Point Kaizen

Point Kaizen describes improvement actions concentrated on one workstation = on the spot.

In general, all lean activities are striving to increase the output of your processes by simultaneously increasing the level of quality by shorten lead times and using less resources. But not all lean initiatives are reaching these targets. Typically the cause lies in the lack of clear targets by the management combined with a misinterpretation of kaizen activities and organizational change.

Kaizen is the Japanese term for “change for the better” on a continuous matter. Point Kaizen refers to a compressed focus on one workstation and improvement actions during a few days, where e.g. in the end the station is no more the bottleneck of the line/cell. For many people this is considered as “Lean”, but it is only a small part of the journey to real operational excellence.

As mentioned Point Kaizen is a scheduled event. When you have an own Lean Management Team or Kaizen Manager these are the guys who are in charge for the upcoming days. Once the team is gathered the action starts.

5S all over: Yes! Let’s start! Use the euphoria and sort out, get rid of all unwanted objects. Clean-up and proper arrange tools needed. Install e.g. flow racks following the 2 bin principle to ensure straight material flow. The Kanban System and FIFO can’t be skipped. Once the workstation is transformed - everybody is proud to have been part this lean activity and communicates the success story.

If you continue with Point Kaizen activities you will reach a better performance on each isolated workstation and probably everybody thinks that you have a great lean initiative. But the real long term results are missing out. So why to continue with lean activities?

Take a step back and see what you have so far. With the improvement actions on each workstation you have raised the efficiency of all single steps but didn’t consider the flow of material in between. It might be tiring to put all this effort in and then the management comes along and sees no obvious progress. This is the point when you move from Point Kaizen action to a systematical organizational change. This process is focusing on the underlying targets of the organization, such as raising performance, decreasing lead times, improving quality and making more profit.

The A3 format comes back in the game. Not only the A3-report and A3 problem solving but more the target setting on an A3 format that tells the story of how the targets can be reached by preset measures. Combined with the future state Value Stream Map showing all Kaizen Bursts each representing a Point Kaizen activity. All those measures lead to a future state of material and information flow that drives your organization into new spheres. In the future with the new Value Stream your bottlenecks will shift along this stream and always creating new point kaizen starting points. Bottlenecks by this can be either stocks of material, high process times or a lack of information. All Kaizen activities, no matter concerning material or information flow, are implemented following a prioritized list. You not only will have to reallocate resources, but also actively participate on the process of organizational change. You and your mid-management are in the driving seat, you have to know where your organization is heading, so make sure that you and your management are participating on Kaizen activities.

Point Kaizen is the first brick of the foundation for organizational change. With the systematic identification of bottlenecks, Point Kaizen activities can be planned and conducted. To have quick changes but is still able to deliver, one bottleneck after the other is worked on. Each Point Kaizen delivers one piece of improvement for the overall improvement needed. These superordinate targets are an increased output, reduction of lead times by simultaneously achieving Zero Defects Policy and all this combined with lower labor costs.

Quick Response Manufacturing Control

“ Quick Response Manufacturing Control” (QRMC) is a concept developed in the 90’s and describes an organizational philosophy which propagates the orientation towards the reduction of lead times as the primary target of all corporate decisions.

An approach was developed against the backdrop of the thinking that emerged in the 1990s, moving away from specialization and toward strong customer orientation and the resulting process-oriented organization, with the result that the entire organization was fundamentally transformed and aligned to the factor of time. Improved quality, lower prices, and greater responsiveness are accomplished as a result of the company's ongoing focus on the QRMC principles.

The concept of short lead times does not clearly stop when production reaches its limits; rather, all divisions of the complete organization must be incorporated into this strategy and align the targets, as determined by customer needs. Furthermore, this model allows for an outwardly adaptable and quick response to changing customer requirements.

Properties of QRMC

QRMC is distinct from existing "lean management" approaches, which are not in competition with QRMC but rather complementing it.

QRMC is appropriate for usage in businesses where production has the features of a significant number of variants manufactured in small batches with customer-specific characteristics. To make a decision if QRMC is the right approach for your business, see the following matrix.

