Kaizen - Strategy for performance excellence

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A STRATEGY FOR

PERFORMANCE

EXCELLENCE


Executive Overview

Participant manual

Tools WorkbookKnowledge Breakthrough

Lecture notes Lecture notes

Performance Excellence Series

Training Module Elements


Table of ContentsExecutive Overview

Session 1.0 Introduction…………………………..3

Session 2.0 Wastes elimination…………………. .9

Session 3.0 Kaizen Methodology………………..15

Session 4.0 Integrated Improvement Strategy…...28

Session 5.0 Kaizen Project Examples……………32


Model: Performance ExcellenceDeliverable Integration of Lean Robust Processes

Through Elimination of the Nine Wastes of Processes: Over production, Delays, Transportation, Process, Inventories, Motions, Defective Products, Untapped Resources, Mis-used Resources

ManufacturingProduction

Feedback

InputsCore Business Processes

Output

1. Customer *Wants *Needs2. Suppliers Raw Material Sub-Assemblies Products MRO3. Customer Returns Signature Service Non-Signature Service

Demand Management

Supply Management • Procurement• Inventory/Material Management• Supplier Management

Forecasting Order Services • order attainment• order entry

Service > 99%

FinanceTreasuryAccounting

What is needed, in Quantity that is

needed at the time it is needed at a competitive cost

+ Flexibility,

Responsiveness towards

customer’s wants and needs

Delivery:• Minimal shipment/order• On - timeCosts:• low cost associated with customer value focusQuality• Low to zero defects• Service beyond shipment• Feedback

Lean Site Manufacturing Total Productive Maintenance Mistake- Proofing (Poka-Yoke)

Quick Changeover (S.M.E.D)

5S Statistical Problem SolvingDesign of Experiments

Process Capability Analysis

Kanban Visual Management Pull Systems Cellular Manufacturing Priority Planning

Spaghetti Chart Takt Time

Quality Cost & DeliveryStandard Work

Fishbone Pareto

Production Part Approval Process

Advanced Product Quality Planning

Product Creation Process

QuintusMulti-Generation Product PlanningRegression Analysis

Failure Mode Effects Analysis

Pareto Analysis

5W’s, 2H’s

MSA

Mistake Proofing

Process Mapping

HistogramFishbone Diagram

Affinity Diagram

Approach: Kaizen Six Sigma (6δ)

Information TechnologyOperational ManagementEngineering ManagementQuality ManagementHuman ResourcesOrder Fulfillment

Operations Management

Marketing/Sales

Statistical Process Control

Parameters

Value

1st Priority People

Optimize Profits/EVA

Continuous Improvement

Lean - Robust Process

Management Characteristic

Visionary

Cooperation & Collaboration

Focus & Perseverance

Required Information

Individual Behavior Motivation

Organization Evolution

Group Dynamics

Market Requirements


Why Kaizen

TimeCPI Project

Time

CPI

Time

Sa

vin

gs

Sa

vin

gs

Sa

vin

gs

Process Improvement Project Implemented

Maintenance of Process Performance

Kaizen

CPI• Data Driven Methodology to Magnify Impact of Process Improvement• Apply Control Techniques to Eliminate Erosion of Improvements• Proceduralize/Standardize Improvements for Improved Maintenance of Critical Process Parameters

Kaizen• Use Small Teams to Optimize Process Performance by Implementing Incremental Change• Apply Intellectual Capital of Team Members Intimate with Process

CPI Projects Emphasize Control and Long Term Maintenance

Kaizen Projects Emphasize Incremental Improvements


CPI • Disciplined Methodology• Technical Approach

(Quantitative)• Data Driven - Statistical• Operational Focus• Reduce Variation• Focus on Large Impact• Larger/Longer Projects

Kaizen • Philosophical Approach• Common Sense Approach

(Qualitative)• Data Driven - Observation• Customer Focus (Takt time)• Waste Elimination• Incremental Change• Smaller/Shorter Projects

Performance Excellence Obtained by Continuous Improvement

Improvement Tools

Complimentary Tools Driving Continuous ImprovementComplimentary Tools Driving Continuous Improvement

Expanding the Strategy


Comparative AnalysisImprovement Methodologies• Similar in Structure• Improvements measured against established process• Team oriented

• Similar improvement tools• Measure effectiveness of improvements• Maintain new performance level• Standardize & Proceduralize

Results• More Efficient Processes

Comparison• Both are Effective Improvement Mechanisms• CPI/6s best applied to large complex problems• Kaizen/Lean best applied to achieve incremental changes and eliminate wastes.

