ACUP: 2005 University of Missouri

1. Management, empowerment, and quality initiatives:  PositiveTransformation of the Inplant through Lean Principles and Sustainability. ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

2. A Paradigmatic Shift…a time for change! “New opinions are always suspect, and usually opposed, without any other reason but because they are not already common.” John Locke “If you want to succeed you should strike out on new paths, rather that travel worn paths of accepted success.” ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University John D. Rockefeller “You must predict the death of your own market in Order to save the market.” Frank Romano

3. 2005 PIA/GATF Technology Forecast • Growth Opportunities • Growing Print Niches (direct market printing) • Digital/Toner-based Printing • Ancillary Services (>10yrs will become 20-25% of budget) • Exports • Threats • USPS Rates (how is this going to affect your operations?) • Global Competition-Print Imports • Paper Prices ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Davis, Ronnie. (2005). Over the horizon: An environmental scan for 2005 and 2006. GATFWorld (17/1). Sewickley,PA: Graphic Arts Technical Foundation

4. 2005 PIA/GATF Technology Forecast • IMPLICATIONS FOR STRATEGIES and OPERATIONS • Manufacturing Efficiency (profit leaders 3% more efficient) • Support Efficiency (profit leaders 12% more efficient) • Be a Learning Organization • Focus on Ancillary Services (7% of total print revenues) • PRINT PLANTS CONTINUE TO DECLINE • 1994 53,000 print plants • 2005 less than 45,000 (decline of 15%) • Predicts that 1,300 plants will close in 2005-2006 • “The reduction in number of plants does not mean that industry • overcapacity is falling. In fact, the surviving plants are more • productive making for more overcapacity” (Davis, 2005) ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Davis, Ronnie. (2005). Over the horizon: An environmental scan for 2005 and 2006. GATFWorld (17/1). Sewickley,PA: Graphic Arts Technical Foundation

5. Be a Learning Organization “The focus is not only developing new skills; it is also on how to learn new skills, knowledge, and capability—learning how to learn.” Darren Dolcemascolo (2004) ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Dolcemascolo, D. (2004). Lean and the learning organization. Retrieved February 2, 2005 from http://www.emsstrategies.com

6. What is Lean? • A philosophy • A series of applications • An opportunity for unified engagement • A system of productivity techniques • A system of quality improvement concepts • A way in which to define value from a customer’s perspective • An application that creates culture, engages everyone • and encourages continual change and improvement. ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

7. What is Lean? “If you had to leave my house this second and immediately begin the task of getting four new tires Put on your car, filling the gas tank to the top, cleaning the windshield, and then drinking seven ounces of water, how long do guess it would take?” “Which car in the Indianapolis 500 race wins? ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Answer: “it is not the fastest car that wins. It is usually is the car that spends the least amount of Time in the pits. And what happens in the pits? That’s where they replace all four tires, fill the gas tank, clean the windshield and give the driver seven ounces of water to drink all in less than nine seconds.” Feingold, J. (2005). Getting lean. Fort Wayne, IN: WCM Associates.

8. History of Lean Many of the ideas embodied in Lean are derived from the concepts proposed by Frederic Taylor, Frank and Lillian Gilbreth, Henry Ford, William Deming, and others. Emerged from Japan (Post WWII): - Kiichiro Toyoda - Taiichi Ohno (Why-Why) and Shigeo Shingo (JIT) - Incorporated Ford production practices of Ishikawa, Deming, and Juran into Toyota Production System (1949-1975) Brought to North America through Ohno and Shingo’s books ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

9. Lean Defined Lean is a systematic approach to enhancing value of a product or service while reducing and eliminating waste both in the manufacturing and non-manufacturing components of a company ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

10. The Philosophical Core of Lean • The workplace is safe, orderly, and immaculately clean • Products are build just in time, and only to customer demand • Six sigma quality is built into the product and process • 99.9996% perfection – 3.4 ppm failed (parts per million) • Empowered work teams make key decisions on the shop floor and in supporting functions • Visual management techniques are used to spread critical information throughout the factory • There is a relentless pursuit of perfection ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Henderson, B.A., Larco, J.L. (2003). Lean Transformation. Richmond, VA: The Oaklea Press

11. Lean Principles • Kaizen (continuous improvement) • 6S • Muda (identification and elimination of waste) • Visual Management • Value Stream Mapping • VOC (voice of the customer) • Takt time (beat) • Data Collection • Pull System • TPM (total productive maintenance) • Work Cell Optimization (single piece flow) • SMED (single minute exchange of dies) • Kanbans ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

