creating flow and eliminating waste in lean product ... · both, lean manufacturing and lean...

Transfer inovácií 29/2014 2014

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Ing. Klaudia Mund, DTech

51 Charlbury Road, OX2 6UX Oxford, UK

email: [email protected]

Abstract

Both, lean manufacturing and lean product development emphasize waste-free processes consisting of value-added activities, which are interconnected into a flow. Waste identification and elimination become a key element in any process improvement effort. The aim of this article is to synthesize information regarding various types of waste occurring on the production floors and which can be also found in product development (PD). The practical relevance of office waste to PD environment will be discussed and few practical examples will be provided. The challenge is to determine the role and identify what implications flow and waste entail for PD. Toyota utilizes powerful tools and techniques to create flow in order to make processes more controllable and specific techniques will be presented.

Key words: Lean manufacturing; Lean product development; Lean thinking; Flow; Waste

INTRODUCTION

Japanese lean thinking and lean practices are rapidly spreading worldwide across various industries. The publications Womack, Jones and Roos (1990) and Womack and Jones (1996) have been used as fundamental guides for lean transformation consolidating lean thinking into five lean principles:

1. Define and specify value from the customer perspective

2 Identify and map the value stream

3. Create flow and eliminate waste

4. Establish pull from customer

5. Pursue perfection

Once the customer value is understood, the whole process - the value stream - needs to be identified and the steps and activities analyzed if they are either value-added or non-value added. Process mapping makes it possible to identify redundancy and to eliminate waste and consequently allows creation of flow of value-added activities. Each product should be produced when a customer pulls it - order it - and it should comply with customer expectations for what he is prepared to pay. Perfection emphasizes the journey of continuous improvement of the products and processes.

The lean methodology is ‘all about identifying and eliminating non-value-added activity or waste’ reveals Cooke (2009:42). Clearly, value-added activity is any action adding value to the product or changing the process. On the other hand, activities that add costs but do not add real value are non-value-added and therefore constitute waste. Waste can be defined as: ‘anything that does not add value to the product or to the operation’. The term ‘anything’ could represent for example a part, material, waiting time or walking.

However, it would be misleading to see the lean concept only from this perspective. Because, based on five lean principles, the lean approach is also about clear identification of customer value, which is the starting point in a lean system. The customer value in its turn leads to waste identification and creation of flow.

WASTE IN MANUFACTURING AND IN PRODUCT DEVELOPMENT ENVIRONMENT

Manufacturing and product development environments have some similarities and the management principles of the Toyota Production System (TPS) can be applied to any technical or service process; thus the lean practices can also be extended to PD (Morgan & Liker 2006:5). While a manufacturing process consists of repetitive activities organized into serial value streams, product development process consists of many interdependent activities and a series of parallel work streams. Huge challenge in PD is to identify activities and tasks which are repeatable. Another challenge is management of the flow of invisible information, as opposed to a flow of visible physical products in manufacturing. The invisibility and non-repetitive activities makes the identification of waste difficult. Waste identification and its elimination becomes an important step in establishing flow in a process.

The success in Toyota´s product design and development begins with seeing and understanding this as a process, which is a necessary prerequisite for such a process to be standardized and continuously improved. PD is a complex environment and it can be viewed as a repeatable step-based process interrupted by waste (Morgan & Liker 2006:70). Bhasin and Burcher (2006:58) emphasize that lean product development (LPD) is ‘concerned with reducing waste at all levels; but it is also about changing corporate culture’.

Waste has been discussed in the lean literature (Bicheno & Holweg 2009:21; Dennis

CREATING FLOW AND ELIMINATING WASTE IN LEAN PRODUCT DEVELOPMENT


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2007:20-24; Greasley 2006:299; Kobayashi 1990:52; Locher 2008:15; Morgan & Liker 2006:72) predominantly in a connection to TPS. Taiichi Ohno, the ‘father’ of TPS (Ohno 1988), identified following seven categories of manufacturing waste abbreviated in consultancy as TIM WOOD (Table 1):

7 Ohno’s waste categories

1. Transportation Defects

4. Waiting

2. Inventory 5. Over-production

3. Motion 6. Over-processing

7. Defects

Table 1: 7 Ohno's manufacturing waste categories

Over the years lean researchers and practitioners worldwide have continuously discovered new categories and added them to this original list, such as: knowledge disconnection (Dennis 2007:20-24), unused employee creativity (Liker 2007:60), underutilized people (Locher 2008:15), waste of management (Jones 2010) and waste of knowledge (Ward 2009:30). A comprehensive list with various waste categories in manufacturing and new types of waste is provided in Table 2.

