This week, I was fortunate enough to visit the spectacularly beautiful city of Istanbul on a business trip. As the meeting point of East and West for over 2000 years it is not an exaggeration to say that few cities have had greater influence on the development of human culture than Istanbul. This is epitomised by the magnificent Hagia Sofia museum, built in the sixth century as a Byzantine church, converted into an Ottoman Mosque in the 15th century and then into a secular museum in the 1930’s. Layers of history and culture are built into the walls of this amazing building.

The interior of the Hagia Sofia in Istanbul where an ancient mosaic of the Virgin Mary and Child is surrounded by quotes from the Koran and Islamic Iconography.

However, it was a much more mundane example of Turkish culture that really got me thinking. In Istanbul there are a lot of white cars. In fact, I would guess more than half the cars on the road are white. As someone who worked in the automotive coatings industry before founding TXM, I was curious as to the reasons for this. What I discovered is that Turkish people buy white cars because they are easier to sell.

This stems from a belief that white cars have better resale value. There is nothing inherently better about white cars. In fact in most cases they are coated with a simpler and cheaper paint system than other colours. However, the car owners of Istanbul believe that white cars are better. If enough people hold this belief, then it becomes self-reinforcing as demand for white cars increases and prices follow.

This belief becomes immensely powerful in that it drives the whole market for cars in Istanbul, which in turn will affect scheduling and manufacturing decisions by car manufacturers and distributors and will affect what paint companies make.

What is Culture?

Turkey Street White Cars
There are an abundance of white cars in Istanbul and the reasons why got me thinking about culture.

When I ask people in businesses what is culture, the answers I often get are disturbingly vague. People talk about values and “the way things are done around here”, but find it difficult to point to specific examples. However, like the white cars in Istanbul, your culture has a powerful effect on what happens in your business. Therefore it is vitally important to understand it.

Culture is built on beliefs. These beliefs then drive behaviours. If enough people share these beliefs and demonstrate these behaviours, then that will influence outcomes. So, the people in Istanbul believe that white cars are easier to sell, which will drive their behaviour of selecting white cars, which will influence the whole car market.

When we are trying to implement Lean in order to achieve operational excellence, culture can often stand in the way. Leaders and employees often have beliefs that go against Lean thinking and these beliefs drive their behaviours and in turn outcomes. There are many examples. I have seen many companies deliberately hold extra inventory to cover the risk of machinery breakdown. This can prevent the business reducing lead time and is certainly a barrier to ever achieving one-piece flow. I have heard many a manager complain that their people never tell them when there is a problem, because they believe “management won’t listen”. In this environment, problem solving will never be successful.

Safety is also driven by culture. I visited a site recently where every single pallet racking column had been damaged by forklift impacts. The forklifts were driven like formula one cars. There was clearly a belief among forklift drivers that this behaviour was OK and there would be no consequence for this kind of driving. Perhaps even targets for speed of loading trucks or the chance to squeeze in an extra break if the work is done quickly may have reinforced that belief and dangerous behaviour.

How Do You Change Culture?

If we are going to achieve sustainable improvement, we must change culture. This requires the specific beliefs that drive employee behaviour to be changed. This cannot be achieved by simply lecturing people on the behaviours and beliefs we want. It’s not as easy as a “team talk”. Instead we need to demonstrate that outcomes will change.

So, to change the belief that “we need stock because machines always break down” the first step would be to measure downtime to show how often machines actually break down. We have to take action to improve machine reliability and actually demonstrate with facts and data that the machines are no longer breaking down. At that point we can then experiment with gradually reducing the safety stock until we demonstrate that it is no longer necessary.

The actions of leaders are key to changing culture, especially first line leaders. In the forklift safety example, if leaders at any level allow forklifts to speed and drive dangerously without saying anything, then this will just reinforce the belief that speeding is OK and potentially encourage the behaviour. However, if managers and supervisors start consistently stopping and counselling speeding drivers, then the belief that speeding is OK will be slowly eliminated and the behaviour will change. Too often though leaders seem to believe that it is enough to give a lecture at a team meeting. They are then too busy or simply not around to stop and take action when the wrong behaviour is demonstrated in the workplace.

Sustained Cultural Change Takes Time!

Changing cultural behviours is a gradual process and might need tweaking more than once.

This is painstaking work and takes time. The specific problematic beliefs and behaviours need to be identified, work needs to be done to change the outcome of the behaviours or to demonstrate through facts that the beliefs are incorrect and then the culture will change. However, if the effort is not consistent across leadership or is not sustained, then culture will quickly revert back to the old ways.

“Management never listens” is a good example of this. Often a new manager will do a “listening tour” to understand the issues at “the coal face”. When they are overwhelmed with issues to deal with, then they rationalise to themselves that is just not “realistic” to deal with all the issues. Unfortunately, this acts to strengthen the belief that “management never listens” and make team members even more reluctant to share ideas. Instead, in addressing this issue you need to set expectations up front about what can be done and how long it will take to ensure that 100% of your promises are kept – consistently.

How TXM Can Help You Build a Continuous Improvement Culture?

At TXM, our coaches change culture through demonstrating to leaders how different beliefs and behaviours can deliver different outcomes. This usually comes through experimentation and reflection. We encourage leaders and teams to try something new in a way that minimises their risk and support them while they try the new behaviour.

We then encourage them to reflect on the behaviour and to observe the outcomes of the new behaviour. This cycle is repeated, initially with the close support of our coach and then increasingly independently while checking in with our coach. Over time, the new behaviours become habit. This drives better outcomes, which reinforces the new beliefs. This then locks in new ways of working in a sustainable way.

So, what about the white cars in Istanbul? Well that’s a tough one. It would require leaders, influential people and and businesses with influence to buy other colours and be seen driving other colours. This would then influence people’s beliefs about white cars and ultimately their behaviour in purchasing non-white cars. This then would change the market for non-white cars. However, I suspect that the people of Istanbul are quite happy with their white cars, so it might be better to choose other cultural battles!

In this blog Anthony Clyne talks about building your own Kanban Boards.

Kanban Boards

A Kanban board with tags and tasks for operators on the factory floor.

A Kanban board is a visual management tool designed to help visualise work, limit work-in-progress, and maximise efficiency (or flow). Kanban boards use cards, columns, and continuous improvement to help teams commit to the right amount of work, and get it done.

Kanban is a visual system for managing work as it moves through a process. Kanban visualises both the process (the workflow) and the actual work passing through that process. The goal of Kanban is to identify potential bottlenecks in your process and fix them so work can flow through it cost-effectively at an optimal speed or throughput.

A Kanban board is a more efficient and less frantic method than having multiple people to contact each day, just to define the current status of the work. A Kanban board displays everything required to make informed decisions including:

1. Which work to prioritise first

2. Which resource to use next

3. Ability to collect valuable metrics

4. At a glance view the whole workload picture

5. Timing, flow and resource assignments

To grasp the concept of Kanban, there are several fundamental Lean principles built into a Kanban board that support how a team can practice and build upon continuous improvement cycles. We will discuss the importance of understanding your entire value stream, the creating knowledge process and being respectful towards the people involved.

Seeing the Whole Value Stream

Within Lean, “Seeing the Whole Stream” is a key concept for understanding the entire value stream. It can be challenging to have a single and shared view of what the team is facing. It is also problematic to track the entire team’s capacity when you have to go and interpret what each team member is working on. These interactions through the day are not the best use of your time or theirs. Visual Management is essential to managing a team’s work in progress and display all the activities in one place.

Creating Knowledge

If you only work within the functions of your role within a company, you’re missing an important opportunity to cross-train yourself and those in your team. It is amazing what a set of fresh eyes can bring to solving a problem or a task that is falling behind. It happens so many times that after collaborating with a co-worker, a solution can be found to progress the work or aid in selecting the right solution.

