Productivity
depends on both
"Lean" thinking and Quality
Customers demand products / services that are
Better,
Cheaper,
Faster.
This requires harmony between the design of the product / service and the processes used to
produce / provide them. Processes must accommodate the variety of products / services that
customers want -- easily and cost effectively. "Lean thinking" must be used to ensure that value is
added in each step of the process. High quality is needed to avoid the wasted time and effort of
rework. Cycle Time needs to be minimized to meet delivery requirements and minimize
inventory.
The following discussion of Lean Thinking and productivity uses manufacturing termminology
because the techniques originated there. However, the concepts are applicable to all processes
Manufacturing
Service
Administrative
Lean Thinking
Production management focuses on optimizing the use of resources -- people and equipment. F.
W. Taylor developed "scientific management" at the turn of the 20th century. Activities were
broken down into their smallest individual steps. The physical actions (motions) for each step
were analyzed and modified to minimize production time. Unnecessary steps were eliminated.
Henry Ford developed the assembly line to enable mass production and, thus, lower costs.
Taylor's methods were used to simplify assembly -- eliminating wasted human effort.
Standardization of parts and processes (for example, all Model T's were painted black) increased
efficiency and reduced waste -- harmony of design and production. Ford also worked steadfastly
to minimize cycle time. It took only 48 hours to convert iron ore into an engine and install it in an
automobile.
The 1973 oil embargo dramatized the effectiveness of the Toyota Production System (lean
production). Producing quality product only as needed and then in the shortest possible cycle time
led to tremendous savings in labor, materials, and inventory. Some key elements of lean
production are:
Continuous, paced flow
Flexible workforce
Small lot size
Pull system -- Just-In-Time (JIT)
Autonomous defect control.
Cycle time reduction
Organization
Orders must flow through production as efficiently as
possible. Orders should flow continuously (Just In Time --
JIT) with queues between work stations as small as possible. Cells, like the U-shaped work area
at the right, allow a single worker to operate several machines or do several operations.
Maintaining a rhythm in operations (cell and otherwise) leads to better over-all efficiency. This
may be referred to as line balancing or takt time (in German). The workforce is cross-trained to
allow flexibility in cell operation and scheduling.
The 5 S's (Japanese words) are used to outline improvement actions workers / teams can apply in
their work area. Translated these are:
seiri -- straighten up
seiton -- put things in order
seiso -- clean up
seiketsu -- personal cleanliness
shitsuke --- discipline
Pull System -- Kanban
Work is "pulled" through production rather than "pushed." Final assembly (or final operations) is
scheduled to meet customer delivery requirements. The operations just before final assembly
(operations) are scheduled to meet the final assembly schedule, and so on back to the start of
production. This is in contrast to starting jobs into production when orders are received or
materials are received, and then trying to adjust schedules through production to maintain
manpower and equipment productivity while meeting shipping requirements.
When designs and production volumes permit, Kanban systems are used. Storage space for
standard components is limited to a number of standard containers. When a container is
withdrawn for use in the next operation, an order is automatically generated to make another
container of components. This "pulls" production orders through the system and eliminates a lot
of expediting.
Eliminate Waste
Every step in production must add value -- in materials and in productive labor effort. Scrap
wastes labor and materials. Non-value-added steps must also be eliminated -- especially in
administrative activities. Catching quality problems as early as possible eliminates the wasted
effort spent on defective materials.
Autonomous defect control is used to stop production when a defect is found so that the problem
can be corrected before additional effort and materials are wasted. Autonomous defect control
may utilize
self-inspection,
poka-yoke (mistake-proofing), and / or
visual control systems
to attain six sigma quality levels.
Cycle Time Reduction
Fast (low) cycle times allows customer orders to be shipped quickly Less money needs to be
invested in inventory on the shop floor and in the warehouse. If inventories are low, there is less
opportunity for product becoming obsolete before it is shipped. In that case, it is usually scrapped
-- waste -- or sold at fire-sale prices -- lost revenue. Low Work-in-Progress inventory (WIP)
means there is less potential scrap if defective parts are discovered after additional operations are
complete.
In small batch operations and administrative processes, it is frequently easier to quantify cycle
time accurately than it is to measure defects. Focusing process improvement activities on
reducing cycle time (eliminating the defects that cause unnecessarily long cycle times) will
usually achieve better results faster than focusing on defects alone.
Set-up / Change-over
Time spent in preparing to do a different operation (set-up) is non-value-added time. The
customer doesn't want to and generally doesn't pay for it. The Japanese initially focused on the
notoriously inefficient changing of dies on large presses. The goal of SMED was Single Minute
Exchange of Dies. Today, the goal is to be able to change-over from doing one activity to another
with as little wasted effort as possible. This allows lot sizes to be reduced (perhaps even to 1) so
that the cost to produce custom orders in small lots is low -- mass customization. Efficient design
strategies contribute heavily to competitive advantage.
Total Productive Maintenance (TPM) is particularly useful in focusing on the utilization of
equipment including set-up / change-over and quality.
Supply Management
Many businesses have obtained sizeable cost savings through out-sourcing. Since suppliers now
represent the largest costs of most manufacturers and assemblers, it is essential that the delivery
and quality of suppliers be actively managed. JIT deliveries of defect-free components are
required. Many companies have supplier certification programs -- based on ISO9000 / QS9000
requirements, proof of high quality processes, and a history of providing virtually defect-free
materials -- that eliminate incoming inspection. The participation of suppliers in the development
of new products and improvement of existing products results in greater quality improvements
and cost savings.
Design for Manufacturability -- DFM
Design for Manufacturability (DFM) is a key enabler of lean production. The design of a product
and the processes used to produce it must be analyzed simultaneously in order to optimize
quality and reliability,
materials and equipment usage,
process cycle times,
production scheduling, and
in-process inventory.
The objective is to reduce defects to the six sigma quality level, minimize cycle time, and
minimize inventory. Actions include manufacturing process analysis and assembly process
analysis, which is frequently referred to as Design for Assembly (DFA).
Design for Assembly -- DFA
Final assembly (or the final steps of any process) are where unresolved quality issues can no
longer be avoided. Everything must fit together and work as it should or the product cannot ship
or the service cannot be completed. The more things that must come together, the more
opportunity for problems. Consequently, the emphasis is design should be to minimize the
number of parts and process steps -- fewer opportunities for error. Six Sigma reinforces this view.
Combining parts allows a reduction in the number of CTQs (Critical-To-Quality characteristics).
Traditional design for assembly focuses on
reducing the number of parts on the basis
that one part is cheaper than two. This can
be especially true when the indirect costs
of maintaining part drawings, bills of
material, purchasing, etc. The extensive
use of plastics has led to a significant
reduction of parts in a wide variety of
consumer goods. Using the same
components in a variety of product models
further reduces costs and increases
reliability and serviceability.
