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Engineering Management MSE507 Lean Manufacturing Chapter 2 The Value Stream "Whenever there is a product for a customer, there is a value stream. The Challenge.

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Presentation on theme: "Engineering Management MSE507 Lean Manufacturing Chapter 2 The Value Stream "Whenever there is a product for a customer, there is a value stream. The Challenge."— Presentation transcript:

1 Engineering Management MSE507 Lean Manufacturing Chapter 2 The Value Stream "Whenever there is a product for a customer, there is a value stream. The Challenge lies in seeing it” PHILIP (PHIL) M. CONDIT Chairman and Chief Executive office The Boeing Company

2 "There is only one boss: the customer. And he can fire everybody in the company, from the chairman on down, simply by spending his money somewhere else." Samuel M. Walton Wal-Mart Stores, Inc. Chairman & Chief Executive Officer

3 Why Map A Value Stream? Lean Manufacturing is: the relentless elimination of waste Waste is using resource… …without adding value Waste is all around us, but it can be very hard to see Value Stream Maps (VSM) help us see waste

4 Value Streams A Value Stream is the entire set of activities running from raw material to finished product for a specific product or product family In a typical enterprise, value streams can intersect with other value streams, branch apart or Y together

5 Value Stream Maps Value Stream Maps are powerful visual tools to help see waste and understand the flow of material and information Especially powerful for illustrating the wastes of Overproduction, Idle Material & Transportation Value Stream Maps show all actions required to deliver a product… Value Added…as well as Non-Value Added

6 Other Benefits Of VSM Provides a big picture perspective that helps focus on improving the whole process, not just optimizing bits and pieces Shows the linkage between the information flow and material flow Helps to see across the functional boundaries over which a product’s value stream flows

7 Other Uses For VSM To help understand how your business actually works (you don’t understand the current process if you can’t draw it) A tool for establishing a vision and implementation plan for a new business or product line A visual tool and common language for talking to others about your manufacturing process

8 Mapping Process Product Family Current State Drawing Work Plan & Implementation Future State Drawing Understand how the value currently flows Design a LEAN flow Plan how to get there and execute the plan Define the Value Stream

9 Value Stream Step 1 Create a Matrix Create a matrix if your mix is complicated

10 A Reminder The point of value stream mapping is not the maps, but to understand the flow of information and material and see waste...and then use that understanding and insight to improve your process IMPLEMENT FUTURE STATE!

11 Engineering Management Value Stream Mapping Current State Maps (CSM)

12 The Current State Map A pictorial view, drawn with pencil and paper while observing the process on the factory floor, that shows how material and information currently flow Creates a baseline for future improvements to be measured against Clarifies understanding of how the current production system actually operates

13 Example Material Flow Information Flow INVENTORY ICONS WITH PUSH ARROWS Customer Start with the Customer

14 PROCESS BOX ICONS DATA BOX ICONS - C/T time - C/O time - Up time - Scrap 28 days 15 sec 7.6 days 10 days 7 days 1.5 days 3 days 395sec501 sec 150 sec60 sec PLT = 57.1 days PT = 18.7 minutes Time Line-PLT- Process Lead Time PT- Process Time

15 Material Flow Icons Assembly XYZ Corporation Data Box C/O=30 min. C/T=45 sec. 3 Shifts. 2% Scrap I 300 pieces 1 day InventorySupermarket ShipmentPush Finished Goods to Customer Physical FIFO First-In-First-Out Process Box Supplier/ Customer Mon + Wed Pull

16 Information Flow Icons Manual Information Flow Electronic Information Flow Weekly Schedule OXOX Load Leveling Box Sequenced-Pull Ball Withdrawal Kanban Production Kanban Signal Kanban Post

17 General Icons Uptime Changeover Kaizen Lightning Burst Operator Buffer or Safety Stock “Go See” Production Schedule

18 Value Stream Map - Acme Exercise (Use the Handout Data Sheet) Use a pencil and small Post-it notes on 11” x 17” paper. Use the following colors BLUE - Process YELLOW - Inventory (tear in half) PINK - Master schedule / Production control GREEN - Supplier & Customer Fill in a Post-it notes for each process/data and symbol Remember “Always start with the Customer” Build the map, leave enough room between process boxes to show inventory and enough space on the bottom to draw the time line