This table includes in the middle column examples of waste identified in PD, all derived from 7 Ohno’s manufacturing waste.

Although waste on the production floor is more tangible and therefore easy to see and waste in PD is more complex the point is to start systematic waste reduction right at the source: in the PD process (Ballé & Ballé 2005:18; Kennedy 2003:13). Beyond the 7 Ohno’s categories of manufacturing waste there are specific types of waste reflecting the unique aspects of PD environment. Cooke (2009:42) identified following categories: ‘Disruption and distraction’; ‘Communication barriers’; ‘Using inappropriate or poor tools’; ‘Inaccurate handover of information’; ‘Generating useless information’; ‘Missing the unvoiced customer requirement’ (testing to specification) and ’Regenerating discarded information’ (results of failures).

Morgan and Liker (2006:19) concur and identify two broad categories of waste in PD. Firstly, waste created by poor engineering results in low levels of product or process performance. Secondly, there is waste in the PD process itself. Additional waste categories specific for the PD environment were identified in the literature (Reinertsen 2005:45; Schuh, Lenders & Schöning 2007:7; Bicheno & Holweg 2009:27) and are summarized in Table 3 below:

Table 2: Overview of waste categories

Source: Researcher´s own construction based on literature study


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Table 3: Overview of waste categorization in PD

Source: Researcher´s own construction based on literature study

WASTE IN OFFICE ENVIRONMENT AND THE IMPLICATIONS FOR PRODUCT DEVELOPMENT

Apart from manufacturing and PD waste Venegas (2007:10) has identified categories of waste in office environment. Four main types of waste according to compartmentalization of offices are distinguished: information, process, physical environment, and people. Each of these areas contains its own sub-categories, which are summarized and visualized in Figure 1.

Based on personal experience and the facts discussed above most of the office waste also occurs in PD environment, as discussed in following examples from an R&D department at a vehicle manufacturer.

Information waste occurs in various forms and leads to obstructions in the flow of value. For example, redundant inputs or outputs of identical data can easily happen in work on development projects, owing to the vast number of components and change releases. Data are repetitively fed into systems: this takes time and resources without adding any value. The important point with regard to information systems is that they need to be compatible.

Figure 1: Waste categories in office environment Source: Researcher´s own construction based on Venegas (2007)


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Many problems occur between departments if they use separate and incompatible systems, for example when tracking releases of parts and product changes. Teams are not able to share data and many of the redundant inputs and outputs mentioned earlier happen regularly. Another problem occurs with insufficient data available on the system: this may occur when some departments update their data periodically and others do not. Moreover, the causes for the existence of incompatible systems might be various, such as when there are inadequate skills and training to operate the systems or insufficient system implementation.

People waste refers to misuse of people’s energy and time in terms of the human dimension in any process improvement. Despite people being the most valuable asset in organization, many companies remain unaware of even the most simple root causes of people-related problems leading to waste. All stakeholders in a PD process need to have a clear definition of their roles and responsibilities. If the responsibility, accountability and authority for a particular role are not clearly defined and communicated many problems can occur. For example, there could be conflicts between project teams and groups, tentative behaviour, lack of commitment, duplication of work, or performance ambiguity and time delays.

