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Lean & Kaizen Training For rapid process improvement
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The many names for Systems Improvement
Kaizen
Lean Thinking
Flow
Continuous Improvement
Just In Time
Theory of Constraints
Quality Circles
Six Sigma
Total Quality Management
Total Productive Maintenance
Quick Replenishment
Re-engineering
And did we mention…
Systems Improvement?
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Many of the teachings are the same
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What is Kaizen?
Continuous improvement
Kai = to break apart, to change
Zen = to study, to improve
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What is a Kaizen Event?
An intensive burst of process improvement!
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Continuous? Or Burst?
In the western world, the word “Kaizen” has become short-hand for “Kaizen Event”
So “Kaizen” is not really a synonym for “continuous improvement” after all!
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The biggest change of all…
All Systems Improvement teachings emphasize ways of thinking – not just sets of practices
Every employee is hired to use their mind – not just their body
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The biggest change of all
Ultimate objective of all continuous improvement is Human development
The real power is when everyone is applying “lean thinking” to their work every day
When everyone is giving birth to miraculous new ideas every day
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The biggest change of all – Employee Empowerment
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World Class Benchmarks
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World Class Benchmarks
Quality improvement – 50% per year. (helped by new product introductions)
Productivity improvement – 2% per month
Over 10% of total process time is value-adding activities – compared to 5% for most companies
Continuous improvement culture
Total employee involvement, with sharing of authority, accountability, and reward
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How do they do that?
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The second biggest change of all – Management Style
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The Second Biggest Change of All
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The second biggest change of all Management Style
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Formula for Change
Change = V x D x A
V = Vision
D = Dissatisfaction
A = Action (quick first steps)
The degree of change is the result of multiplying all factors.
If any factor is zero, change won’t happen
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Process Improvement Mandate
Process Boundaries
Why does this need to be improved?
Improvement targets
Empowerment Boundaries
Participants
Session dates, times, and places
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Empowerment Boundaries
Where do you think we might find a template for our executives to use to define Kaizen Team Empowerment Boundaries?
Within our Portal!
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Everything
Takes time
Costs money
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Costs of Inventory
Cost to borrow money
Insurance
Space
Loss due to damage and obsolescence
Cost to count it (over and over)
Cost to move it (over and over)
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The accountants have it wrong
Inventory is not an asset
Inventory is a liability
Goal = minimize inventory
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All work is either
Value Add
Transforms material or information to meet the true desires of an external customer
Non-Value Add
Control
Information
Administration
Other
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Which of these activities add value?
Looking for parts
Building products
Inspecting
Testing
Rework
Delivering services
Packaging
Shipping
Searching for info
Filling out forms
Entering data
Answering customer questions
Stocking shelves
Training
Selling
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Low hanging fruit
Where do you think you will find the “low hanging fruit” when you begin your improvement efforts?
By reducing the 5% of value-add activities?
By reducing the 95% of non-value-add activities
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The # 1 Fundamental Principle of Process Improvement
Anything that does not add value is waste, and must be reduced or eliminated
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Reduce and Eliminate Waste
Reduce
“Necessary Non-Value Add” activities that really are needed for control – until the process can be further simplified
Eliminate
“Unnecessary Non-Value Add” activities
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The Seven Types of Muda As defined by Taiicho Ohno (Toyota executive, 1912-1990)
Defects
Overproduction of goods not demanded by actual customers
Inventories awaiting further processing or consumption
Unnecessary processing
Unnecessary movement of employees
Unnecessary transport of goods
Waiting for an upstream process to deliver
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And a few more types of waste
Unsafe or unergonomic work conditions
Working to the wrong metrics
Missing or misinformation
Underutilized human potential - skills, talents, and ideas
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Goal = Get ever closer to zero
Zero waste
Zero defects
Zero scrap
Zero rework
Zero receiving rejections
Zero downtime
Zero inventory
Zero handling
Zero paperwork
Zero mistakes
Zero absenteeism
Did we mention…
Zero waste?