Every time this happens is an opportunity to grow — by hearing new ideas and understanding new perspectives for the team and yourself. It is equally valuable to see the work that someone else is doing. Visibility of the work provides the opportunity to help your team deliver value faster. By keeping individual projects separate from each other, the opportunities to focus on both little and large problems across all projects as a whole is hidden.

With a Kanban board setup, when a concern arises, the team can see the issue on the board and can immediately start to develop a shared response and begin working towards a solution together. Often this will happen automatically soon after the Kanban board is working with deadlines, metrics and schedule information. All of these visual information triggers the sharing of information leading towards new ideas and help to progress the problem towards a conclusion. Therefore it is important to have the information displayed to the team as without being able to visualise that there is a problem first, the ability to focus the team together is lost. Without these visualisation techniques of the Kanban board, it can be difficult to see how all work is connected.

Being Respectful Towards People

Wasting someone’s time is disrespectful, and we do this sometimes unintentionally with running a simple team status meeting to provide information. Many of these status meetings go around the room, as each team member reports information on their tasks. While it is important to have a say most of the attendees are disinterested in most of what is being said, while the others wait for their turn to talk.

As a result in this type of meeting we are, in fact not talking to each other – we were talking at each other. The meeting is missing the opportunity to improve the quality of the meeting itself and to remove obstacles out of each other’s way so the projects can get done. If we cannot improve the quality of our communication, it becomes a much harder task to improve the quality of our work. Finding out that you are always on a different page from your team can be frustrating. In the end, miscommunications result in complexity, frustration, and increasing anxiety levels. As Deming said, “A bad system will beat a good person every time.” [February 1993 Deming Four Day seminar in Phoenix, Arizona.]

How do Kanban Boards Assist?

Another example of a Kanban System in action.

Having a single Kanban board allows a team to visualise the entire process and enables more time in the meeting to focus on the essential aspect of work such as deadlines, changes in priorities or arising concerns. Then at the daily team meeting, we can create a single point meeting that addresses communication problems by having to speak to each person and many people prefer visual information because it is quicker to process. The daily team standup meeting is around 10 minutes duration to cover project status, metrics, task assignments and problem-solving. Most of this discussion ends up eliminating the need for lengthy status meetings and long emails.

Creating Kanban Boards

To get started, refer to “Personal Kanban Mapping work” by Jim Benson, 2011. It is a great starting point into the “World of Post-It-Notes” and how to organise work tasks. Then just do it by developing a mock-up to test the visualising of workflow steps needed to progress the work. Once the mock-up is ready, put it to work and test it out in the real world Refine by understanding “What works well?” and “What is needed?” to support Kanban.

In conclusion, as work transitions towards knowledge work, visualising the tasks and priorities for our team is more important than it has ever been. When you begin to define your visual management or Kanban board, you need to understand how adding value is created in your processes, understanding how you collect your company knowledge and ensure you continue to respect your people’s abilities and skills. Then you and your team can trial your mock-up Kanban board and daily meetings, and to continuously improve your processes of managing your knowledge work.

Still need help building your Kanban Boards? Contact us we can help you build boards and amplify your business.

Lean Manufacturing and its Lean Tools has evolved from its beginnings at Toyota into a system used by businesses around the world. Lean Manufacturing has brought about a number of standard tools and systems you can use across businesses and industries without much modification. Below we will talk about the different Lean tools at your disposal when thinking about your Continuous Improvement journey.

Practical 5S Systems

equipment in a black container
Practical 5S being used to organise machinery parts of frequent usage for more efficient processing.

Practical 5S is a Workplace organisation tool that standardises a work area by:

Sorting Out – Leaving only what is needed for the process
Set In Order – Arranging in the way you need it
Shine + Check – Keep it clean and simple
Standardise – Write the standards and share them
Sustain – Audit, inspect and improve the current standard – repeat

A3 Plans

An A3 plan is simply a business plan or project plan expressed on a single A3 sheet of paper. A3 plans are used for summarising and explaining the strategy, presenting projects and solving problems. By limiting the format to a single A3 sheet of paper and applying rules around layout A3 plans ensure that the essential information is communicated in a clear and concise fashion.

Andon Lights

andon lights
An example of an Andon Light on the factory floor. Resembling a traffic light that are universally known for stop, start and caution.

Refers to a system that provides notification to request support. This is typically leaders, maintenance, and operators of a quality or process. It works when an issue is found at a process, the team member has the ability to immediately notify support staff so that the problem can be reacted to by assigning people within a defined response time.

In manufacturing, it allows a worker to stop production when a problem is found and immediately call for assistance. This can be extended to an office process, where raising an Andon flag means that the process does not go on to the next step until the issue is resolved.

The Andon can be triggered manually or automatically by using push button, pull cord or even flags. The common reasons for activating the Andon can be part shortages, defect created or found, tool/machine malfunction, or the existence of a safety problem.

Continuous Flow

One element of a Just In Time system is continuous flow, where the production work in progress moves smoothly between work stages with little (or no) inventory buffers between each step. Understanding Flow; how parts move along the processes, between each workstation and what this looks like across the minute, hours, shift, day, week and month.

The future state value stream map has provided a vision for what the production flow will look like, defining which parts of the overall production process can flow easily, which parts need direction and which sections need the highest level of control.

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Kaizen (Change For the Better)/Continuous Improvement

Applied to any organisation, Kaizen implies continuing improvement involving everyone. It usually refers to continuous small step improvements over a sustained period of time. Kaizen usually happens at the “Gemba” or workplace.

It is the Continuous Improvement of your entire value stream for individual or collections of processes that are the total sum of your business. Kaizen at its core is a way of thinking/mindset for improving your business, people, and process.

Kamishibai Boards (Red Green Task Board)

Kamishibai Boards are used to keep track of standard work & tasks.

A system whereby coloured “tee cards” are used to represent routine tasks in the workplace. In the typical application, the tags are printed red on one side and green on the other.

They are then flipped from red to green as tasks are completed. Kamishibai Boards can be used in a variety of situations from the factory floor to daily, weekly and monthly admin tasks in the office.

Kanban Systems

Kanban Boards are used in an established pull production system.

A process to signal the need for work, either for Production to make something or stores, or supplier, to supply something. For Kanban the signal is a physical indicator – it may be a card, an empty box or a returned trolley.

Implementing a Kanban system will highlight any problems in your production system. Setting stock levels and reorder lead times will test your initial parts analysis and production data. Audit the system regularly to check all Kanbans are present and they are where they should be.

Overall Equipment Effectiveness (OEE)

The origin of OEE is from the Japan Institute of Plant Maintenance and is a key element of the common TPM movement. OEE is a performance measure commonly used to monitor successful improvements to a process/area/machine. OEE is designed to indicate how effectively a manufacturing operation is utilised and is mostly applied to critical or constrained processes.

OEE can at times be a complicated metric to understand as it is derived from three individual calculated components. The components of OEE are: Availability, Performance, and Quality.

To calculate an OEE for a single machine first you need to know your Availability, Performance, and Quality.

• A =  Represents the percentage of scheduled time that the operation is available to operate. Often referred to as Uptime.
• P=  The speed at which the machine runs as a percentage of its designed speed.
• Q= The Good Units produced as a percentage of the Total Units Started.

OEE= (AxPxQ)

Plan Do Check Act/Adjust (PDCA)

Plan, Do, Check, Act or Plan, Do, Check, Adjust is an iterative four-step management method used for the control and continuous improvement of processes and products. At its core it is a problem-solving methodology.

PLAN – This is where you take the overall situation and determine the steps needed to solve the problem. You must define SMART metrics (simple, measurable, achievable, reasonable & trackable) if you want your plan to succeed.

