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Engineering Management Learning to See Parts IV, V A Value Stream Mapping Workshop Mike Rother & John Shook Lean Enterprise Institute MSE507 Lean Manufacturing
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Engineering Management

Learning to See Parts IV, V A Value Stream Mapping Workshop

Mike Rother & John Shook Lean Enterprise Institute

MSE507 Lean Manufacturing

Value Stream Mapping Workshop Goals

l  To understand the complete value stream l  To introduce Value Stream Mapping (VSM) l  To draw a current state map

•  Learn the mapping concepts and icons l  To be able to design an improved value stream

•  Develop the ability to “see the flow” of a value stream l  To draw a future state map

•  Learn the mapping concepts and icons

Value Stream Mapping Topics

Topic Page •  Overview •  The Process (Steps 1-3) •  The Process (Step 4 Case Study) •  The Process (Step 5) •  The Process (Step 6) 4 •  The Process (Step 6 Acme Stamping Case Study) 35 •  The Process (Steps 7-9) 45 •  The Process (Step 10) 52 •  Conclusions 54

Value Stream Step 6 Draw the Future State Map

THE PURPOSE: l  Highlight sources of waste l  Eliminate them l  In a short period of time.

THE GOAL: To build a chain of production where the individual processes are linked to the customer(s) either by continuous flow (the best) or pull and each process gets as close as possible to producing only what the customer(s) need when they need it.

What can we do with what we have?

Value Stream Map - Current State

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

Competitive LT = 3 days

Takt Time = 18.2 min

Customer Data On-Time Delivery Demand = 45/day

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

Raw = 5 days

WIP = 12.1 days

FG = 6.5 days

Inventory

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

Touch Time = 89 min

Flow of Value Lead Time Lead Time = 23.6 days

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

CT (67) > Takt Time (18)

Constraints OTD, Lead Time Max Wip = 7.6 days

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

CO = 23 min

CO = Changeover

Setup Times OP Margin, Lead Time CO = 1 hour

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

Maintenance OTD, Lead Time Uptime = 70%

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

Quality FTY = 67%

Customer

Demand = 45 per day 2 shifts

Stamping

342

CT=1sec Co=1 hr. Uptime=85%

S. Weld # 1

CT=3 min Co=10 min. Uptime=70%

I

I

I I Coils

5 days

CT= 15 min Co=0 min. Uptime=100% 2 shifts

CT= 67 min Co= 23 min FTY = 67% 2 shifts

Shipping I I 81

202 122

Assembly Test

90

1X Daily

90/60/30 day Forecasts

Order Entry

Production Control

MRP

6 WEEK Forecast

Suppliers

WEEKLY SCHEDULE Lead Time - 34 Days

5 days

1 sec

7.6 days

3 min

1.8 days

15 min

2.7 days

67 min

4.5 days

4 min

2 days

Lead Time =23.6 days

1 shift 1 shift

CT= 4 min Co=0 Uptime=100% 2 shifts

Competitive Lead Time = 3 Days

Takt Time = 18.2 Minutes

Orders/day = 36

Queue = 1.5 Days

Touch Time = 89 min

What is the pitch time?

Flow of Value OTD, Lead Time Who is setting the pace?

The Office

l  Office functions support many shop floor value streams - purchasing, payroll

l  The rate of customer demand is often hard to “see” l  Inventory can be forms, paperwork, in-baskets, out-baskets,

voicemail, email l  Cycles of activity often are random - little standard work l  Confusion about who the customer is and what is value

The Office

HOWEVER, THE OBJECTIVE IS TO

ELIMINATE WASTE!

The Office Current State

l  Define boundaries of your value stream l  “There has to be a ‘product’ or ‘service’ to follow - like a

purchase order or payroll document - otherwise use a normal flowchart” (LEI)

The Office Current State

l  What capability do you provide? l  Is the demand stable?

•  If not, what is the range ? l  What is the customers expectation of performance?