A paradigm shift from the dominance of cost-based approaches and ways of thinking (e.g. unit costing) to measuring instruments is proposed, with the lead time for customer order fulfillment as the only essential indicator for controlling the overall material flow. It is vital to consistently use the four QRMC core concepts in order to successfully implement the QRMC philosophy in your organization in a durable and broad manner:

1. Time is crucial

2. Adaptation of organizational structures

3. Organizational-wide application

4. Dynamic toolset

Time is crucial

The common wisdom about work is that the quicker, harder, and greater you work, the more work you accomplish in less time. This mindset is represented in today's control systems, which consider "touch-time" control (value-adding activities) to be the most important component in time efficiency. Because the "touch-time" can be precisely measured without any doubt. And each and every controller assumes: Only what I can measure I can control. However, because touch-time lead times account for only around 5% of all lead time, the cost-cutting potential is modest as most of the time it is already squeezed to a minimum.

Furthermore, no matter what system you look at, the presumption of “faster, higher, further” only applies to a certain point, the break point. See it overstressing the the system. E.g. when the manufacturing input factors (5M) are pushed to their limits, the quality level will drop, toolings will wear out faster or even destroyed, in short: the system will collapse.

But to keep on going, how is the “non-touch-time” (non-value-adding tasks) measured. According the standard, cost-based approach, all expenditures for incoming and finished goods storage are covered including all overhead that is needed on defining processes on how and when a product will be produced. With existing traditional systems, these overhead costs are not really accurate apportioned.

As a rule, overcharges are utilized to spread this cost block among the things. Most of control frameworks don't correspond upward an ideal opportunity to the genuine causes. These overheads, then again, address the costs of time, or all the more explicitly, the expenses of lead times.

QRMC doesn't suggest that upward costs can be allocated all the more effectively, yet rather that more limited lead times mean lower upward expenses. The lead season of associations that attention on a QRMC technique is continually limited, permitting the organization to prosper in market significant numbers (e.g. delivery reliability or delivery time).

It may be challenging trying to begin utilizing QRMC approaches. Toward the beginning of a QRMC project, taking on the QRMC methodology and rules will prompt higher item costs.

The formation of cycle arranged hierarchical units eliminates the division of work into little useful work steps in free handling units (purported QRMC cells). The "autonomous working gatherings" work association standards are utilized in this QRMC cell's rundown steps. Inside the QRMC cell, multi-functional staff has a bigger responsibility, which is addressed in an expansion in "touch-time."

More modest clumps ought to be fabricated, as indicated by QRMC, to upgrade responsiveness. Thus, there are more set-up processes, which raise unit costs. Producing more modest bunches requires a higher recurrence of set-up processes, prompting more noteworthy set-up costs.

How does the lead time consumption influence you in the event that you can deliver on request and not in stock in light of the QRMC drive?

Cost decreases for distribution center terminations, as well as continuous structure uses, staff compensations for material dealing with, and deterioration costs, are completely limited. Notwithstanding these immediate consumptions, managerial expenses, for example, arranging and establish the executives have been brought down essentially.

Inventories ascend in esteem since they are not sold on the grounds that they are not created because of direct client interest.

All things considered, lead times brings down upward expenses. As opposed to the accepted problem of the following expense expansion in customary controlling, an increment in “touch-time" will subsequently bring about a general expense decrease, thinking about hierarchical QRMC structures!

Adaption of organizational structures

With a traditional and capacity arranged construction, an organization working in a confounded and dynamic market environment described by small batches, huge variations, customer specific goods, and intense competition can't achieve the objective of significantly bringing down the lead times. Accordingly, many errands have almost no immediate market reference; the longings of both outer and inner clients are just obscure. Besides, a capacity arranged association is wasteful, with long coordination and choice cycles.

Four areas of activity are determined to meet the points of "responsiveness to the customer" as a vital cutthroat component and leap forward into new aspects as far as adaptability and execution.

1. Change to cell manufacturing

2. Group liability rather than hierarchical control

3. Broadly educated workers > Qualification Matrix

4. Lead time as key figure

CELL MANUFACTURING

The solid consideration towards customers needs delivers a QRMC cell. This requires the mix of all capacities expected to meet customers assumptions, and henceforth focuses on a painstakingly characterized and limited market and additionally customer target.

Thusly, a QRMC cell involves the express task of man, machine, material, and procedure in a multi-useful structure, as well as their actual mix in one spot. Subsequently, outline work exercises are handled autonomously and completely to make a cell result.

