POM Project

Lean manufacturing — General Motors

Submitted by: Geetanjali Chhabra

Anurag Batra
Nancy Arora
Priyanka Singh Sengar
Prashanth Vijay

Submitted to: Ms. Priyadarshni Bakshi

Faculty: IILM, Gurgaon

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 Index

S. no Contents

1. Introduction

2. Lean manufacturing—Specifics

3. General Motors—Company
Overview
4. GM—Lean manufacturing

5. GM-- Examples OF Lean

manufacturing

6. Conclusion

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 INTRODUCTION TO LEAN

Lean principles come from Japanese Manufacturing Industry. The term was first
coined be John Krafcik in a fall 1988 article, “Triumph of The Lean Production
System”, published in the Sloan Management Review and based on his master’s
thesis at the MIT Sloan School of Management. Krafcik had been a quality engineer
in the Toyota-GM NUMMI joint venture in California before coming to MIT for MBA
studies.

The term “Lean” manufacturing was popularized by Womack and Jones in their
book “The Machine That Changed the World”. This book benchmarked
manufacturing companies were typically much more productive and efficient than
their Western counterparts.

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Lean is...

• Eliminating waste

• Reducing costs

• Shorter lead times

• Understanding what is important to your customer.

“Average people managing brilliant processes to achieve exceptional results.”

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 Definition of LEAN

“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.”

What are the LEAN tools??

 Muda (waste identification) - An activity that consumes resources and creates

no value.
 5S & Visual Workplace -A technique used to establish and maintain a safe,
orderly and clean workplace. The basis of a competitive environment
providing visual indicators and information in the work area and achieved
with 5S disciplines.
 Kaizen - Continuous, incremental improvement of an activity to eliminate
waste.
 Value Chain/Stream - The specific activities required to design, order, and
provide a specific product.
 Just-in-time - A system for producing and delivering the right items at the
right time in the right amount.
 Kanban -A system to regulate the pull of products by signalling upstream
production and delivery.
 Poka-yoke -A mistake-proofing device or process to prevent a defect
occurring during manufacture.
 Six Sigma – Provides an emphasis on statistical techniques to isolate and
quantify variations in process or product performance.
 Standard Work – Is a system for standardising the work procedures
developed through competitive manufacturing.

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JUST IN TIME

Objectives:

Produce only the products the customer wants. Produce products only at the rate
that the customer wants them, with perfect quality and with minimum lead time

Strategies:

 Balanced workload throughout the factory.

 Changes in product demand should not result in large fluctuations in
production levels.
 Establish a TAKT time
 Minimize setup times to achieve single digit times (improved planning &
redesigning processes)
 Lead times should be reduced through cellular manufacturing, reducing
queue times, etc

MUDA:

Muda is a traditional general Japanese term for activity that is wasteful and doesn’t
add value or is unproductive, or an unuseful in practice. It is also a key concept in
the Toyota Production System (TPS) and is a one of the three types of wastes (muda,
mura, muri) that it identifies. Waste reduction is an effective way to increase
profitability.

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Muda (waste identification)

Waste (Muda) of Waiting

 Whenever any employee is waiting for something, it is costing the company

money.
 Unbalanced work load
 Unplanned maintenance
 Quality problems leading to uncertain activities
 Waste (Muda) of Inventory

Work in Progress (WIP) is a direct result of overproduction and waiting. Excess

inventory tends to hide problems on the plant floor, which must be identified and
resolved in order to improve operating performance. Excess inventory increases
lead times, consumes productive floor space, delays the identification of problems,
and inhibits communication. By achieving a seamless flow between work centers.

Waste (Muda) of Overproduction

Simply put, overproduction is to manufacture an item before it is actually

required. Overproduction is highly costly to a manufacturing plant because it
prohibits the smooth flow of materials and actually degrades quality and
productivity. The Toyota Production System is also referred to as “Just in Time” (JIT)
because every item is made just as it is needed. Overproduction manufacturing is
referred to as “Just in Case.” This creates excessive lead times, results in high storage
costs, and makes it difficult to detect defects. The simple solution to overproduction
is turning off the tap; this requires a lot of courage because the problems that
overproduction is hiding will be revealed. The concept is to schedule and produce
only what can be immediately sold/shipped and improve machine changeover/set-
up capability.

