1. Introduction to Lean Systems
GEOP 4316

2. Outline Definitions The basis of Lean The 7 wastes
Organization’s Strategy
Product Life Cycle
The components of Lean

3. Definitions What is Lean Production?
A production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination.
Working from the perspective of the customer who consumes a product or service, "value" is defined as any action or process that a customer would be willing to pay for.

4. Definitions What is Lean Production?
Essentially, lean is centered on preserving value with less work.
Lean manufacturing is a management philosophy derived mostly from the Toyota Production System (TPS)

5. Definitions What is Lean production? Less Waste Less human effort
Less manufacturing space
Less investment in tools
Less Engineering time
Maximizing the value
Less than what?
Taiichi Ohno

6. +1 The 7+1 Wastes Unused human talent

7. The 7 Wastes Overproduction and inventory wastes
Overproduction: Product with no customers
Inventory: Product waiting for further actions
Found in batch systems
Excess inventory :
Increases lead times
Dedicates raw materials and resources unnecessarily
Consumes productive floor space
Delays the identification of problems

8. The 7 Wastes Waiting Waste
Waiting for process to finish, resources to become available and/or materials to arrive
Whenever goods are not moving or being processed, the waste of waiting occurs.
Typically more than 99% of a product's life in traditional batch-and-queue manufacture will be spent waiting to be processed.

9. The 7 Wastes Rejects and Defect Waste
Products not suitable for sale and/or reprocessing to bring them up to standard.
Associated costs
Scrap and loss of material
quarantining inventory
re-inspecting
rescheduling
capacity loss
loss of customers and sales

10. The 7 Wastes Transportation and movement waste
Transporting product between processes is a cost incursion which adds no value to the product.
Transportation can be difficult to reduce due to the perceived costs of moving equipment and processes closer together.
Movement waste is related to ergonomics and is seen in all instances of bending, stretching, walking, lifting, and reaching.
Unnecessary movement of people, double handling of materials, long distance between workstations, stretching

11. The 7 Wastes (Number + 1) Unused Human Talent
Improper or deficient training
Lack of decision making ability
Lack of a promotion system
Not listening to employee’s suggestions

12. Levels of Lean System’s is defined at multiple levels
Multiple Organizations (SC view)
Supply side inbound to the production system
Distribution outbound to the customers
Suppliers ↔ Manufacturing ↔ Customers
System’s is defined at multiple levels
Single organization/ entity
Corporation
Business Unit/ Division
Plant
Cell/Line
Workbench
Operator

13. Business Strategy
Strategy, a concept of military origin, refers to a plan of action designed to achieve a particular goal.
In military usage strategy is distinct from tactics, which are concerned with the conduct of an engagement, while strategy is concerned with how different engagements are linked

14. Business Strategy
“… is the direction and scope of an organization over the long-term: which achieves advantage for the organization through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfill stakeholder expectations".
Johnson and Scholes (Exploring Corporate Strategy)

15. Customers & Operations Strategy
Customers have a set of requirements (needs)
Customers = Market segments
Customer needs have to be identified and prioritized
Basic functions vs. optional functions/ features
Cost
Warranty
Quality (reliability and robustness)
Speed of delivery
Customization

16. Customers & Operations Strategy
Concept of tradeoffs
Less expensive materials, reduce cost but lower quality
Instead of dedicated trucks we send material by train
Fewer customer service representatives, lower cost, lower customer satisfaction
Can’t have it all!

17. Customers & Operations Strategy
Order Winner
What do you offer that is unique? Different from the others you compete with? what does the organization do better?
The benefit/ characteristic/ feature that will make people finally chose what you are offering?

18. Customers & Operations Strategy
Operations strategy is about planning for the products and systems that match the organization’s customer requirements
There must be alignment between the organizations capabilities and the products
Lean manufacturing / philosophy is a set of systems and approaches (capabilities) that must be linked to the business strategy

19. Customers & Operations Strategy
While Lean in general applies to any organization/products, it may not have the same strategic value/ significance
Tools and focus linked to the OW/ key customer criteria
Lean is in general more applicable to low/medium cost standardized high quality products / services
Less applicable to products with high customer service levels (high levels of availability, speed of delivery)

20. Ops Str. and Product Life Cycle
Product’s life cycle – describes the relationship between time and a product’s sales/ process maturity/ profitability, ….
Important understanding of the “status” of a product (and future status) to define operations and marketing strategies.
Introduction/Birth > product awareness, development of process and technology, distribution systems, supplier base, introductory pricing…
marketing/product/lifecycle/

21. Ops Str. and Product Life Cycle
Continuation…
Growth > capacity expansion, automation/ production control, expanded distribution systems, expanded promotion / sale channels
Maturity > Focus on efficiencies (process/ SC improvements), quality improvements, outsourcing, promotions to fend off competitors, secondary distribution channels
Decline > sell product, resource reallocation

22. Components of Lean
Lean is made up of many building blocks (concepts, tools, frameworks)
continuous improvement
(KAIZEN)
roof is the philosophy
Pull/Kanban
Cellular / Flow
Total Productive Maintenance
steps to the
house
Quality at the Source
Point of Use Storage
Quick Changeover
Standardized Work
Batch Reduction
Teams
value
stream
mapping
Visual Controls 5S
Streamlined Layout

23. Total Productive Maintenance
Components of Lean
Many of the components are at the
Plant, Cell/Line, Workbench, Operator level
continuous improvement
(KAIZEN)
Pull/Kanban
Cellular / Flow
Total Productive Maintenance
Quality at the Source
Point of Use Storage
Quick Changeover
Standardized Work
Batch Reduction
Teams
value
stream
mapping
Visual Controls 5S
Streamlined Layout

24. Components of Lean Other are more directly linked to the SC
continuous improvement
(KAIZEN)
Pull/Kanban
Cellular / Flow
Total Productive Maintenance
Quality at the Source
Point of Use Storage
Quick Changeover
Standardized Work
Batch Reduction
Teams
value
stream
mapping
Visual Controls 5S
Streamlined Layout

25. continuous improvement
Next steps
The course will discuss all of these elements
First three in black
continuous improvement
(KAIZEN)
Pull/Kanban
Cellular / Flow
Total Productive Maintenance
Quality at the Source
Point of Use Storage
Quick Changeover
Standardized Work
Batch Reduction
Teams
value
stream
mapping
Visual Controls 5S
Streamlined Layout