01 History Of Manufacturing Systems And Lean Thinking.ppt

manufacture

1. LEAN THINKING
www.yalinenstitu.org.tr

2. •Introduction
•A Brief History of Manufacturing
Systems
•Mass Production
•Lean Thinking

3. INTRODUCTION

4. PROBLEMS
No more
space for
inventories
Decreasing
profit
margins
High
costs
Defective products,
customer returns
Insufficient
sales
Competition
Backorders
Equipment
breakdowns

5. What Should Be Done?
What were the ideal systems in the industrial evolution ?
Which one is
the ideal
system?
Which is the
way to the
ideal
system?

6. A BRIEF HISTORY OF
MANUFACTURING
SYSTEMS

7. A BRIEF HISTORY OF
MANUFACTURING SYSTEMS
•CRAFT PRODUCTION
–By using handtools
–Non-repetitive ( one-off, unique )
–Customer and product focused
•INDUSTRIAL REVOLUTION
–Steam energy - machines
–Process oriented layout, general purpose machines
–Repetitive products
–Inter-changeable parts (maintenance and repair are
economic ) – “Factory System/American System”
–More production / unit time

8. A BRIEF HISTORY OF
MANUFACTURING SYSTEMS
•MASS PRODUCTION
–Pioneered by Henry Ford, mass production
adds the following to the industrial revolution
era’s principles :
•Standard products and operational
efficiency
•Flow ( Usage of conveyors at final
assembly )
•Economies of Scale

9. A BRIEF HISTORY OF
MANUFACTURING SYSTEMS
•MASS PRODUCTION
•Special purpose machinery ( product specific )
•Go - No go gauges
•More precise parts for easy assembly
–Problems with the Ford System
•Lack of ability to provide product variety
•Lack of model changeover ability because nearly
all machines are focused on producing one
specific part.
•Customers’ demand for a product life cycle less
than 19 years ( Model-T ).

10. A BRIEF HISTORY OF
MANUFACTURING SYSTEMS
•MASS PRODUCTION
–The Case For Others
•To supply for customers’ product variety demands
•Therefore process focused manufacturing
systems – ( long throughput/lead time )
•Bigger and faster machines that reduce costs per
process step
•As a result of this longer throughput/lead time and
much larger inventories
•Sophisticated MIS requirements due to long
delays between processes and complex product
routings.
•Necessity to use MRP systems.

11. A BRIEF HISTORY OF
MANUFACTURING SYSTEMS
•LEAN MANUFACTURING
–TOYOTA – JAPAN
•Mentality of avoiding waste due to hard
times
•Flexibility imposed by small scale market
•Global competition and regulations

12. -1880 Local Markets Craft Mfg.
1880 – 1920 National Market Mass Production
1920 – 1960 International Trade Economies of
and Market Sharing scale
MANUFACTURER DOMINATION
PERIOD

13. CUSTOMER DOMINATION
PERIOD
1960 - 1980 Saturated Markets Marketing
1980 – Global Competition Presenting Value
to the
Customer

14. MASS PRODUCTION
SYSTEM

15. “As farmers became obsessed with
batch production ( harvesting once a year )
and inventories ( grain silos ) ,
they drove the hunters’ wisdom of doing
things one by one to extinction”
Taiichi Ohno
MASS PRODUCTION

16. Basic Characteristics of Mass
Production
•Production lot sizes as big as possible
•Layout according to Machine type
•Long changeover times
•Holding safety inventory for production problems
•Detailed work division
•Single-skilled workers
•Control based quality
•Management based on central planning
•Production planning based on sales forecasts
•Point efficiencies
•Priority of capacity utilization

17. Process 2
WITH SMALLER LOTS
Process 1
Process 2
ABAB
A+B
ABAB
A+BA+BA+B
Mass Production
A B
A+B
Process 1
B
B
B B
B
B

18. Problems With Mass Production
•Long delivery times
•Weakness in responding to customer demands
•Increase in inventories
•Decrease in quality
•Increase in non value adding activities
•Work becoming more complex everyday
•Increasing hierarchy and bureaucracy
•Additional costs
•Difficulty in adapting to variations
•Long term planning necessity
•More capital reqirement

19. Inventory level
downtime
supply /
material
flow
labor
forceplanning
set-up
defects
/ rework
capacity
Mass Production

20. Source of Problems
Continuing the habit of producing the
maximum number of standart products
and emphasizing the importance of
capacity utilization as a principal of
MASS PRODUCTION
of the Manufacturer Domination Period!

