Faculty of Industrial Management

INTRODUCTION TO
LEAN
 CONTENTS

Lean overview
The Origins of Lean Manufacturing
Lean concepts
Lean Thinking
Lean Principles
Lean Methods
What Is Lean Manufacturing?
Benefits of Lean Manufacturing
Improvement Strategies and Techniques
Conclusion
 THE ORIGIN OF LEAN
MANUFACTURING

Discussion question: Who created the Toyota

Production System?
 THE ORIGIN OF LEAN
MANUFACTURING
Before 1850 Craft manufacturing
1850 Eli Whitney (Interchangeable parts)
American
Civil War Drawing conventions, Tolerances
Modern machine tool development

Fredrick Taylor (Standardized work, time study & work

1900 standards)
Frank Gilbreth (Process charts, motion study)
World War I
Henry Ford (Assembly lines, flow lines,
manufacturing strategy)

World War II Deming & Juran (SPC, TQM, PDCA,

1950 Customer Service)
Eiji Toyoda, Taiichi Ohno, Shigeo Shingo
Toyota production system, JIT
Stockless production, World class manufacture

1990 The concept of lean thinking was introduced

Lean Manufacture to the Western world in 1991 by the book
The Machine That Changed the World
written by Womack, Jones, and Roos.
THE CREATOR OF THE TOYOTA
PRODUCTION SYSTEM
THE ORIGIN OF LEAN MANUFACTURING

Taiichi Ohno said openly that he got the idea from

Henry Ford's books and the American supermarket

Ford's My Life and Work (1922) describes just-

in-time (JIT) and other lean concepts explicitly.
Henry Fords assembly line inspired the principle of flow (keep
products moving because no value is added while it is sitting still)

The Indy 500 Rapid Changeover

Depletion of supermarket shelf stock triggers

replenishment; it is a "pull" system like kanban
The American Grocery Store led to the Pull system material use signals
when and how stock needs to be replenished
THE ORIGIN OF LEAN MANUFACTURING
TPS HOUSE
TPS HOUSE
 LEAN CONCEPTS (3 MS)

Three critical concepts that are the target of

elimination in a lean organization

MURI
Overburdening people or equipment

MURA
Unevenness of flow

MUDA
Non-value added work WASTE in a process
 MUDA (7 WASTE)

A job can consist of 75 percent waste (or even more)

1. Overproduction
2. Waiting
3. Transportation
4. Processing
5. Inventory
6. Motion
7. Defects
 An 8th waste
MUDA is the Japanese word for WASTE.
is the wasted
potential
5 7 2 of people
1 4 3 6
Overproduction To produce sooner,faster
or in greater quantities
Seek it out and get rid!
than customer demand.
Over Processing 1 Inventory
Processing beyond
the standard
required by the 7 2 Raw material,
work in progress
customer. or finished goods
which is not having
value added to it.
Rework
Non right Waiting
first time.
Repetition 6 3 People or parts
or correction that wait for
of a process. a work cycle to
be completed.

Transportation 5 4 Motion
Unnecessary movement
of people, parts or
Unnecessary movement of people machines within
or parts between processes. a process.
 LEAN THINKING

A bad process
will beat
a good person
every time
- W. Edwards Deming

ITS ABOUT THE PROCESS

LEAN THINKING (4 PS)

PHILOSOPHY

PEOPLE

PROCESS

PROBLEM SOLVING
PDSA THE LEAN METHODOLOGY

Adopt/Adjust/ Define project

Abandon & sustain (Project Charter)
improvement

Act Plan

Study Do

Monitor progress and Hold event

results 30, 60, 90- Implement Action
day reviews Plan

FOLLOWING THE LEAN METHODOLOGY ENSURES KNOWLEDGE CREATION AND

CONTINUOUS IMPROVEMENT
WHAT IS LEAN MANUFACTURING?

A systematic approach for the identification

and elimination of all forms of waste from
processes or value stream.

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.
LEAN PRINCIPLES
LEAN THINKING PRINCIPLE #1
SPECIFY VALUE

???