Team responsibility

The drop from a hierarchical organization, in which those in control train e.g. operators what and how they should work, to a self-mindful organization inside a cell, is the following field of activity. Representatives plan and assemble their own corporate philosophies. The notable strategies for autonomous gathering work, like work revolution, work advancement, and occupation growth, come into consideration here. By working autonomously, productivity and product quality are improved endlessly. After totally planned requests have been finished; time is accessible to finish one more part of the QRMC hierarchical design: multi-practical employee qualification.

Multi-Qualified employees

At the point when workers are sick or on vacation, their obligations can be taken over and dealt with by different colleagues. This is the most quick rationale in broadly educating exercises. One more part of "cross functional qualification" is that weariness in positions is killed, and the scope of assignments turns out to be seriously captivating. This inspiration has an unsuitable clarification, however it is considered unreasonably quickly. Other key explanations behind "cross functional qualification" with regards to QRMC includes:

• Subject to the every day bottleneck, the obligations in a QRMC cell are incredibly adaptable. Various requests might happen at various stations inside the cell, expecting operators to work on an assortment of assignments consistently. The multi-qualified operators upgrade the cell's adaptability, empowering bottlenecks to be kept away from.

• Advanced machine parks don't constantly request the full focus of operators. Subsequently, the operator should be qualified of handling different machines at the same time.

• Long-term continuous improvements of process steps inside the QRMC cell are much of the time achieved because of the different work volumes.

Lead times as key figure

To evaluate the cell's performance, the lead time must be utilized and assessed frequently. Overhead costs can only be lessened by concentrating on lead times and the consequent suffering pressure to lower it.

The lead time is defined as the major goal as a result of this knowledge. On the 2nd layer, standard indicator systems and performance indicators do not need to be updated; instead, they operate as assistance and control function. The QRMC number can support this targeted orientation on cell level.

The following formula is used to compute the QRMC number:

Q "RM - Number "= "Lead Time reference period" /"Current Lead Time" ×100

Two points must be predetermined for a sufficient implementation of this new measurement technique:

1. To commence, the cell must clearly control the start and end points of the lead time measurement ("When does the time starts to run?"). Only when the cell has both the necessary material and the order release, for example.

2. The time, on the other hand, should only be monitored if the cell has absolute control over the associated time. Only those aspects of the cell's team that it has command on can be assessed.

As a result, employing the QRMC number has a variety of benefits:

While the assessment reveals a falling curve when appropriate measures to minimize the lead time within a cell are adopted, the graphical display of the QRMC number shows an ascending graph. The cell crew is much more inspired by increasing graphs than by dropping graphs.

Smaller lead time reductions at a later period are awarded more than greater lead time reductions at an earlier time by the QRMC number. This is demonstrated by the fact that lowering the lead time from e.g. 1hr to 30min is more difficult than cutting it from 3min to 2min.

Lastly, the QRMC number creates a dynamic competition within the organization, allowing teams and cells to monitor and analyze their progress in lead time reduction.

Organization wide application

In order to adopt the QRMC approach in your production areas it needs to be rolled out in the complete organization.

The fields of administration, purchasing, and product development are clearly referenced. As previously stated, it is also essential to minimize the interfaces by remodeling the cells to QRMC cells. Moreover, conventional process optimization techniques can be abolished, parallelized, integrated, or altered.

Planing your production with QRMC

A Material and Resource Planning (MRP) system helps you with production planning by assessing material requirements, initiating order proposals, and executing orders based on delivery dates.

The MRP system, on the other hand, is only as good as the employees filling it with information. In contrast to the processing time, "buffer times" for the order term are frequently scheduled to ensure smooth workflow and overcome planning flaws. The parameters for an MRP system are fairly straightforward after rebuilding the organization to QRMC cells. The MRP system is used to carry out greater cooperation and scheduling of the material flow from the supplier via the QRMC cells to the end date.

The system uses conventional logic based on lead times to regulate WIP levels, material orders, and backward scheduling by delivery date. The lead time is determined using the QRMC cell's lead time rather than the processing timings for every processing stage.

The MRP system is not used to manage micromanagement for each particular machining phase; this is performed by the cells independently. This implies the MRP system will be simpler, and the buffer times associated with each machining process will be shorter. Adjustments in the lead time as a result of cell optimizations are communicated back to the MRP system.

