Lean Principles

1. Lean Principles

2. Lean Principles Definition • Lean is a systematic approach to process optimization based on the premise that anywhere work is done, some amount of waste (non-value add effort) is generated • The goal is: Total elimination of waste (MUDA) through: • Identifying the sources • Planning for waste elimination • Use of Lean, Process Management and Six Sigma • Establishing “permanent” controls that prevent reoccurrence • The first step toward waste elimination is identifying it Move it!

3. Examples of the 7 Areas of Waste • Seven Areas of WASTE • Correction Correcting or repairing a defect in materials or parts adds unnecessary costs because of additional equipment and labor expenses. An example is the labor cost of scheduling employees to work overtime to rework defects.

4. 2. Overproduction Producing more parts than necessary. Producing parts at a rate faster than required. Doing this requires more raw product inventory than necessary, over uses machines and people and requires more storage area. Examples of the 7 Areas of Waste

5. 3. Processing Examples of the 7 Areas of Waste Processing work that has no connection to advancing the line or improving the quality of the product. Examples include typing memos that could be hand written or painting components or fixtures internal to the equipment.

6. Examples of the 7 Areas of Waste • Conveyance • Conveyance is incidental, required action that does not directly contribute value to the product. • It’s vital to avoid conveyance unless it is supplying items when and where they are needed (i.e. just-in-time delivery).

7. Examples of the 7 Areas of Waste 5. Inventory Inventory is a drain on an organization’s use of capital. The greater the inventory, the higher the carrying costs. If quality issues arise and inventory perishes, defective material may be hidden in finished goods. To remain flexible to customer requirements and to control product variation, we must minimize inventory. Excess inventory masks unacceptable change-over times, excessive downtime, operator inefficiency and a lack of organizational sense of urgency to produce product.

8. Examples of the 7 Areas of Waste • Motion • Any movement of people or machinery that does not contribute added value to the product; i.e., programming delay times and excessive walking distance between operations.

9. Examples of the 7 Areas of Waste • 7. Waiting • Idle time between operations or events, i.e. an employee waiting for machine cycle to finish or a machine waiting for the operator to load new parts.

10. Lean Value Stream Analysis

11. I I I I I Dellex A way of viewing the overall Value Stream, from supplier to the customer, on one sheet of paper. Enabling you to “see what is actually happening.” Best Metal, Inc 500 Ft Rolls • Pieces/Mo Tray= Shifts= Delivery DPMO= Quality DPMO= Mon & Wed Tue. & Thurs . I Coils 5 days Stamping 1 Person Person Person Person Person Person C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= Lean Value Stream Map

12. It helps you visualize more than the just the single process level, i.e. order entry, invoicing, shipping, assembly, test, welding, etc. You can see the complete flow. Value Stream Analysis is a qualitative process that allows you to understand in detail how your business should operate to achieve breakthrough performance levels. It helps you see sources of inefficiency and problems in the complete generation and delivery of your service or product. It forms the basis of an improvement vision and plan by helping understand how door-to-door flow should be performed to optimize costs, cycle times and quality. It conceptualizes Six Sigma projects as well as other improvement efforts. Value Stream Analysis is good for describing what you will do to change business-performance levels. I I I I I Dellex Best Metal, Inc • Pieces/Mo 500 Ft Rolls Tray= Shifts= Delivery DPMO= Tues. & Thurs. . Quality DPMO= I Mon & Wed Coils 5 days Stamping 1 Person Person Person Person Person Person C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= C/T = Uptime = Run Hrs= Breaks= Hrs Avail= Sec. Avail= Why a Value Stream Analysis is Essential

13. Value Stream Analysis puts the pertinent information about the total work effort of a product or service on one sheet of paper, the current-state map. The human mind loses continuity and clarity when information is fragmented across multiple places and sheets of paper. We can also map the information flow, i.e. customer and supplier ordering, production control, etc., to complete the picture. Overall performance and process-specific problem areas become visible for improvement actions. This analysis can be done as a part of the overall characterization of a process. The next step is to identify efficiency and effectiveness targets for the process. The end result is a future-state map with a vision/plan that is achieved through Six Sigma projects and other actions. Value-Stream Analysis Summary

14. Applying the5S Principles

15. 5S - Workplace Organization • 5S means the workplace is clean, there is a place for everything and everything is in its place. • 5S is the starting point for implementing improvements to a process. • To ensure your gains are sustainable, you must start with a firm foundation. • Its strength is contingent upon the employees and company being committed to maintaining it.

16. Step Japanese Literal Translation English Step 1: Seiri Clearing Up Sorting Step 2: Seiton Organizing Straightening Step 3: Seiso Cleaning Shining Step 4: Seketsu Standardizing Standardizing Step 5: Shitsuke Training & Discipline Sustaining 5S Translation - Workplace Organization Focus on using the English words, much easier to remember.

17. Definition: To sort out necessary and unnecessary items. To store often used items at the work area, infrequently used items away from the work area and dispose of items that are not needed. Why: Removes waste. Safer work area. Gains space. Easier to visualize the process. Things to remember Start in one area, then sort through everything. Discuss removal of items with all persons involved. Use appropriate decontamination, environmental, and safety procedures. Items that cannot be removed immediately should be tagged for later removal. if necessary, use movers and riggers. SORTING - Decide what is needed.

18. Item Useful Unknown Useless Keep & Monitor Keep & Store Useful Useless Sorting ABC Storage Dispose A Method for Sorting

19. Definition: To arrange all necessary items. To have a designated place for everything. A place for everything and everything in its place. Easily visible and accessible. Why: Visually shows what is required or is out of place. More efficient to find items and documents (silhouettes/labels). Saves time by not having to search for items. Shorter travel distances. Things to remember Things used together should be kept together. Use labels, tape, floor markings, signs, and shadow outlines. Sharable items should be kept at a central location (eliminated excess). STRAIGHTENING – Arranging Necessary Items

20. Definition: Clean everything and find ways to keep it clean. Make cleaning a part of your everyday work. Why: A clean workplace indicates a quality product and process. Dust and dirt cause product contamination and potential health hazards. A clean workplace helps identify abnormal conditions. Things to remember “Everything in its place” frees up time for cleaning. Use an office or facility layout as a visual aid to identify individual responsibilities for cleaning. This eliminates “no man’s land.” Cleaning the work area is like bathing. It relieves stress and strain, removes sweat and dirt, and prepares the body for the next day. SHINING – Cleaning the Workplace

21. STANDARDIZING – Creating Consistency Definition: • To maintain the workplace at a level that uncovers problems and makes them obvious. • To continuously improve your office or facility by continuous assessment and action. Why: • To sustain sorting, storage and shining activities every day. Things to remember • We must keep the work place neat enough for visual identifiers to be effective in uncovering hidden problems. • Develop a system that enables everyone in the workplace to see problems when they occur.

22. Definition: To maintain our discipline, we need to practice and repeat until it becomes a way of life. Why: To build 5S into our everyday process. Things to Remember Develop schedules and check lists. Good habits are hard to establish. Commitment and discipline toward housekeeping are essential first steps toward being world class. SUSTAINING – Maintaining the 5S