Waste in the physical environment is related to safety issues and to the movement of people or objects. Obviously, organizations pay more attention to safety issues on the shop floor so as to protect workers from injuries. For example, moving machinery, manipulators, welding equipment or conveyor belts can cause injuries or damages if not appropriately used. The physical environment for PD is basically the office and also, in the later stages of PD the factory floor. Testing of components or prototypes is mainly carried out in the pilot halls located within production plants. Any injuries on a shop floor or in the office environment can be costly in loss of productivity and in payment of allowances and compensations. Indeed, any organization needs to care for people and keep the working environment safe.

Process waste does not require further discussion, as the waste categories listed in Figure 1 are derived from 7 Ohno’s manufacturing waste.

TECHNIQUES AND STRATEGIES TO CREATE CONTINUOUS FLOW

One of the most powerful ways to reduce lead time while increasing development speed is the creation of flow in PD process. Flow considers value streams: these include all work and functional expertise required to take the product from the planning phase - and then through design, prototype and testing phases - to product launch, known as Start of Production.

Flow in PD process refers to flow of information and knowledge (Locher 2008:65) and can be improved by adopting concepts such as: cross-functional teams, obeya (large room) and shared resources. Locher (2008) also identified benefits of flow in PD:

1. process lead time can be reduced by 50-90%

2 .process quality can be improved by 30-90%

3. process time can be reduced by up to 40%.

Toyota’s methods and techniques used for establishment of continuous value stream and flow in PD are described by Morgan and Liker (2006:83-97):

Process logic – refers to a framework for coordination of a development programme and related human resources. Process logic defines tasks, activities and their sequences and contains a step-by-step process description that generates schedules and determines personal responsibilities and time constraints. Although this framework consists of PD process requirements and decisions that must be taken at each milestone, it does not provide specific details or instructions on how to do the work.

Workload leveling – is a critical component of effective resource utilization during a development programme, which considers the leveling of resources and product planning before the execution phase. Workload leveling is determined by scheduling of resources and product portfolio planning. The product strategies must be aligned with the business strategies and must ensure the best use of available resources.

Platform strategy – refers to the use of common product platforms and families of product variants, which are derived from modular architecture. This involves the use and re-use of sets of engineered components, design alternatives, available tools and manufacturing processes from previous programmes. This can lead to advantages in economies of scale and also to product innovation.

Staggering vehicle launches – is concerned with the cyclical scheduling of vehicle development projects, and engineering redesigns of vehicles (facelifts) included in the product portfolio. The purpose is to level and balance workloads related to engineering resources, development programmes and manufacturing facilities over a lengthy period of time.

Cross-functional synchronization – is required for synchronization of activities between functional departments and development teams. Effective synchronization must be both inter-functional and intra-functional. It all depends on an understanding of work details and instructions,


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specific activities and their sequences - and roles and responsibilities for each stakeholder in the programme. The effective way to synchronize cross-functional activities is their integration and alignment in cross-functional teams, created from selected experts and around specific vehicle subsystems.

Flexible capacity system – allows allocating extra resources in a development programme when they are required to enable workload control and leveling of resources. One strategy used is that of flexible staffing, which deals with sharing of highly skilled technical staff across multiple projects. The requisite high level of flexibility in a programme can be only achieved by rigorous standardization of skills and design and through the process itself.

Detailed scheduling – deals mainly with the schedule discipline of all stakeholders and their commitment to programme milestones. The sense of attentiveness to intermediate target dates is crucial for effective sharing of resources and for managing multiple projects simultaneously.

Staggered releases – attempt to manage and facilitate design and release processes. LPD uses a ‘design-release stagger’ where large and more complex parts requiring more time are designed and released first while smaller components are released later.

Management cycle time – refers to regular time schedules or deadlines, where managers track and control progress in engineering work. In an LPD process the management cycle time occurs on an almost daily basis, which means that management requires daily meetings to review programme status and discuss open issues. Thus, the managers have an opportunity to make decisions and develop effective counter-measures immediately when problems arise: this also allows them to align teams accordingly.

Jidoka – is a concept used in lean manufacturing and is applicable to PD. It refers to the practice of recognizing abnormal conditions and detecting failures and more importantly, it involves quick rectification and deletion of errors before they create waste in a process.