Measure- Data Collection- Determine Process Potential / Goals

Evaluate- Root Cause / Vital Few- Statistical Analysis

Improve & Verify- Implement Improvement- Validate Improvement

Standardize- Standardize / Leverage- SPC- Update Procedures

Evaluate- Baseline Process Performance- Establish Target

Decide-Compare solutions- Choose

Act-Communicate - Implement improvement- Control

Measure- Validate improvement- Standardize - Update ProceduresFocus

- Reduce Process Variation- Identify Critical Cause and Focus Resources for Maximum Impact

Focus- Eliminate Waste 5 s- Seek Incremental Process Changes

Kaizen/Lean 6

• Different methods used to determine improvement opportunities

Summary- Technical Approach based on Statistical Analysis- Requires Significant Data Collection- Best applied to Manufacturing Processes- Typical Projects 1-3 Months

Summary- Common Sense Approach based on Observation- Applicable to all types of processes- Defined improvement strategy- Typical Projects 1 week


Major CPITools (6) Kaizen Lean Description

Cp/Cpk Process capability assessmentDOE Design of experimentsSPC Process control based on statistics and data analysisFMEA Risk assessment toolRegression Correlate effect one variable has on anotherProcess Map Map process steps to communicate and identify opportunities5 whys /2 hows Determination methods for root cause discoveryPareto Column chart ranking items highest to lowestFishbone Cause / Effect Diagram5S Elimination wasteVisual Mgmt Emphasis on visual techniques to manage processPoka-Yoke Error proofing techniquesSpaghetti Chart Kanban Material storage technique used to control processTakt Time Determine pace or beat of a processStd Work Evaluate tasks done during a processSMED Single minute exchange of dies - Quick machine set upTPM Integrate maintenance strategy with processCellular Flow Reduce inventory & cycle time thru process layout and pull

production techniques

Expand Process Improvement Program to Utilize Kaizen Tool Kit Expand Process Improvement Program to Utilize Kaizen Tool Kit

Tool Kit Comparison


Performance Excellence:

Expanding the Strategy through Kaizen

Introduction

Wastes elimination

Kaizen Methodology

Integrated Improvement Strategy

Kaizen Project Examples



Is the continuous elimination of waste


What Does Kaizen Mean?

KAI ZENTo modify, to change Think, make good, make better

= KAIZENMake it easier by studying it, and making the improvement through elimination of waste.

+


What is Waste?

Everything we make that

costs something without

adding value to the product

Our objective > Value added = Maximum

Non-Value Added = Minimum


The Nine types of waste

Overproduction Delays (waiting time) Transportation Process Inventories Motions Defective products Untapped resources Misused resources

9 Wastes


Elimination of Wastes and Continuous Improvement

Elimination of wastes

KAIZEN


One piece flow SMED Visual Controls Workplace

Organization Kanban Standard Work Process Control Total Productive

Maintenance Poka-Yoke

The Approach The Means The Strategy

Lead-time Costs Quality the first

time


Introduction

Wastes elimination

Kaizen Methodology






Kaizen Methodology Kaizen improvement The mandate One-piece flow SMED Visual controls Kanban Workplace organization Standard work Quality every time Total productive maintenance


Kaizen Improvement is a Team

Multi-disciplinary Specific mandate Short delays Responsible teams


Kaizen Improvement is composed of 4 steps

To Evaluate To Decide To Act To Measure

E

D

A

M


Kaizen Improvement is continuous improvement


Kaizen Improvementis NOW !!!


To Evaluate

You can only improve things you know well.


