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Choosing Lean Manufacturing

Choosing Lean Manufacturing. Vrunda Consultancy Service, Ahmedabad. Presented to you by :. Purpose. Convince the executive team of the imperative need to embrace Lean Manufacturing as the Business Methodology of choice. Outline Lean implementation steps, challenges, cost and time. Agenda.

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Choosing Lean Manufacturing

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  1. Choosing Lean Manufacturing Vrunda Consultancy Service, Ahmedabad Presented to you by :

  2. Purpose • Convince the executive team of the imperative need to embrace Lean Manufacturing as the Business Methodology of choice • Outline Lean implementation steps, challenges, cost and time.

  3. Agenda • The Present • Current Market Conditions • The Profit Equation and Consequences • Lean Manufacturing Overview • The Basics of Lean Manufacturing • Expected Lean Benefits • The Path • What makes a company Great • Lean Implementation Methodology, steps, Costs and Timeline • Obstacles to Implementing Lean and Overcoming them

  4. Current Market Conditions Consequences The Profit Equation The Present

  5. Drastic Increase in Globalization Consumers have more choices The Market forces a “Price cap” Drastic increase in Competition Current Market Conditions

  6. Before Price = Cost + Profit • Now Profit = Price - Cost Profit Equation • Profit Equation

  7. We must : Find a way to keep our costs down Be more productive Consequences

  8. The Basics of Lean Manufacturing Expected Lean Benefits Lean Manufacturing Overview

  9. Order Processing, Transport, Storage, Waiting, Rework, Machine Setup, Inspection, Machine Breakdowns, etc... The Basics of Lean Manufacturing It means : - Eliminating work processes that add no value to the product - Simplify those processes that do Typically >95% of Total Lead Time is Non-Value Added!! RUN TIME Total Lead Time

  10. The Basics of Lean Manufacturing It results in the : - Highest quality part - Lowest total cost - Shortest Lead Time

  11. Reduce all processes by 25% Value Waste Value Waste Initial Process Waste and Value Both Decrease General Process Reduction Waste Only Reduction Value Waste Value Maintained Resources Decrease Target & Reduce Waste Maintain Value Value Creation Value Increased Resources Focused Value Waste Apply Resources to Create More Value Typically, > 95% of the total Lead Time is Non Value Added Total Lead Time Order Cash Total Lead Time Opportunity for improvement by reducing waste and creating additional value 11 / 45

  12. Observations Problem Solving Lean Tools Team Culture Involvement of all Employees The Basics of Lean Manufacturing It targets the sources of wastes

  13. Lead Time Reduction Productivity Increase WIP Reduction Quality Improvement Space Utilization Percentage of Benefits Achieved 0 25 50 75 100 Expected Lean Benefits Flexibility Skill Enhancement Visual Mgmnt From “AMERICA’S BEST - INDUSTRYWEEK’S Guide to World-Class Manufacturing Plants” 13 / 45

  14. Expected Lean Benefits Strong Competitive Advantage • Increased Productivity ( 10% - 50%) • Improved quality • Shorter time to market • Improved on-time delivery • Reduced space requirements, shorter travel distances • Improved workflow, reduced order processing errors • Better customer service through streamlining

  15. Expected Lean Benefits Significant cost savings that last • Reduced inventory cost ( 30% - 80%) • Less damages due to handling • Reduced Setup time (30% to 90%) • Team working culture • Delegation of accountability • Better use of resources - plant, skilled labor, utilities • Reduced manpower turnover, Less attrition costs

  16. Lean implementation steps, timeline VCS Advantage Obstacles to Implementing Lean Cost of implementing Lean What makes a Company Great The Path

  17. What is our strategy How are we going to achieve it? What is your vision for your company? What makes a Company Great

  18. Process • Steps • Requirement Lean Implementation Steps Top management Commitment Clarify Specific Needs • Specify Value • Map Value Stream • Recognize and eliminate waste • Create Flow & Pull • Perfection Proper Planning Choose Lean Specialist Well Defined Matrics Pick up a Lean Project Plan for Reward & Recognition Form & Train Teams Continuous Monitoring Implement Learning

  19. Lean Implementation Timelines Allow 6 - 8 months to implement lean manufacturing practice Allow 5 - 6 months to see results: Cost savings, Productivity improvement, Increased margins

  20. Obstacles to Implementing Lean Implement Obstacles Support • Commit to Lean • Create bold vision • Communicate • Focus on core business • Reward the performers • Measure progress • Temporary losses on the profit-and-loss statement. • Obsolete inventory become more visible. • Natural resistance to change • Traditional Cost accounting • Fear of losing the command and

  21. VCS Advantage • Our consultants are recognized for their unique experiences and continuing development of lean concepts with an enterprise perspective. • We have significant experience in manufacturing industries. • We are interested in making you both competitive and self sufficient as soon as possible.

  22. Varies from company to company Undertaking lean manufacturing to increase productivity Expect to hire a lean specialist Outsource activities that are not related to core business Subsequent lean initiatives are sponsored by previous savings Customize product mix Minor capital purchases Cost of implementing Lean Costs involved Working Smart

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