Competing in the Marketplace Kaizen Training Competing in the Marketplace “What factors are important to the customer?” John Deere - Supplier Development

Kaizen Training TIME: The single best indicator of competitiveness Set-up or Change-over Time Product Development Time Manufacturing Cycle Time Customer Lead Time / Delivery Time Working to reduce or minimize each of these times can make your company more valuable to both its internal and external customers.

Manufacturing Lead Times Kaizen Training Shrinking Lead Times Order Lead Times Manufacturing Lead Times Delivery Lead Times Reducing the overall time from receiving the order to delivering the product makes your company more responsive to the customer. This can become the deciding factor when the customer makes their selection. As can be seen, manufacturing is only one part of the entire process. Inputting, processing, and issuing orders is an area for improvement, as well as, assembly, loading and delivery to the customer`

Kaizen Training Where’s the Time in Lead Time This timeline represents an overall lead-time, with very little time spent on adding value to the product. Non-Value Added Time (NVA) 99% of Total Lead time Value Added Time (VA) 1% Common Concentrated on reducing VA time, with no attention given to NVA. Improvement Efforts Non-Value Added Time (NVA) 99% of Total Lead time VA 1/2 % Results of Common Improvement efforts, did not improve response time. VA time is reduced, but, the costs for those improvements in lead time was substantial.

Non-Value Added Time (NVA) Kaizen Training Where’s the Time in Lead Time When we look at attacking the NVA Activities in the Timeline and compare that to the original timeline: Greatest Opportunities are actually here! Non-Value Added Time (NVA) 99% of Total Lead time Value Added Time (VA) 1% NVA Time 95% of Total Lead time VA 5% Great Job!! This shows a 5X improvement in lead time

Kaizen Training Different Types of Activities Being able to tell the difference between NVA and VA activities is an important step in the Improvement Process. An activity that changes raw material to meet customer expectations. Value Added Activity (VA) Those activities that take time, or occupy space but do not add to the value of the product. Non Value Added Activity (NVA) You must ask yourselves “Would you as a customer be willing to pay for any NVA activity being performed to that NEW 4x4 Pickup you just ordered?”

Kaizen Training Some examples NVA Activities: Waiting on machine cycle Walking Unnecessary stock on hand Generating useless reports Unnecessary motion Transporting parts THE GOAL IS TO ELIMINATE THE NON-VALUE ADDED ACTIVITIES.

A definition: Destroy, in our minds, the concepts and techniques of manufacturing that we practice today. Create a vision of what our production system and manufacturing techniques should be. Carry out that Vision by breaking through the status quo. KAIZEN We must avoid the urge to discover more sophisticated and technological solutions to tasks we shouldn’t be doing at all.

Kaizen Training Basic Rules for Change Keep an open mind to change No such thing as a dumb question or idea Avoid spending money (Capital expense should be a last resort) Maintain a positive attitude Don’t’ make excuses & question current practices Think about how to do it, NOT why it can’t be done Just do it!! Have Fun!!!

Kaizen Training Steps on Team Development Forming Storming Norming This is the development of a multi-functional team with a variation of backgrounds and knowledge Storming Open & honest discussion, also brainstorming Norming Stage where the group agrees how to operate as a team Performing Agreement on solutions & taking action Adjourning Closing on the continuos improvement process after 30 days

Kaizen Training What is TAKT Time? TAKT time is how many minutes or seconds are needed to make one part when considering the daily volumes, to be produced in that workcell and the total time available to perform the job. TAKT time is NOT the time it takes to manufacture the product. It is based on customer demand. Who is the customer? The next operation Customer orders

Kaizen Training TAKT TAKT Time: TAKT Time Calculation Production Time Available / Period Number of Required Units / Period TAKT Production Time Available / Period (one shift): Breaks - 2 @ 10 minutes Shift Time ( 8 hrs. ) Clean-up at end of shift Production Time Available: - 20 mins. 480 mins. - 5 mins. 455 mins. or 27,300 secs. Units Required / Period (one shift): 10,500 Units Sold Monthly 21 Working shifts / month 500 Required units / shift 27,300 secs / shift TAKT Time: 54.6 secs. 500 units / shift

Kaizen Training The 5S Housekeeping Standards Sort Sanitize (Safety) First Step towards Continuos Improvement The aim of 5S is to create an atmosphere to keep a clean, organized, safe and efficient workplace for everyone. The foundation for the practice of 5S, comes from a Japanese program derived from these words, seiri, seiton, seiso, seiketsu and shitsuke. The 5S’s are a conventional approach towards maintaining and improving the work place. The following words have been chosen for the 5S acronym’s. Sort Sanitize (Safety) Sweep Straighten Sustain

Kaizen Training Meaning of the 5S’s Sort Straighten Sweep Examine everything at the workplace & identify what is needed and what can be discarded Straighten Organizing the way things are put away with efficiency, quality, and safety in mind. Need to decide where and how things should be put away and what rules should be obeyed to insure that it is maintained. Sweep (Scrubbing clean) Sweeping, scrubbing and cleaning of the building, machines, fixtures & tools so that all areas of the workplace are neat & tidy. This leads to early detection of mechanical problems before they become major breakdowns. Machines cry!

Kaizen Training Meaning of the 5S’s Sanitize Sustain (Safety) Insuring that each workplace is properly designed for safety. This is to protect every member from the dangers during the performance of their assigned tasks. Sustain (Standardize) Developing the practice necessary to continually participate in the 5S process. This requires that each of the S’s become a personal habit. This is the most difficult of the 5S’s, but it is the most important factor in achieving long term success. Establishing routines and procedures for maintaining and improving on the first four (S’s), incorporating visual management tools.

Kaizen Training WASTE

Kaizen Training Staffing Productivity Waste Productivity Do MORE with LESS Staffing Productivity Waste Productivity

WASTE SHIFT MINDSET CURRENT REQUIRED THINKING THINKING Processing Transportation Inventory Correction WASTE TYPES OF WASTE Over- Waiting Production Motion WASTE IS "TANGIBLE” IDENTIFY MANY SMALL OPPORTUNITIES -LEADS TO LARGE OVERALL CHAGE CONTINUOUS IMPROVEMENT WASTE NOT DEFINED REACT TO LARGE EXAMPLES REACTIVE IMPROVEMENT

ELEMENTS OF WASTE Definition Example 1. Transportation - Transporting 1. Transportation - Carrying farther than necessary or Tools to Point of Use temporarily locating, filing, stacking and moving parts (people, paper, information) is waste. 2. Correction - Doing something 2. Correction - Redo an Activity over is waste. Because of Error 3. Overproduction - Generating 3. Overproduction - Number of excess paper or information, or Copies generating information or paper too soon in a process is waste.

ELEMENTS OF WASTE Definition Example 4. Motion - Unnecessary work 4. Motion - Tools in drawers movements are a form of waste. 5. Waiting - Waiting for people, 5. Waiting - Meetings to start paper and information is waste - it stops work. 6. Inventory - Too much of 6. Inventory - Supplies anything is waste. 7. Processing - this is waste in 7. Processing - Typed when the process itself. Redundant handwritten would be activities sufficient

Kaizen Training Process requires ongoing inspection and enforcement to ensure “Standardized Work” is being followed Standards Inspect Enforce Process does not improve automatically Standardize Problem Solve Improve Stabilize . Identify Waste - Following standards will only maintain, not improve, the process. - Improvement focuses on the entire process.