To synchronize order planning in QRMC systems with several QRM cells, a "capacity forecast" system, the so-called POLCA system, is initiated.

The POLCA (Paired-Cell Overlapping Loops of Cards with Authorization) system relies on the QRM cell structure and guarantees a constant flow of information among two cells. This prevents production from causing material blockages in the next cell. As a result, WIP accumulate between both the QRM cells. POLCA straightens out the varied capacities and lead time per cell, inhibiting the development of these "buffer or backlog stocks."

Due to planning in the MRP system, POLCA only operates on an order if it is required and genuinely needed POLCA aids in the identification of highly frequented bottlenecks in the system, narrowing the range of optimization techniques.

Coming to an end

Through the adoption of the QRMC methodology and its effective implementation, not only are lead times lowered, but also overhead expenses are diminished tremendously.

Additional effects include increased product and process quality, and also high variability against short-term market shifts and fluctuating client behavior. Customer responsiveness in today's marketplaces, with the appropriate items in the right location at the right time, is a crucial component that will result in greater market share. Cost savings and sales growth can both be achieved with QRMC.

In todays and tomorrows competitive market, a strategy that guarantees organizations are more competent and durable.

Stop the line authority

Stop the line authority describes the ability or permission of operators to stop the process when a deviation or problem occurs. By doing so it is prevented that defective parts are passed on the downstream process steps.

A typical example are so called “Andon cords“ that can be pulled to immediately stop the process and inform the supervisor. To read more about Andon itself go here.

When you are in the lean world you might have come across the famous Toyota quality control mechanism “Andon Cord”. The cord is a simple tool to alert others of deviations or problems in the production line, at Toyota everyone has the authority to pull the cord. By pulling the cord almost instantly production will stop and give the alert to responsible supervisors that there is a crucial issue that needs immediate action. Following the lean principles and shop floor structure, a supervisor would step up and help the operator reviewing the deviation of product or process and define counter measures. When doing so and working with an A3 Problem Solving approach, the supervisor is coaching through the problem solving process and shares with others the outcome or lessons learned on how to prevent this failure of happening again.

In Lean Manufacturing - pulling the Andon Cord is emphasized to all operators. The target is simply to block all defective parts from leaving the company and reaching the customer. At the same time it creates the opportunity to improve your processes to prevent future defects.

NEXT STEP: GO GEMBA

Instead of explaining you the complete principle of Gemba Walks here the short version. But if you want to learn more about Gemba Walks go here.

You can discuss problems as much as you want but when you don’t get yourself to see it, it is worthless. This is where the Gemba Walk comes in the game. Gemba is a Japanese term and stands for “the place where it actually happens”. This can be everywhere and everything in the process chain, but by pulling the Andon Cord the place is defined.

Key of Gemba is not to talk in wild theories or totally abstract about problems, but to have a look where it occurs and discuss them on site (looking at the process in the real world, get rid of unnecessary power points and excel sheets! Nobody cares anyway!) Too often we want to believe the statement of an “expert” and forget about it instead of going there and have a look ourselves in oder to gain a better understanding of the problem and make up our own opinion.

VISUALIZATION

When you are at the place of action, make sure to bring an A3 with you. Make sure that you describe the process properly and the failure that occurred.

In the lean manufacturing world the best known use case of the A3 report is the problem solving report. In this case the responsible person from the quality department takes the A3 report, starts the problem solving actions and follows a systematic structure that makes it possible to describe the effects that are currently leading to a deviation from the standard. Using the A3 only makes sense when you don’t know the root cause yet. If you already know the root cause don’t waste your time. Fix it and go back to normal.

Key Questions are with Gemba Walks and A3:

1. What should happen?

2. What is happening?

3. Explain why!

The A3 Report is foldable and can be then placed at the line or the work station. This is a great and a standardized tool to visualize that a problem is known and on the watch list.

LAST BUT NOT LEAST - STOP THE LINE (JIDOKA)

Now it is time to tackle the hardest part for all players in your organization: STOP THE LINE. In Lean Management, the original term is the Japanese word JIDOKA. This concept is driven by the maxim to have the best quality of goods and to bring the potentials out of the processes or products through continuous improvement. You have to stop all production when a deviation occurs and implement effective counter measures before restarting the line.

