1. Lean Manufacturing in a Lean Economy
Darren Dolcemascolo
EMS Consulting Group, Inc.
Copyright EMS Consulting Group, Inc. 2008

2. Lean Manufacturing in a Lean Economy
You will learn:
The need to become lean today
Benefits you can expect by implementing a lean initiative
Principles and steps of implementing a lean program
Critical success factors—the reasons that lean ideas fail in so many companies, and how to avoid these pitfalls
Copyright EMS Consulting Group, Inc. 2008

3. Copyright EMS Consulting Group, Inc. 2008
Presentation Agenda
Lean Manufacturing Principles and Benefits
The Lean Implementation Process
Pitfalls/Critical Success Factors
Q&A
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4. Toyota Production System
The TPS House Diagram
A System Based on a Structure
TPS
Goal:
Highest Quality, Lowest Cost, Shortest Lead Time
Best Safety, High Moral
Not a set of Techniques
Structural System
The house is strong only if the:
Roof is strong
Pillars are strong
Foundation is strong
People are strong
A weak link weakens the whole system
Just In Time
Right part-Right amount-Right Time
Jidoka
Built-in-Quality
Line Stop
Efficiency
Visual Controls
Error Proofing
Andon
5 Whys
Flow
Takt Time
Pull
Quick Changeover
Operational Stability
Standardized Work
TPM
Kaizen
Leveled Production
Toyota Production System
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5. Lean Manufacturing Overview
Value - A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer. Features of the product or service, availability, cost and performance are dimensions of value.
Waste - Any activity that consumes resources but creates no value.
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6. Lean Manufacturing Overview
Lean Manufacturing is an operating philosophy that focuses on the elimination of the seven wastes:
Overproduction
Excess inventory
Defects
Non-value added processing
Waiting
Excess motion
Transportation
MUDA
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7. What does Lean do? Total Lead Time Lean Transformation Total Lead Time
Value-Creating Time
Non-Value-Creating Time (waste)
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8. Lean Manufacturing Overview
Lean Thinking, Womack and Jones, 1996
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9. Lean Conversion Process
“The greatest enemy to tomorrow’s success is sometimes today’s success.”
- John Maxwell
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10. Current State of Our Economy
Credit Crisis: Difficult for Businesses to Obtain Credit to
Meet Payroll
Purchase Raw Materials
Grow as a company
Unemployment on the Rise
Major Recession
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How Can Lean Help?
Current Economic Conditions create an opportunity for lean thinking – a need to go lean based on survival!
Applying lean principles will create the following:
Shorter Lead-Times to Customers
Net Decrease In Inventory- Frees Up Cash
Productivity Growth- increases capacity without additional capital/hiring
Quality Improvement- lowers costs and attracts additional business
Copyright EMS Consulting Group, Inc. 2008

12. How Can Lean Help: Shorter Lead Times
Benefits to Operation
Ability to Quote Jobs Faster
Ability to Process Orders Faster
Ability to Get Orders to Production Faster
Ability to Process Jobs Through Production Faster
Competitive Advantages
Attract more business
Get paid faster/rely less on credit
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13. How Can Lean Help: Decrease in Inventory
Benefits to Operation
Freed up floor-space
Freed up cash
Competitive Advantages
Have cash on hand for expansion of business or to handle short-term “down” periods
Copyright EMS Consulting Group, Inc. 2008

