Lean Manufacturing

CHAPTER 1 A BRIEF HISTORY OF LEAN MANUFACTURING

In 1900s U.S. manufacturers like Henry ford brought the concept of mass production. U.S. manufacturers have always searched for efficiency strategies that help reduce costs, improve output, establish competitive position, and increase market share. Early process oriented mass production manufacturing methods common before World War II shifted afterwards to the results-oriented, output-focused, production systems that control most of today's manufacturing businesses. Japanese manufacturers re-building after the Second World War were facing declining human, material, and financial resources. The problems they faced in manufacturing were vastly different from their Western counterparts. These circumstances led to the development of new, lower cost, manufacturing practices. Early Japanese leaders such as the Toyota Motor Company's Eiji Toyoda, Taiichi Ohno, and Shingeo Shingo developed a disciplined, processfocused production system now known as the "lean production." The objective of this system was to minimize the consumption of resources that added no value to a product. The "lean manufacturing" concept was popularized in American factories in large part by the Massachusetts Institute of Technology study of the movement from mass production toward production as described in The Machine That Changed the World, (Womack, Jones & Roos, 1990), which discussed the significant performance gap between Western and Japanese automotive industries. This book described the important elements accounting for superior performance as lean production. The term "lean" was used because Japanese business methods used less human effort, capital investment, floor space, materials, and time in all aspects of operations. The resulting competition among U.S. and Japanese automakers over the last 25 years has lead to the adoption of these principles within all U.S. manufacturing businesses. Now it has got global acceptance and is adopted by industries world over to keep up with the fast moving and competing industrial field.

Dept. of Mechanical Engineering 1

Lean Manufacturing

CHAPTER-2 WHAT IS LEAN MANUFACTURING?

Lean manufacturing is a manufacturing system and philosophy that was originally developed by Toyota, Japan and is now used by many manufacturers throughout the world. Lean Manufacturing can be defined as: "A systematic approach to identifying and eliminating waste (non-value-added activities) through continuous improvement by flowing the product at the pull of the customer in pursuit of perfection." The term lean manufacturing is a more generic term and refers to the general principles and further developments of becoming lean. The term lean is very apt because in lean manufacturing the emphasis is on cutting out FAT or wastes in manufacturing process. Waste is defined as anything that does not add any value to the product. It could be defined as anything the customer is not willing to pay for. Manufacturing philosophy is pivoted on designing a manufacturing system that perfectly blends together the fundamentals of minimizing costs and maximizing profit. These fundamentals are Man (labour), Materials and Machines (equipments) called the 3 Ms of manufacturing. A well-balanced 3M is resulted through lean manufacturing.

Dept. of Mechanical Engineering 2

Lean Manufacturing

CHAPTER-3 WASTES IN MANUFACTURING

The aim of Lean Manufacturing is the elimination of waste in every area of production including customer relations, product design, supplier networks, and factory management. Its goal is to incorporate less human effort, less inventory, less time to develop products, and less space to become highly responsive to customer demand while producing top quality products in the most efficient and economical manner possible. Essentially, a "waste" is anything that the customer is not willing to pay for. Typically the types of waste considered in a lean manufacturing system include:

3.1 Overproduction
To produce more than demanded or produce it before it is needed. It is visible as storage of material. It is the result of producing to speculative demand. Overproduction means making more than is required by the next process, making earlier than is required by the next process, or making faster than is required by the next process. Causes for overproduction waste include:

Just-in-case logic Misuse of automation Long process setup Unleveled scheduling Unbalanced work load Over engineered Redundant inspections

3.2 Waiting
For a machine to process should be eliminated. The principle is to maximize the utilization/efficiency of the worker instead of maximizing the utilization of the machines. Dept. of Mechanical Engineering 3

Lean Manufacturing Causes of waiting waste include:

Unbalanced work load Unplanned maintenance Long process set-up times Misuses of automation Upstream quality problems Unleveled scheduling

3.3 Inventory or Work in Process (WIP)

This is material between operations due to large lot production or processes with long cycle times. Causes of excess inventory include:

Protecting the company from inefficiencies and unexpected problems Product complexity Unleveled scheduling Poor market forecast Unbalanced workload Unreliable shipments by suppliers Misunderstood communications Reward systems

3.4 Processing waste

It should be minimized by asking why a specific processing step is needed and why a specific product is produced. All unnecessary processing steps should be eliminated. Causes for processing waste include:

Product changes without process changes Just-in-case logic

Dept. of Mechanical Engineering 4

Lean Manufacturing

True customer requirements undefined Over processing to accommodate downtime Lack of communications Redundant approvals Extra copies/excessive information

3.5 Transportation
This does not add any value to the product. Instead of improving the transportation, it should be minimized or eliminated (e.g. forming cells). Causes of transportation waste include:

Poor plant layout Poor understanding of the process flow for production Large batch sizes, long lead times, and large storage areas

3.6 Motion
Motion of the workers, machines, and transport (e.g. due to the inappropriate location of tools and parts) is waste. Instead of automating wasted motion, the operation itself should be improved.

Causes of motion waste include:

Poor people/machine effectiveness Inconsistent work methods Unfavorable facility or cell layout Poor workplace organization and housekeeping Extra "busy" movements while waiting

Dept. of Mechanical Engineering 5

Lean Manufacturing

3.7 Making defective products

This is pure waste. Prevent the occurrence of defects instead of finding and repairing defects. Causes of processing waste include:

Weak process control Poor quality Unbalanced inventory level Deficient planned maintenance Inadequate education/training/work instructions Product design Customer needs not understood

3.8 Underutilizing people

Not taking advantage of people's abilities. Causes of people waste include:

Old guard thinking, politics, the business culture Poor hiring practices Low or no investment in training Low pay, high turnover strategy Nearly every waste in the production process can fit into at least one of these

categories. Those that understand the concept deeply view waste as the singular enemy that greatly limits business performance and threatens prosperity unless it is relentlessly eliminated over time. Lean manufacturing is an approach that eliminates waste by reducing costs in the overall production process, in operations within that process, and in the utilization of production labor. The focus is on making the entire process flow, not the improvement of one or more individual operations.

Dept. of Mechanical Engineering 6

Lean Manufacturing

CHAPTER-4 ELEMENTS OF LEAN MANUFACTURING

Those concepts that lead to the implementation of lean manufacturing successfully are called elements of lean manufacturing. The basic elements of lean manufacturing are waste elimination, continuous improvement, pull system, one-piece workflow, cellular manufacturing and 5Ss. When these elements are focused in the areas of cost, quality and delivery, this forms the basis for a lean production system.

4.1 Elimination of waste

Waste is anything that doesnt add value to the product. Seeing whether the process is adding value to the product or not is the best way to identify wastes.

Is the activity adding value?

If YES Is this the best way to do it? If NO Can it be eliminated? If not, can it be reduced?

Out of the complete processes in an industry only about 5 % actually add value to the product. Rest of the process does not add any value. Rest 35% activities are such that even though this doesnt add any value but still it cannot be eliminated as it is necessary. For eg. Inventory cannot be completely reduced, scrap materials cannot be made zero, it may take few minutes to load unload and load for next operation etc. So focus should be on complete elimination of waste activities and reducing the necessary non-value adding activities

Dept. of Mechanical Engineering 7

Lean Manufacturing

4.2 continuous improvement

Japanese looked at improving their work every time they do it. This lead to the development of concept called continuous improvement. Japanese rather than maintaining the improvement they have achieved they concentrated in continuously improving their work. This improvement can be in any field like quality, error proofing, lead-time reduction etc. So the focus should be on how you can improve your work than the same done last time. Improvement is classified into innovations and kaizen. Innovations are those improvements which cause drastic changes. These occur due to huge technological advancements in the field of research and development. These are mostly done by high level engineers. Kaizen include small small improvements done by lower order employees. According to the level of employees the type of improvements each should focus are as shown below:

In order to achieve continuous improvement the work culture of the workers should be modified. The workers should be aimed at improving their work each time they do it.