On the first view stopping the line might sound hard and insane, as you will stop all value adding activities and actually stop shipping goods. But think about it again. Failing to solve problems when they occur will force you to pile up your inventory with non-conforming parts that will need rework before shipping. You will bind additional resources in space and workers and by that you will burn money. Finally it will keep your organization away to improve and move forward with the developments of the market and with your competitors.

This is exactly the point where the principle of continuous improvement comes in the game, where you see all deviation as an opportunity of improvement.

To practice and learn more about continuous improvement and the CIP methodology, go ahead and read the CIP article here.

If you can’t measure you can’t control

Make sure that you have an organization wide monitoring in place which provides you with all KPIs necessary to run your business. Line stops and counter measures will be part of the tracking process in order to understand if the counter measures are effective, gain a better understanding of the processes and documentation of the improvement process itself.

1. What is the deviation?

2. What are the measures implement?

3. Are the counter measures effective?

You see there is again the logic of PDCA in the continuous improvement process.

All this information will be than part of the Shop Floor Mgmt. to get the information throughout the complete organization and to make sure that all players have the same understanding in what direction your organization is heading.

Policy Development Plan

The Policy Development Action Plan is a form used by the department working on Policy Development objectives. It supports detailing specific activities required for the long term success, reaching milestones, defines responsibilities and deadlines. All team members are listed with objective definitions, meeting dates and mgmt. support owners.

Smoothed Production

The topic of discussion today will be the so-called smoothed production. It is integral for customer satisfaction as it is a part of the ordering and complete fulfillment process. It makes sure that the supply chain capabilities are enough for stable production.

Smooth production benefits you by having a proper influence on your workplace configuration. It does this by helping to create a stable output with optimized inventory via a pre-condition. This presupposition/pre-condition simplifies your workplace based on the following conditions:

• Standardized work processes

• One-Piece Flow within the workstation

• Complete processing

• Stabile customer TAKT TIME

• Minimal TAKT TIME loss

• Maximum Output

• Flexible deployment of workers

• “U-Shaped“ layout

• Set-up time optimization

• Quicker material change

• Two-Bin-Principle

The smooth production is structured in the following:

• Planning Strategy

• Constant lot sizes

• Stabile material needs

• Fixed production times

• Flexible inventories

• Fixed timelines

• Higher delivery dependability

It is implemented by:

Material flow

• Scheduling methods

• No part shortages

• Pull-principle

• Supermarket

• Route traffic

• Small containers

Warehouse Organization 

• Full transparency

• FIFO-Principle

• Minimal warehouse levels

• Set assembly

• Bar codes and Data Matrix Codes

You may be asking the question, “but why do we need smooth production?”

It is a well-known fact that smooth production has many veritable advantages. With that said, there are also some potential drawbacks, but those can be eliminated or at the very least mitigated in the implementation phase. 

Here are some of the benefits and drawbacks of smooth production:

The next question you might be asking is, “how does one implement smooth production?”.

Following are some of the requirements for smooth production:

• Variable worker allocations should be the basis for the production power of the system. The variable shift models are first optimized for maximum output and then implemented specifically.

• Two factors determine the minimum inventory of safety stock for a part number. The first is the variability in customer ordering habits. The second factor is the degree to which the program is successful in the production line. To hit the right spot between these two factors will require systematic optimization with the help of a mathematical model.

• To determine what the maximum inventory of each part number should be, we should look at the delivery cycle of that said part number. This is essential for weekly pick-ups or delivery.

• The production equipment inventory should be in accordance with necessary tool changes and set-up times.

• The weekly production plan should be consistently released to the concerned parties once the production macro planning has been finished.

• An information board at the assembly areas will contain all the planned orders.

• The material requirement determination should solely be on the basis of the production plan.

• Assembly areas should be designated for the online measurement of production units. A data matrix system should be implemented for reducing errors in the documentation process.

• The ability to control production is a must if there are any noticeable short-term reactions arising due to discrepancies between the expected outcome and the actual outcome of the production plan.

• Any daily deviations must be dealt with proper countermeasures. The production plan must be flexible enough to allow time to deal with backlogs. Meeting shipping deadlines is the primary goal.

• A time-saving approach must be implemented in moving full racks from assembly areas to warehousing. 

