2 What you can Expect“Value Stream Analysis Kaizen Training” contains what you need to know to get the job done, not everything you need to know to be an expert.Part 1Lean concepts and terminologyPart 2The process by which we create future states
3 First were did Lean come from? F. Taylor championed time and motion studies for Henry Ford. Employees were trained to do simple and narrow tasks (and, many businesses still do today).While E. Whitney was perfecting the concept of standard parts for interchangeability during serviceHenry Ford combined these two systems to define predictable manufacturing for his era. These were times of mass markets, huge production runs, infrequent changes.Toyota learned from this and expanded upon it with the kanban system noticed during a visit to a U.S. grocery store to help them produce cars JIT because of the great cost of raw materials in Japan Then the U.S. took notice during the oil shock and the world took notice soon afterwards
4 Lean Thinking Value in the Eyes of the Customer The Value Stream Flow Pull of the CustomerPerfection
5 Value AddedValue is added any time we physically change our product towards what the customer is buyingIf we are not adding value, we are adding cost or wasteLean Manufacturing drives the systematic elimination of wasteValue-Added Time : MinutesTime in Plant : WeeksORDERCASHKEY QUESTION – Are my customers willing to pay for this ????
6 Value Added vs. Non-Value Added Typically 95% of Total Lead Time is Non-Value Added!!!Value added5%Non-value addedLEAN = ELIMINATING THE 7 WASTESOverproductionWaitingTransportationNon-value added processingExcess inventoryExcess motionDefects
8 7 Basic Types of Waste (Toyota) Overproduction – producing more than what is demanded by the customerInventory – Storing more than the absolute minimum neededTransportation – the unnecessary movement of materialsWaiting – waiting for the next process stepExcess processing – due to poor tool or product designWasted motion – unnecessary reaching, walking, looking for parts, tools, prints, etcDefects – scrap and rework
9 What is Flow ?Producing and moving one item at a time (or a small and consistent batch of items) through a sequence of process steps as continuously as possible, with each step making just what is requested by the next step.We usually analyze part of a total value stream. The part that we have most control over. But we must draw the entire picture the whole flow helps us account for all of the major cost and time elements. It show how material and information flows interact and sometimes conflict. And most importantly, keeps us focused on our primary objective, to satisfy the end customer.Once we have the big picture of the whole value stream, we can focus on value as defined in the eyes of the customer,Items flow through a value stream:In the manufacturing industry…In the service industry…..In the admin. Such as in HR…we have internal customers, all of you are HR customers..The point is there are many immediate customers that are part of a value stream, we create value through adding value to each item as it goes through the value stream.TRADITIONALCONTINUOUS FLOWLean Lexicon Version 1 p9
10 Continuous Flow – More Efficient & Faster Traditional Batch LayoutContinuous Flow Layout
11 Supermarket Pull System “Production” KANBAN“Withdrawal” KANBANproductproductMike Rother Learning to SeeSUPERMARKETCUSTOMER PROCESS goes to supermarket and withdraws what it needs when it needs it.SUPPLYING PROCESS produces to replenish what was withdrawn.PURPOSE: Controls production at supplying process without trying to schedule. Controls production between flows.
12 Takt TimeTakt time paces production to the pace of customer requirements.Total daily operating timeTakt Time =Total daily customer requirementOperating time = 1 shift x 8 hours – (2) 20-min. breaks = 440 mins/dayCustomer 880 units/month= = 44 units/dayRequirement 20 days/monthFacilitator Notes:Takt time is the primary measurement tool in standardized work. Takt time is the German work for musical meter or rhythm.440 mins/dayTakt time = = 10 mins/unit44 units/day
13 What is a Value Stream ?A Value Stream is all the actions, value creating and non-value creating, required to bring a product from order to deliveryStarts with raw materialsFinalizes at the end-customerInvolves several businessesA value stream is all the activities that create value. All of the actions for a whole product family.A value stream starts with raw materials and ends with end customer. It is a visual management picture of the complete process.Most value streams involve several businesses. It includes suppliers and processes outside of this facility. The complete process. You need to think outside our walls.