12. Lean Principles In a truly lean system, everyone—subcontractors, first-tier suppliers, systems integrators or assemblers, distributors, customers, employees can see everything so it’s easy to discover ways to create value. Also there is instant and positive feedback for employees making improvements, a key feature of lean work and a powerful element to continuous improvement. Darren Dolcemascolo (2004) ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Dolcemascolo, D. (2004). Lean overview. Retrieved February 2, 2005 from http://www.emsstrategies.com

13. Kaizen (Continuous Improvement) A management philosophy emphasizing employee participation, In which every process is continuously evaluated and Re-valuated for the elimination of waste. • How to hold a Kaizen event: • Select a subject for the event • Select and assemble the team • Affirm management’s commitment • Preset the road map • Train the team • Perform the “present state” analysis • The “next step” proposal should be generated • The team presents its action plan to management • Assign the action items • Track activities and results using visual management boards • Implement the changes • Measure the improvement and report results • Say “Thank You.” ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

14. Kaizen (Continuous Improvement) Develop Recommendations ANALYZE PLAN Prioritize Opportunities Characterize current And future states Develop Approach Develop Knowledge pool Develop Action Plan The Kaizen Loop Charter the Team And Mission Create and refine solutions ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Recognize future opportunities Test and verify solutions Implement Solutions Analyze and validate ACT VERIFY Daily, K.W. (2005). Lean manufacturing handbook. DW Publishing Co.

15. Safe Clean Organized Work Environment • 6S (formerly 5S) • A system designed to organize and standardize a workplace • Sort (Seiri) • Set in Order (Seiton) • Shine (Seison) • Standardize (Seiketsu) • Sustain (Shitsuke) • Safety (Anzen) ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

16. 6S A methodology for organizing, cleaning, developing, and sustaining a productive work environment. Sort – Get rid of clutter Set in Order – Organize the work area “a place for everything and everything in its place.” Shine – Clean, neat, and orderly (encourage pride in ownership) Standardize – Establish written standards for order and cleanliness Sustain – Maintain standards through training, empowerment, commitment and discipline Safety – Continuously make aware and enforce a safe working environment. ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

17. Benefits of 6S • - Improved morale • - Improved quality and profitability • - Space • - Safety • - Reduced motion waste: any movement of people or • machines without adding value to the product. • - Structure for sustaining order • - Eliminate the “erosion of improvements” • - Not about housekeeping – it is about “zero housekeeping” ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

18. “Muda” and the 7 Wastes The Philosophy: The identification and elimination of waste for the value stream is the central theme of LEAN. Successful implementation requires that the entire workforce be trained in identifying and eliminating waste from their work. Waste exists at all levels in the organization. Effectiveness is the collective integration of man, method, material, and machine. 1. Over-production 2. Wait time 3. Transportation 4. Processing 5. Inventory 6. Motion 7. Defects ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

19. The Seven Wastes 1. Over-production 2. Wait time 3. Transportation 4. Processing Producing more than is needed, faster than needed or before it is needed (JIT Theory) Automation in the wrong places Cost Accounting Practices Length of communication Lengthy set-up times Low up-times, Poor planning Idle time that occurs when codependent events are not fully synchronized Inconsistent work methods Lack of proper equipment or materials Long set-up times Poor equipment maintenance Production bottle-necks Any material movement that does not directly support immediate production Improper facility layout Large lot processing Large lot purchasing Poor production planning Poor work place organization ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Decision making at inappropriate levels Inefficient policies and procedures Lack of customer input concerning requirement Redundant effort which adds no value to a product or service (transparent to customer or which customer would be unwilling to pay for)

20. The Seven Wastes 5. Inventory 6. Motion 7. Defects Inaccurate forecasting Incapable process Incapable suppliers Long changeover times Poor inventory tracking Unbalanced production processes Any supply in excess of process requirements necessary to produce goods or services in a JIT manner Ineffective equipment Lack of visual controls (VMB, Kanbans) Poor process documentation Poor workplace organization Any movement of people which does not contribute added value to the product or service Repair or rework of a product or service to fulfill customer requirements as well as scrap waste resulting from make-ready. Excessive variation High inventory levels Inadequate tools or equipment Incapable processes Insufficient training Poor layouts unnecessary handling ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Daily, K.W. (2005). Lean manufacturing handbook. DW Publishing Co.

21. Value “Lean thinking therefore must start with a conscious attempt to precisely define value in terms of specific products with specific capabilities offered at specific prices through a dialogue with specific customers. The way to do this is to ignore existing assets and technologies and to rethink firms on a product-line basis with strong, dedicated product teams. This also requires redefining the role for a firm’s technical experts and rethinking just where in the world to create value.” James Womack ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Womack, J. & Jones, D. (2003). Lean thinking. New York, NY: Free Press.