4.3 Pull system

Dept. of Mechanical Engineering 8

Lean Manufacturing Manufacturing system can be divided into two 1) Push system Here the products are made according to the market forecast and not according to the current demand. So here the information flow is in the same direction as the product flow. So there may chance of piling of finished goods as there are always fluctuation in demand. Thus the product is pushed through the production line.

Information Flow
WIP Raw Process A Supplier Matl Fin. Goods WIP Process B

Process C
Customer

Part Flow

2)Pull system- Here the product is made according to the customer demand. So the information of the quantity and type of product flow in the opposite direction to that of the product. Here no piling of finished products occurs as the production is according to the customer demand. Hence the customer pulls the product through the production line.

Information Flow
Supplier Process A WIP Raw Matl

Process B

Process C

Fin. Goods Customer

Part Flow
4.4 One-piece flow
One piece flow is one of the important techniques in implementing lean manufacturing. Traditional batch production in mass production is replaced by one piece flow Dept. of Mechanical Engineering 9

Lean Manufacturing in lean manufacturing. Here batch size is reduced to almost one. This reduces the total lead time and also reduces waiting between operations or queuing. Following figures show how effective is one piece flow over batch production.

Batch & Queue Processing

Proces s Proces s Proces s C

10 minutes 10 minutes

10 minutes

Lead Time:

30+ minutes for total order 21+ minutes for first piece

One piece flow

Proces Proces Proces s s B s C

12 min. for total order 3 min. for first part

From the above example it is clear that the lead time can be reduced to almost 40% of the lead time when it was batch production. Also it can be noted that it takes about 85% less time for the first part to be produced. Thus product can be produced according to current demand quickly.

4.5 Cellular manufacturing

In traditional mass production machines are arranged according to its functions. But in cellular manufacturing machines are arranged according to the processes involved in Dept. of Mechanical Engineering 10

Lean Manufacturing production. The plants layout is designed in such a way that transportation between machineries is reduced to minimum. For the implementation of such a good plant layout deep knowledge of processes as well as proper analysis of processes involved in production is necessary. Following figures shows the diagrammatic representation of both forms of floor arrangement.

FUNCTIONAL

CELLS

CELL ADVANTAGES OVER FUNCTIONAL DEPARTMENT

1. Shorter Lead Time 2. Improved Quality - Quicker problem identification 3. Improved Quality - Less potential rework or scrap 4. Less Material Handling 5. Improved Coordination 6. Reduced Inventory 7. Departmental conflicts eliminated 8. Simplified Scheduling 9. Less Space Required

4.6 The 5 Ss
It is the Japanese method of keeping the work place clean and tidy. This helps in reducing many unnecessary movements. The 5Ss are:

Dept. of Mechanical Engineering 11

Lean Manufacturing Sort (Seiri) - Perform Sort Through and Sort Out, by placing a red tag on all unneeded items and moving them to a temporary holding area. Within a predetermined time the red tag items are disposed, sold, moved or given away. Set in Order (Seiton) - Identify the best location for remaining items, relocate out of place items, set inventory limits, and install temporary location indicators. Shine (Seiso) - Clean everything, inside and out. Standardize (Seiketsu) - Create the rules for maintaining and controlling the first 3Ss and use visual controls. Sustain (Shitsuke) - Ensure adherence to the 5S standards through communication, training, and self-discipline.

Dept. of Mechanical Engineering 12

Lean Manufacturing

CHAPTER-5 KEYS TO LEAN SUCCESS

Following are some considerations to successful lean implementation:

5.1 Prepare and motivate people

Widespread orientation to Continuous Improvement, quality, training and recruiting workers with appropriate skills Create common understanding of need to change to lean

5.2 Employee involvement

Push decision making and system development down to the "lowest levels" Trained and truly empowered people

5.3 Share information and manage expectations 5.4 Identify and empower champions, particularly operations managers

Remove roadblocks (i.e. people, layout, systems) Make it both directive yet empowering

5.5 Atmosphere of experimentation

Tolerating mistakes, patience, etc. Willingness to take risks

5.6 Installing "enlightened" and realistic performance measures, evaluation, and reward systems
Do away with rigid performance goals during implementation

Measure results and not number activities/events

Dept. of Mechanical Engineering 13

Lean Manufacturing

Tie improvements, long term, to key macro level performance targets (i.e. inventory turns, quality, delivery, overall cost reductions) After early wins in operations, extend across ENTIRE organization.