• The requirements of the long-term sales plan should be integrated into the production plan so that production capacities and worker allocation are determined. 

• It is imperative that order calling and Just-In-Time delivery schedule data be automatically transferred to the resource planing system so that production planning can be done.

• The production planning for the system will determine the specific production calendars with your organizations shift models. 

• All underlying data in the system must contain related shipping dates or the dates can be transferred from the demand data as well. 

• To control the complete system, the updated inventory trend with planned shipping dates, for example, weekly and monthly, should be represented graphically.

• All possible scenarios should be simulated, because it is important to determine optimum capacities, performance, etc. for universal or shared production areas.

So, what factors make smooth production successful?

The two factors are planned output realization and controlling of supply

1. Production plan fulfillment as a part of planned output realization (source: Information board at production area as part of shop floor mgt)

2. Performance grading of workers in the production area that is done on the basis of the number of Dollars created in exchange for optimal material usability and worker effort (whether overtime or temporary workers)

3. Material usability of purchased parts, WIP, and raw materials when assembly time bears the cost or parts become short (Source: Information board at production area as part of shop floor mgt)

4. Special trips for the respective assembly area as a truthful Dollar figure

5. Supply capabilities and service grade for finished goods are measured using the number of delivered parts and the number of delivery dates met as a result of customer requests when demand data is transferred. (Source: Information board at production area as part of shop floor mgt)

Alternative measures for the success of smooth production:

• Usage of constant customer feedback to determine customer satisfaction as used by companies e.g. from the automotive industry 

• Iterative comparison of customer feedback with important shipping and delivery figures

• Target values of no customer feedback are used to get parameters to measure with

With the help of Kaizen workshops in conjunction with the introduction and implementation are used to create optimal basic parameters of success:

• The finished goods inventory levels are available transparently to be used as an early warning signal

• A minimal failure rate is strived for in the overall process of making sure of data from the production and logistics division

• Over-production of products is reduced by ensuring that upstream assemblies are only producing the right amount of product to be used by the downstream processes

• With the implementation of workshops, the set-up time can be reduced drastically

• Constant reduction of purchase parts does not diminish the availability of the material in the production line while also reducing downtime 

• Optimal balance is achieved for assembly lines and areas and the requirements are met for variable worker allocation

• The specifications of operator qualification shall determine how the qualification and training of workers should be conducted

• There has been evidence of improvement in production flexibility in comparison to the past

The Osborn List

Brainstorming with the the Osborn Checklist:

When it comes to getting new ideas - the so called Osborn List is a great method to steer the process. This creative idea generation technique is named after its inventor, Alex Faickney Osborn. Osborn is also regarded as the father of brainstorming.

The Osborn List is a simple method to support the process for concept creation, it thereby is a comprehensive list of questions about ideas and problems which can be used either individually or in groups. The main goal is to encourage creativity and divergence in concept generation.

The series of simple questions need a point of focus, which can either be an existing solution or a proposed concept to a designated problem. During the brainstorming session writing each statement on a card will help you to structure the approach itself. Randomly take a card while discussing alternative solutions.

When you have your topic, product or process you want to discuss, go through the checklist. The Points are:

• What else can it be used for?

  • New ways of using it? Other use when modified?

• Can it be adapted?

  • Is there anything out there similar to this? What other idea does this suggest? Was there anything similar in the past? What could you copy? Who could you emulate?

• How can it be modified?

  • New direction? Change in color, design, motion, form of shape...? Any other changes?

• Can it be magnified?

  • What can be added? More time? Greater frequency? Stronger? Higher? Larger? Longer? Thicker? Heavier? What value can be added? Duplication? Multiplication? Exaggerate?

• Can it be minified?

  • What can be taken away? Can it be smaller? Condensed? Miniature? Lower? Shorter? Narrower? Lighter? Streamline? Split up? Less frequent? Understate?

• Can it be substituted?

  • Can it be replaced? Who else could do it? Other components? Other material? Other process? Other power? Other place? Other approach? Other time?

• Can it be rearranged?

  • Carry over parts? Interchange components? Other pattern? Different layout? Different sequence? Change cause and effect? Different place? Change schedule? Earlier? Later?

• Can it be reversed?

  • Change positive and negative? What about the opposite? Turn it backward, upside down, inside out? Reverse roles? Turn tables? Turn other cheek? Change shoes?