Poka Yoke – is another concept known from lean manufacturing and enhances flow in a process. The concept of Poka Yoke is applicable to PD in various forms including checklists, standards, quality matrices or standardized processes. These concepts provide design guidelines, test and timing requirements and quality characteristics that assist engineers to prevent errors before they occur.

Pull system – is a further concept adapted from manufacturing applicable to PD. It refers to identifying and delivering the right information and knowledge to the right engineer at the right time. The engineers working on development

programmes are responsible for pulling information they require, in order to locate and extract it.

Engineering cadence (takt time) – although this concept is commonly utilized in lean manufacturing it is more difficult to apply it in PD. ‘Takt’ is a German word, with its origin in music, and means ‘a precise interval of time’ or ‘uniform pace’.

According to Dennis (2007:53) manufacturing takt time is calculated as follows:

Takt time = Daily operating time/Required quantity per day

Keyte and Locher (2004:69) and Locher (2008:60) use a similar formula for calculating takt time in PD:

Takt time = Effective working time in a period/ Demand in a period

Morgan and Liker (2006:93) write that takt time in PD process is a crucial mechanism to establish engineering cadence and coordinate activities at a regular pace. Engineering cadence mechanisms are achieved through rigorous design reviews scheduled at regular intervals. Input into the design and tool manufacturing process is provided at a later stage through scheduling physical prototype builds and part coordination events.

The methods originate from lean manufacturing and from the successful TPS. However, it is also possible to adopt and adjust the majority of them to the requirements of a PD environment. Through implementation of these techniques an organization can develop flow and create controllable and predictable design processes and focus on waste elimination and continuous process improvement.

CONCLUSION

Product development processes can be managed and improved as any other business process but there is a need to understand the process logic and to identify several critical characteristics of this specific environment. Waste is one of the first concepts which organizations address when they embark on a lean journey, as it is easily understandable and delivers quick wins and tangible outcomes. Once people understand this concept they learn to see waste in their working environment and start to eliminate it in their daily jobs. Basically, all types of waste need to be identified and continuously eliminated, as they can cause significant financial losses and penalties, time delays and communication problems.


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REFERENCES

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Bhasin, S. & Burcher, P. 2006. Lean viewed as a philosophy. Journal of Manufacturing Technology Management, 17(1):56-72.

Bicheno, J. & Holweg, M. 2009. The lean toolbox: the essential guide to lean transformation. (4th ed.). Buckingham: PICSIE Books.

Cooke, G. 2009. Lean, mean NPD machine. System design: Engineering management, 41-42.

Dennis, P. 2007. Lean production simplified: a plain language guide to the world´s most powerful production system. (2nd ed.). New York: Productivity Press.

Greasley, A. 2006. Operations management. West Sussex: John Wiley & Sons Ltd.

Jones, D. T. 2010. The waste of management. [Online]. Available: http://www.leanuk.org. June 2010. [1 September 2013].

Kennedy, M. N. 2003. Product development for the lean enterprise: why Toyota´s system is four times more productive and how you can implement it. Virginia: The Oaklea Press.

Kobayashi, I. 1990. 20 keys to workplace improvement. Oregon: Productivity Press.

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Ohno, T. 1988. Toyota production system: beyond large-scale production. New York: Taylor & Francis Group.

Reinertsen, D. G. 2005. Let it flow. Industrial Engineer. June 2005.

Schuh, G., Lenders, M. & Schöning, S. 2007. Mit Lean Innovation zu mehr Erfolg – Ergebnisse der Erhebung. Wekzeugmaschinenlabor WZL der RWTH Aachen. [Online]. Available: http://www.lean-innovation.de [26 May 2013].

Venegas, C. 2007. Flow in the office: implementing and sustaining lean improvement. New York: Productivity Press.

Ward, A.C. 2009. Lean product and process development. Cambridge: The Lean Enterprise Institute.

Womack, J.P. & Jones, D.T. 1996. Lean thinking: banish waste and create wealth in your corporation. New York: Simon & Schuster Inc.

Womack, J.P., Jones, D.T. & Roos, D. 1990. The machine that changed the world. New York: Free Press.

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