Constructing Office Current State

l  Waiting should be recorded if there is no apparent ‘end’ takt time and the next process is far away

l  Use Cycle Time of customer process to understand total lead time

I

Outbox

1 Day

w

Waiting

1/2 Day at meeting

I

Inbox

1 Day

Constructing Office Current State

State Street Assembly Customer

Make notes where you see obvious Waste on the Map

Poor workplace Organization

Re-enter Data: Legacy System

Duplication: Many Signatures

Paper Form Rework: Incomplete Data

State Street Assembly Supplier

1 sales Rep

State Street Assembly Michigan Steel

Company Customer Customer

Central database

Engineering database

I

Outbox

2 files 1 Day

w

Waiting

1/2 Day at meeting

I

Inbox

2 files 1 Day

I

Outbox

3 files 1 Day

w

Waiting

1/2 Day Customer

I

Inbox

10 files 1 Day

I

Outbox

4 files 1 Day

w

Waiting

I

Inbox

2 files 1 Day

w

Waiting

1/2 Day Purchasing quote

I

Inbox

7 files 1 Day

Clarify 1 Day

I

Email / voicemail

W

Meeting 3 hours

4 Estimates .5 hours

Total 10 Days Total CT 8 hrs 20 min

60 min 3 hrs 20 min 4 hrs 10 min

.5 hr 3 hr 1 Day .5 Day 1 Day 1 Day .5 Day 1 Day .5 Day 1 Day 1 Day 1 Day 1 Day

Order Receipt

Manf. Eng.

Eng. Review

Quote Prep

BOM Validation

1 Sales Rep 1 Eng. 1 Eng. 1 sales Rep

Email Quote Design

Log file

Phone Clarification

Email -Clarification

EmailOrder Phone

Clarification

Phone Clarification

Constructing Office Current State

Product Family

Plan & Implementation

Current State Drawing

Future State Drawing

Value Stream Step 6 Draw the Future State Map

Designing a Lean Flow •  You always need a future state •  Use pencil, update regularly, 70%

correct is fine •  Basis for work plan - blueprint •  Begin by drawing a current state •  1st iteration assumes using existing

equipment, only minor purchases •  Use the list of future state questions

Value Stream Step 6 Future State Map - Icons

Value Stream Step 6 Future State Map – Question Summary

  What is the takt time?   Will we build to shipping or to a supermarket?   Where can we use continuous flow?   Where do we have to use supermarket pull systems?   At what single point in the production chain do we trigger

production?   What levels of work will we release and take away from the

pacemaker process?   How will we level the production mix at the pacemaker

process?   What supporting improvements will be necessary?

(e.g. uptime, set-up, training)

ACME Stamping Case Study

Value Stream Step 6 Future State Map – Acme Co. Example

First View of the Future-State map Showing

Takt Time, Weld/Assembly Cell, and the

Finished-Goods Supermarket

Value Stream Step 6 Acme Co. Future State – 1st View

Stamping

Takt=60 sec. C/T=56 sec.

C/O= 0 Uptime=100%l

2 shifts

Weld& Assy

LR Shipping

Staging

1X Daily

State St. Assembly

18,400 pcs/mo

-12,000 “L”

-6,400 “R” Tray=20 pcs.

2 Shifts

Notice that on this Future-State Map the four welding and assembly process boxes have been combined into one process box to indicate the continuous flow. A small sketch of a cell inside the process box also indicates the cellular manufacturing concept.

Value Stream Step 6 Acme Co. Future State – 2nd View

Second View of the Future-State Map

Showing Stamping and Raw Material

Supermarkets

Value Stream Step 6 Acme Co. Future State

Signal or Batch kanban

l  The stamping process needs to produce batches larger than 60 pieces.

l  A trigger point is set up in the stamping supermarket which includes changeover, replenishment delay and other stamping problems. In this case stamping will keep 1.5 days of parts in its supermarket

l  A signal Kanban is sent to the stamping process whenever the number of bins remaining drops to a trigger ( minimum ) level

Value Stream Step 6 Acme Co. Future State

What about Raw Material? l  To build a plant level value stream the Future State must also

show a third supermarket at the receiving dock which holds coils of steel

l  Acme can attach an internal withdrawal Kanban to each coil and send these Kanbans to their own production control department whenever another coil is used.

l  Production control can order coils based on their actual usage instead of a best guess determined by MRP

l  The cards are then returned to the receiving dock as a signal for shipments that are due.

l  Milk runs for daily deliveries should be considered at this point

Stamping

Takt=60 sec. C/T=56 sec.