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Goal = Get ever closer to zero process times
Setups
Sales quotes
Delivery date promising
Sales order delivery
Production process time
Purchase order lead times
Outsourcing
Engineering changes
Time to market
Returns
Repairs
Data collection
Data analysis
Period end close
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Lego Game A game to “learn to see waste”
Every Lean Consultant has a favorite Lego game to help people “learn to see waste”.
Newcomers to Lean teachings almost always have several “aha” experiences before the game is over.
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1. 5S Steps to reduce or eliminate waste
Organize the workplace
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Organize the Workplace
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5S – to organize the workplace
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5S Sort, Set, Sweep, Standardize, Sustain
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2. Arrange for flow Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
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What is “flow”?
A process where a "target object" moves quickly from value-adding activity to value-adding activity without interruptions for any of the 7 types of muda
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A “target object” might be…
A physical item moving through production or distribution
A design spec for developing a new product
An approval process (for anything that needs approval)
Any other "target object" that you can conceive that receives value by going through a process
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Why flow? Vastly improved process efficiency
"Flow" processes routinely outperform "batch & queue" processes by staggering margins, with common numbers like:
20-40% increase in productivity
70-90% lead time improvement
40-60% reduction in floor space
50-90% reduction of WIP
40-70% quality improvement
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Why flow? Improved employee morale
In the classic research book Flow: The Psychology of Optimal Experience, Csikzentmihalyi studies thousands of self-described "optimal experiences" at work and play, and summarizes the characteristics of an optimal work experience
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What are your self-described “optimal experiences”?
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Flow – Optimal Experiences
The worker sees and understands the whole process and how the parts fit together
The worker has high degree of control and involvement
The task requires full attention - it is neither boring nor overwhelming
There are few or no interruptions
There is immediate feedback
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The flow of flow
In your own mind, compare the "flow of flow" to the "flow of batch & queue"
Is it any wonder that employees in a flow environment report a much higher degree of job satisfaction?
In addition, flow usually also provides:
Improved communication between direct work force and management / staff
Improved safety
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Why flow? Improved supplier relations
Don't you wish that your customers would:
Provide you with long-term visibility of their level-loaded production schedule
Commit to a long-term partnership with you
Offer their Kaizen Team to teach your people how to achieve the best-of-class results that they have already field-tested and proven within their own company?
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Why flow? The number one reason…
All of that is great, but what is the number one reason for wanting to achieve flow?
Flow enables pull
(remember this answer for later)
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Why arrange everything around product lines?
To reduce many types of waste
Uninterrupted work flow
The better the flow – the lower the WIP (Work In Process)
The lower the WIP – the faster the throughput
Fewer set-ups and change-overs
Fewer mistakes
Less rework and obsolescence
Dedicated support people that know your challenges, and are available when needed
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Production Environments that embrace flow
Continuous Flow (non-discrete products)
Repetitive (assembly lines)
Lean (work cells)
Click here for a comparison of production environments that embrace flow
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Functional Department Layout (Spaghetti Diagram)
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Work Cell Layout
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Why are work cells the “holy grail”?
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Why are work cells the “holy grail”?
Production lines still need to deal with sales forecasting, batch sizes, and finished goods inventories.
The work cell can accommodate a batch size of one. And it can be employed in work environments that have traditionally been organized in batch & queue departments - which have the most opportunity for improvement.
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What if our process includes a “monument”?
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What’s a “monument”?
A “monument” is anything (but usually a large piece of equipment) that is so huge or expensive that it requires large batches, and/or must be shared by the production processes for several product lines
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What if our process includes a “monument”?
Ideal option is often to replace the monument with equipment capable of producing in small lot sizes
But the world isn’t always ideal, is it?
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What if our process includes a “monument”? (Decouple the process)
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Inventory is bad
Inventory is terrible
Inventory is a liability
We want zero inventory
Inventory is to be minimized
Reduce inventory
Inventory is bad, bad, bad…
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What do you think is (by far) the number one reason for lean initiative failures?
Reducing inventory too much too soon
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Lower the water level slowly
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Lower the water level slowly
Why?