DO – This is when a solution is devised and is implemented. There may be a mini PDCA cycle with each implementation step; planning what we are going to do, doing it, checking that section and adjusting, before moving onto the next big step.

CHECK – Just because you have put a new system into place doesn’t mean you have finished. You must check your implementation is effective. This is where our SMART metrics help. If we can’t measure the outcome, then how do we know we have done the right thing? Alternatively, you may have solved one problem but not the one that needed solving.

ACT/ADJUST – Now we compare our checking outcomes against our plan. If we have achieved the desired results, we document and standardise the process. If our plan hasn’t been achieved, we repeat the process. Investigate what didn’t work, create a new plan, implement and check how it went this time.

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Poke Yoke (Error Proofing)

Methods that prevent or detect defects in products. Error Proofing is the use of any automatic device or method that either makes it impossible for an error to occur or makes the error immediately obvious once it has occurred. It is a common process analysis tool.

Total Productive Maintenance (TPM)

Total Productive Maintenance is one of the more advanced Lean Enterprise tools and once Production flow, set up reduction and good housekeeping are in use, it becomes important to keep your machine uptime at it’s best. Running closely in parallel with 5S, TPM is the process where the operator becomes involved with the regular, daily maintenance of their machine. The targeted machine needs to be thoroughly cleaned and any maintenance issues fixed; the aim is to return the machine to a brand-new condition.

Value Stream Mapping

Value Stream Map
A Value Stream Map helps to understand the waste in your processes and eliminate them.

Value Stream Mapping is a powerful Lean technique used to document, analyse and improve information flows or materials required service for a customer. Specifically, a “current state” value stream maps identifies the value and waste in a process flow enabling the development of a “future state map” to eliminate that waste. Toyota created this tool calling it a Material & Information Flow Chart.

Where Do You Begin?

Knowing where to start your Continuous Improvement journey can help you decide which tools you want to implement first. It can be quite difficult to understand your position but here at TXM, we can help you understand your position and pick the right tools to use in your business.

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Lean Manufacturing has been around since the 80s. While lean has been around for quite some time, the underlying principles are still relevant today. In fact, there are still many businesses that can benefit from lean today.

If you are new to this term, we’ve broken down this article into 9 parts which you can jump right into after clicking on the links below:

Lean Manufacturing by Definition

Lean Manufacturing (also known as Lean Management, Lean Enterprise, Lean Production or Lean Thinking) is a system of management developed by the Toyota Motor Corporation and adapted successfully across the world to almost every sector of manufacturing as well as a huge range of non-manufacturing sectors including Healthcare, Banking, Government & Services and even Agribusiness.

What is Lean Manufacturing and How Did it Come About?

Back in the 1980’s when western companies realised that they were rapidly losing market share to Japanese manufacturers, a number of US and European academics were sent to study the differences between Toyota and the US and European manufacturers, (most famously Womack and Jones). From these studies, the term lean manufacturing was coined to describe Toyota’s relentless focus on eliminating waste and lead time.

Lean Manufacturing or the Toyota Production System is, in fact, a practical solution developed by a medium-sized manufacturer to address its cash flow problems. Many manufacturers may be daunted by the size of automotive assembly plants and see them as a unique working environment that has little in common with their business. However, the reality is that the underlying principles of Lean Manufacturing are simple, common sense and can be applied in every manufacturing business, no matter how small.

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The 5 Methodologies of Lean Manufacturing

Five core principles underly the Lean Manufacturing methodology

  • Focus on Processes – Lean is focused on improving processes. This can apply to any process where inputs are converted to an output. Therefore, while Lean was developed in manufacturing processes, it can equally apply to processes in sales, supply chain, human resources or finance as well as in a huge range of non-manufacturing businesses.

 

  • Maximise Value and Minimise Waste – In Lean, we define value as the actions or process steps that add value for the customer of that process. Everything that is not value is then defined as waste. Lean manufacturing methodologies focus on eliminating that waste, but also on increasing the value the customer receives in order to create competitive advantage.

 

  • Standardising the Work – A key element of Lean thinking is the idea of improving the standard. However, to improve a standard, you must first have a standard. Therefore, in Lean Manufacturing, we try to standardise every task in terms of content, sequence, timing, and outcome. When we standardise work, we increase the chances of getting a consistent quality result and also, we can measure when we have improved the standard. As well as standardising the work Lean also standardises the workplace by using 5S to create a work environment where there is a place for everything and everything is in its place, safe, clean and ready for use.

 

  • Creating Flow – A core principle of Lean manufacturing is the idea of flow. This means a process where products or services flow through every process step in a defined sequence, one by one, at the rate of customer demand. When this is achieved, we minimise the waste in the process and deliver the minimum lead time and maximum agility.

 

  • Solving Problems – In Lean manufacturing, we welcome problems as problems give us the opportunity to learn and improve the process. However Lean manufacturing specifies that we use the scientific method to solve problems and improve the process. Rather than jumping to the solution, we first identify the root cause of the problem, develop a solution, implement the solution, check the results so we know that the solution work and then lock in the new method through new standard work. We call this the Plan-Do-Check-Act method of solving problems and it is at the core of Lean Methodology.

 

What is the Purpose of Lean Manufacturing?

This was summarised by a Toyota engineer called Taiichi Ohno, widely considered the father of Lean Manufacturing, when he said, “all we are trying to do is reduce the lead time”.

When we reduce lead time in a process, we eliminate waste and create a more agile and flexible process.

This means lower costs, lower working capital, better use of factory space, shorter lead times to customers (of course) and greater flexibility and agility to respond to customer needs. As the world speeds up and customers want more and more customisation in shorter and shorter lead times, then the need to reduce lead time in everything we do becomes even more important.

Unlike other improvement approaches, such as Six Sigma, Lean Manufacturing also gives us a robust management system. It provides a way to develop, maintain and improve highly efficient business processes that deliver to customers what they need when they need it with perfect quality.

It also provides a highly effective management system that enables businesses to get the best out of all their people at every level of their organisation. Importantly it gives leaders a framework for day to day leadership as well as tools to ensure alignment with strategy throughout the business. 

Why is Lean Production Important?

Lean Production is an important aspect of manufacturing because it delivers a foundation business can use to build and continually improve on. Lean was developed from the Toyota Production System, so production is at the core of Lean Thinking.

However, Lean also allows a “production mindset” to be applied in a wide range of non-manufacturing processes in order to achieve consistent, standardised results and continually eliminate waste.

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What are the Lean Principles?

Building on the 5 methodologies mentioned above there are 5 distinct principles to creating a Lean & Operational Excellence culture in your business.

 

  1. Eliminating Wastes – One of the key elements of a Lean manufacturing system is to eliminate anything that does not add value to the customer. Eliminating waste reduces lead times, increases revenue and increases overall customer satisfaction.

 

  1. Build Quality In – Quality control is one of the largest sources of waste, by ensuring quality control (QC) many businesses create waste. It is beneficial to develop Quality Management Systems which will help reduce production issues without the need for excessive resources on QC.

 

  1. Creating Knowledge – A Lean production system encourages Lean teams the ability to properly document and retain valuable knowledge. Creating a set of standard work instructions used on the production line for every shift is a way of creating knowledge and setting standards.

 

  1. Continuous Improvement – Continuous Improvement (CI) is the most critical principle of Lean Manufacturing, it is the constant and unchanging mindset of on continual improvement. Aiming to show that you are never truly finished improving your business, it’s processes or it’s people.

 

  1. Respect for People – One of the core pillars of Lean and Operational Excellence often neglected by leadership is respecting people. Lean Leadership helps to nurture a culture where respect for people and Continuous Improvement is encouraged and championed across teams and departments.