Dept. of Mechanical Engineering 14

Lean Manufacturing

CHAPTER-6 COMPARISON BETWEEN TRADITIONAL AND LEAN MANUFACTURING

For years manufacturers have created products in anticipation of having a market for them. Operations have traditionally been driven by sales forecasts and firms tended to stockpile inventories in case they were needed. A key difference in Lean Manufacturing is that it is based on the concept that production can and should be driven by real customer demand. Instead of producing what you hope to sell, Lean Manufacturing can produce what your customer wants with shorter lead times. Instead of pushing product to market, it's pulled there through a system that's set up to quickly respond to customer demand. Lean organizations are capable of producing high-quality products economically in lower volumes and bringing them to market faster than mass producers. A lean organization can make twice as much product with twice the quality and half the time and space, at half the cost, with a fraction of the normal work-in-process inventory. Lean management is about operating the most efficient and effective organization possible, with the least cost and zero waste.

6.1 OVERALL ORGANIZATIONAL CHARACTERISTICS:

TRADITIONAL MASS PRODUCTION Business Strategy LEAN PRODUCTION

Product-out strategy focused on Customer focused strategy focused on exploiting economies of scale of stable identifying and exploiting shifting product designs and non-unique competitive advantage. technologies Makes what engineers want in large quantities at statistically acceptable quality levels; dispose of unused inventory at sale prices Leadership by executive command Makes what customers want with zero defect, when they want it, and only in the quantities they order

Customer Satisfaction

Leadership

Leadership by vision and broad participation Flat structures that encourage initiative and encourage the flow of vital information that highlights defects, operator errors, equipment abnormalities, and organizational deficiencies.

Organization

Hierarchical structures that encourage following orders and discourage the flow of vital information that highlights defects, operator errors, equipment abnormalities, and organizational deficiencies.

Dept. of Mechanical Engineering 15

Lean Manufacturing
External Relations Information Management Based on price Information-weak management based on abstract reports Culture of loyalty and obedience, subculture of alienation and labor strife Based on long-term relationships Information-rich management based on visual control systems maintained by all employees Harmonious culture of involvement based on long-term development of human resources

Cultural

Production

Large-scale machines, Human-scale machines, cell-type layout, functional layout, minimal multi-skilling, one-piece flow, zero skills, long production runs, inventories massive inventories Dumb tools that assume an extreme division of labor, the following of orders, and no problem solving skills Maintenance by maintenance specialists Smart tools that assume standardized work, strength in problem identification, hypothesis generation, and experimentation Equipment management by production, maintenance and engineering

Operational capability

Maintenance

Engineering

"Isolated genius" model, Team-based model, with high input from with little input from customers and concurrent development of customers and little respect product and production process design for production realities.

6.2 MANUFACTURING METHODS:

TRADITIONAL MASS PRODUCTION Production schedules are based on Products manufactured to Production cycle times are Manufacturing lot size quantities are LEAN PRODUCTON

Forecast product is pushed Customer Order product is pulled through the facility through the facility Replenish finished goods inventory Weeks/months Fill customer orders (immediate shipments) Hours/days

Large, with large batches moving between operations; product is sent ahead of each operation

Small, and based on one-piece flow between operations

Dept. of Mechanical Engineering 16

Lean Manufacturing
Plant and equipment layout is Quality is assured Workers are typically assigned By department function By product flow, using cells or lines for product families 100% at the production source With one person handling several machines High has responsibility for identifying and implementing improvements Low small amounts between operations, ship often

Through lot sampling One person per machine

Worker empowerment is Low little input into how operation is performed Inventory levels are High large warehouse of finished goods, and central storeroom for in-process staging Low 6-9 turns pr year or less

Inventory turns are

High 20+ turns per year

Flexibility in changing manufacturing schedules is

Low difficult to handle and High easy to adjust to and implement adjust to

Manufacturing costs are Rising and difficult to control

Stable/decreasing and under control

Dept. of Mechanical Engineering 17

Lean Manufacturing

CHAPTER-7 BENEFITS OF LEAN MANUFACTURING

According to the study conducted in various industries world over the main benefits achieved by implementation of lean manufacturing is as shown below.