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Waste (Muda) of in appropriate Processing

Often termed as “using a sledgehammer to crack a nut,” many organizations

use expensive high precision equipment where simpler tools would be sufficient.
This often results in poor plant layout because preceding or subsequent operations
are located far apart. In addition they encourage high asset utilization (over-
production with minimal changeovers) in order to recover the high cost of this
equipment. Toyota is famous for their use of low-cost automation, combined with
immaculately maintained, often older machines. Investing in smaller, more flexible
equipment where possible; creating manufacturing cells; and combining steps will
greatly reduce the waste of inappropriate processing.

Waste (Muda) of transportation

Transporting product between processes is a cost incursion which adds no

value to the product. Excessive movement and handling cause damage and are an
opportunity for quality to deteriorate. Material handlers must be used to transport
the materials, resulting in another organizational cost that adds no customer value.
Transportation can be difficult to reduce due to the perceived costs of moving
equipment and processes closer together. Furthermore, it is often hard to determine
which processes should be next to each other. Mapping product flows can make this
easier to visualize. Waste (Muda) of Motion

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5’S Technique:

5’S(sometimes called 5 C) is a referee to a list of five Japanese words which,

transliterate and translated into English, start with the letter S and are the name of a
methodology. This Is a mnemonic for a methodology that is often incorrectly
characterized as “standardized clean up”, however it is much more than clean up. 5
S is a philosophy and a way of organizing and managing the workspace and work
flow with the intent to improve efficiency by eliminating waste, improving flow and
reducing process unevenness.

Elements of 5S

1. Sort
2. Shape
3. Shine
4. Standardize
5. Sustain

1) Sort: When in doubt, move it out Red Tag program

2) Shape: Make it obvious where things belong
 Lines, Labels, Color coding, Signs and Shine
 Clean everything, inside and out
 Prevent dirt, and contamination from reoccurring
 Results in Fewer breakdowns, Greater safety, Improved quality and More
satisfying work environment.
3) Standardize
 Establish guidelines for the team5S conditions
 Make the standards and 5Sguidelines visual
 Maintain and monitor those conditions.


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4) Sustain
 Determine the methods your team will use to maintain adherence to the
standards
 5S communication board
 Visual standards and procedures
 Daily 5 minute 5S
 Activities/meetings
 Weekly/Monthly 5S audits.

KAIZEN:

Kai means “change”. Zen means “Good (for the better)”. Gradual, orderly and
continuous improvement, ongoing improvement involving everyone

 The PDCA Cycle Plan what to do?

 How to do it?
 Do what was planned.
 Check Did it happen according to plan?
 How to improve next time?

KANBAN:

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 “A system of continuous supply of components, parts and supplies, such that
workers have what they need, where they need it, when they need it.”

The word Kan means "visual" in Japanese and the word "ban" means "card". So
Kanban refers to "visual cards".

POKA YOKE:

3 Rules of POKA YOKE

1. Don’t wait for the perfect POKA YOK……..Do it now

2. If your POKA YOKE idea has a better than 50% chance to succeed……Do it
3. Do it now ………. Improve later

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 GENERAL MOTORS CORPORATION

General Motors Corporation (GM) has one of the most wide-spread lean
manufacturing initiatives in place. GM grew interested in lean manufacturing in the
early 1980s, as it examined elements of the Toyota Production System that had been
adopted by several Japanese auto manufacturers.

In 1994, GM and Toyota formed a joint venture called the New United Motor
Manufacturing Inc. (NUMMI) to pioneer implementation of lean methods at an
automotive manufacturing plant in the U.S. Compared to a conventional GM plant,
NUMMI was able to cut assembly hours per car from 31 to 19 and assembly defects
per 100 cars from 135 to 45. By the early 1990s, the success of NUMMI, among other
factors, made it increasingly clear that lean manufacturing offers potent
productivity, product quality, and profitability advantages over traditional mass
production, batch-and-queue systems. By 1997, the "big three" U.S. auto
manufacturers indicated that they intend to implement their own lean systems
across all of their manufacturing operations.