 

Value and Waste

With regard to the first principle of eliminating waste, Toyota realised that most of what happened in their factories did not add value to the product and therefore was waste. They classified this waste into seven categories. In recent years others have added more waste categories, but the original seven is a good place to start.

 

The Seven Wastes Are:

 

  1. INVENTORY: Inventory has value on the balance sheet of a company, but it is not value. The customer will not pay you more for your product if you hold more inventory, and will also not pay you less if you manage to meet his delivery expectations with less inventory. While inventory will often be necessary (e.g. as buffer to compensate for variation in customer demand), it should always be considered to be waste and be minimised.

 

  1. WAITING TIME: Waiting time is the unproductive time spent by employees waiting for something to happen. Often they will be waiting for another employee to complete his or her task or waiting for a machine to complete its cycle. While waiting, the worker is not adding value to the product and therefore waiting is waste.

 

  1. MOTION: In many tasks, employees will spend a lot of their time walking. Walking from one part of a production line to another, walking back and forth to collect or deliver materials, or walking around their work cells. While walking, employees are not adding value to the customer, so motion is waste.

 

  1. TRANSPORTATION: Closely related to motion is transportation time. This is the time spent moving materials and products around your plant or from location to location—a necessity if you have a large site or multi-site operation, but it does not add value to the product and is therefore categorized as waste.

 

  1. DEFECTS: Ask most manufacturing people about waste and they will talk about scrap or defects. Making scrap and defects does not add value to customers’ products, and obviously should be considered waste.

 

  1. OVER-PROCESSING: Production processes frequently incorporate processes that do not add value to the product and we should consider those processes wasteful and try to eliminate them altogether. Examples of this kind of waste include excessive inspection steps, packaging of work in progress or subassemblies that need to then be unpacked later in the process, and de-burring parts (when the drilling or cutting process that caused the burr can be redesigned to prevent the burr in the first place).

 

  1. OVER-PRODUCTION: Over-production is the opposite of just in time. Over-production is producing more than is needed sooner than needed. Over-production usually manifests itself as work-in-progress inventory. Over-production is usually caused by big batches and unbalanced processes and is in some ways the worst form of waste as it is associated with increased inventory, more transportation of materials, and often with over-processing.

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How to Implement Lean Manufacturing Methodologies?

When implementing Lean there are many views on the best way to go. At TXM we have worked with hundreds of companies and seen dozens of different approaches. We have identified seven critical success factors for implementing Lean.

  1. Have a Clear Strategic Goal – Lean is not a strategy for your business. “Being Lean” is not an outcome. Lean is instead a methodology to deliver your business’ strategic goal. If you start with a clear goal and communicate this through your business, then leaders and teams will understand the importance of the Lean activities and be more likely to engage and sustain the improvement. It is important that the whole leadership team is aligned with this strategic goal and sees it as important rather than Lean being seen as just an activity for operations.

 

  1. Leadership “Walks the Talk” – I am always surprised by the number of organisations where the senior leaders seem to believe that the Lean initiative “does not apply to them”. Senior leaders need to demonstrate Lean leadership behaviours which means communicating a clear vision for the Lean transformation, going regularly to the place where the work is being done, showing front line employees respect and when things are not as expected, asking why rather than condemning and directing people. Remember as a leader “the standard you walk by is the standard you set” and this truism definitely applies to Lean.

 

  1. Map your Value Streams – We have discussed how Lean is about maximising value and eliminating waste. But how do you see the waste in your business and how do you decide the best way to eliminate that waste? The answer is by mapping the end to end flow of value from receiving raw materials to delivering finished goods. The way we do this is a value stream map. This enormously powerful (when used correctly) business tool can provide you a simple and clear roadmap for improving your business.

 

  1. Set Clear Standards – Standardised work and a standardised workplace are key foundations of a Lean management system. Start with 5S to standardise your workplace and then build standardised work starting with the most critical tasks in your process. This will stabilise your process and deliver more consistent results, which in turn provides a platform for improvement.

 

  1. Develop Your Front-Line Leaders – Your front-line leaders are the supervisors, team leaders and junior managers that your front-line staff directly report to. These people are the most influential in your business as they are often long-serving and have a huge influence on culture. Front line staff usually trust and listen to their immediate supervisor more than any other person in the business.
  • Unfortunately, front line leaders often have no leadership tools or training and are not engaged in change processes. Giving your front-line leaders the tools and skills to lead their team effectively and drive improvement will free up more senior leaders from day to day issues. It will also maximise the likelihood that your lean transformation will be successful and sustained.

 

  1. Set Simple and Clear Measures that Can Be Improved Every Day – Often business metrics are highly complex and only get measured once per month, as part of monthly financial reporting. At the workplace, where customer value is created, there are often no measures other than getting today’s urgent order out the door.
  • Instead, develop simple measures for safety, quality, delivery, output and cost that can be measured every day, are easily understood and recorded by front line teams. This will ensure that problems are addressed every day, rather than weeks after they occur when the financial results are reviewed.

 

  1. Get the Right Resources – a Lean manufacturing transformation is not easy. People in your business are probably already really busy. Therefore, you need to get the right resources to ensure that your transformation has enough momentum. This will usually consist of a mix of external resources such as TXM to provide expertise, coaching and project management along with internal resources who can drive the change and complete the key actions internally.
  • Remember when implementing Lean is that we are not trying to BE Toyota. Toyota is a unique business occupying a particular position in a distinct market, the global automotive industry. Therefore, unless you are also a global automotive manufacturer seeking to dominate the mid-market for cars, then implementing Lean is not about mimicking Toyota right down to learning a whole pile of Japanese words.
  • Instead successful Lean manufacturing implementation is about LEARNING from Toyota and adapting the tools, principles and philosophies to create your own system of management for your own business. And unless you are a Japanese company or operating in Japan, don’t worry too much about the Japanese words – they will just confuse and alienate people.

What is the Difference between Lean Manufacturing, Continuous Improvement and Operational Excellence?

Often, we see these three terms used interchangeably. In particular, a business leader responsible for your Lean program may be called a Lean Manager, a Continuous Improvement Manager or an Operational Excellence Manager.

So, what is the difference? Are they all the same thing or are they distinct methodologies? To resolve the confusion, the TXM perspective is:

  • Lean Manufacturing is a System of Management – it is a set of tools and principles used to manage a business in order to achieve superior performance.
  • Continuous improvement is an attribute of business culture – it means that the culture of your business encourages staff to always look for ways to improve performance. Lean is the approach that most companies use to create a continuous improvement culture, although Six Sigma and the older Total Quality Management approach have also been used to build a continuous improvement culture.
  • Operational Excellence is an outcome. What it means is really something you define. What is excellent operational performance for your business? Lean enables you to achieve operational excellence, but it is not the only approach you might apply. For example, Industry 4.0 technologies and other improvement techniques such as Agile or Six Sigma can be applied as part of the goal of achieving operational excellence.

What is the Difference Between Traditional and Lean Manufacturing?

The overarching major difference between traditional manufacturing and Lean manufacturing encompasses a totally different mindset and way of thinking about your customers. There are several major differences between traditional and Lean Manufacturing outlined below.

 

Traditional

Production driven by a sales forecast (Push Manufacturing).

Problems are viewed negatively

Work in process (WIP) is viewed as a normal part of operations.

Improve the system and disregard all types of waste in the process.

Management is the primary driver of change.

If a process is working there is no need to change it.

Standardized work (people performing the same task the same way) only exists in documents like SOPs, rarely in reality.

Focuses on training and relies on people to not make mistakes.

Systems thinking, often ignoring or unable to see the enormous opportunities for improvement.

Lean

Production is driven by customer demand (Pull Manufacturing)

Problems are viewed as opportunities for improvement often through root cause analysis.