Batch & queue is more tolerant of quality problems, machine breakdowns, and other problems that stop production Click here for more quality effects of flow vs. batch & queue
It takes intensive problem elimination efforts before a process is ready to withstand the harsh penalties of andon line-stopping
The "rocks beneath the water of inventory” should be slowly and carefully revealed, so that each new rock can be removed as it surfaces
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What does jidoka mean?
Everything stops whenever anything goes wrong
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What are andon lights?
Lights that looks like a traffic light – located on the shop floor. Anyone can turn on a light at any time.
Red light – stops production
Yellow light – need inventory
Blue light – have a question
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Key enablers of flow
Total Quality Maintenance
When there is any quality problem anywhere, the whole process stops
Total Productive Maintenance
When any machine is down, the whole process stops
Minimize “internal” setups
When a machine is down, the whole process stops
Reliable suppliers
When a delivery is late or rejected, the whole process stops More key enablers of flow
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When does batch & queue make sense?
Temporarily while your people are unable to stop problems that stop flow
Permanently for…
Prototypes
Non-mission critical processes that simply aren't worth the effort to convert to flow
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Your competitors are going to buy you up and pay for you by liquidating your own excess inventories if you continue to use batch & queue for...
Production of product lines with any kind of volume
New product design cycles that allow your competitors to consistently "beat you to market"
Sales order processing & fulfillment processes that are inefficient enough to annoy and anger your customers
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3. Standardize Work Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
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The USA Principle
Understand
Simplify
Then… (and only then)
Automate
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Standard Work
Definition
Standardization of best work practices - as the work is actually routinely done. (in real life)
Purpose
To make operations repeatable, ensuring consistently high productivity, and reduced variability of output
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To get started with defining Standard Work, start by…
Review the Standard Operating Procedures, routings, and other process documentation? (wrong)
Observe and document the way things are actually being done
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Components of Standard Work
Work layout & sequence
Standard WIP
Takt time and cycle time
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What’s the difference between?
Process lead time
Cycle time
Takt time
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Process Lead Time – time required to complete the whole race
Examples: Time to produce an item, complete an engineering design process, complete an approval process, process and ship a sales order...
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Cycle Time – what comes out the end of the pipe
The average time between completion of two discrete units of production.
For example, the cycle time of motors assembled at a rate of 120 per hour would be 30 seconds per unit
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Takt Time – planning drumbeat
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Takt Time – planning drumbeat
Process Lead Time and Cycle Time are measures of the average time that it actually takes to do something
Takt time is used for planning
Takt time can be thought of as “planned cycle time” (planned average time between completion of two discrete units of production coming out the end of the pipe)
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Takt Time Calculation
What is the formula for calculating the “drumbeat planning” Takt Time? (planned average time between completion of two discrete units of production)
The available production time (per day) divided by the rate of customer demand (per day)
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Takt Time
The “drum beat” pace of planned production, set by:
Forecast?
Capacity?
Efficiency targets?
Utilization targets?
Material availability?
The rate of customer demand?
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Takt Time – driven by the rate of customer demand
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Maximize Throughput Not Output
Output
The dollar value of items produced
Throughput
The dollar value of items produced that have been sold
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Output The dollar value of items produced
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Throughput
The dollar value of items produced - that have been sold
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Operational Takt Time
Takt Time = Rate of Customer Demand
Operational Takt Time = Takt Time adjusted for Sales & Operations Planning
E.g. Seasonality
Planned downtime
New product introduction ramp-up
Etc.
Click here for summary of Time Definitions
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Target Cycle Time
When doing Staff Load Balancing for a process that is divided between several staff positions, it is common to need to add Wait time to the Standard Work for some staff positions in order for each sub-job to be synchronized to the same Target Cycle Time.
Target Cycle Time must be less than or equal to (and is usually equal to) Operational Takt Time.
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Takt Time, Operational Takt Time, and Target Cycle Time
In many environments, Takt Time, Operational Takt Time, and Target Cycle Time are all the same, and the single term "Takt Time" can be used.
