1. Lean

2. Lean Defined Toyota Production Systems: An operating philosophy in which the best quality, cost and delivery of a product or service is achieved through shortening the production flow by eliminating waste. Elimination of 3 M’s: Muda (waste), Mura (inconsistency), Muri (unreasonableness) Womack, Jones, Roos, The Machine that Changed the World  Half the hours of human effort in the factory  Half the defects in the finished product  One-third the hours of engineering effort  Half the factory space for the same output  A tenth or less of in-process inventories

3. Lean History Early 1900’s Henry Ford’s integrated production process (moving conveyance, interchangeable parts, standard work, etc) Mid and later 1900’s came the contributions of Kiichiro Toyoda, Tai’chi Ohno, Shigeo Shingo, and others Ideas generated by financial necessity

4. Current Competitive Environment: Value Add versus Non Value Add $ Profit “fixed” price K a i z e n time Total Cost = VA + NVA Classic business model: Cost + Profit = Price New business model: Price – Cost = Profit

5. Seven (?) Lean Wastes 1.Over production – prior to demand 2.Waiting – for information, materials, people, equipment, etc. 3.Transportation – more conveyance than is necessary 4.Over-processing – e.g., any form of inspection 5.Inventories – having more than absolute minimum 6.Motion – more than necessary to complete the task 7.Defects or Rework Note the internal nature! 8. Knowledge Disconnection – inhibition of knowledge, ideas and creativity flows 9. Sustainability

6. 5 Elements of Lean Systems 1.Leadership: Styles, Skills, Abilities, Behaviors, and Practices 2.Culture: Atmosphere 3.Team (stakeholders: employees, management, supply chain) 4.Principles 5.Tools

7. Lean Leadership 1.Leadership Styles a.Consideration (employee-centered behavior) b.Job Structure (job-oriented behavior) 2. Choice of Style: Numerous Situational Factors a.Leader’s Internal forces b.Subordinates’ Internal forces c.Type of organization (formal versus informal) d.Position power (degree of power and influence manager has over subordinates) e.Group effectiveness f.Time pressure g.Problem itself

8. Lean Leadership (continued) Leadership Skills, Abilities, Behaviors and Practices 1.Lead by example: 2.Mangement By Wandering Around (MBWA) 3.Participative Management 4.Delegation: ranges from an strong, authoritarian style to permissive 5.Results orientation 6.Problem-solving skills 7.Methodical in approach 8.Imaginative versatility and flexibility (an ability to tolerate ambiguity, accept change, seek change, put out fires) 9.Organizationally savvy and politically connected 10.Team builder (facilitator and motivator) 11.Do not crave the limelight (share the success) 12.Listen, sensitivity (receiving information), care, communicate, praise, reward 13.Honesty and integrity 14.General management outlook 15.Negotiation and persuasion (salesmanship, convey the purpose) 16.Accept responsibility for decisions and actions 17.High motivation 18.Defuse conflict 19.Implement organization policy and procedures 20.Personable (interact with superiors, subordinates, clients, other stakeholders) 21.Experience, judgment, intuition 22.Mentoring (encouragement and advice) 23.Partnering

9. Lean Culture: Create a Learning Organization Leaders are both learners and teachers, leaders must:  Accept stewardship and responsibility for transformation  Be deeply committed to change  Participate in pursuit of excellence  Create an environment for continuous improvement: kaizen, never-ending  Create an environment for flexibility: quick adaptation to changing needs  Overcome cultural resistance; do not yield to resistance, skepticism, or reluctance  Reflection: plan, attempt, analyze, learn, institute (Plan, Do, Check, Act)  Mistakes are learning opportunities (fear-free environment) It’s okay to make legitimate mistakes Problems are exposed because of increased trust People are not problems, they are problem solvers Emphasis placed on finding solutions, instead of “who did it?”  5 Why’s  Change and improvements typically occur slowly and in small steps  Experimentation  Rewards (group and individual) are important

10. Lean Culture: Establish High Agreement 1.Recognize importance of standards (common method or process with clear understanding of importance) 2.Structure Every Activity – each activity should be stable, reliable and repeatable by all (standardized thinking) 3.Valuing and adopting standards versus our “own” way 4.Dynamically improving standards

11. Lean Team Understand value of people: Training, Education, Empowerment Leverage knowledge of those closest to problems Participative management Nothing is sacred (ask 5W2H often) Fear-free environment Standardized thinking 100% participation External view (supply chain)

12. Lean Practices Create the learning organization Simplicity and Visibility: simple solutions, quick problem identification and fix Establish High Agreement Connect Every Supplier and Customer (internal and external) Systematic Waste Reduction and Problem Solving

13. Lean Tools 1.Quick Changeover (SMED) of Machines and Cross Trained Workers 2.TQM 3.Continuous Improvement: kaizen and kaikaku events 4.Value Stream Mapping 5.Workplace Organization: 5 S’s 6.Leveled and Balanced Production (uniform plant loading) 7.Pull Approach and Produce/Withdrawal Signal (kanban) 8.One Piece Flow 9.Audio/Visual Status Signals (Simplicity) 10.Error Proofing: Poka-yoke, Andon, Jidoka (quality at source) 11.Total Preventive Maintenance and Wellness Programs 12.Cellular Configuration (plant within a plant) 13.Standard Work Instructions (SWI’s) 14.External: greater supplier participation/collaboration

14. Lean Goals: Cost, Quality, Flexibility, Speed 1. Cost Strategy: waste elimination 2. Productivity (Speed) Strategies  Produce to exact customer demand  Produce one unit at a time  Eliminate waste  Commit to continuous improvement  Understand the value of people  Allow for no contingencies  Promote long-term perspective  Others?

15. Lean Goals: Cost, Quality, Flexibility, Speed (continued) 3. Quality Strategies  Operator empowerment  Perfect parts every time  A new customer definition  “Quality at the Source” tool kit  Operator responsibility  Visibility management  Others? 4. Flexibility Strategies  Increase operator skills  Multifunction equipment  Plant within a plant (various layout types)  Resources always ready  Others?