WIP is a sign that a process needs improving and is a type of waste to eliminate.

Improve system by eliminating waste and improving current processes.

Everyone is empowered, trained in the principles of lean and encouraged to look for ways to improve processes.

Always looking for ways to improve processes and people.

Everyone performs the same task the exact same way until a better way is discovered; then everyone performs the task the new and improved way.

Focuses on developing processes that are error proofed.

Views the business as a series of interrelated value streams that can and should improve.

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Lean has evolved over the years becoming the go to methodology for process improvement and continuous improvement. Visual management is the lifeblood of a Lean production system. It provides insight across teams, departments and management. It is the link between the people and the data. Giving every stakeholder a clear picture of the day-to-day goals and objectives of the business.

 

We’ve broken down this article into 4 parts which you can jump right into after clicking on the links below:

 

What Do We Mean by Managing Visually?

Managing visually is the ability of a system to quickly show the current status to anyone that stands and observes, within 30 seconds. It may be the production status, quality standards, delivery status or a machine status. There are indicators in place to let everyone know how things are tracking. If visual management has been done well, EVERYONE in your factory understands and knows how to fix an issue if something is wrong.

quality and otif board
Consulting Director Anthony Clyne explaining the elements of a visual management board.

 

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What is Visual Management?

The key to growing a business is often the ability to empower people at every level to make decisions and take accountability. The TXM Lean Daily Leadership Process (LDLP) that our lean consultants use is our proven methodology that brings together visual management and leader standard work to achieve this empowerment. Visual management is the framework to communicate expectations, performance, standards, and problems in a method that requires little to no time to understand. You may have heard of visual management being used on the factory floor, but it can be used in a variety of industries and environments.

 

 

The Purpose of Visual Management?

Visual management is used to share information, work standards, build on those standards, highlight problems, stop problems occurring and prevent problems altogether.

Sharing Information – One of the major goals of visual management is the sharing of information. This information is usually about the day to day operation with metrics showing inputs, outputs, and any problems. This is one of the main purposes of visual management, the ability to share information succinctly.

Pie Machine Quality Standard
Quality & standard work on display for every employee to see and adhere too.

Developing Standard Work – Visual management also has the ability to build standard work and processes. Improving these standards is the main purpose of Lean and building a culture of continuous improvement. These standards are then built upon with new and improved processes evolving with the business.

Sharing Standard Work – Another objective is to share standards of how work should be completed. This helps with shift change overs and training staff in the standard work procedures. Standard work will eliminate waste in the process creating stability and consistency within your Lean Production System.

Highlighting Problems – Another objective of visual management is to highlight problems when they occur, appearing out of the ordinary and deviating from the standard. Andon Lights can highlight problems on the factory floor in real-time while metrics on the visual management boards highlight problems hourly or daily.

Solving Problems – Highlighting problems and issues on a visual management board allows for the problem to be analysed and worked through at the point of the problem. It can accelerate the problem-solving process driving quick results.

 

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What are the Benefits of Visual Management?

Saving Time – Visual management has the ability to cut down the time it takes to understand and process the information on the board. An efficient visual management board should communicate the status of the work area within 30 seconds.

Real-Time Updates – Visual management creates a centralised location for all updates to be kept and housed. It is usually updated daily to provide up-to-date information on production targets, sales targets and problems and issues.

Faster Problem Solving – It provides a structured system to discuss and work through problems in a formal setting, helping users accelerate the problem-solving process. By using tools like root cause analysis and problem solving strips you can solve the most complex problems faced by business in a timely fashion.

Improved Accountability – Visual management allows for greater accountability for everyone in the process. Helping to define roles, allocate tasks and give a standard work procedure to follow. Everyone in the process has ownership for their daily tasks.

Improved Team Performance – Improved accountability can translate into higher team performance. The purpose of visual management is to improve team performance and drive a step-change in efficiency.

Waste Reduction – Completing processes at the right time has an impact on reducing the amount of waste produced. By giving stakeholders the correct up-to-date information and resources being properly utilised has a dramatic effect on waste reduction.

 

 

Types of Visual Management

Visual management is formed by a combination of Visual Metrics and Visual Controls into easily digestible information with little to no training to understand. Visual Metrics – These are among the first tools implemented during a Lean implementation. This is the displaying of data to tell us how each area is tracking. The challenge is to ensure the information is gathered by those doing the work, in a timely fashion, and displayed so everyone in the area understands the current status. This also needs to be taken a step further; metrics must drive actions and there needs to be a clearly defined process for taking action and getting support when it’s needed.

Kanban Cards
Kanban Cards are one of the many visual controls you can implement.

Visual Controls – They cover more broadly how an area works physically – matters of where items are located, general housekeeping and controlling the flow of production can all be covered by visual controls. For visual controls to be effective there needs to be a clearly defined process for getting support when it’s needed. Visual Management Boards can help you answer questions on the factory floor that might take hours to answer if not done via a Visual Management Board.

  • Can you tell how each area is performing?
  • Will they meet their targets this week?
  • Who is doing something to correct the problem?
  • When will it be fixed by?

If you can’t answer these questions within a few minutes, then it’s time to revisit your Visual Management and the data you collect.

 

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Examples of Visual Management

Continuous Improvement Boards – Using a simple design and layout these boards are used to display short term actions. These types of boards are usually found on the factory floor with machine status, daily output metrics and problem-solving issues for all employees to see.

Project Status Boards – Status boards are an agile project management tool, acting as a focus point where teams can visualise work, limit work in progress and maximise resources. It gives all stakeholders a clear picture and objective for the short and long-term goals of the project.

2 men standing in front of visual management board
Ferguson Plarre Baker’s daily meeting at a production visual management board.

Daily Management Boards – Probably one of the more used board designs is a daily management board, used to communicate between shifts and across departments. The information on this type of board is simple and easy to understand.

5S Control Board – A control provides a central control and tracking of a 5S system. It highlights progress on a 5S audit, tasks to complete as well as clearly showing who is responsible for different areas of the workplace and different activities in the workplace.

 

 

Visual Management and 5S

5S and Visual management go hand in hand being the heart and soul of a Lean production system. 5S workplace organisation is a simple, practical approach delivering sustainability by sorting out, setting in order, shining and checking, standardising and sustaining. 5S uses visuals to achieve its goal of a standardised system used by every stakeholder in the business whether on the factory floor or in the office 5S and visual management can help start your Lean transformation on the right foot.

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Need Help Creating a Visual Management Board? Contact Us Now!

Related Articles

Managing Director Tim McLean explains the different types of visual controls you can implement.

Visual Controls

Visual Management and Visual Controls go hand in hand, they are the lifeblood of a Lean production system. Visual Management is designed to create a visual workplace with controls communicating without words and interruptions in process.

Visual Controls have the potential to help identify problems, reduce waste, reduce production costs, shorten lead times, reduce inventory, create a safe working environment and even increase your profits.

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Visual Controls standardise decision making based on facts. For example, if the light is red, I can not go, if it is green I can.  The color of the traffic light is a fact that allows us to make a decision to go or to stop our car. Likewise, visual controls give us the ability to tell normal from abnormal right away. So to extend the analogy, the car going through the red light is clearly abnormal, whereas a flow of traffic on a green light is normal. In fact, visual controls are everywhere in our everyday life from market car spaces, to colour coded subway lines and green emergency exit signs. Unfortunately, we step in to our workplaces, these useful codes to direct our behaviour tend to disappear and we are faced with ambiguity everywhere.

Visual Controls can be used across your business are equally effective in the office, operations or engineering. Visual controls can also be powerful in maintaining quality and safety. There are a variety of different visual controls you can implement to create an environment in which the non-standard can be distinguished from the standard. Below is a summary of some of the more widely seen visual controls our consultants see out in the field.