To Evaluate

Tools for analysis

•The 5 whys : search for root cause

•Matrix

•Pareto diagram

•Fishbone diagram

•Distribution histogram

•Check sheet

•etc.

E

D

A

M


To Decide

The value of a decision is no greater than the quality of the analysis.

Compare all solutions;

cost, feasibility, efficiency, etc.

Choose

Establish measurable objectives

E

D

A

M


To Act

Communicate operators, other employees from the areaother people servicing the area

Implement decisions

Control their execution

E

D

A

M


To Measure

Compare the results in relation to the objectives.

Resume EDAM

E

D

A

M


Become familiar with the Mandate

Draft the plan of attack Current situationDesired situation

Complete the observations

Current situation

•Matrix

•Setups video

•Etc...


Implement one-piece flow

Analyze

•Identify the products•Identify the customers•Understand and describe the Processes

–part/process matrix–Flow diagram–analysis of the Process Flow–Spaghetti diagrams–TAKT time


Introduction

Wastes elimination

Kaizen Methodology






Complimentary Continuous Improvement Approaches

Kaizen

6 Sigma Lean Site


Categoryof Waste

Type ofWaste

WasteReductionApproach

Methods Focus Points PrincipleWorksheets

DesiredResults

People

Processing

Motion

Waiting

WorkplaceManagement

Standard Work

WorkplaceOrganization

Kaizen

Layout Labeling Tools/parts

arrangement Work Instructions Efficiency Skills training TAKT time Shift meetings

cell/area teams Visual displays

Standard Work Sheet(SWS)

Time ObservationForm

Standard WorkCombination Sheet

(SWCS) Work Load Balancing

Sheet (WLBS) Work Load Balancing

Sheet Kaizen Target Sheet Kaizen Action Sheet

Highefficiencyand outputwork areasthat are safe

QuantityInventory

Making toomuch

Movingthings

Just in Time

Kanban

Leveling

SMED

PreventiveMaintenance

Work balance WIP location &

amount Kanban types Lot sizes Changeover analysis TPM analysis

SWS SWCS WLBS Kanbans Production Capacity

by Process TPM Scheduling

Sheet

What YouNeed

When YouNeed It

Quality

Fixing defects ErrorProofing

Detection

Warning

Prediction

Prevention

Automatedassistance

Fixturemodifications

Successive checks Photocells,

templates, etc. Cross training

SWCS Error Proofing Action

Sheet Error Proofing “To

Do” List Skills Training Matrix

DesiredQuality

Performance Excellence Manufacturing


Sales per employeeincreased 155%

Labor costsreduced 75%

100% of hourlyemployees on selfdirected workteams

Inventory reducedby 70%

515 Inventoryturns per year

100% customerretention rate

Annual laborturnover less than1%

1% workerabsentee rate

ROA increased to55%

Productivityincreased by 208%

Worker developedHR policies

0.4 Lost workdayrate per 100employees

On-time or freedelivery guarantee

Scrap and reworkdecreased by 65%

Warranty costs of0.36 percent ofsales

1997 Plant of the Year

Industry Week


Introduction

Wastes elimination

Kaizen Methodology






Kaizen/CPI

A STRATEGY FOR PERFORMANCE

EXCELLENCE

Kaizen Project: Corporate Quality

ISO Hardcopy Procedures Elimination

an Office Process Improvement Example


Kaizen Project: ISO Hardcopy Procedures Eliminationan Office Process Example

Background: ISO Policy and Procedures are currently on the company web site. Hardcopy sets of policy and procedures are also mailed to 95 remote facilities and distributed to 40 locations within Corporate Headquarters.

Kaizen Project:

Eliminate hardcopy distribution of policy and procedure manuals for all corporate headquarters locations and all other facilities having company web site access.