Lead Time Reduction Productivity Increase WIP Reduction Quality Improvement Space Utilization

Percentage of Benefits Achieved 25 50 75 100

(From ERC staff meeting, march 20,2002,Maryland University) Establishment and mastering of a lean production system would allow you to achieve the following benefits:
Lead

time is reduced by 90% is increased by 50%

Productivity Work

in process is reduced by 80% is improved by 80%

Quality Space

utilization is increased by 75%

These are areas in an establishment that directly affects its survival. There are many other benefits also which directly or indirectly affects the performance of the industry.

Dept. of Mechanical Engineering 18

Lean Manufacturing

OTHER BENEFITS

Reduced scrap and waste Reduced inventory costs Cross-trained employees Reduced cycle time Reduced obsolescence Lower space/facility requirements High quality & reliability Lower overall costs Self-directed work teams Lead time reduction Fast market response Longer machine life Improved customer communication Lower inventories Improved vendor support and quality Higher labor efficiency and quality Improved flexibility in reacting to changes Allows more strategic management focus Increased shipping and billing frequencies

However, by continually focusing on waste reduction, there are truly no ends to the benefits that can be achieved.

CHAPTER-8

Dept. of Mechanical Engineering 19

Lean Manufacturing

CASE STUDY
The company:
The Parker Hannifin Aircraft Wheel & Brake Division.

The product:
Designer and manufacturer of aerospace commercial and military wheel and brake systems.

The challenge:
To reduce high finished goods, spares components and work-in-process inventory levels and the need to reduce long engineering and manufacturing cycle times. The project objectives: 1. Reduce total Final Assembly (F-A) cycle time from 30 to 15 days. 2. Redesign F-A operations to: a. Integrate product-lines where feasible; b. Kit, build, pack & ship in one day; c. Optimize available floor space; d. Minimize operational transportation.

Measured results:
1. Implemented "one-piece flow" philosophy; a. Eliminated Build-to-Stock paradigm. b. Reduced F-A Cycle Time from 30 to 4 days. 2. Saved approximately 3,200 sq. ft. of floor space (40 percent of area); a. Integrated four product-lines into three; b. Reduced Transportation up to 30 percent.

This case study was provided by FlowCycle, Texas-based lean manufacturing consulting and training firm. (www.advancedmanufacturing.com)

Dept. of Mechanical Engineering 20

Lean Manufacturing

CHAPTER-9 CONCLUSION
LEAN can be said as adding value by eliminating waste being responsive to change, focusing on quality and enhancing the effectiveness of the work force. Although lean has its origin in the automobile industry it is being successfully used in other production industries. Lean manufacturing is now extended to fields like I.T, service etc in order to reduce production cost and meet changing customer needs. Since lean is completely customer oriented it is here to stay. It is also important as it emphasis customer satisfaction. Lean has made its way into curriculum of major universities around the world. In universities like MIT, Maryland university etc Lean manufacturing is included into the syllabus and it is given importance to new entrepreneurs. Many consulting firms are also functioning for proper guidance to those who are interested in lean. Lean manufacturing cannot be attained in one day or one week or one month or in a year. It needs lot of commitment and hard work. Also there is no end in lean manufacturing. The more you eliminate waste the more you become lean. That is why it is said that:

lean is a journey

Dept. of Mechanical Engineering 21

Lean Manufacturing

REFERENCES

1. Besterfield, Dale H.: Total quality management,

(Pearson education)
2. www.advancedmanufacturing.com 3. www.1000ventures.com 4. www.mamtc.com

Dept. of Mechanical Engineering 22