14 Value Stream MappingHelps you to see the sources of waste in the value streamShows the flow of information and materialForms the blueprint for lean implementation (Imagine trying to build a house without a blueprint).Helps you to see more than just the single process levelProvides a common language for talking about manufacturing processesMakes decisions about the flow apparent, so they can be discussedTies together lean concepts and techniques, which helps to avoid “cherry picking” Improvement projectsMike Rother Learning to See
15 What is Value Stream Analysis? Value stream maps describe a value streamValue stream analysis is a planning processUses value stream maps to communicateInformation FlowMaterial FlowThree value stream maps are createdCurrent stateIdeal stateFuture state (3 months from now)Action plans are developed for the future state map*they are visual descriptions of a value stream. They are powerful because they give us a way of communication about what the current value stream is and what it will become in the future.*Value stream analysis is a planning process that uses value stream maps. It has clear boundaries and is usually focused on a part of the value stream. Value stream maps are used to communicate either info. Or material flow.*In a value stream analysis three value stream maps are created:Current state: what is the value stream today. Ideal state: Making the Current State better, map depicting the opportunities for improvement employing lean methodologies. Future State: mos. What do we want the value steam to be.From the future state we choose action plans for the next 3-6 months. We chose this action with ideal state in mind or what good looks like.*
16 The Value Stream Analysis Process Phase 1-Pre-event workPhase 2-The Main EventPhase 3-Accountability Process
17 Value Stream Analysis Process Phase 1 Pre-event Planning
18 Pre-Event Work Three weeks prior to the event Determine team members Define the objective of the teamSelect the area and topicLogistics (conf. Rm., times, facilitator supplies, etc.)Invite team members to the eventClarify roles and responsibilitiesEvent leader-value stream manager from the area (owns resources and results)Event facilitator-CI Leaders who manage the improvement process and share in ownership of resultsSubject matter expertsValue is what the customer is buying from the value stream. For example, a total value stream may provide a storage cabinet to an end-customer. The Value that the end-customer is buying “is an orderly, organized area” which they create by buying the cabinet, some bins and some labels)Read questions?We summarize this definition of what the customer sees as value and attach it to our value stream map.
19 Pre-Event Work Two weeks prior to the event Part/quantity analysis (select representative part number)Gather and review data (Yield, job closures, CONC, etc.)Determine future demandReview prior event dataReview any customer issuesReview any requirements for capital equipmentOne week prior to the eventVerify customer demandReview above dataValue is what the customer is buying from the value stream. For example, a total value stream may provide a storage cabinet to an end-customer. The Value that the end-customer is buying “is an orderly, organized area” which they create by buying the cabinet, some bins and some labels)Read questions?We summarize this definition of what the customer sees as value and attach it to our value stream map.
20 Value Stream Analysis Process Phase 2 The Main Event
21 The Main Event Training Gemba Walk Value Stream Map-Current State Develop Ideal State MapDevelop Future State Map (3 months out)Develop Future State PlanManagement Report OutValue is what the customer is buying from the value stream. For example, a total value stream may provide a storage cabinet to an end-customer. The Value that the end-customer is buying “is an orderly, organized area” which they create by buying the cabinet, some bins and some labels)Read questions?We summarize this definition of what the customer sees as value and attach it to our value stream map.
22 VSM Event Steps 1 &2 Training and Gemba Walk The concepts of Lean need to be applied to classroom training as well as our other processesThis is a learn by doing processWe will minimize classroom learningGemba WalkGemba means, “shop floor” or “where the process is”We need to go there so we know what we are mapping
23 VSM Event Step 3 Current State Map Value Stream Map-Current StateMap the physical flow (manufacturing loop, customer loop, supplier loop)Map the information flowComplete the lead time data barVisually identify wasteIdentify value added/non-value added (red, yellow, green dots)Visually identify the most significant opportunities with kaizen bursts.Summarize all information and metrics (date, P/N, times, inventory, OTD, quality, etc.)Value is what the customer is buying from the value stream. For example, a total value stream may provide a storage cabinet to an end-customer. The Value that the end-customer is buying “is an orderly, organized area” which they create by buying the cabinet, some bins and some labels)Read questions?We summarize this definition of what the customer sees as value and attach it to our value stream map.
24 Elements of Value Stream Maps Monthly Orders30 Days880Op 11 DayS/U = 1 hr CT = 1.6 minS/U = 0.08 hr CT = 0.9 minS/U = 0.08 hr CT = 1.2 minTotal = 57 Days Total = 1 Hr Min.Takt Time = 440 min/ = 10 min/unitBi-MonthlyMRPS/U = 0CT = 60 minS/U = 1.95 hrCT = 40.3 minSupplierCustomer451251.60.9601.240.3Op 22 DaysOp 3Op 4Op 55 DaysOp 645 DaysInformationSupplier LoopCustomer LoopManufacturing LoopDoes your map look like this?Discuss.Note the bursts. Long cycle times and inventory amounts are highlighted. Cycle time can be reduced by using 6 Sigma to increase the number of quality parts out of a process. Also used to understand the process and the effects of speeding up the cycle time. High inventory often used to mask quality problems or a result of build up due to bottlenecks.Lead Time Data Bar
25 Manufacturing Loop Questions What are the changeover times?What are the quantity of machines per process?Count all work in process (WIP)Look for evidence of quality problemsLook for processing wasteIs there great distances between processes?Is the product flexible or made to order?Is there obvious batch processing?Notes:
26 Customer Loop Questions Who and where are your customers?What are the product lines or families?Future marketing plans? Review growthpotential.What is the total yearly order requirement? Quantity by product family or product typeWhat is the high, low and mean ordering pattern? Monthly or quarterly high & low for several periodsHow often do we deliver to our customer?What takt time do we supply to?G.M.AT&THere’s the questions we need to know about our customer’s current state.Break into teams. For a 3 legged process, you may have 4 teams, 1 for each leg of the process and 1 for the supplier/customer loop.