22. Value Stream Mapping • Visually documents a process • Provides fact-based process description as basis for understanding current problems • Enables teams to quickly see improvements within the process and begin defining critical Xs (underlying causes) • Helps team see how a process should work once they eliminate waste • Helps communicate inside and outside the organization ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

23. Visual Management “Visual management is critical to achieving truly empowered employees. Empowerment is not possible without information, and the best way to insure that information is available is through simple visual management techniques” (Henderson & Larco, 2003). • The strategy of providing visual information on daily activities available for • everyone in the workplace. • Shadow boards • Visual display boards (safety, 6S rating, Quality, training, SOPs, On-time delivery, etc) • Cell production status board (set-up times, TPM, etc) • Red tag, yellow tag identification ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

24. Visual Management Board – 6S ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

25. QUAD’s “Island of Excellence” ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

26. Activity Board ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

27. Visual Management ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

28. Pull “In the next few years, printing firms can learn to quickly print up small lots of books and distribution warehouses can learn to replenish bookstore shelves frequently. Eventually new ‘right sized’ book printing technologies may come along and make it possible to simply print out the books the customer wants at the moment the customer asks for them, either in a bookstore or, even better, in the customer’s office or home. And some customers may not want a physical copy of their ‘book’ at all, Instead, they will request the electronic transfer of the text from the ‘publisher’ to their own computer, printing out an old-fashioned paper version only if they happen to need it. The appropriate solution will found once the members of the publishing value stream embrace the fourth principle of lean thinking: pull. (Womack & Jones, 2003, p.25, para. 2). ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Womack, J. & Jones, D. (2003). Lean thinking. New York, NY: Free Press.

29. Total Productive Maintenance A systematic approach to eliminate downtime of equipment • Five Pillars of TPM • Autonomous maintenance – to clean • Maintenance mindset and training – to detect • Planned maintenance system – to correct • Overall equipment effectiveness – to perfect • Early equipment management system – to protect ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

30. Total Productive Maintenance Program requires operators to be responsible for cleaning and inspecting, lubricating, performing precision checks, and other light maintenance tasks. • Benefits: • Increases overall equipment effectiveness using improvement activities • Establishes autonomous maintenance engaging equipment operators • Established a planned maintenance system • Requires training to improve operation and maintenance skills • Institutes a system for preventive maintenance • Eliminates breakdown losses ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

31. Implementing a Lean Culture “Lean organizations create a culture of continuous improvement, and within that culture, they employ tools of lean to eliminate waste. Not surprisingly, it begins with the customer (not the plant manager or industrial engineer). The customer is the definer of value.” Darren Dolcemascolo (2004) ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Dolcemascolo, D. (2004).Implementing lean. Retrieved February 2, 2005 from http://www.emsstrategies.com

32. Implementing a Lean Initiative Traditional Facility Facility in Transition Profit Leaders Plant-wide meetings with to local management at least Monthly. All communication is one way Plant-wide meetings with To local management at Least monthly. Visual communication of plant vision, goals, and performance has started. Plant-wide and Departmental meetings As often as daily. Two way communication. Goals and performance are understood and known by everyone. Plant Wide Communications None, generally an adversarial relationship, characterized by blaming and finger pointing. No one on the shop floor is expected to use anything other than “arms & legs” in the performance of the job. Employees are expected to “manage” their work area. Everyone is encouraged to participate, but middle managers and supervisors and road blocks. Employee suggestions system started. Work force feels like owners. Integrated self managed work teams. Improvements implemented without direct management involvement. Employee Empowerment ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

33. Implementing a Lean Initiative Traditional Facility Facility in Transition Profit Leaders Quality less important than costs or schedules. Emphasis is on detection of errors. Everyone thinks quality is the responsibility of the QC Department QA department enforcer of quality program Supplier certification program in place. Everyone has “time” stopping capability. Error proofing prevents defects from occurring, Employees treat all downstream operations like customers. Quality measurements only meaningful in ppm. Quality Supervisors used as cops in direct labor reporting system. Idle machines viewed as a problem. Scrap, rework and downtime are considered a cost of doing business. Supervisors feel threatened as responsibility and accountability is pushed down to the people on the shop floor. Cop management mentality is replaced with trust and respect. Supervisors converted to trainers, coaches, and facilitators. Machine operators give plant tours to customers Shop Floor Management ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