19 VSM - Acme Exercise Draw in Customer and Suppliers data.

20 State Street Assembly pieces/month L R Tray = 20 pieces Step 1 State Street Assembly 500 ft coils Michigan Steel Company

21 VSM - Acme Exercise Draw in process boxes and data. Add a shipping box Draw in the Inventory triangles and data

22 18400 pieces/month L R Tray = 20 pieces Coils 5 days II I II I Stamping 4600 L 2400 R S. Weld #1 C/O=1 hour S. Weld #2 Ass’y #1 Ass’y #2 1 Shipping Staging 1100 L 600R 1600 L 850R 1200 L 640R 2700 L 1440R C/T=1 sec Uptime =85% 27,600 sec. avail. C/T=39 sec Uptime = 100% 27,600 sec. avail. C/O=10 m C/T=46 sec Uptime = 80% 27,600 sec. avail. C/O=10 m C/T=62 sec Uptime = 100% 27,600 sec. avail. C/O = 0 C/T=40 sec Uptime = 100% 27,600 sec. avail. C/O = 0 State Street Assembly Steps 2 & 3 State Street Assembly 500 ft coils Michigan Steel Company

23 VSM - Acme Exercise Draw in Customer and Suppliers delivery schedules and method.

24 Steps 4 & pieces/month L R Tray = 20 pieces 2 shifts Coils 5 days II I II I Stamping 4600 L 2400 R S. Weld #1 C/O=1 hour S. Weld #2 Ass’y #1 Ass’y #2 1 Shipping Staging 1100 L 600R 1600 L 850R 1200 L 640R 2700 L 1440R C/T=1 sec Uptime =85% 27,600 sec. avail. C/T=39 sec Uptime = 100% 27,600 sec. avail. C/O=10 m C/T=46 sec Uptime = 80% 27,600 sec. avail. C/O=10 m C/T=62 sec Uptime = 100% 27,600 sec. avail. C/O = 0 C/T=40 sec Uptime = 100% 27,600 sec. avail. C/O = 0 Tues. & Thurs. 500 ft coils 1x Daily State Street Assembly Michigan Steel Company

25 VSM - Acme Exercise Put in production control and schedules Draw in Information flows Internal and external

26 Step 6

27 VSM - Acme Exercise Material flows between processes (push, pull, kanban)

28 Production Control MRP Daily Order 90/60/30 day forecasts 6 week forecast 1x Daily Tues. & Thurs. 500 ft coils Coils 5 days II I III Stamping 4600 L 2400 R S. Weld #1 C/O=1 hour S. Weld #2 Ass’y #1Ass’y #2 1 Shipping Staging 1100 L 600R 1600 L 850R 1200 L 640R 2700 L 1440R C/T=1 sec Uptime =85% 27,600 sec. avail. C/T=39 sec Uptime = 100% 27,600 sec. avail. C/O=10 m C/T=46 sec Uptime = 80% 27,600 sec. avail. C/O=10 m C/T=62 sec Uptime = 100% 27,600 sec. avail. C/O = 0 C/T=40 sec Uptime = 100% 27,600 sec. avail. C/O = pieces/month L R Tray = 20 pieces 2 shifts State Street Assembly Daily Ship Schedule Step 7 Weekly Schedule Weekly Fax Michigan Steel Company State Street Assembly MRP

29 VSM - Acme Exercise Draw production lead time/value-added timeline Calculate production lead time for inventory triangles by dividing quantity of inventory by the customer daily requirement This is a really neat trick! It turns a count of inventory into the number of production days that inventory represents Stamping / Weld 18,400 pieces/mo / 20 days = 920 pieces/day 920 / 16 hours (2 shifts) = 57.5 pieces/hour 7000 pieces (total Inv.) / 57.5 pieces/hour = hours of Inv hours of Inv. / 16 hours = 7.6 days of Inventory Finish the rest of the calculations. What is the inventory production lead time? Title and date the map