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 Since the early 1990's, GM has worked actively to integrate lean manufacturing
and environmental initiatives through its PICOS Program. In addition, GM's WE
CARE (Waste Elimination and Cost Awareness Reward Everyone) Program
complements lean implementation efforts at GM facilities, as many projects result in
both operational and environment improvements. The WE CARE Program is a
corporate initiative that formalizes Design for the Environment and Pollution
Prevention efforts into a team-oriented approach.

GENERAL MOTORS IN INDIA

In 1928 General Motors began with assemblage of Chevrolets, trucks, buses

and batteries. Although it closed operations in 1954, it has been in Indian market as
a part of tie-ups with Hindustan Motors to produce Bedford trucks, Vauxhall cars,
Allison transmission and off-highway equipments. In 1994, General Motors India
was incorporated as a 50-50 joint venture with C.K. Birla Group of Companies. In
1999 it became a fully owned subsidiary of General Motors when General Motors
Overseas Corporation bought the remaining shares.
The existing General Motors plant was originally built by Hindustan Motors.
In 1994 General Motors modernized it. The plant is located at Halol, near Vadodara,
Gujarat.

The General Motors India, Models are:

 Opel Corsa
 Corsa Sail
 Chevrolet Forester
 Chevrolet Optra
 Chevrolet Taver
 Opel Vectra

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Plan layout and floor planning:

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 EXAMPLE LEAN PROJECTS AND RESULTS—
GENERALMOTORS

A. Kanban Implementation

GM manufacturing plant in Talegaon, Gujarat receives more than 95 percent of its

parts in reusable containers. Many of these reusable containers also serve as
kabana, or signals for when more parts are needed in a particular process area. This
"kanban"-type system eliminates tons of packaging wastes each year and reduces
the space, cost, and energy needs of managing such wastes.

The plant has also implemented electronic kabana with some suppliers, enabling
the suppliers to deliver components “just in time” for assembly. For example,
seating systems are delivered to the shop floor in the order in which they will be
installed.

B. Assembly Paint Booth Cleaning

At GM's Assembly Plant, paint booths were originally cleaned every other day
(after production) to prevent stray drops or chips of old paint from attaching onto
subsequent paint jobs. It was discovered, however, that the automated section of the
painting operations really only needed to be cleaned once a week, and larger holes
were cut in the floor grating to allow for thicker paint accumulations. The reduction
in cleaning frequency facilitates improvements in the process "up-time" and flow. As
an additional benefit, through this and other more efficient cleaning techniques, use
of purge solvent decreased by 3/8 of a gallon per vehicle. When combined with

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reductions achieved by solvent recycling, VOC emissions reduced by 369 tons in the
first year following these adjustments.

C. Application of Lean Methods to Administrative Processing in the

Purchasing Group

In addition to applying lean thinking to manufacturing processes, GM has

looked at ways to lean its internal administrative processes. For example, GM's
purchasing group investigated the company's Request for Quote (RFQ) processes by
which supplier products are sought. Because each RFQ has to include a detailed
listing of system requirements, RFQ's under the prior paper-based system could be
quite large, ranging in size (in total paper "thickness") from 3/4 of an inch to 6
inches thick.

Upon applying a value stream mapping and analysis, GM identified a number

of ways in which this process produced an excessive amount of waste. Not only did
it require GM to purchase and use a great deal of paper, but also incurred costs and
used raw materials associated with printing and packaging, in addition to cost and
energy required to deliver each package to each potential supplier.

GM's solution was to transform the RFQ process into an electronic-based

system that is not only paperless, but that avoids the additional costs and waste
associated with printing, packaging, and shipping each RFQ. Using an internet-based
system called Covisint, GM is able to improve procurement efficiency while lowering
costs by saving time and eliminating waste. By distributing RFQ's electronically, GM
estimates that the company will save at least 2 tons of paper each year.

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D. Lean Enterprise Supply Chain Development

In the early 1990s, GM realized that it was not sufficient to just lean GM's
operations, as GM (and the customer) directly bears the costs of supplier waste,
inefficiency, delays, and defects. GM assigned a group of engineers to work more
closely with its suppliers to reduce costs and to improve product quality and on-
time delivery.