• Can it be combined?

  • What about a blend, an alloy, an assortment, an ensemble? Can units be combined?

Often the Osborn List is remembered with the mnemonic aid of "SCAMPER" which thereby stands for - Substitute, Combine, Adapt, Modify/Magnify/Minify, Put it to different use, eliminate, reverse/rearrange.

The Osborn List will support you to gain a new perspective on existing ideas, products and processes. Please be aware that the list helps you for improvement sessions but shouldn't be used in the beginning of an innovation process itself.

Layered Process Audit

Today we will talk about layered process audits.

LPA, or Layered Process Auditing, is a quality technique developed for manufacturing management. When used correctly, LPA brings your organization to improve quality, minimize scrap and rework, plus reduce customer rejections by driving cultural change throughout your company. To gain a better idea and to understand what LPA means we will have a little deep dive.

Layered Audits are a defined approach that devotes time and resources to ensuring that high-risk procedures and error-proofing mechanisms are consistent and functional. Therefore, three important components make up a Layered Process Auditing System:

• Full focus on High Risk Processes (HRP) by a list of defined audits

• Depending on layer of audit the audit itself is performed from various levels of management

• A system of reporting and follow-up to ensure that containment is maintained based on specific needs. But also, to maintain and drive the continuous improvement process in your organization

A full stack of audits

This part of a Layered Process Auditing System is straightforward. Audits are merely a set of questions aimed to investigate machinery or processes. An LPA system's audits should concentrate solely on parts of the value adding process where deviation poses a high risk of producing defective products. E.g. if you have an end of the line quality check station that is measuring crucial parameters or functions that are critical to customers of your product and the calibration is wrong, you are producing in Takt defective or non-conforming products. No need to mention that you should keep an eye on that process. With the help of a proper LPA system you will have the EOL station within the layers allowing containment and corrective action as soon as the station surpasses set tolerances.

Multiple layers of audits comes with multiple layers of auditors

Multiple layers of authority from across your manufacturing department conduct audits on a regular basis, at a predetermined frequency, in an LPA system. For example, once per shift, the Shift Leader conduct an audit that checks the parameters or settings of your EOL-Station. Another layer of management, which may include process engineers, maintenance staff, or even the human resources department, would circulate through the system performing the exact same audit. The sample audit might be performed once a week or once a month by someone in the layer by assigning a number of auditors to this layer and establishing a timetable that cycles through the system's audits. Yet another layer of management, such as the plant manager or even executive staff (the number of levels in an LPA system can vary enormously from facility to facility, depending on your organizations demands and needs). This extra layer of auditors performs the same collection of audits on a rotating schedule, concluding the example audit once a month or once a quarter, for example.

Countermeasures, Containment Actions, Reporting and Improvement Process

In order to have an effective, a Layered Process Audit system you’ll have to combine analysis, measures and improvement process.

If an auditor observes a non-conformance during an audit, the auditor should not only document their findings but also take quick appropriate action to ensure that defective products do not leave the facility. In order to help with the documentation and immediate actions you can use the A3 report and methodology. Simple but effective. You can find it here. Anyway, the findings should be documented and made readily available to management for further analysis. An LPA system is a handy tool for debugging problem areas and identifying areas that are suitable for improvement actions when combined with a strong system for recording and reporting these audit results. A systematic approach will be discussed in the Shop Floor Mgmt. article.

Though Layered Process Audits may be developed to meet a customer or corporate demand, effective LPA systems are built, implemented, managed, accountable to, and owned by your participatory manufacturing management group. A solid LPA system may help you to take proactive control of your manufacturing operations while also enhancing product quality and business bottom line.

Deviation Management

Deviation Management is simply said the pure ability to identify deviation of a process according to the standard work process and you have a structured approach to tackle that issue.

5 Reasons to work with Deviation Management

1. Improve compliance and ownership of defective goods or processes

2. Continuous feedback to operators and staff of their deviations

3. Structured process for deviation documentation, tracking of counter measures and problem solving

4. Prioritization of improvement measures

5. Data collection to engage external suppliers and customers

Lighthouse Project

When talking about Light House Projects this means nothing less than that a small sector of your organization e.g a department is already turned around. By that we are talking about living already the ideal state, that you defined for the complete organization.