30 Production Control MRP Daily Order 90/60/30 day forecasts 6 week forecast 1x Daily Tues. & Thurs. 500 ft coils Coils 5 days II I III Stamping 4600 L 2400 R S. Weld #1 C/O=1 hour S. Weld #2 Ass’y #1Ass’y #2 1 Shipping Staging 1100 L 600R 1600 L 850R 1200 L 640R 2700 L 1440R C/T=1 sec Uptime =85% 27,600 sec. avail. C/T=39 sec Uptime = 100% 27,600 sec. avail. C/O=10 m C/T=46 sec Uptime = 80% 27,600 sec. avail. C/O=10 m C/T=62 sec Uptime = 100% 27,600 sec. avail. C/O = 0 C/T=40 sec Uptime = 100% 27,600 sec. avail. C/O = pieces/month L R Tray = 20 pieces 2 shifts Daily Ship Schedule Step 7 Weekly Schedule Weekly Fax 5 days 1 sec 7.6 days 1.8 days 2.7 days 2 days 4.5 days 40 sec62 sec46 sec39 sec PLT = 23.6 days PT = 188 sec. Acme Steering Bracket Line State Street Assembly Michigan Steel Company MRP

31 The Office Office functions support many shop floor value streams - purchasing, payroll The rate of customer demand is often hard to “see” Inventory can be forms, paperwork, in-baskets, out-baskets, voic , Cycles of activity often are random - little standard work Confusion about who the customer is and what is value

32 The Office HOWEVER, THE OBJECTIVE IS TO ELIMINATE WASTE!

33 The Office Current State Define boundaries of your value stream “There has to be a ‘product’ or ‘service’ to follow - like a purchase order or payroll document - otherwise use a normal flowchart” (LEI)

34 The Office Current State What capability do you provide? Is the demand stable? If not, what is the range ? What is the customers expectation of performance?

35 Constructing Office Current State Waiting should be recorded if there is no apparent ‘end’ takt time and the next process is far away Use Cycle Time of customer process to understand total lead time I Outbox 1 Day w Waiting 1/2 Day at meeting I Inbox 1 Day

36 Constructing Office Current State State Street Assembly Customer Make notes where you see obvious Waste on the Map Poor workplace Organization Re-enter Data: Legacy System Duplication: Many Signatures Paper Form Rework: Incomplete Data State Street Assembly Supplier

37 1 sales Rep Constructing Office Current State

38 Mapping Tips Use Colored Post-it notes paper for Mapping (Easier to move Post-it notes than redraw) Use roll of butcher paper so you can use a wall and see the whole VSM Use string or ribbon to show material & information flows Decide whether to count all parts or sample

39 Mapping Tips Best to map production lines between Tuesday and Thursday Use someone from the line or process to walk you through it first, post-it note process, come back and get Real Data and Times If you plan on using the times to balance your process then do not take shortcuts - you will be way off (Embarrass yourself!!) See with your hands. No “Armchair Lean!”

40 Mapping Steps À Gather customer information Á Get with the process owners and talk / draw - through the process sequence and capture the sequence on a Post-it note  Walk the process - Post-it note process boxes (up versus down stream?) à Fill in data boxes and inventory levels. (Get Real Times) Ä Document how goods are delivered to the customer Å Gather supplier information Æ Add information flows Ç Sketch how material moves between processes. È Draw production lead time/value-added timeline

41 Mapping Tips Calculate production lead time for inventory triangles by dividing quantity of inventory by the customer daily requirement This is a really neat trick! It turns a count of inventory into the number of production days that inventory represents Add a title and date the map

42

43

44 Homework Assignment Questions: 1.Use slide 30 as a template and construct a value stream of your choice (product or service) 2.Explain the advantages and possible disadvantages of using Value Stream Maps to improve the business Read Lean Thinking Chapter 3 - Flow Pages

45 Questions? Comments?


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