14. How Can Lean Help: Productivity Growth
Benefits to Operation
Lower Product Costs
Increased Capacity
Competitive Advantages
Increased profitability
Ability to compete on price due to lower costs
Attract more business
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15. How Can Lean Help: Quality Improvement
Benefits to Operation
Lower Product Costs
Better Quality Product Produced
Competitive Advantages
Increased profitability
Attract more business
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16. How Can Lean Help: Bottom Line
Lean thinking will help a company become self-reliant:
Fuel for growth by producing better quality, lower cost products with the shortest lead times.
Ability to Grow without relying on the availability of credit from financial institutions.
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17. Lean Conversion Process: Lean Thinking
Specify value
can only be defined by the ultimate customer
Identify the value stream
exposes the enormous amounts of waste
Create flow
reduce batch size and WIP
Let the customer pull product through the value stream
make only what the customer has ordered
Seek perfection
continuously improve quality and eliminate waste
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Value Stream Approach
Select Product Family
Create current and future state maps
Develop and manage action plan using Project Management approach
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19. Planning Tool: Value Stream Mapping
Definitions
- Current State Map – Map showing information and product flow as it is currently done.
- Future State Map - Map showing an attainable information and product flow with significantly less waste than that of the current state.
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Value Stream Mapping
Purpose of Mapping
To identify and eliminate waste in the value stream.
End Product of VSM
Picture of “future state” with an action plan to achieve it.
Prioritized Projects
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21. Value Stream Mapping: Current State
Begin mapping at the end of the process (customer) and work backwards.
Then, map the information flow from your customer back to your supplier.
Connect the two.
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22. Current State Value Stream Map
Production
Control
Raw Matl.
Customer
Supplier
MRP
Units/day
Units/day
Information Flow
Material Flow
Process A
Process B
Process C I I I
Value Creating Time = 180 seconds
Lead Time = 18 days
Data
Data
Data
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23. Value Stream Mapping: Future State Elements
Flexibility
Short Lead-Time
Connected Processes
Flow Loops
Simplified Information Flow
Awareness of the Customer Requirement
Scheduling one point in the value stream
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Kaizen Event Approach
Kaizen Event Overview
3 to 5 day breakthrough event
“Working level” participants w. facilitator
Appropriate for use with several lean tools
Appropriate for new implementations and for continued improvement
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Kaizen Events
Typical Tools 5S
SMED (Single Minute Exchange of Die)
TPM (Total Productive Maintenance)
Mistake Proof (Poka-Yoke)
Visual Controls
One-Piece Flow/Takt Time/Layout
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Kaizen Events
Kaizen Event Process
Educate (1/2 – 1 day) – Lean with emphasis on particular tool
Set goals
Map out baseline
Brainstorm ideas
Select ideas and formulate future state
Develop plan to implement future state (Implement as much as possible immediately- during event.)
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Kaizen Events
Advantages
Exciting experience for all involved
Can Accomplish Improvement Rapidly
Participants learn a great deal
Skeptics can be won over
Valuable tool for implementing aspects of a value stream improvement
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Kaizen Events
Disadvantages
Improves points in the process but without VSM approach, does not lead to flow across the enterprise
Action list at the end often is ignored- important to meet weekly until complete.
Tendency to revert to old methods after the event.
No lasting cultural change.
Tendency to judge events on short-term cost savings only
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29. Where to Start- Toyota’s 4 P’s?
Philosophy – Hold an off-site meeting of top leaders and define your company’s vision
Process – Begin implementing a connected value stream.
People – Train and indoctrinate your people into the new lean way of thinking, effecting culture change.
Problem Solving – Train people in a problem-solving methodology and give them time to meet in groups and solve problems.
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30. Typical Approach that Works
Perform an assessment and develop an overall plan for implementation. Create a Company X Production System based on an assessment.
Select some key items/pilot projects for process improvement (based on an assessment) and implement kaizen/5S.
Combine VSM approach with problem solving and 5S training.
Use the Value Stream Mapping approach to identify improvement projects (both kaizen and “six sigma” projects)
Roll out 5S implementation and basic problem solving training plant-wide to build momentum.
Copyright EMS Consulting Group, Inc. 2008

31. Typical Approach that Works
Implement the projects/roll out lean training in small bites in conjunction with projects
Continue expanding by value stream (or department), whichever makes more sense.
Extend across entire organization.
Create a Lean Promotion Function.
Develop a growth strategy for additional business.
Extend Lean to Your Suppliers.
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32. Copyright EMS Consulting Group, Inc. 2008
Pitfalls/Barriers
Too much compromise/Lack of Leadership Commitment to Lean
Tendency to Revert Back to Old Ways when setbacks occur
Tendency to use TPS/Lean as a Cookbook
Tendency to make surface changes without applying lean principles properly (customizing to suit the situation)
Short-Term Thinking at the Expense of Long Term
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33. Roles in Change Process
Executive Sponsor
Lean Coach
Resources
Accountability
Process Owner
Value Stream Team
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Leadership
Top management support /commitment is critical for successful lean transformation.
Support and commitment means not only lip service but $$, resources, making difficult decisions, and eliminating roadblocks.
Middle managers down to team leaders must become change agents- the transformation from skeptic to teacher does not happen overnight.
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Lean Coach/Teacher
Internal or external lean expert that teaches but does not do the work. The lean coach:
Leads model line programs
Leads value stream mapping
Leads kaizen events
Teaches lean tools and philosophy through courses and improvement events
Coaches leaders at all levels
Develops the lean operating system (metrics, principles, assessment approaches)
Internally promotes the lean transformation.
Externally learns and brings back new ideas.
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36. Key Ingredients of Change
Participation &
Ownership
Structure
Organization
Documents
Roles/Resp
Committed,
Knowledgeable
Leadership
Change
Effort
Lasting Results
Accountability
Learn by doing
Education &
mentoring
Toyota Way Fieldbook, Liker and Meier, 2005
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Culture Change
Education and changing metrics alone will not drive culture change
Seeing/Experiencing is believing.
Lean must be tried and the word must be spread through successes in pilot projects.
Strong leadership is necessary to drive culture change.
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38. Copyright EMS Consulting Group, Inc. 2008
Recap
The Current Economy is a compelling reason to implement lean
Lean thinking will help a company become self-reliant:
Fuel for growth by producing better quality, lower cost products with the shortest lead times.
Ability to Grow without relying on the availability of credit from financial institutions.
Lean Requires a Systematic Implementation Approach
Lean Requires Strong Leadership
Copyright EMS Consulting Group, Inc. 2008

39. Lean Conversion Process
“Perfection is not attainable, but if we chase perfection, we can catch excellence.”
- Vince Lombardi
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40. Copyright EMS Consulting Group, Inc. 2008
Questions?
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