Lean Transformation with Value stream mapping

value stream mapping

1. ...1
Lean TransformationLean Transformation
Lean / Value Stream
Mapping Overview

2. ...2
AgendaAgenda
•Lean Principles
•Company Vision
•What is Value Stream Mapping
•Seven requirements of Lean
•Building Lean Organization

3. ...3
Roots of Lean ThinkingRoots of Lean Thinking
•Interchangeable parts: 1850’s
•Toyoda Weaving: 1902
•Ford: Highland Park: 1913
•GM: Mixed Model: 1930-1940
•Deming Influence: 1950’s
•Ohno: American Supermarkets: 1950’s
•Toyota Production System: 1945-1970-now
•Theory of Constraints: 1980’s
•“Lean”

4. ...4
Womack and JonesWomack and Jones
“Lean Thinking” 5 principles:“Lean Thinking” 5 principles:
1- Specify value
2- Map the flow of value
3- Make value flow
4- Pull from the customer
5- Seek perfection
Jim Womack and Dan Jones,
Lean Enterprise Institute, USA & England

5. ...5
VisionVision
Supply Chain Vision
(13 weeks)
Customer
Order Raw Material
Assembly
& Test
Procurement
Cycle
Order
Cycle
Current Supply Chain
(average in excess of 40 weeks)
Delivery
Cycle
Assembly
Cycle
ShippingManufacturing
FINL
A
FA B

6. ...6
VisionVision
Integration of control
systems
Material Flow StrategyMaterial Flow Strategy
Engine Core Build
Preparation
Test cell
Component Assembly
A Supply Chain delivering an
engine every shift

7. ...7
Point Efficiency vs System EfficiencyPoint Efficiency vs System Efficiency
Fast rower
How fast should we produce?

8. ...8
The TransformationThe Transformation
“It’s all about
Connecting
the Dots”

9. ...9
What is a Value Stream?What is a Value Stream?
All activities both value added and non-
value added required to bring product
from raw material to the customer
Value Stream
Customer
Producer
A
CUSTOMER
Raw
Material
Finished
Product
Producer
B
Producer
C
Warehouse
Assembly &
Text

10. ...10
What is Value Stream What is Value Stream
Mapping?Mapping?
Current State
Map
Future State
Map
Implementation
Plan
Product Family
Definition

11. ...11
Example of a Current State MapExample of a Current State Map
Customer
Raw Material
Supplier Production
Control
90/60/30
day forecasts
Daily
Order
6 Week
Forecast
Weekly Fax
Producer A
1
I2500 parts

I
1800 parts

I
Shipping
1500 parts
Weekly Schedule Daily
Schedule
30 days 35 days 5 days
5 hours 10 hours 20 hours
Leadtime
= 270 days
Processing
time = 35 hrs.
Producer B
1
Assembly
1
I
2500 parts
200 days
C/T = 46 sec.
C/O = 10 min.
Uptime = 80%
C/T = 46 sec.
C/O = 10 min.
Uptime = 80%
C/T = 46 sec.
C/O = 10 min.
Uptime = 80%

12. ...12
Set-up
Total Work
<30 hrs
Shipping
Part
Producer
Assy &
Test
Batch
Example of a Future State MapExample of a Future State Map
Daily
Schedule
Leadtime
= 47 days
Processing
time = 25 hrs.
Customer
Raw Material
Supplier Production
Control
90/60/30
day forecasts
Daily
Order
6 Week
Forecast
Weekly Fax
25 days 2 days
10 hrs 15 hrs
20 days

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Value Stream Mapping AdvantagesValue Stream Mapping Advantages
•Measures value from a customer’s perspective
•Focus is on lead time
•Shows a system view
•Links the material and information flows
•Enables the organization to identify waste
•Provides a roadmap for continuous improvement & change

14. ...15
Seven Requirements of LeanSeven Requirements of Lean
1- Takt time
2- Finished goods strategy
3- Continuous flow
4- Pull System
5- Schedule only one point
6- Pitch
7- Interval
(EPEI=Every Part Every Interval)

15. ...16
Requirement #1: Takt TimeRequirement #1: Takt Time
•Synchronizes the pace of production to the
pace of sales
•The rate of assembly based on customer
demand
TAKT Time =
Effective working time per shift
Customer demand per shift
460 minutes
460 pieces
= 1 min / partTAKT Time =

16. ...17
Requirement #2: Finished Goods StrategyRequirement #2: Finished Goods Strategy
•Build to Stock
–Best for mass production
–Standard product
•Build to Order
–More difficult to level load
–Custom product
–High value product coupled with uncertain demand
•Hybrid
–Aids level loading
–Run as a Build to Order system with inventory for peak loads
–High value or highly variable demand patterns

17. ...18
Requirement #3: Continuous FlowRequirement #3: Continuous Flow
Process
B
Process
A
Process
C
10 minutes
10 minutes
Batch & Queue Processing
Leadtime : 30+ minutes for total order
10 minutes
Process
A
Process
B
Process
C
One-Piece Flow
3 min.
Leadtime : 12 min.

18. ...19
Customer goes to supermarket and gets what they need when they need it
Supplier produces to replenish what was withdrawn
supermarket
supplying
process
customer
process
production
kanban
withdraw
kanban
withdrawn
product
new
product
Purpose: A way to control production
between flows without scheduling
Requirement #4: Pull SystemRequirement #4: Pull System

19. ...20
Requirement #5: Schedule Only One Point -Requirement #5: Schedule Only One Point -
What & WhenWhat & When
flow
Customer
Supermarket
Flow
Customer
FIFO FIFO
Pull

20. ...21
Requirement #6: PitchRequirement #6: Pitch
•Management timeframe: how often we find out and
can react to problems
•It is a takt image for the operators
Start
In
FIFO
KANBAN
Out
Finish
Strategy

21. ...22
Requirement #7: IntervalRequirement #7: Interval
(EPEI = Every Part Every Interval)(EPEI = Every Part Every Interval)
How long does it take to make
parts of every model?
HA
B
C
DE
F
G

22. ...23
Future State - What to expectFuture State - What to expect
Drumbeat Set the pace
Pitch Monitor flow of material
Reduce process inefficiencies
Flow / Pull / KanbanReduce inventory levels

23. ...24
Building the Lean OrganizationBuilding the Lean Organization
•Every one of us must realize that:
–the company is in business because of our customers
–the customers have choices
–those choices lay with our competition
–waste adds cost, time, and service interruption thus giving the
advantage to the competition

24. ...25
Supporting the Lean OrganizationSupporting the Lean Organization
•At every level…
–Understand what is important to the customer
–See the flow of value
–Recognize waste
–Solve problems that interrupt the flow of value
–Continuously improve the flow of value
–Continuously reduce variation to enable the achievement of lean
metrics

25. ...26
VSM Project Milestone - TypicalVSM Project Milestone - Typical
Week 1Week 2 Week 4 Week 5 Week 6
(4 - 9 months)
Management
awareness
Team
Training &
Workshop
Identify
VSM Expert &
Project Leader
Team members
& commitment
Present action
plan to Mgmt
Implement action
plan & monitor
progress

26. ...27
Driving…
•Customer Satisfaction
•Quality Improvement
•Inventory Reduction
•Leadtime Reduction
•Process Improvement
A Drumbeat ThroughoutA Drumbeat Throughout
the Value Chainthe Value Chain