27 Production Control Questions Where in the production chain do we trigger production?How much work do we release at one time?How long does it take to go from customer order to production order?How do we physically schedule production?How do we react to customer emergencies?Notes:
28 Supplier Loop Questions #1 question, how do you tell suppliers what to ship, make, etc.?When and how often do they get purchase orders from Customers?When and how do we change the purchase order?When and how often do suppliers ship product and how? Is it level? (Truck, train, etc.)Do we have standard pack quantities?Are suppliers aware of our inventory quantities?Are we sure of suppliers inventory? How?Do we have a supplier training program?Notes:
29 Information Flow Questions How are the manufacturing and procurement orders distributed?Who gets themHow frequentlyWhat is the process of generating themHow are the shop order schedules generated and revised? Are there “shortage meetings”? What parts of the manufacturing loop are scheduled by MRP? Make sure to document the informal (hot lists) as well as formal (MRP) information channels.
30 Current State Lead Time Data Bar TotalCycle Time(CT)DOH Inventory8 Days4 Days12 Days4 Hrs(1 Hr.)4 HrsVA Time (yes/no)CT Total
31 Mapping Icons COMPUTER WIP NotesThese are all the icons: point out some of the key ones…- the customer box- the push arrows- the computer tombstone indicating info is waiting to be processed- the information box
32 Visually Identify Waste As a team, review each process step for elements that are value added and non value addedEach step can have any combination of value added, type 1 waste and/or type 2 wasteIdentify value added with a green dotIdentify type 1 waste (waste but unavoidable in the current state) with a yellow dotIdentify type 2 waste (pure waste, eliminate immediately) with a red dotAs type 2 waste is identified, generate the actions to remove it (this will be the beginning of the future state implementation plan)Prioritize the waste opportunities and identify the biggest opportunities on the CS map with kaizen bursts
33 VSM Event Step 4 Ideal State Map Avoid shared resourcesAssume that anything is possibleOur customers are happyOur profits are upHigh job satisfactionCapital is available if neededCreate an ideal state mapMap the physical flowMap the information flowComplete the lead time data bar
34 VSM Event Step 5 Future State Map (3 months out) What of the ideal state map can be implemented in 3 months?Identify short term goalsLEAD TIMEINVENTORYPRODUCTIVITYQUALITYCAPACITYWork from your current state mapNow it’s time to get practical. The future state map describes what you really think you’re going to accomplish in the next 6-12 months.Again don’t let this step take too long to create—some parts of the plan aren’t easy to see yet. Focus on the places that are easy to see and plan about. You learn by doing. Don’t try to develop fancy plans.As you develop the future map, focus on the low hanging fruit. Where is obvious impact to inventory?
35 VSM Event Step 6 Future State Plan This plan answers the question, “what actions need to be completed in the next 90 days to achieve the future state?Think back to the “visually identify waste” stepPlan addresses all “red dots” and Kaizen bursts
36 VSM Event Step 7 Management Report Out This report out is how the team publicly commits to managementWhat the goal of the event wasWhat was learnedWhat was accomplished during the eventWhat the outcome is. How much better will we be?Description of the future stateCommitment of the action plan
37 Value Stream Analysis Process Phase 3 Accountability Process
38 The Accountability Process The momentum for improvement is never higher then at the end of the event when everyone can really see the waste. As a result the accountability process must start immediately following the event (next day).Display the current state map, future state map and future state plan in the the affected area.Commit to a stand up meeting in front of the maps and plan (daily at first, and then less frequent as applicable)Focus on Due date control. Not meeting dates is letting the team downValue is what the customer is buying from the value stream. For example, a total value stream may provide a storage cabinet to an end-customer. The Value that the end-customer is buying “is an orderly, organized area” which they create by buying the cabinet, some bins and some labels)Read questions?We summarize this definition of what the customer sees as value and attach it to our value stream map.