Color Coding

The easiest form of visual controls to apply is color coding, where we use colors to communicate status. Once implemented, it allows employees to easily identify what action to take next. Having color-coding standards in your workplace will help ensure a uniform style across the business.

Color coding can be applied to all departments, including colour-coding shadow boards for tools, color coding floor markings, even office documents. Another tool that can be used is a color-coded visual board. These boards are updated on a regular basis provide instructions on everyone’s tasks in the workplace. Implementing a color-coded visual board can help employees keep track of their work tasks.

TXM Lean Case Study – Managing Lean Office Processes with Colour Coding

Andon

Andon refers to a system that provides notification to management, maintenance, and operators of a quality or process problem. It works when an issue is found at a process, the team member has the ability to immediately notify support staff so that the problem can be managed. In manufacturing, it allows a worker to stop production when a problem is found and immediately call for assistance. This can be extended to an office process, where raising an Andon flag means that the process does not go on to the next step until the issue is resolved.

The Andon can be triggered manually by using push button, pull cord or even flags. The common reasons for activating the Andon can be part shortages, defect created or found, tool/machine malfunction, or the existence of a safety problem.

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Standard Work

Often there are always several ways to do a task but only one of these ways is the most efficient use of resources based on current knowledge. Over time, the skills needed to perform a task can become lost and the process of relearning is repeated.

Standard Work provides employees of all levels with structure and predictability to their working week to enable them to maximise their efficiency and impact.  The process of developing standard work ensures that employees understand all of their “must-do” tasks and allocates the most appropriate time to complete these tasks.

In the Toyota Production System there are four aspects to standardisation:

  • Content – this is agreeing with the steps that are involved in the task. Sometimes there is debate as to whether particular steps are necessary. To develop standardised work the team must agree on what the necessary steps are.
  • Sequence – the steps must be completed in the same sequence every time. This is essential to ensure a consistent outcome
  • Timing – there should be a standard time that it takes for a trained person of average competency to do the task. Knowing this standard time enables us to balance that task with other tasks to create level production.
  • Outcome – The outcome of the task needs to be clearly defined in terms of quality, safety, and output.

The Standard Work approach is established so that it is practical and useful to everyone and free of difficulty. Standard Work is not perfect and is considered a living document that develops over time. But remember, standard work will die very quickly if it is ignored.

Examples of Standard Work:

  • Work instructions at each work cell allowing operator and production changeovers to be an easy transition.
  • Standard worksheets with instructions and diagrams for manufacturing processes.

Floor Line Marking & Signage

Floor line marking and signage showing pathways, vehicle lanes, working cells, and intersections. These consist of colour-coded floor markings, signage with different logos and markings to make these easily and quickly identifiable.

Floor markings and signage as visual controls outline where materials & people flow should end up reinforcing a safety culture without interruption to the manufacturing process.

TXM Lean Case Study – Global Pneumatic Manufacturer

Visual Boards

2 men standing in front of visual management board

 

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Visual boards are used to promote Plan, Do, Check, Act. The boards work when the first shift starts & the production plan is established at a stand-up meeting. At every change over the production for the day is tallied on the board and any problems are action-ed by the supervisor to recover production at the next change over.

Visual boards come in a variety of shapes and sizes, they can be used across the business in all departments not just limited to the factory floor. In the office, visual boards can be used for projected sales targets, actual sales targets, quoted projects and even the mood of employees.

Quality Standards

 

Having quality standards for products helps to give your operators a visual control to base their decisions off when determining quality. These standards should be in reach of operators for easy reference. Visual Controls when applied to quality help to reduce defects and eliminate quality control inspection from your process.

There are a variety of visual controls you can introduce into your organisation to support your visual management goals. Visual controls are used to help your organisation see the wastes, shorten time to find out information & materials and promote a Plan, Do, Check, Act culture of Continuous Improvement.

TXM Lean Case Study – Nexans Lean Office

By Justin Tao – TXM China Consulting Director

What is a Visual Management Board?

If takt time is the heart of Lean production, then Visual Management represents the nervous system in Lean management. Visual Management is an essential tool when we implement Lean. Visual Management helps to amplify the impact of Lean management by visually building a bridge between Lean tools and Lean management.

Ferguson Plarre Bakers conducting a daily stand up meeting reviewing the past days’ performance.

Some common types of Visual Management in the workplace include:

Most companies have Visual Management Boards, which is one of the simplest formats of Visual Management. I often find that some so-called “Visual Management Boards” actually are “show boards”, which only show the information, records or plans and lack interaction with readers. What’s worse, the content of them is often out of date.

How to Identify If Your Visual Management Board Really Works? – The 31 Second Rule

A real Visual Management Board should contain three elements: standards, problems, and actions.

  • Standard: In Lean, we set target performance as the standard, rather than average performance.  The standards should be clearly indicated on the board, which tells how things should be if everything is perfect.
  • Problem: What is the problem? Problem is the deviation from standard, either actual performance (e.g. lower than target), or the standard itself (improper target); One operations manager in an ice-cream factory told me that there’s no need for improvement as their efficiency is more than 120% every day. After my observation, actually, they had twice the number of operators than was needed on the production line.
  • Actions: Countermeasures to a problem should be taken when there’s a problem. A Visual Management Board without action is definitely just a show board. How effectively the problems are addressed, and the actions are carried out, represents how efficient your organisation is

All these elements help the user to understand what’s actually going on in the work area. Only by making the things visible, it is possible to identify the deviations (problems) and quickly address and solve them.

Windsor Caravans employee standing in front of his daily visual management

What Does a Good Visual Management Board Look Like?

At TXM, we believe that a good Visual Management Board should match the 31-second rule:

  • In 1 second, it can tell us if it’s normal (everything is fine in the work area), according to the standards (target or plan); The work area should “talk” to you in simple terms. Usually, companies use green to represent good status (e.g. hit the target, on time), and use red to represent problem status (e.g. lower than the target, delayed);
  • In 10 seconds, it tells us what the problem is if it’s not normal.
    At TXM, we use magnetic concern strips to record and manage problems.;
  • In 20 seconds, it tells us what action is to be taken, who is responsible for this and what support is needed. Problems without actions, or actions without checks, are a waste to have on the board!

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A suitable Visual Management Board will help communicate between users and viewers and make the Lean Daily Leadership Process more efficient and effective. The form of the Visual Management Board is limited only by your imagination! Contact TXM to make your Visual Management more efficiently and effectively.

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More TXM Lean Methodology Videos

How To: Create Flow Without an Assembly Line

Assembly Line in a Factory
Factory Production Line

One of the most well-known Lean concepts is that of “flow”. The most familiar example of flow is the automotive assembly line. On an assembly line products flow through a factory moving through different workstations at a steady rate until they roll off the assembly line completed.

This, of course, is how cars are assembled. And we all know that the automotive industry, especially Toyota, is the inspiration for Lean Thinking. But what if you don’t make cars or are even involved in mass production? What if you are not even involved in production at all and are in a service business. What possible relevance can flow have to your business? This is a question I get asked all the time and, in this article, I hope to explain how flow can be relevant to any process.

Why do You Need Flow?

How often to you look at your process in your office factory or warehouse and wonder where you are up to, how long it will take to finish the current work and what your capacity for more work is? Imagine if your process worked at a predictable rate with every step of the process synchronised to that rate. Imagine as well if there were no buffers or wait times between processes, meaning that your underlying value adding time was also your lead time. If you imagine that scenario you are imagining flow. Whether you are making cars, fabricating steel columns, making bespoke staircases or processing credit applications, flow can deliver huge benefits. So how do you create flow away from the assembly line?