Current Process:

1. Outside vendor prints 135 sets of ISO Policy & Procedures manuals: $3,000

2. 95 sets of manuals mailed (Fed Ex) to facilities beyond Corporate Headquarters. $18 /set x 95 sets = 1,710

$4,710

updated and distributed twice per year x 2$9,420


Kaizen Project: ISO Hardcopy Procedures Elimination

Action Plan:

1. Survey all corporate facilities to determine those having Web site access. (1/7/00)

2. Remove from hardcopy distribution list those facilities having web site access. (1/10/00)

3. E-mail bulletin all facilities having web site access of discontinuance of hardcopy manuals distribution, and to use web site instead. (prior to planned March, 2000 distribution)


Improved Process:

1. Outside vendor prints 40 sets of ISO Policy & Procedures manuals: $889 (for facilities not able to access web site procedures and eight extra sets)

2. 32 sets of manuals mailed (Fed Ex) to facilities beyond Corporate Headquarters. $18 /set x 32 sets = 576

$1,465 updated twice per year x 2 = $2,930

(current cost) $9, 420 - (improved cost) $2,930

Kaizen project annual cost savings: = $6,490


Kaizen Project: ISO Hardcopy Procedures EliminationOngoing Continuous Improvement

Action Plan:

1. Establish timetable for implementation of website access for facilities not presently able to view electronic procedures. (TBD)

2. Remove from hardcopy distribution list these facilities once web site access is established. (TBD)

3. E-mail bulletin latest facilities having web site access of discontinuance of hardcopy manuals distribution, and to use web site instead. (TBD)


Kaizen/CPI

A STRATEGY FOR PERFORMANCE

EXCELLENCE

Kaizen Project:

Color Key - Optimize Press Capability

a Shopfloor Process Improvement example


Color Key - Optimize Press CapabilityDec. 6 - 10, 1999

Team members: Herkie Hill (Team Leader) Derick Fultz (Sub- team leader) Lee Salsberry Carolyn Oliver Phylis Dancy Marvin Bell Lueontine Smith John Whittington Dave Hensley (Consultant) Hosea Foster

Objectives: Reduce WIP by 70% Improve throughput by 40% Reduce backlog by 50% Reduce leadtime by 5 days Identify (5) 5S improvements Train operators on all shifts Work hard and have fun


Kaizen Project: Color Key Press Optimization

a Manufacturing Process Example

Background

Color Key area currently has 14 days of WIP in front of the 4 press operations. The presses are operated on 3 shifts, 5 days per week. The lead time for these products is approximately 4 weeks.

Kaizen Project

Optimize press capability and reduce lead time by 5 days.


Current Process of S. Tai Press:

1. Current production average = 118 pcs/hr for a cost of .09 cents per piece

2. Total cost anualized per customer demand = $129,168

Gross Vs Realization Capacity AnalysisS. Tai Dec 99

66

15

60

90

990

210Tool ChangeClean UpBreaksLunchRun TimeUnaccounted Time



1. Improve set up reduction techniques

2. Introduce short cycle scheduling with 2 day window

3. Locate production management board by press

4. Organize WIP by tube size

Action plan:


SET UP TIMESMachine: S. Tai Start Date: 12/8

Target: 25 % Improvement

1211:38

27% Improvement

Min

ute

s

adjustment

8:308

8:23 adjustment

5:044

remove

& install

tooling

established external check list

& created tooling cart for preset up

1 2

Observation Number

remove

& install

tooling


Improved Process of S. Tai Press:

1. Improved production average = 179 pcs/hr for a cost of .06 cents per piece

2. Total anualized per customer demand = $86,112

WIP reduced .5 dayKaizen Project annual cost savings : = $43,056

S. TAI Realization Capacity AnalysisJan 0024

15

60

90

1119

132Tool ChangeClean UpBreaksLunchRun TimeUnaccounted Time



Ongoing Continuous Improvement

Action Plan:

1. Create daily review panel of pacer board to help resolve daily problems in a timely manner. Include maintenance, planning, supervisors and KPO. (1/24)

2. Install 2nd counter on press to help maintain daily output numbers. (12/31)

3. Locate rack near press to organize parts by tube size. (1/14)

4. Add yellow and red lights to press for visual notice of downtime. (12/14)

5. Design & implement 3 move die exchange. (1/31)


A Key Strategy In Pursuit Of World Class Performance

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Kaizen - Strategy for performance excellence

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