Quality
Flexibility
Service
Variety

----VALUE----
Variability
Response-
Time
Cost

The critical starting point for Lean Thinking is value

as defined by the customer.
 LEAN THINKING PRINCIPLE #2
IDENTIFY THE VALUE STREAM

All the actions required to bring a specific product or service

through the three critical transformation processes by
viewing process from the beginning to end, focusing on value
added versus non-value added work:
Idea transformation: concept to market launch
Information transformation: order-take through scheduling
to delivery
Physical transformation: raw materials to final customer

Value-add time
(Hours) Inventory Waiting Setup Transportation Waiting Inspect

Typical value-add to lead-time ratio ~ 1%

Waste
Value-add activity
LEAN THINKING PRINCIPLES #3,4,5

#3: Create Flow

Every time the flow of work stops we consume resources that
adds costs but generates no value. So process one unit at a
time with no stoppages or interruptions

#4: Develop Pull System

Respond only when the customer pulls work. Consumption of
resources triggers replenishment of resources

#5: Strive to seek perfection

The real benchmark is zero waste, not what your competitors
are doing!
 CURRENT LEAN THINKING
PRINCIPLES

Customer Focus

Data driven decisions

Respect

Results

Accountability

Excellence
 LEAN PRINCIPLES

Customer Focus: Know your customer and continuously strive to enhance customer value by
producing exactly what the customer wants, when they want it, and in the smallest possible quantities.
It is not about producing what you think the customer wants. Remember, everything that you do that
your customer does not perceive as value is waste; strive to eliminate all waste.

Data driven decisions: Give the most weight to information that can be verified with data; make
decisions based on analysis rather than anecdote or intuition.

Respect: Employees are central to value creation, so 1) grow leaders who understand the work, live
the philosophy and teach it to others; 2) develop exceptional people and teams who follow Lean
principles; and 3) collaborate with partners and suppliers to improve customer value. Employees know
where waste is and how best to improve the process, so involve them in improving the process.

Results: Set ambitious SMART goals and monitor progress using performance measures.

Accountability: Hold yourself and others responsible for following through on commitments and share
results.

Excellence: Challenge tradition (status quo), seek out best practices, use data and creativity to
address problems (innovate and evolve - take risks), improve quality, enhance timeliness, and reduce
costs, learn from experience (failures and successes), monitor and sustain improvements checking to
see whether performance goals/targets have been achieved. Action: Preference on action not
perfection - don't let the best be the enemy of the better! Plan-Do-Study-Act. Innovate and evolve
(experiment and take calculated risks).
HOW DO WE DEFINE VALUE-ADDED?
Value-added vs.
Customer is willing
to pay for it
Actually transforms
a product or service
Done correctly the
first time
Non Value-added
Consumes resources
without creating value
for the customer
(often CYA)
Low percent of the
time work is complete
and accurate (%CA)
Requires extra time,
effort, or resources
 GANTT CHART

WORKSTATION 1
Waiting for operator
Waiting for setup
Machining
Only machining is
Waiting to form transfer batch
value-adding time.
Waiting for cart
This Gantt format
Transportation of the cycle time
Waiting for tool (unbatching) makes non-value-
WORKSTATION 2 adding time highly
Machining visible.
Waiting to form transfer batch
Waiting for cart
Transportation

0 50 100 150 200 250

BENEFITS OF LEAN
 LEAN IS ABOUT SIMPLIFYING OUR
WORK

1. Eliminate tasks that do not add value

2. Make things easy and intuitive for
customers and staff
3. Automate repetitive tasks
4. Leverage staff talent
. So how do we identify what tasks can be eliminated? First, we must understand our customers needs because value is
defined from the end-users perspective. Once we have identified the steps in the process that add value then we can focus
on the remaining process steps to determine which steps can be eliminated without sacrificing service quality.

. Automating a bad process may not resolve the underlying reasons for process problems and inefficiencies. We refer to processes that are
automated without streamlining as perfuming the pig or putting lipstick on the pig. If it is an ugly and smelly process before automation,
it will typically be an ugly and smelling process after automation. Lesson here, streamline before automation!
 COMPARISON OF LEAD TIME

Business as Usual
Customer Waste Product
Order Shipment

Time
Lean Manufacturing

Customer Product
Order Shipment
Waste

Time (Shorter)
IMPROVEMENT STRATEGIES

Eliminate non- Combine tasks or

value added tasks functions

Concurrent
Co-locate work
processing

Shift roles and Eliminate or

responsibilities reduce batching

Automate Solve Problems

 JUST-IN-TIME

Driven by a need survive after the devastation caused by the

war, JIT was developed by Toyota Motor Co. and gained
worldwide prominence in the 1970s

JIT philosophy means getting the right quantity of goods at the right
place and the right time

JIT exceeds the concept of inventory reduction

JIT is an all-encompassing philosophy found on eliminating waste

Waste is anything that does not add value

A broad JIT view is one that encompasses the entire

organization
 5S-CANDO

5S-CANDO, a systematic approach to cleaning and organizing

the workplace, suppresses friction.

Seiri (Sort)= Clearing up

"When in doubt, throw it out.