This effort has involved over 150 supplier development engineers conducting
lean implementation workshops called Purchased Input Concept Optimization with
Suppliers (PICOS). As part of PICOS, small teams of GM engineers visit GM suppliers
for several days to conduct training on lean methods and to lead a focused kaizen-
type rapid improvement event. Follow-up was conducted with the suppliers at 3
and 6 months to determine if productivity improvements had been maintained, and
to assist with additional process fine-tuning.

Over time, GM found that having an engineer involved in the PICOS program
who is familiar with environmental management provided important benefits for
leveraging additional environmental improvement from the PICOS events. By
working with suppliers on environmental improvement, GM has also, among many
things, been able to

 promote the use of returnable shipping containers in lieu of single-use,

disposable ones;
 GM's guidelines for designing for recyclability and broadly disseminating its
list of restricted or reportable chemicals; and
 Communicate success stories to the supplier community as examples of what
can be done.

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GM also announced that suppliers will be required to certify the implementation of
an EMS in their operations in conformance with ISO 14001. GM is currently
developing a broader supply chain initiative, with involvement from EPA and NIST,
that some participants hope will become a vehicle to integrate technical assistance
on advanced manufacturing techniques and environmental improvement
opportunities. Two PICOS events are described below.

E. Steering Column Shroud PICOS Event

GM conducted a PICOS rapid improvement event with a key supplier to enhance the
cost competitiveness and on-time delivery of steering column components. The GM
team used value stream mapping and the "five whys" to assess the existing process
for steps that cause long lead times and delays. The assessment revealed that the
supplier shipped the steering column shrouds (or casings) to an outside vendor for
painting prior to final assembly with the steering column, adding significant flow
time to the production process.

Using the "five whys" technique, the team asked why the shrouds needed to be
painted in the first place. The answer was "because the die (plastic mold) creates
flaws that need to be covered." This led the team to a simpler, less wasteful solution
– improve the quality of the die, and mold the part using resin of the desired color.

After some research, and capital investment of $400,000, the supplier incorporated
an injection molding process for the shrouds into the assembly line, eliminating the
need for the time consuming painting step. This project saved the supplier
approximately $700,000 per year, while shortening lead times and improving on-
time delivery to GM.

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This lean project produced environmental benefits, although they were not needed
to make the business case for pursuing the project. Elimination of the painting
process step

 eliminated 7 tons per year of VOC emissions from the painting process step,
 all hazardous wastes associated with the painting process step (including
clean-up rags, overspray sludge, off-spec and expired paints), and
 environmental impacts associated with transporting the shrouds to the
painting vendor and back.

F. Thermoplastic Color Purging PICOS Event

While working with a supplier to reduce lead times and improve quality for the
production of a thermoplastic molded component, a GM-facilitated team found
additional waste elimination opportunities associated with color changeovers. At
this time, the suppliers' operations were running seven days a week to meet
customer demand.

The team found that each time the supplier changed resin colors to produce a new
batch of parts, as many as 5 to 10 large plastic parts needed to be scrapped. The
accumulated scrap typically would fill a 30 yard dumpster every day, resulting in
$3,000 to $4,000 per week in disposal costs. In addition, the supplier consumed
more resin than necessary, contributing to higher material costs.

By focusing the rapid improvement event on streamlining the die set up and color
changeover process, the team was able to reduce the need to run overtime shifts to
meet customer demand while eliminating a significant waste stream, as well as the
extra resin and processing associated with the scrap.

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 Conclusion:

Value creation is all about delivering value at every step of supply chain, so as to
maintain efficiency as well as effectiveness. However, it benefits not only the
company but also the end consumers. It aids in building wealth as well as equity for
the organizations.

Lean manufacturing is one such system that helps in cost optimizations at every
step of supply chain so as the non-value adding steps become the targets of
elimination.GM is one such organisation that follows the principles of Lean
manufacturing in practice.

The various ways tools of the same are Just in time, kaizen, six sigma, standard
work, poke – yoke, Muda etc. The value adding cost optimization techniques not
only remove the non value adding steps but also give the company a cost advantage
and efficient management of resources.

Thus the Lean manufacturing technique has become a part and parcel for GM as an
organisation.

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