C/O= 0 Uptime=100%l

2 shifts

Weld& Assy

LR Shipping

Staging

1X Daily

State St. Assembly

18,400 pcs/mo

-12,000 “L”

-6,400 “R” Tray=20 pcs.

2 Shifts

20

1.5 days

batch

bin

Coils

PRODUCTION CONTROL

State St. Assembly

6-WEEK Forecast

Daily Order

1X Daily

coil

coil

(at the press)

Value Stream Step 6 Acme Co. Future State – 2nd View

Value Stream Step 6 Acme Co. Future State – 3rd View

Third (Final) view of the Future State Map

Showing Load Leveling, Changeovers, and Timeline

l  The material handler pulls the Kanbans out of the leveling box one-by-one at the PITCH increment and moves trays of brackets from the finished goods supermarket to the staging area one-by- one according to the withdrawal Kanban.

Production Control

Daily Orders

bin bin

bin

OXOX WELD&ASSY

L R

bin Shipping

Staging

Load Leveling Box

Value Stream Step 6 Acme Co. Future State

Stamping

Takt=60 sec. C/T=56 sec.

C/O= 0 Uptime=100%l

2 shifts

Weld& Assy

LR Shipping

Staging

1X Daily

State St. Assembly

18,400 pcs/mo

-12,000 “L”

-6,400 “R” Tray=20 pcs.

2 Shifts

1.5 days

batch

bin

Coils

PRODUCTION CONTROL

State St. Assembly

6-WEEK Forecast

Daily Order

1X Daily

coil

coil

(at the press)

EPE= 1 shift. EPE <10 min..

changeover

Weld

changeover Welder

uptime

1 sec.

1.5 days

1 day

168 sec

2 days Production Lead-time= 4.5 days

Processing Time= 169sec

20

20

20

20

OXOX

Daily order

90/60/30 day Forecasts

Daily Order

Value Stream Step 6 Acme Co. Future State – Complete View

Value Stream Step 7 Generate a Value Stream Plan

l  Create the yearly Value Stream Plan l  Tie it to business objectives l  Relate the Future State Map to your layout l  What to do, by when, by whom

l  Fix the obvious l  Broken equipment, needed maintenance l  Purchase small tools, replace home-made fixtures

l  5S l  Break the implementation into steps

l  Break your future state into “loops” l  Each loop contains the flow up to and including a supermarket

Pacemaker Loop

Stamping Loop

Supplier Loop

Value Stream Step 7 Acme’s Value Stream Loops

Value Stream Step 7 Example Value Stream Plan

Value Stream Step 8 Start Making the Improvements

l  Make continuous Value Stream Improvement the responsibility of management

l  Don’t wait to get your future state map perfect l  The main point is ACHIEVING the future state

Value Stream Step 9 Conduct Value Stream Reviews

l  Make continuous Value Stream Improvement the responsibility of management

l  Conduct regular Value Stream Reviews while walking the floor l  Value Stream Manager and Plant Manager l  Focus on obstacles to implementation

Assy

Stamping

Coils Suggestions: - Review walking the flow - Concentrate on the problems

Value Stream Step 9 Example Value Stream Review

Value Stream Step 10 Repeat the Cycle

l  Keep working for perfection

What Can Be Achieved?

l  75% of wasted steps eliminated

l  Throughput time shrinks to less than 10% of current state time

l  Demand amplification is eliminated

l  Quality higher and consistent from start to finish

l  Transport links and information needs shrink dramatically

Concluding Comments

l  A future state can’t be implemented all at once l  Kaizen events help work towards the future state l  Value Stream Mapping:

l  Helps you visualise more than a single process level l  Links the material and information flows l  Provides a common language l  Provides a blueprint for implementation l  Can be more useful than quantitative tools l  Ties together lean concepts and techniques

Review of Goals and Expectations

l  To introduce Value Stream Mapping (VSM) l  To draw a current state map

l  Learn the mapping concepts and icons l  To be able to design an improved value stream

l  Develop the ability to “see the flow” of a value stream l  To draw a future state map

l  Learn the mapping concepts and icons


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