UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth 1 SPX SME Upgrading Building Capacity, Capability & Sustainability Dar Es Salaam, Tanzania 21 st June 2011

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Who am I? Enterprise Ireland, Competitiveness & Lean Business Department Manager EU Japan Centre for Industrial Co-Operation European Benchmarking Network Advisor Internationally on Benchmarking and Best Practice Trinity College Dublin, Dept of Statistics(retired) Author

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Agenda What is Lean Case Study examples

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Level 1 Level 3 Process Benchmarking The Five SsTotal Productive Maintenance Overall Equipment Efficiency Six Sigma Business Excellence Value Analysis &Management Lean Production Target Cost Management Facilitated Assessment Benchmarking Physical&Process Flow in the Office Physical&Process Development Production Control Systems Saving Time in the Workplace MaintenancePractical Quality Tools Team Building & Culture Sales and Growing them Financial Management Supply Chain & Logistics Innovation& Design Business StrategyImplementation Self Assessment Benchmarking Physical FlowProcess FlowSet Up Time Reduction Check SheetsRun ChartPeople & TeamsBasic Maintenance Level 1 Level 2

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth What do we mean by Lean? Lean is shorthand for Best Practice within a sector Helps People identify and deliver improvements in their businesses Provides a framework for competitiveness improvement by building the capability and competences of people to

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth What is Lean? Focused on Effectiveness and Efficiency Doing the right things well! A War on Waste!!! What is the alternative?

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth What is Lean? Based on the Toyota Production System Understood by American consultants Six Sigma – Developed by Motorolla Corp, statistically based approach Similar tools but: Lean focuses on continuous business processes Six Sigma focuses on discrete projects for improvement Driving and integrated into company strategy

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Some Lean Principles…. Time Money Effort Must want to compete…..

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Rules 1. Fairness 2. Firmness 3. Consistency 4. Look 5. See 6. Understand 7. Do Dealing with People Dealing with Processes

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Five Fundamental Lean tools….. Process Mapping Physical Flow mapping Check Sheets – What is going wrong? Run Charts – Is it getting better or worse? Teams – People working together to improve their business

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Key Lean Questions….. What are you doing? How are you doing it? Why are you doing it? Who is going to improve it? When? Capture the FACTS! Make things better…..

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth War on Waste- Absolutely Focused & Relentless Motion Transportation Processing Defects Waiting Over-production Inventory People

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Lean - Action based on FACTS Benchmarking = Diagnosis Best Practice = Medicine

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Why Benchmarking? Benchmarking allows us to : Analyse & Improve Key Business Processes-Qualitative and Quantitative Eliminate Waste Improve Performance Improve Profitability & Market Share Based on FACTS…..

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Benchmarking is a continuous systematic process for comparing business processes for improvement...

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Benchmarking for Success Tool Use vs Company Development Stage Evolution of Company 123 Diagnostic Holistic Process B/mark Best in Class

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Acceptable Standards are constantly changing......

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth RESULTS Supplier Partnerships World Class Manufacturing Competitive Products and Services Business Process Management Customer Partnerships World Class JITJIT Employee Involvement TQMTQM The Medicine

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Layout / Flows Set Up Time Reduction Manufacturing Systems Productive Management JIT Supplies JIT Manufacturing

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Process Capability Waste Elimination Tools of Quality Customer Focus Quality Function Deployment Total Quality Management

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Employee Involvement =Expectation Empowerment People Effectiveness Quality Awareness Group problem Solving Improvement Teams

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Products and Services Design for Manufacture Design for Operation Regulatory Approval Product Evaluation

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Management Effective Information Technology Structures and Strategies Plans + Projectscts

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Office Processes World Class Processes Lean Administrative Systems Continuous Improvement Value Added Process Identification

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Packaging: 16% reduction of packaging line cycle time Pet-food products: 14% cost reduction per unit Recycling: Sort line throughput up by 600% Insulation products: Reduction of the build time from 5 days to 0.8 of a day Packaging: Net margin increased from 5% to 15% Engineering: Labour productivity on fabrication line increased by 35% Food additives: 17.5% reduction in Labour costs Engineering: 20% Gross profit from current average of 9% Lean - Sample Results

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Case Study- Pet Food Ltd Sector: Food- Pet treats/dental chews Project Description: Cost reduction programme in packing. Value streams/problem areas defined. Measurable Success: 4% increase in output per direct employee 2.5% reduction in direct labour costs. Labour costs as % of sales went from 23.5%-20% Lead time reduced from 8-6 wks

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Case Study- Analytical Systems Ltd Sector: Water treatment Project Description: Re-organisation of production area/ 5S/Value Streams/Planning schedules Measurable Success: Capacity increase 150% (2 -5 per wk) New layout allowed for 15% more capacity 4 week lead time for all products achievable

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Lean - Sample Results Flat Food – Over 10million savings made County Foods- Game Changing result Medical – 38% improvement on EBITDA

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth What can you see? How can you help? How can you add value to your clients, your business, without conflicting on confidentiality? What about suggesting benchmarking?

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth On the Floor.... What is current state? Visuals for feedback Detailed use of tools Process Physical Check Sheets Run charts Teams

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth In the Office.... What is current state? Visuals for feedback Detailed use of tools Process Physical Check Sheets Run charts Teams

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth For the Management..... Next Steps Absorption of tools and techniques Focus for the Business

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Q and A

UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION Reducing poverty through sustainable industrial growth Together Everyone Achieves More TEAM