building the production system through a developed lean programme

BUILDING THE PRODUCTION SYSTEM THROUGH A DEVELOPED LEAN PROGRAMME

The Philips Excellence Lean Model

Royal Philips2nd March 2017

2 Copyright © Royal PhilipsSTRICTLY CONFIDENTIAL – DO NOT USE OR REPRODUCE WITHOUT WRITTEN PERMISSION

Founded in 1891

HQ in Amsterdam

NL

Sales of circa. €17Bn

Circa. 69K Employees

R&D Investment of around 7% of

revenue

Present in over 100 Countries

About Royal Philips

“Our goal is to improve the lives of 3 billion people a year by 2025”


3

The Leadership ProblemLeading with Lean

Only 13% of Employees

worldwide are engaged at work

Sources: Gallup 2013 Employee Engagement Survey & Harvard Business Review 2013

24% of Employees are actively disengaged

71% of Senior Executives rank

Employee Engagement as very important for

Organisational Success

?


We started with understanding the ‘Why’ of Lean

Toyota doubled its market share from 2000 to 2010 and became no. 1 car manufacturer a number of times from 2009 onwards

Honeywell have outperformed the S&P 500 Index by over 100% over the last 10 years using the Honeywell Operating System (HOS) as a major driver of their Business

Porsche, starting in the early 1990s, used a Lean Enterprise Strategy (End-to-End) as a basis of its turnaround strategy and became the most profitable car company in the world

Danaher has grown profitably by almost 20% every year for the past 20 years, using a CI based Business System (Share Price growth of 2,909%)

Moved from a ‘factory based’ CI approach to a Business wide people system: 289% Share Price increase over 10 years (June 2003 – June 2013)


5

Significantly increased Employee Engagement

Bottom line impact in the Hundreds of Millions € range

Time-to-Market improvements of between 30-70%

Quality improvements of 30% Year-on-Year

Inventory reductions of >30%

Floor space reductions typically 20-30%

Kaizen implemented >200K

We have delivered significant results across Philips and continue to do so


We focussed on Lean thinking, rather than Lean Tools, and have driven a principle based transformation

Principle Driven

System Driven

Tool Driven

Embedding principles into culture

Embedding principles into culture

Embedding principles into the culture

Structuring tools into a systems context

Using specific methods to create point solutions

Based upon the Shingo Institute Model


Lean thinking

1. Correctly specify value for the customer

2. Identify the value stream and remove waste

3. Make the product flow

4. So the customer can pull

5. By striving towards perfection

Which starts with understanding the Customer value


The Continuous Improvement Curriculum is designed to provide our Employees with the appropriate level of competence and behavioural change.

The Central Theme of our Programme is the Certification of 100% of our People in Lean Thinking


Lean Solutions

(e.g. Healthcare or Lighting installations)

LeanInnovation

(e.g., IT, R&D, Upstream

Marketing, etc.)

Lean Office

(e.g. Markets, Finance, HRCustomer Service, etc.)

LeanSupply

(e.g. Factories, Warehousing,Distribution, Suppliers, etc.)

Nat

ure

of a

ctivi

ty

Value Stream

Proj

ect

Repe

titive

Physical Virtual

We have created a Lean Excellence Model to Transform our whole Enterprise


We are utilising the Fundamental Lean Tools, combined with Lean Leadership, to transform our business


We are ‘Leading with Lean’ at every level of our Organisation

Leadership Activism provides the essential

elements of Role Modelling and leading

by example

Mosquito Leadership multiplies the Leader’s

impact beyond their span of control, which will usually, even in the case of Senior Leaders,

be quite small

Visible Leadership ensures that the

employees see what the Leader is doing and helps to engage the team members

Coaching Leadership moves from directive to

coaching leadership and enables sustainable

improvement


Thank you!

Philip Holt

LinkedIn: Philip HoltWebsite: leadingwithlean.com

Twitter: @LeanMaster1

Leading with Lean

https://www.linkedin.com/in/philipholt

http://www.leadingwithlean.com/

https://twitter.com/LeanMaster1

https://twitter.com/LeanMaster1




building the production system through a developed lean programme

Leadership & Management