Seitori (Set In Order)= Organizing (Arranging)

"A place for everything and everything in its place.

Seiso (Shine)= Cleaning (Neatness)

Shitsuke (Standardize)= Discipline

Seiketsu (Sustain)= Standardization (Ongoing improvement,

holding the gains)
5S-CANDO
 VISUAL CONTROLS

Any communication device used in the work

environment that tells us at a glance how work
should be done and whether it is deviating from the
standard

"Basically, the intent is to make the status of the

operation clearly visible to anyone observing
that operation" (Wayne Smith, 1998).
"Visual controls identify waste, abnormalities, or
departures from standards" (Caravaggio, in
Levinson, 1998)
 EXAMPLES OF VISUAL CONTROLS

5S-CANDO (arranging)

Jidoka or automation

Andon lights and buzzers announce tool status

JIT: kanban squares, cards, containers

Lines on the floor to mark reorder points

Safety: colored labels for materials

Statistical process control charts: should be clearly

visible
 HEIJUNKA

The leveling of production by both volume and product

mix

Stability of manpower

Reduction of unnecessary overtime

Reduction in inventory levels

Reduction of stress levels in the production area

 "PULL" PRODUCTION CONTROL
SYSTEMS

A method of controlling the flow of resources by

replacing only what has been consumed. Production is
based on customer demands

Just-In-Time (JIT)
First described by Henry Ford in My Life and Work
(1922)

Kanban

All reduce inventory and its carrying costs, along with

cycle time.
Tie-in with small lot and single unit processing
 STANDARDIZED PROCESS

Standardization is the process of developing and

agreeing upon technical standards

Better decision making

Cost reduction and increase in efficiency
Effective information sharing
Easier international transfer of marketing skills
Simplifying the coordination and control between
subsidiaries and business functions
 ERROR-PROOFING
(POKA-YOKE)

A techniques that help operators avoid mistakes in

their work caused by choosing the wrong part,
leaving out a part, installing a part backwards, etc.

Error-proofing makes it difficult or impossible to

do the job the wrong way.

Slots and keys, for example, prevent parts from

being assembled the wrong way.

Improves safety and Productivity, and Reduces

breakdown
 KAIZEN (OR SCORE EVENTS)

Planned and structured process that enables a

small group of people to improve some aspect of
their business in a quick, focused manner.

Select
Clarify
Organize
Run
Evaluate

A Kaizen Event typically lasts 3-5 days.

 SMED (SET UP REDUCTION)

The practice of reducing the time it takes to change

a line or machine from running one product to the
next

WIP and lot size reduction

Finished goods inventory reduction
Improved equipment utilization/yield
Increased profitability without new capital
equipment purchase
 ANDON SIGNALING SYSTEM TO STOP
LINE

A Japanese term refers to the warning lights on an assembly

line that light up when a defect occurs. When the lights go
on, the assembly line is usually stopped until the problem is
diagnosed and corrected.

Bring immediate attention to problems as they occur in the

manufacturing process.
Provide a simple and consistent mechanism for communicating
information on the plant floor.
Encourage immediate reaction to quality, down time, and safety
problems.
Improve accountability of operators by increasing their responsibility for
good production and empowering them to take action when problems
occur.
Improve the ability of supervisors to quickly identify and resolve
manufacturing issues.
 TAKT (TIME)

The rate that a completed product needs to be finished in

order to meet customer demand

Gives the rhythm at which system should operate

Smooth production planning & reduced interruptions in operations
System synchronization with customer requirement
Enable pull scheduling
No over production
No rush hours in work
WIP reduced
 VALUE STREAM MAPPING

A tool for guiding improvements by identifying waste &

isolated processes

Enable Visualizing the production process

Identifies waste in each step of the production process.
Provides a plan for implementing improvements to the production
process to reduce costs.
 SUMMARY AND CONCLUSION

Most of lean manufacturing is

common sense!
 SUMMARY

Business activities can contain enormous quantities

of built-in waste (Muda).

The greatest obstacle to the waste's removal is

usually failure to recognize it.

Lean manufacturing includes techniques for

recognition and removal of the waste.

This delivers an overwhelming competitive

advantage.
PROBLEM SOLVED

If I were given one hour

to save the world, I would
spend 59 minutes defining
the problem and
one minute solving it.

- Albert Einstein
 INDIVIDUAL TASK

o Why Lean?

o Principles of Lean?

o Lean Concepts?

o Lean Methods?

o Lean Thinking?

o Goals of Lean?

o Types of Waste?

o Lean Tools?
Students will be randomly picked to
o Value added work?
present his/her opinions.