Mapping Processes with Colour Coding

Understand Your Current Process

A value stream map is a tool that will help you design your flow. The TXM Manufacturing Agility Process® (MAP) is based on automotive value stream mapping techniques, but adopted for low volume, high mix manufacturing and service flows. The current state map helps you understand your current process and identify how you create value for the customer and where there is waste. You then develop a future state design for your process that eliminated unnecessary steps and defines your flow.

Measure the Flow

Once you have defined the steps in your flow you need to decide how to control the rate of flow. The concept here is that we match the rate of activity at every step in the process to the rate of customer demand or takt time. To do this you need to find a unit of measure for your process that can serve to control your rate of flow. This is easy in assembly, because products are fairly uniform, and it is a simple matter of counting units.

In some office processes also, it can be as simple as measuring the number of transactions, such as the number of quotes for a sales team. However, for more complex processes, you may be trying to measure “apples against oranges” as one job or product differs in terms of work content to the other. The answer here is to find a simple metric that can be quickly measured, and everyone can understand.

It may be that the metric is not perfect, but as long as your product mix is reasonably constant (e.g. a mix of difficult jobs and easy jobs) this variation should even itself out. If the variation is too great, you might need to create two or more flows, grouping similar products or jobs together with different measures to track the flow.

Once the unit of measure is established you can calculate your takt time in terms of minutes per job (or a takt rate in jobs per minute). The aim is that each process step will then work to that rate.

Lay Out the Flow

You have defined the steps in your flow and set a takt time, but to really make your flow effective, your physical process layout should reflect the flow. This means bringing the processes together so that jobs naturally flow from one step to another. We call this a Lean Facility Layout. It can apply equally in an office, engineering or manufacturing process. Bringing the processes together makes interruptions to the flow of work clearly visible and enables you to correct these problems as they occur rather than after targets have been missed.

Don’t Let Perfection Get in the Way of Better

Rockets in a Hangar
SpaceX Rockets

Of course, reading this short article, you will have visions of an automotive moving assembly line with cars moving through workstations timed down to the last second. This is probably more aspiration than reality for many customised or office processes. There is likely going to be some variation in process times from step to step and it is likely that you will need small buffers to balance out variations in product mix. However, by creating a flow, even if it is not perfect, you will have significantly improved the consistency and predictability of your process. You will also be much more able to see and eliminate waste and problems.

Where can Flow Work?

At TXM we have been applying flow concepts in non-traditional processes for over a decade. None of our customers make cars and very few have been involved in continuous, production line assembly of mass-produced products. Instead, some of the processes we have applied flow concept to include:

If these principles can work in these diverse industries and applications (and many more) they can work in your business.

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What is Project Manufacturing?

Shipbuilding is one of the oldest and most complex forms of project manufacturing

When we think of a manufacturing business, we usually think of a business that manufactures a defined range of products. These products are manufactured in the same way every time.

Product development typically involves a creative design phase, a process of testing and approval, prototyping or production trials and finally product launch. Much of our thinking and much manufacturing and supply chain literature assumes this model of manufacturing and product development.

Increasingly we see companies that operate in a different way. Their products are developed to meet a particular customer order. They don’t have a prototyping process because the product is a one-off. That is, every product is effectively a prototype.

They manufacture the product from some common parts on the shelf, but will also often require one-off bespoke parts. These parts are ordered just for that particular customer order. Finally, these products usually have a long lead time from order to delivery. Orders are often inter-related and sequenced over a period of time. I call this type of manufacturing project manufacturing.

Project manufacturing is not new, shipbuilding is a great example that has been around for hundreds of years. However, the major driver of the growth of project manufacturing is changing approaches to commercial and residential construction.

Globally the last 20 years have seen more and more of the elements of buildings manufactured off-site and delivered to the site. This approach makes sense as building sites tend to have limited space and the ability to control complex assembly processes and perform them efficiently is limited. Shifting elements of construction off-site simplifies on-site work.

“Manufacturing efficiencies” can be achieved in specialized factories dedicated to one element of the construction project.

The use of automated equipment greatly improves the efficiency of manufacturing and assembling elements such as joinery, structural steel or wall framing. This is much more efficient than doing this work manually on site. Examples of off-site construction include modular and relocatable buildings, pre-fabricated framing, structural steel, joinery, modular bathrooms, building maintenance cranes, HVAC systems, pre-fabricated building facades, and pre-cast concrete panels.

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Learn How TXM Helped ATCO to Transform Manufacturing of Relocatable Buildings from the Lean Case Study Video

Project-based construction is also frequently seen in shipbuilding, plant and equipment manufacture, aircraft manufacture, commercial vehicle fit-out and heavy trailer manufacturing.

Seven Common Problems in Project Manufacturing and How to Overcome Them

Because of the unique nature of every product, project manufacturers often argue that they don’t operate a “production line” and that Lean does not apply to them. In fact, at TXM we have made something of a specialty over the years in working with project manufacturers. We see the same problems over and again. The seven most common problems we see in project manufacturing are:

1. Throwing Projects Over the Wall

For many project manufacturers, projects go through a series of handovers. Once the job is won, sales will hand over the project to engineering. Engineering will then complete the detailed design and hand over the designs and (hopefully) a bill of materials to purchasing.

Purchasing then order the parts and hand the job over to manufacturing. The problem with this approach is that no-one owns the whole project and that delays are allowed early in the project (often at customer instigation) that then compress lead times at the end of the project leading to expediting, escalating costs and late delivery. An effective project management function and end to end project management processes are essential to ensure that budgets and deadlines are met.

Learn Five Reasons Why You Spend Your Day Fire Fighting and What do Do About Them

2. A lack of standardisation and reliance on “ground up” customisation. Project manufactured products are inevitably one-offs, but that does not mean that they need to be completely bespoke in every way. Often engineers are allowed too much freedom to design every product in a unique way. Clear engineering standards, use of standard materials from a limited range of suppliers, standard sub-assemblies and customisation using “plug and play” options can greatly reduce cost, lead time, complexity and design risk.

Learn How to Create Lean Standardised Work for A Customised Product

 

3. Material shortages – Many project business spend their days expediting materials. Unfortunately expediting always leads to more expediting as pushing one order forward inevitably pushes other orders back. Kanban systems can be highly effective for standard items such as fasteners, fittings, common raw materials, and standard subassemblies. For bespoke parts, they need to be identified in the handover from sales, ordered as early as possible and then tracked by the project manager. Supplier lead times need to be respected and planned for.

Discover Five Ways to Improve the Performance of Your Suppliers

 

4. Incomplete and inaccurate information from sales and the customer: Products are usually highly complex in project manufacturing. It is reasonable for engineering to insist that information handed over on each new product is complete and accurate. Avoid the temptation to “just get started”, when information is incomplete as this rarely saves time and often leads to rework and errors. It is fair to expect that if customers fail to meet deadlines for providing information then delivery dates get pushed back accordingly.

 

5. Inadequate information provided to production: Too often production is expected to “just know” what to do when information on drawings and specifications is incomplete or inaccurate. This inevitably leads to errors and rework. Drawings need to be fully detailed and simple techniques such as colour coding can help prevent simple errors such as folding a part the wrong way or welding a cleat on the wrong side of a beam. A manufacturing engineering function can often greatly help the smooth transfer of information from engineering to production.

 

6. A lack of production “flow”: Project-based manufacturers often believe that they don’t have a flow. Products are manufactured in on place on the factory floor in what we call a “static build”. Workers often move from product to product based on availability of parts, “priorities” and, in some cases, worker preference. This approach is space-hungry, leads to long and unpredictable lead times, provides little indication of production progress and means that every tool and every material has to be transported to every job. On the other hand, creating a “pulse flow” where products move at prescribed intervals provides a visual indicator of progress and sets a real imperative to solve problems quickly so that products can keep moving. The result is usually shorter lead times, higher productivity and better use of factory space.