In other environments, the differences can become important.
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Takt Time – planning drumbeat
We’re workin’ to da takt time… to da takt time…
Workin’ to da takt time… Uh huh…
We’re workin’ to da takt time… to da takt time…
Workin’ to da takt time… Oh yeah…
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Balanced Scorecards
There should be clear relationships between
Strategic Measures Scorecard
Departmental Measures Scorecards
Process Measures Scorecards
(Perhaps open your Balanced Scorecard template and click on the hyperlink to Training and Ideas for Creating Measures Scorecards)
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Information Feedback Time
Definition:
The time it takes to receive feedback regarding key measures of a process.
Information Feedback Time is one of the "process time prints" that is an important part of any process improvement effort.
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Process Measures Scorecards
should be posted where people can see them while working on the process
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Visual Systems
Wherever possible – implement visual systems that…
Are easily found where needed
Are easy to understand
Are quick to understand
Provide (only) the most meaningful feedback
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Visual Systems
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Major Goal – Error Free Processing
Use Cause & Effect Analysis to identify and eliminate all root causes for errors
Ask why? Why? Why? Why? Why?
Poke Yoke = error proofing
What are some examples of poke yoke?
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Error Free Processing
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Process Design Tools
Value Stream Map
Flow chart
Functional Flow Chart
Process Design Matrix
Organization Chart
Brainstorming/Affinity
Root Cause Analysis
Spaghetti Diagram
Time Observation Worksheet
Standard Work Instructions, Chart, & Analysis
Staff and Machine Load Balancing
Instructions for each of these tools can be found within each of your Systems2win Templates
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Process Design Objectives
Many of your Systems2win templates contain a link to a checklist of Process Design Objectives
(Perhaps open your Process Design Matrix template, and review the list of Process Design Objectives now)
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Job Design & Change Management Tools
Jobs Design Spec
Change Management Worksheet
Force Field Map
Organization Chart
5S Schedule
Standard Work Chart
Standard Work Audit Checklist
Instructions for each of these tools can be found within each of your Systems2win Templates
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Software Design Tools
In the design process, three things can happen
Don’t change
Change process
Change software
Software Design Tools
Customization Spec
Upgrade Spec
Integration Spec
Data Conversion Spec
Software Fit Analysis (New software purchase spec)
Instructions for each of these tools can be found within each of your Systems2win Templates
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Process Documentation Tools
Any design tools, plus…
Standard Work Instructions
Standard Operating Procedure
Training video
User-defined on-line help (within a software application)
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Training Program Development Tools
Any design or documentation tools, plus…
Training Program Development Spec
Training Plan
Training Evaluations
Training Outline
(perhaps with Instructor Notes)
Training slides & handouts
(perhaps with Instructor Notes)
Training database sample data
Cross-Training Matrix
Instructions for each Training Program Development tool can be found within each of your Systems2win Templates
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4. Small batches Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
Make small batches
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Why are small batches better?
Shorter lead times
Less inventory – and obsolescence
More flexibility – to meet demand variability
Higher quality – with lower scrap & rework
Less floor space – in production and storage
Lower cost? (be sure to consider ALL factors)
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What is needed for small batch sizes?
Short setups
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What are the two primary measures used to reduce Lean batch sizes?
Internal Setup Time
Every Part Every Interval
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What is “internal setup time”?
The time from last good part to first good part
Your mission is to minimize internal setup time
Common Goal = SMED (Single Minute Exchange of Dies)
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Every Part Every Interval answers what questions?
When can we get it?
How small can our batch sizes be?
If we got an order tomorrow for one of everything we make – when could we deliver the whole order?
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Every Part Every Interval - Calculation
Time Available for Changeovers = Working hours per month for pacemaker operation minus calculated total cycle time for all items going through pacemaker operation (e.g. 320 working hrs – 280 cycle hours = 40 hours)
Number of Intervals Per Month = Time Available for Changeovers divided by number of products or product families times Changeover Time per changeover (e.g. 40 hours / 20 products x 1 hr per CO = 2)
EPE Interval = Number of working days per month divided by the Number of Intervals per Month (e.g. 20 working days / 2 Intervals per Month = Every Part Every 10 days)
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How to improve your EPE Interval?