21. Mass Procution works when :
–Product or process technology is superior
•Lucent Technologies
–The company is the leader in a growing
sector
•IBM during the 80’s
–There is no Lean Competitors
•GM and Ford before Toyota
Mass Production

22. LEAN THINKING
WASTE

23. What is “Lean ”?
•“Lean : The part of
meat that consists
principally of lean
muscle

(
fat-free)

•Lean Thinking is an approach that Lean Thinking is an approach that
aims to get rid of all the wastes aims to get rid of all the wastes
(fats) that bring a burden to the (fats) that bring a burden to the
system.system.

24. Lean Thinking
•Presenting the customer the perfect
value
–In terms of price, quality, delivery,
conformity with the changing demands
•Value creating processes
–design (concept to launch)
–production (order to delivery)
–service (during product life cycle)
•Waste-free lean processes

25. •In MIT ,
•Between the years 1985-1990,
•By spending 5 million US Dollars
•With the leadership of James P. Womack,
Daniel T. Jones, Daniel Roos
•Global benchmark study about the
Automotive Industry in the areas of:
–Product development
–Supply chain management
–Manufacturing operations
–Customer relations
CONCLUSION: Japanese manufacturers are CONCLUSION: Japanese manufacturers are
far ahead in every aspectfar ahead in every aspect
International Motor Vehicles Programme

26. IMVP Research - 1989
Japanese in
Japan
Japanese in
North
America
American in
North
America
All Europe
Productivity ( hours / veh. ) 16,8 21,2 25,1 36,2
Quality (assembly defects/100 veh.) 60 65 82,3 97
Space (sq.ft/vehicle/year) 5,7 9,1 7,8 7,8
Size of Repair Area (as % of assy space) 4,1 4,9 12,9 14,4
Inventories (days for 8 sample parts) 0,2 1,6 2,9 2
Automation
Welding % 86 85 76 77
Painting % 55 41 34 38
Assembly % 1,7 1,1 1,2 3,1
Work Force
% of Work Force in Teams 69 71 17 0,6
Job Rotation ( 0 = none, 4 = frequent ) 3 2,7 0,9 1,9
Suggestions / Employee 61,9 1,4 0,4 0,4
Number of Job Classes 11,9 8,7 67,1 14,8
Training of New Production Workers (hours)380 370 46 173
Summary of Assembly Plant Characteristics, Volume Producers, 1989
( Averages for Plants in Each Region )

27. IMVP Research - 1989
Japanese
Producers
American
Producers
European
Volume
Producers
European
Specialist
Producers
Avg. Engineering Hours per New
Car ( millions ) 1,7 3,1 2,9 3,1
Avg. Development Time per New
Car ( in months ) 46 60 57 60
Supplier Share of Engineering 51% 14% 37% 32%
Die Development Time ( months ) 14 25 28
Prototype Lead Time ( months ) 6 12 11
Time from Production Start to First
Sale ( months ) 1 4 2
Return to Normal Productivity After
New Model ( months ) 4 5 12
Return to Normal Quality After New
Model ( months ) 1,4 11 12

28. The Machine That Changed The WorldThe Machine That Changed The World
Published inPublished in 19901990
Over 5Over 500.000 00.000 sold in more than 11 sold in more than 11
languageslanguages
- James P. Womack- James P. Womack
- Daniel T. Jones- Daniel T. Jones
- Daniel Roos- Daniel Roos
The Machine That Changed The
World

29. •Between 1992-1996,
•50 Companies of different sizes, of different
ages ( old-new ), and active in different sectors,
from The USA, England, Germany and Japan
have been examined. Sales over 300.000
( English )
Lean ThinkingLean Thinking
–Published in 1996
–James P. Womack
–Daniel T. Jones
“Lean Enterprise” Project

30. General Motors Framingham, USA versus Toyota Takaoka, JAPAN
versus NUMMI Fremont, USA 1987
Assembly Hours per Car
Assembly Defects per 100 Cars
Assembly Space per Car
Inventories of Parts ( Average )
Space used for Rework
Absenteeism
16
45
0,45
2 hours
none
none
31
130
0,75
2 weeks
15%
15%
General
Motors
Toyota
19
45
0,65
2 days
7%
1,5%
NUMMI
Source : IMVP World Assembly Plant Survey, 1989
NUMMI PLANT IS A JOINT VENTURE BETWEEN GENERAL MOTORS and
TOYOTA. NUMMI IS BEING MANAGED BY JAPANESE MANAGERS and
OPERATED BY AMERICAN WORKERS IN THE USA.
Universality

31. The GOAL
As competition increases getting Lean is
compulsory
•Producing only the products demanded by
the customer
•At the exact time the customer demands
•By consuming less resources
•And focusing on the activities that create
value for the customer
FROM MASS PRODUCTIONFROM MASS PRODUCTION
LEAN MANUFACTURINGLEAN MANUFACTURING
TOTO