Learn how TXM Helped Boat Builder Sykes Racing to Create Flow Production in this Lean Case Study Video

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7. Starting jobs that you can’t finish. Often the temptation can be to get a project into production, before you have all the parts, drawings and information. This is fraught with risk. Instead, develop a “good to go” process where jobs are only released to the line if all the parts and documentation is ready. If project managers see that the production “timeslots” are approaching, it tends to focus their mind to make sure that everything is delivered on time and that their project is “good to go” and does not miss its scheduled production time slot.

Summary

Project manufacturing is a growing phenomenon, especially in construction. It is true that this type of manufacturing requires a different approach to traditional manufacturing. However, if the benefits of project manufacturing are to be truly delivered then Lean thinking needs to be applied in a targeted way to ensure that project manufactured products are always delivered on time, on quality and on budget.

on time in full cover
Tim McLean’s book On Time In Full Provides Detailed Solutions to Your Material Management Problems

The Keys to Successful Lean Material Management

Over the years many manufacturers have adopted Lean tools focused on improving the efficiency of production processes.  However, often despite these efforts manufacturers still suffer downtime, poor productivity and missed deliveries. The cause is the inability to get materials to the right place in the right time and in the right quantity.

Many companies know about Kanban and pull systems, but few seem confident to use them. Instead they often rely on cumbersome and ineffective spreadsheets. ERP systems also fail to offer solutions to many companies. A value stream map will show the process steps and, critically, the information flows that trigger the movement of materials and production jobs from one process to the next. From this you can develop your future state map. It is at this point you will probably get introduced to some new concepts for managing the flow of production jobs and materials.

READ ON TIME IN FULL TO FIND LEAN SOLUTIONS FOR YOUR SUPPLY CHAIN

The Difference Between Push, Pull and Flow

The first response many companies adopt to overcome problems with material shortages and late deliveries are to look for a software solution. I call this automating the chaos! There are very many systems available, but most offer a enterprise resource planning or ERP approach. In this approach the business enters a forecast for expected customer requirements in the future. This is called a “push” system since materials and production are “pushed” through the production process in anticipation of future customer demand. This approach relies on customer forecasts being accurate. If you are one of the many companies which cannot get accurate forecasts from customers, then the ERP approach will be ineffective.

In a lean process we aim to achieve “flow”. This means that individual products flow from process to process in sequence. The ideal is “one piece flow” such as on an assembly line or production “cell”.  Each process hands the product on to the next process without work in progress or delay between processes. Failing that, a “First in First Out” (FIFO) lane can be used to control work between processes. A FIFO lane has space for a limited amount of product, usually no more than a few hours of production. Once the lane is full the upstream process needs to stop. This controls the work in progress and ensures consistent, fast lead time for all products flowing between the two processes.

Sometimes you can not achieve flow. For example, a process where it is necessary to run a batch of product such as heat treatment or plating or where set up times are too long to permit a batch size of one unit. Where processes have different hours of operation (e.g. one shift assembly vs. three shift machining) it can also be very difficult to achieve flow. In these situations a pull approach can be used. This means that production at the upstream process is “pulled” by the consumption of parts at the downstream process.

LEARN ABOUT IMPLEMENTING AN ERP SYSTEM

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Kanban

fixing a kanban system
Kanban cards like these trigger replenishment of materials. They are the most well know Lean material management tool, but by no means the only one.

There are many different types of pull systems used in lean manufacturing processes. The one readers are likely to be most familiar with is Kanban. In a Kanban system a card is attached to each container of materials. As the materials are consumed on the production line the cards are removed and returned to the upstream process or to the supplier. Parts are then picked or manufactured in the quantities specified on the Kanban cards, the cards are attached to the containers and the replacement parts sent back to the line. Usually multiple Kanban cards will be required for each part.

To calculate the number of cards you need to work out the lead time required to return the cards to the upstream process or supplier, to replenish the consumed parts and then to return these parts to the downstream process. You then need to calculate the maximum (not the average) number of parts that will be consumed by the downstream process over this replenishment lead time. Divide this by the number of parts per container to work out the number of Kanban cards you need in circulation for each part. You can then adjust the amount of parts in circulation up or down by adding or removing Kanban cards to the system.

Two Bin System

server racks two bin system
Example of a Two Bin Kanban system. When the bin at the front is empty, the bin behind slides down to replace it and the first bin is replenished

For small low value items, a two bin system can be a simple alternative to Kanban cards. In a two bin system a maximum of two bins of parts are held at the downstream process. The bins are usually clearly labelled with the part number and quantity of parts they are supposed to contain. One bin will be in use and the second bin will be full awaiting use. When the first bin is empty the operator drops it down a return chute or places it in a designated location for material handlers to pick up. The empty bin is then returned to the store, refilled and returned full to the line. The quantity in each bin needs to be enough to allow time for the empty bin to be replenished before the operator is using runs out of parts.

Two bin systems work well, but rely on a short replenishment lead times as the parts must be replenished before the bin in use is finished. They generally only work for items that can be supplied from a store to the line or for items where the supplier offers regular (at least daily) deliveries. They are very commonly used for fasteners and consumables. As the replenishment lead time increases it becomes necessary to introduce more bins to maintain supply and the system reverts to the multi-card Kanban system.

 

LEARN MORE ABOUT TWO BIN SYSTEMS

 

Batch Processes

Branach kanban control board
Example of A Kanban Control Board

In many cases upstream processes that are supplying parts manufacture in batches. In this case a system is needed to accumulate Kanban requirements until the target batch quantity is achieved. One way to do this is to set up a Kanban control board as shown in the picture above.

Kanbans are returned to this board and grouped by product. In this case the target batch size is four. When a product has four cards on the control board, the Kanban cards are then hung on the rail above the board. The machine operator then takes the cards in batches of four.

There is no need for a production schedule as the order of production jobs is simply the order that the batches are loaded on to the rail. There are many other variations on pull systems for batch processes, but these require more detailed explanation than is possible in this article.

 

 

 

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Purchased Parts Supermarket

A common challenge in manufacturing is ensuring that purchased parts arrive on time. The traditional approach is to break down the bill of materials for a job and order the parts for each job individually. However in most cases parts are used in many jobs and matching up the parts requirements with individual jobs involves many transactions and is highly error prone. In your local supermarket the shelves are replenished at a regular interval to replace the products that have been sold. Each location in the supermarket is sized to ensure that the product does not run out before the shelves are restocked. A purchased parts supermarket operates on exactly the same approach. A “plan for every part” is developed which has the characteristic of each part including its usage, supplier lead time, pack type, pack size and type of storage

(eg. shelving, racking or block stacked). Each part is then stored in a dedicated location to make checking stock easy. On a designated day each week (or each day if necessary), the locations storing that suppliers’ parts are checked and the quantity needed to restock the shelves is ordered. An even better alternative is to get the suppliers to restock the “supermarket shelves” themselves.

WHAT TO DO IF YOU HAVE IMPLEMENTED KANBAN AND STILL HAVE SHORTAGES!

The Need to Change Culture

Any system for controlling material requires a level of shop floor discipline and the systems described above are no exception. If products are not returned to their correct location or Kanban cards and product bins get lost, then the system will quickly break down. To create this level of shop floor control we frequently implement 5S techniques to create a discipline of a “place for everything and everything in its place”. The role of the front line supervisor is also critical in ensuring the system is maintained and improved.

In our experience the effort is worth it. Shortages are typically reduced by more than 90%, customer lead times are cut in half and inventory reduced by 50%. The level of expediting and stress is also dramatically reduced – which is often the benefit that our clients enjoy the most!