Increase working shifts
Decrease batch sizes
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Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
Make small batches
What do you think is next?
(hint: what was the #1 reason for wanting flow?)
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Pull
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5. Pull systems Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
Make small batches
Introduce pull systems (self-correcting control)
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Pull - make only what the customer orders
"Pull" is the biggest pay-off for re-designing your process to flow with small batch sizes.
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Benefits of pull
Little or no waste doing things that no one will ever pay for
Little or no finished goods inventory
Little or no reliance on sales forecast
Radically short lead times for radically customized deliverables
An arsenal of weapons to annihilate your competitors: Lower costs, lower lead times, higher quality...
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Key Enablers of Pull
Level Schedule
Level Selling
Locate near customers
Supplier partnerships
More info about Key Enablers of Pull
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Kanban
In Japanese, kanban is the word for "card", because a kanban is often a 3x5 card attached to a parts container. When the container is emptied, (because the parts have been used to fulfill actual customer orders), the container is delivered to the upstream operation, and the kanban card provides the information needed to fill the container.
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Types of kanbans
A kanban can be any visual signal authorizing upstream production or delivery
Materials kanbans
authorize replenishment of materials
Production kanbans
authorize upstream production
Electronic kanbans
can be used to trigger replenishment by off-site suppliers
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Pull, Pull, Pull
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Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
Make small batches
Introduce pull systems (self-correcting control)
(what do you think is next?)
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| Slide 117 |
6. Tiny batches Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
Make small batches
Introduce pull systems (self-correcting control)
Make tiny batches (ideal lot size is 1)
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What is needed for tiny batch sizes?
Short setups
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| Slide 119 |
Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
Make small batches
Introduce pull systems (self-correcting control)
Make tiny batches (ideal lot size is 1)
(What do you think is next?)
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Never Stop Continuous Imprvmenting
(untangling the knots)
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7. Never stop continuous improvement Steps to reduce or eliminate waste
Organize the workplace (5S)
Arrange everything to “flow”
Standardize work
Make small batches
Introduce pull systems (self-correcting control)
Make tiny batches (ideal lot size is 1)
Never stop continuous improvement
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And that concludes our presentation…
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What can you do to help?
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Kaizen Team Roles
Where do you think we might find a document explaining Kaizen Team Roles?
Within our Portal!
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Prepare for Resistance
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Prepare for Resistance
Resistance to change is natural
Stability = security, control, status
Provide assurance that jobs are not at risk
Communicate openly and often
Involve everyone that is affected
Focus on positive payoffs of change
“If someone doesn’t get upset, we’re not really trying to change anything”
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Ground Rules
Where do you think we might find our company’s Ground Rules for Working Together?
Within our Portal!
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Kaizen Principles
Let the mandate guide you
No rank among Team Members
No excuses or blaming – focus on solutions
Open your eyes, ears, and mind
BBQ sacred cows
Ask “Why?” until root cause is uncovered
Creativity before capital
Avoid analysis paralysis – try it & adjust
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BBQ Sacred Cows
Example: If your Consultant for Continuous Improvement is still using handwritten Lean & Kaizen tools – raise your eyebrows and ask them to tell you again about how everyone else is supposed to be open to ideas for Continuous Improvement…
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Let’s do it!
Let’s get out there and improve some processes!
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We’d love to hear your feedback
Systems2win is all about Continuous Improvement
We would love to hear your feedback for how you think we might make our offerings even more valuable
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Terms of Use
We hope you enjoy this free preview of our Lean & Kaizen Training presentation
Copying any portion would be a copyright violation, but you can… purchase an editable version as part of the Kaizen bundle of templates
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Terms of Use - Images
Systems2win has a license to distribute these clip-art images to you – but you don’t have a license to distribute them to anyone else
All image rights are reserved by Jupiterimages Corporation
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