT L EAD T IMES = TP c/t SU TAKT-RT  ( SU + RT + MV) + [  RT x (K CELL – 1)] K CELL = R CELL = W ORK = AT X DFT Mathematical Foundation

14 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved REV. L

15 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology USAJAPAN UK GERMANY Kanban SMI Close Supply Distant Supply SMI Distant Supply Kanban Close Supply Forecast (Software) Demand Trigger Electronic Kanban Supplier Managed Inventory Re-supply based on Demand Pull Re-supply based on Demand Pull Re-supply based on Demand Pull Supplier Forecast (Software) Raw Material Suppliers -- Tier 1, 2, 3 -- Production Facilities Distribution (Supply Point) Customer Base Manage Min/Max FGI Levels Forecasting and Kanban

16 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology The Technology Based Lean Supply Chain Work Content Response Time Daily Rate Flexible Production Planning Actual Orders Certified Supplier Pull Process Management Planned Sequence Release Linearity Customers Manufacturing Suppliers Distribution Strategies VMI Consignment Planning

17 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology CNCS HORIZONTAL MACHINING VERTICAL MACHINING WIP SUB ASMBLY SERVICE PACK SAW DRILLING/ DE-BURR PAINT BOOTH WIP OFFICE Stores RECEIVING LOAD WIP UNLOAD SHIPPING FINAL ASSEMBLY WIP STORES WELD DEPARTMENT Power Train Components: Before DFT

18 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Power Train Components: After DFT SAW DE- BURR SAW DE- BURR POUPOU P.O.U. MILL BORE TAP DRILL MILL BORE TAP DRILL CNC WAIT/ WORK ASMBLY OFFICE AVAILABLE SPACE PAINT BOOTH POUPOU CNC RECEIVINGSHIPPING FINAL ASSEMBLY PACK UNLOAD LOAD WELD SALES ORDERS Shifts Response Time Floor Reduction Space 3 to 2 24 Days to <6 hrs 32% Past Due Orders Reduced 65% within 1 month Batch Containers Eliminated 300 3’x4’x3’ containers

19 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Lead Time Service Schedule Inventory Record Accuracy 35 Days 88% Weekly 8.5 Turns < 50% accurate Plastics Manufacturer: Before DFT ADDITIVES BLEND EXTRUSION PACKING BULK MATERIALS 20 MILES ADDITIVES RAW MATERIAL (ON-SITE) RAW MATERIAL (OFF-SITE) FINISHED GOODS INVENTORY 80% 20% CUSTOMER

20 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology Lead Time Service Schedule Inventory Record Accuracy 35 Days to 7 Days 88% to 97% Weekly to Turns to 24 Turns < 50% accurate to 97% Plastics Manufacturer: After DFT RIP (ON-SITE) OFF-SITE WAREHOUSE CLOSED! WAIT WORK K K K K ADDITIVES BLEND EXTRUSION PACKING BLEND SEQUENCE CONTROL BOARD CHANGEOVER CONTROL SALES ORDER SEQUENCE ADDITIVES BULK MATERIALS FINISHED GOODS SUPPLIERS 25% 75% K CUSTOMER

21 Copyright© Demand Flow Institute, LLC. DBA JCIT International All rights reserved. Demand Flow Technology STAGE 3 STAGE 2 The Proven Path Demand-Driven Vision Business Processes Information Systems STAGE 1 FUNDAMENTALS PROCESS-DRIVEN DEMAND-DRIVEN


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