34. Implementing a Lean Initiative Traditional Facility Facility in Transition Profit Leaders No formal training except as required by law. Some training available to management. Continuous and on-going training in place and available to everyone. Training requirements established for everyone. Training 5-10 years with committed management 3-8 years with committed management Continuous improvement techniques (Kaizen) must be in place to hold position. Benchmarks change daily. Time required ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

35. Tool Kit Comparison Major CPI Tools 6σ Kaizen Lean Description Cp/Cpk 4 Process capability assessment DOE 4 Design of experiments SPC 4 Process control based on statistics and data analysis FMEA 4 Risk assessment tool Regression 4 Correlate effect one variable has on another Process Map 444 Map process steps to communicate and identify opportunities 5 whys /2 hows 4 4 4 Determination methods for root cause discovery Pareto 444 Column chart ranking items highest to lowest Fishbone 444 Cause / Effect Diagram 5s 4 4Elimination waste Visual Mgmt 4 4 4 Emphasis on visual techniques to manage process Poka-Yoke 44 Error proofing techniques Spaghetti Chart 4 4 Visual production process map Kanban 4 4 Material storage technique used to control process Takt Time 44 Determine pace or beat of a process Std Work 4 4 Evaluate tasks done during a process SMED 44 Single minute exchange of dies - Quick machine set up TPM 4 Integrate maintenance strategy with process Cellular Flow 4 Reduce inventory & cycle time through process layout and pull production techniques ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Source: LEARNING and PRODUCTIVITY Pty. Ltd. QTB  2000, QualityToolBox.com, LLC, all rights reserved

36. A Paradigmatic Shift…a time for change! “Lean Leaders have the knowledge and are well versed in the definitions and methods of Lean. They embrace radically different structures, strategies, and day-to-day processes to operate more effectively than ever dreamed. And they can do it within a timeframe and a positive culture that gets sustainable results.” Susan Kelly ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Kelly, S.L. (2003). Lean enterprise: From manufacturing to selling. Gravure (10).

37. A Paradigmatic Shift…a time for change! “Our earnest advice to lean firms today is simple: To hell with your competitors; compete against perfection by identifying all activities that are mudaand eliminating them. This is an absolute rather than a relative standard which can provide the essential North Star for any organization (in its most spectacular application, it has kept the Toyota organization in the lead for forty years). However, to put this admonition to work you must master the techniques for eliminating muda.” ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University James Womack & Daniel Jones (2003) Womack, J. & Jones, D. (2003). Lean thinking. New York, NY: Free Press.

38. Think Lean, Empower lean, Coach lean, And Sustain lean. ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University Thank you for your time… Enjoy the rest of the conference!

39. Sources Dailey, K.W. (2004). The lean manufacturing employee training manual. Tampa, FL: DW Publishing. Emiliani, M.L. (2003). Better thinking, better results: Using the power of lean as a total business solution. Kensington, CT: The Center for Lean Business Management. Epstein, R. (1996). Creativity Games for Trainers: A handbook of group activities for jumpstarting workplace creativity. New York, NY: Training McGraw-Hill. Feingold, J. (2005). Getting lean. Fort Wayne, IN: WCM Associates. George, M.L., Rowlands, D., Price, M., & Maxey, J. (2005). The lean six sigma pocket toolbook. New York, NY: McGraw-Hill. Gilpatrick, K.E., & Furlong, B. (2004). The elusive lean enterprise. Victoria, BC: Trafford. Henderson, B.A., & Larco, J.L, (2003). Lean Transformation: How to change your business into a lean enterprise. Richmond, VA: Oaklea Press. Kaydos, W. (1991). Measuring, managing, and maximizing performance: What every manager needs to know about quality and productivity to make real improvements in performance. Cambridge, MA: Productivity Press. Kelly. S. (2003). Lean enterprise: From manufacturing to selling. Gravure (October). 56-59. Kotter, J.P. (1996). Leading change. Boston, MA: Harvard Business School Press. Payne, V. (2001). The team-building workshop: A trainer’s guide. New York, NY: AMACOM. Rizzo, K.E. (2001). Total Productive Maintenance: A guide for the printing industry (2nd ed.). Pittsburgh, PA: GATFPress. Wireman, T. (1991). Total productive maintenance: An American approach. New York, NY: Industrial Press. Wireman, T. (2004). Total productive maintenance. New York, NY: Industrial Press. Womack, J.P., & Jones, D.T. (2003). Lean thinking: Banish waste and create wealth in your corporation. New York, NY: Free Press. ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University

40. Other Sources Likert, J. K. (2004). The Toyota Way. New York, NY: McGraw Hill www.emsstrategies.com ACUP: 2005 University of Missouri Ken Macro – California Polytechnic State University