32. Basic Principals of Lean
Thinking
Value
Value Stream
Flow
Pull
Perfection

33. Benefit presented to the customer
1 .Value
•Lean thinking originates from “ value”
•Value is created by the producer
•Value can only be defined by the customer
Value is :
•Product and/or service with definite specifications,
•for which the customer is ready to pay for,
•and that meets the customer’s requirements in a given
period of time,
•with a definite price.
Definition of Value

34. Unavoidable
waste
( Incidental
work )
Value adding
work
Waste
( Muda )
ELIMINATE
DECREASE
Value and Waste
33 Types of ActivitiesTypes of Activities
in a Value Streamin a Value Stream: :
•Value Adding
–Transformation of raw material
to product according to the customers’
demands
•Necessary Non-Value Adding
–Die change, adjustment, get/drop tool
•Non-Value Adding
–waiting, counting, sorting, defect, rework

35. “7 big sins”
Wastes
•Defects in product
•Overproduction
•Inventories
•Unnecessary motion of people
•Excessive transportation of material
•Waiting people, machines and products
•Inappropriate processing

36. The Causes of Waste
•Insufficient working methods
•Long changeovers
•Insufficient processes
•Lack of training
•Insufficient maintenance
•Long distances
•Lack of leadership

37. Represents the 3 critical management tasks a
specific product ( goods and / or services )
should pass through :
2 .Value Stream
•Problem Solving : Starting with concept, continuing
with detailed design and engineering and ending with
the launch of production
•Information Management : Starting with order,
continuing with detailed scheduling and ending with
delivery to the customer
•Physical Transformation : Starting with raw material,
continuing with production and ending with the
realization of the final product.

38. process
Lots of companies
One Plant
process process process
2 .Value Stream

39. R & D Planning Production DistributionSales
R & D Planning Production
DistributionSales
Lead Time
Model

40. BOKSİT
MADENİ
Haddehane
Eritme ocağı
Sıcak çekme
Soğuk çekme
Kutu imalatı
MISIR
TARLASI
Mısır stokları
Karamel tesisi
Karamel deposu
Esans tesisi
PANCAR
TARLASI
Pancar deposu
Şeker fabrikası
Şeker deposu
KÖKNAR
ORMANI
Kağıt
sanayi
Karton
fabrikası
Karton
deposu
DOLUM
Dağıtım deposuMağazaEv
Avustralya
Norveç
Almanya
İsveç
İngiltere
İngiltere
Value Stream- Canned Coke
Total Time : 319
days
Total Process
time : 3 hours
Tesco - England
BEET FIELD
BEET
WAREHOUSE
SUGAR
FACTORY
SUGAR
WAREHOUSE
CORN
FIELD
CORN
INVENTORY
CARAMEL
PLANT
CARAMEL
INVENTORY
EXTRACT
PLANT
BOXITE
MINE
Australia
ROLLING MILL
Norway
MELTING
PLANT
HOT
EXTRUSION
COLD
EXTRUSION
Germany
Sweden
CAN
PRODUCTION
FIR TREE
FOREST
PAPER
INDUSTRY
CARTOON
FACTORY
CARTOON
WAREHO-
USE
BOTTLING
FACTORY
England
DISTRIBUTION
WAREHOUSE
England
SHOPPING
CENTER
HOME

41. In Plant Value Stream
MÜŞTERİTEDARİKÇİ
Sipariş
emri
Sipariş
emri
PROSES
1
PROSES
1
PROSES
1
Production programme
PLANLAMA
MRP
minutesminutes
weeksweeks
SUPPLIER
ORDER
PLANNING
ORDER
CUSTOMER
PROCESS PROCESS PROCESS

42. Lead Time
design production delivery
The GOAL
Value Adding Activity Waste (Muda)
To Decrease Lead timeTo Decrease Lead time
To Increase Value Added Time %To Increase Value Added Time %

43. The GOAL
•Financial gains by freeing up resources
•Producing according to real demand instead of forecasts
•Providing customer satisfaction
•Providing traceability of quality
•Reducing unnecessary part inventories
•Reducing the risk of being outdated
•Reducing fluctuation due to promotions
When we decrease the lead time by eliminating
wastes:

44. Manufacturing Lead time
99 % 1%
A typical manufacturing company
Time
Time
90 % 10 %
Lean Manufacturing Approach
Value Added
Waste (Muda)
99.5 % 0.5 %
Improvement results with traditional methods
Time

45. Produce one - deliver one without waiting
3 .Continous Flow
•By performing the real value creating steps
consecutively, transform the raw material
into a product and deliver it to the end user
•Perfect every step (KAIZEN)
–capable – right every time (6 SIGMA)
–available – always available (TPM)
–appropriate – flexible and at the desired scale
( LEAN )

