escm research introduction to lean

8/8/2019 ESCM Research Introduction to Lean

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LEANEliminating waste to add value from the customers perspective

August 7, 2008


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Lean: A principle driven, tool based philosophy that focuses

on eliminating waste so that all activities/steps add value

from the customers perspective.

Strive forState Government processes with:

Lean is all about continuous waste elimination

Lean Explained

Higher customer satisfaction

Shorter lead time

Higher flexibility Higher quality

Lower costs

Higher employee satisfaction


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Relentlessly focus on reducing non-value adding activities

Cost

Defects

Lead time

Inventory

Space

Waste!

Productivity

Customer satisfaction

Profit

Customer responsiveness

Capacity

QualityCash flow

On time delivery

Work Time(value add)

Cycle Time

Before

After

Wait Time(non value

add)

Cost/Chaos

Same work

completed in

less time

Lean Benefits

Cycle time


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The tools get you there the principles keep you there

Five Lean Principles

The continuous movement of

products, services and

information from end to end

through the process

Define value from the

customers perspective

and express value interms of a specific

product

Nothing is done by the upstream process until

the downstream customer signals the need

2Map the

Value Stream

3

EstablishFlow

4

ImplementPull

5Work to

Perfection

1

Specify Value

Map all of the steps value

added and non-value added

that bring a product ofservice to the customer

The complete

elimination of waste so

all activities create

value for the customer


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Typical operation: 1-10% of activities are value-adding

A capability provided to a customer at the right time at an

appropriate price, as defined in each case by the customer.


1. Specify Value

Specify value from the standpoint of the endcustomer

Ask how your current products/services andprocesses disappoint your customers valueexpectation:

price?

quality?

reliable delivery?

rapid response to changing needs?

fundamental definition of the product?

Waste:

Activities that add novalue, add cost and time

Symptoms: need to findroot causes and eliminate

them 7 types of waste:

1. (Unnecessary) inventory

2. Overproduction

3. Waiting

4. Transporting

5. Inappropriate processing

6. Unnecessary motion

7. Defects


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Map the value stream see the whole and improve the system

Whenever there is a product or service for a customer, there is a

value stream. The challenge lies in seeing it.

(Womack, Learning To See)


2. Map the

Value Stream

Identify all of the steps currentlyrequired to move products from orderto delivery

Challenge every step: Why is thisnecessary? Would the customer thinkthe product is worth less if this stepcould be left out?

Many steps are only necessarybecause of the way firms are

organized and previous decisionsabout assets and technologies

All activities, both value added andnon-value added, required to bring a

product (or provide a capability) fromraw material (initialization) into thehands of the customer

Value stream

Value

Incidental

or

ure aste

Pure Waste

Necessary

behind

the scenes

work

Value-adding

Pure Waste


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3. Establish Flow


Line up all steps that truly create value in a rapid sequence

Require that every step in the processbe:

Capable right every time (sixsigma)

Available always able to run(TPM)

Adequate with capacity to avoidbottlenecks and overcapitalization(right-sized tools)

Continuous movement of products, servicesand information through the varioustransactions from end to end in the process

low appears impractical and illogicalbecause we have been trained to think interms of:

departments batches, queues

efficiencies and backlogs

Batch Processing 1 minute per piece

A B CCycle Time = 3 + min

A B CCycle Time = 12 min

Continuous Flow Make One Move One

Apply the right tools at the right stage


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Pull: customer-centric


4. Implement Pull Nothing is done downstream until required upstream

Through lead time compression &correct value specification, letcustomers get exactly whats wantedexactly when its wanted:

At the pull of the customer/nextprocess

Using signals (kanbans)

A system of cascading productionand delivery instructions in whichnothing is done by the upstreamsupplier until the downstreamcustomer signals the need

supplier customer

One moreplease!

Okay


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Continuous Improvement never stops


5. Work to Perfection A continual cycle of process improvements

There is always some waste that can be removed People learn and exercise more creativity

- Involve employees in the process, training them as you proceed

Continuous improvement leads to innovation

Use root cause analysis to solve problems

promptly and permanently. Make ob ectives visible

Current State

Future State

Next Future State

Original State


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Implementing the 5S is often the first step in lean transformation

5S: a framework to create and maintain your workplace

1. S: S RT ( rganization)Distinguish between what is and is not needed

2. S: SETIN RDER ( rderliness)

A place for everything and everything in its place

3. S: SHINE (Cleanliness)Cleaning and looking for ways to keep it clean

4. S: STANDARDIZE (Adherence)

Clearly define Tasks and Procedures

5. S: SUSTAIN/SYSTEMISE (Self-Discipline)Stick to the rules

Common Lean Tools: 5S


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Common Lean Tools: Standardized Work

Why have standardized work? Waste limination

1. To make process rules explicit

stablish the explicit methods for manual tasks with respect to

quality, quantity, cost and safety.

prevent wastes

2. A tool for improvement

There can be no improvement in the absence of standards.Abnormal situations show that something is going on.

expose wastes


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Common Lean Tools: Standardized Work

The devil is in the details. If you do not specify the standard, you allow

wastes to occur that could be eliminated. But more important, it hinderslearning and improvement in the organization.

Specify content, sequence, timing and outcome to prevent and to

expose waste. However, keep in mind that the details have to improve

the flow of value as drawn in a value stream map.

Perfect example of standardised work

1. ach worker understands their task.2. All tools and equipment are at arms length3. Standard work has been practiced to perfection4. Continuous observation and analysis drives

continuous improvement

Types of Waste liminated Searching Finding Selecting Transporting Waiting


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Organizations maintaining long-standing, comprehensive process improvement programs

share common features that enhance their ability to sustain the efforts. They have: Been inspired by influences outside of the public sector, usually a leader with business

experience

Experienced little leadership turnover

Paved the way for the programs implementation by removing organizational barriersand modifying its culture

Focused on certain underlying principles and maintain a consistent conceptualframework

Begun by employing a full-time administrator to oversee the programs implementation

Offered a guarantee to employees that no layoffs will result from a processimprovement pro ect

Made conscious efforts to communicate program successes internally

Maintained reasonable expectations did not achieve success overnight, with mosttaking several years to create a culture that characterizes and sustains their program.

Success Factors

Active leadership in both words and actions is a must

Source: IBM Center for the Business of Government 2007, ImprovingService Delivery in Government with Lean Six SigmaSource: IBM Center for the Business of Government 2007, Improving Service Delivery in Government with Lean Six Sigma


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These organizations create an infrastructure supporting the combined

Lean/Six Sigma program with attention to four goals:

1. deploy a sound, consistent, and robust methodology

2. build trust by removing fear

3. initiate long-term cultural change

4. communicate the vision to all stakeholders.

How Has the Improvement Program been Sustained?

Source: IBM Center for the Business of Government 2007, ImprovingService Delivery in Government with Lean Six SigmaSource: IBM Center for the Business of Government 2007, Improving Service Delivery in Government with Lean Six Sigma

escm research introduction to lean

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