Group Exercise Description Based on your previous work, you’ve been awarded a contract by the Left Dogleg Bank of America (LDBA) to facilitate a lean event on the Credit Card process The current daily demand is 25 and there are 15 minutes in a day. The Credit Card company is looking for help in increasing productivity and reducing variation It’s critical that standard work be created to they can proliferate the model throughout all locations They’ve asked that you focus on the 4 operators that complete the forms Data Entry for Credit Card Application - Green Background Credit Checks - Blue Set the Customer up in the System - Red Issue the Card - Yellow Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT)

Group Exercise Instructions This is the standard model we’ll follow for the event Calculate Takt Time Time study credit card operations Create Percent load Balance work to Takt Create Standard work layout Define Standard WIP Create Standard work combination for operators Complete each tool and be prepared to discuss your proposal with the class along with expected productivity results Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT)

Introduction To Just In Time (JIT) Takt Time Calculation Takt Time = Available time Demand Available time = 15 min 15 min * 60 sec = 900 sec Demand = 25 pc Takt Time = 900 sec = 36sec/pc 25pc A Takt Time of 35 sec mean that we must complete a form every 36 sec to meet customer demand. Make sure everyone understands this. There may be discussion about subtracting time for breaks, cleanup etc. For consistency keep 15 minutes as the available time. Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT) {filename}

Introduction To Just In Time (JIT) Time Observation Form Each team should have a Time Observation form for each operator Remember – Keep the watch running (this insures we capture normal variation) Double check their math – Each dot should take around 4 – 5 sec each (Ex. 2 Red dot Cycle Time should be 8sec) We want lowest repeatable time for each element Encourage note taking when using this tool – This normally reveals additional opportunities to eliminate waste. (Use Time Observation Form.xls) Encourage the team to collect 10 cycles for each operator. There may be times where 10 runs would not be economically feasible, however the more cycles collected - the more accurate the repeatable times will be. Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT) {filename}

Introduction To Just In Time (JIT) Before Percent Loading Chart 48 40 32 24 16 8 1 2 3 4 T/T=36 Sec Emphasize again the space under the Takt time line. This doesn’t mean people are lazy, they are likely over producing. First sum up total operator Cycle Time to complete one form 16 sec + 24 sec + 8 sec + 16 sec = 64 sec Then divide the total operator cycle time by Takt time 64 sec / 36 sec = 1.8 Operators The necessary theoretical staffing for this process is 1.8 Operators Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT) {filename}

Introduction To Just In Time (JIT) After Percent Loading Chart 48 40 32 24 16 8 1 2 T/T=36 Sec Someone will usually ask what happens to the operators no longer needed to perform the process. We should encourage leadership to use these resources as leverage to grow the business. Sometimes additional planned hiring can be avoided. To balance the operations to Takt Combine Operations 1 and 4 = 32 sec Combine Operations 2 and 3 = 32 sec 2 Operators 50% productivity improvement Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT) {filename}

Introduction To Just In Time (JIT) Standard Work Layout Sheet Oper. 2 Oper. 1 1 Oper. 3 2 Takt Time = 36 Sec Focus on how the second operator can perform the 1st and last operations (necessary to balance to Takt) due to the U shape layout. Oper. 4 Standard WIP = 3pc Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT) {filename}

Introduction To Just In Time (JIT) Standard Work Combination Sheet This is an eye chart. The dashed line show the sequence and then return to the first step to repeat the process. Emphasize effective application of the Standard Operation tools should provide the most efficient work sequence. That it what’s documented, and the combination sheet is the tool that we’ll use to monitor the health of the process. If a process has strayed from the expected operating parameters, the first question is “where you following standard work”? This is a Standard Work Combination for Operator 2 Performs operations 2 - Blue and 3 – Red under Takt Time Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT) {filename}

Introduction To Just In Time (JIT) Key Learning Points Takt Time What happens to Takt when demand Goes up? Takt time is smaller (less time to complete product) Goes down? Takt time is bigger (more time to complete product) What happens to staffing needs when Takt Goes Up? Staffing needs increase Goes Down? Staffing needs decrease We should look at Takt monthly or even more frequent depending on demand patterns Time observations Break down to small elements Copious notes – May observe waste during timing Multiple runs must be timed to capture variation Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT)

Introduction To Just In Time (JIT) Exercise Take-aways Percent Load Chart Helps us see graphically where waste (wait time, overproduction) is occurring Theoretical Staffing is an approximation based on how possible it is to split up and combine operations for balancing purposes Standard Work Layout This example shows how a “U” shaped layout enabled us to combine operations 1 and 4 to balance work to Takt Can also be used a visual training tool Standard Work Combination Sheet This where we capture the best work sequence It is a visual description of how the operator work sequence flows Also a great tool for training Managers can use to audit processes and monitor variation Copyright © 2001-2004 Six Sigma Academy International LLC All Rights Reserved Introduction To Just In Time (JIT)