46. Batch and Push Manufacturing
Lead Time : for the whole lot 30 ++ minutes
Process A: 10 minutes Process B: 10 minutes Process C: 10 minutes
One Piece Flow
B
B B B
B
All processes are 1 minute, 3 consecutive processes and lot size ( batch ) of 10
BB
B
B CC
C C
B C
3 min. 12 min.
Continous Flow
“produce one,
deliver one”
Lead Time: 12 minutes

47. Continous Flow
•Ford, 1913, model T
–Continous flow at the final assembly
–Sequential layout of machines
–90% resource savings
–Same model for 19 years
•Today;
–Demand for small lots
–Continous flow for all products
–Adaptation to fluctuations in customer demand
–High product variability demanded by the
customer

48. Example : Mass Production
Material
Warehouse
Finished
Goods
Warehouse
Packaging Painted Parts Storage Touch up
Semi Finished Product Warehouse
Parts
Warehouse
Cut to
length
Lathe Welding
Semi
finished
product
assembly
Final
Assembly
Painting

49. Example : Flow Production
Product A CellIncom
ing
Parts
Ware
house
Finish
ed
Goods
Wareh
ouse
P
A
I
N
T
I
N
G
Space gained
for new
products
Gains :
50% decrease in workforce,
45% decrease in space
94% decrease in lead time
Product B Cell
Product C Cell
Product D Cell

50. All steps demand from the previous
4 .Pull
•Producing what the next process
(customer) demands, at the desired
quantity ( not more / not less ) and at the
desired time ( not before or later ) .
•Following all steps backwards starting from
the end customer’s demand
•A simple way to put production under
control

51. Pull System
CUSTOMER
I demand
one now
I need one
more
RAW MATERIAL
Value should flow, at the time,
for the products,
and at the speed,
demanded by the customer.
Here
you
are
Here
you
are
Here
you
are
Here
you
are
I need one
more
I need one
more

52. Benefits of Pull Systems
•Resources are only allocated to products that
are demanded
•No inventories are formed on the value chain
•Financial turnover ( cash flow ) speeds up
•Regulates the value stream according to the
customer
•Problems like ; Obsolete finished goods
inventory at hand; rework or scrapping of
products due to design changes; discount
campaigns for undemanded products, do not
arise.

53. ... What if a machine breaks down?
... What if there are defective parts among the products?
... What if the deliveries are late?
ALL STOP !!
Assembly
Tier 2 Supplier
Painting
Welding
Stamping
Tier 1 Supplier
Lean Flow
Main Distributor
Dealer

54. Current State
Future State
Perfection ( Ideal State )
Original State
Perfection

55. Principles of Lean Thinking - Summary
1 .VALUE : Specify value for the product
2 .VALUE STREAM : Identify the value stream
for every product family
3 .FLOW : Make the identified value flow
4 .PULL : Make the customer pull the value
5 .PERFECTION : Manage towards perfection.
To avoid focusing solely on the technics ,To avoid focusing solely on the technics ,
always repeat the principles !always repeat the principles !

56. Benefits
ParametersGains
Product Design Lead Time75% 
Manufacturing Lead time90% 
Productivity 100% 
Defects80% 
Inventories90% 
Area used50% 
Work Accidents50% 
New InvestmentsToo little

57. Gains
Reduction in scrap
and rework
Reduction in overtime
Increase in delivery
performance
Reduction in
inventories
Increase in present product
sales
Bringing outsourced
production in the plant
Adding extra value to the
products
Reduction in support
function department
costs
Improvement in
cash flow
Reduction in
manpower costs
New products
SHORT TERM MIDDLE TERM LONG TERM
New sales via better
service
Utilization of freed up
space
Reduction in
obsolete inventories

58. Lean Company Model
JIT JIDOKA
LEAN
MANUFACTURING
SYSTEM
LEAN LEADERSHIP
Lean Supply
Chain
Development
Lean
organization
and
processes
Respect for People and Mutual Trust

59. JIDOKA
ONE PIECE FLOW
LEAN MANUFACTURING TECHNIQUES
5 S
KAIZEN
KANBAN
JIT
POKA YOKE
TPM
SMED
SHOJINKA
DOE
QFD VA/VE
TAKT
VALUE STREAM MAPPING
HEIJUNKA
“The key to lean is in the thinking and not just in the tools”
James WOMACK

60. Paradigm shift
•Adequate quality
•Don’ let the production stop
•Everything’s all right
•GOAL: Production quantity
•Inventory is safety
•High volume low variety
•Functional responsibility
•Being unidirectional
•Hierarchial organization
•Zero defects
•Don’t let the breakdown
happen again
•Continous improvement
•GOAL: Customer satisfaction
•Inventory is waste
•Low volume high variety
•Value stream responsibility
•Being multidirectional
•Lean organization