Processes and structures can be seen as guidance for your organizations’ lean journey. It provides directions, shows what is possible and therefore is the kickstarter for a successful roll-out as people can convince themselves with their own eyes.

Just keep in mind that the lean journey with its process of continuous improvement is never over. The pioneer has to lead the way.

Continuous Improvement Process

Well known, not only in the lean world is the continuous improvement process (CIP). As it says it is a methodology to continuously improve your processes and procedures in your organization. In short = there is always something that can be improved. CIP is not only a saying it is a mindset and should be deeply anchored in your organizations DNA. Therefore it is a must to be lived and demanded by management as well as to be trained and implemented. As per definition the continuous improvement process has no ending it follows the cycle of PDCA over and over again. The basic principle behind CIP is to consistently observe and analyze your processes, take in consideration employees ideas for improvements, implement those and reassess the results if they are according to planned outcome.

Where das CIP come from: A short excursion in history.

In the 1950s, Japanese companies, best known Toyota, started to integrate the "KAIZEN" philosophy of life in operations. The Japanese word KAIZEN stands for "change for the better". To sum it up it means the continuous improvement process by small steps, every day. The ultimate target above all is to reach the highest customer satisfaction possible which guarantees economic success and is achieved by highest quality of goods and services. So they have to be constantly improved. Just think about the KANO - Model.

From the 1980s, European and American car manufacturer started to adopt the CIP methodology to increase their quality and by this their performance of finished goods.

Since the 1990s the CIP methodology made its way from the shop floor into the offices and has a straight impact on an organizations culture. With the so called PDCA cycle it is a never ending process and supports your whole organization on the path of sustainable growth.

Nowadays it is even part of the ISO9001 that defines the continuous improvement process as one of the "seven principles of quality management".

How to apply CIP

As discussed, CIP means improving through a consistent path of small following steps. Basic prerequisite is the ultimate will of your organization's management and the involvement and motivation of all employees in your organization. Focus on customer satisfaction > What is the customer willing to pay for? Everything that has no value for the customer must be seen as waste and has to be eliminated.

In real life organizations take the CIP approach to conduct regular audits by the Lean/Opex-Team. They analyze current issues or challenges and make suggestions for improvements. Typically the following approach can be seen as a rough guideline.

1. What should be improved?

2. Define the process, area or procedure

3. How should it be like and what is it like now? > Define the Delta

4. Numbers cracking > Go through the figures, actual and target state.

5. Describe the deviation or problem

6. What is the outcome by this deviation?

7. What are the costs of the deviation? Loss of quantity, rework, etc.

8. What is the root cause of the problem?

9. Analysis

10. What are the potential solutions?

11. Idea and Solution Mgmt. through teamwork and brainstorming sessions

12. What solution is the best?

13. Evaluation of the best solution defined

14. What measures need to be taken?

15. Cost-Benefit analysis

16. Results are presented to decision makers

17. Defined measures are adopted

18. Who does what, with whom and at what costs?

19. Measures are implemented

20. Verification of effectiveness through KPI tracking

21. If necessary re-evaluate measures to meet targeted outcome

You see, the methodology is very close related not to say a spin off the PDCA cycle.

The endless, repetitive PDCA cycle basically means permanently observing the processes, analyzing bottlenecks and weak points, develop solutions for improvements. To get a better understanding of PDCA read the article here.

In short:

Plan

Recognition of improvement potential, analysis of the current situation, development of improvement measures

Do

Implementation of defined measures

Check

Check the effectiveness of implemented measures with predefined KPIs

ACT

Constantly monitor and review the improvements through audits or reporting. When expected level of improvement is reached adjust the standardization to new level. If you failed on the expected outcome restart the PDCA cycle.

After the PDCA cycle is finished your area of improvement focus will change. E.g. your bottleneck process will move along the complete process.

Key Performance Indicator

Key Performance Indicators are measurements utilized to indicate the performance level or progress with regard to important objectives or defined success factors within your organization. To make it short KPIs are used to track or monitor the progress of your existing daily management system.

So how do measure our progress of our organization? How can we define what type of indicators we should use and what they tell us about the current state of our processes? And so on…

These are just some questions that might rise when thinking about implementing KPIs in order to better understand your organization and define a path to go for improvements. What processes are truly adding value to the final product or service the customer is willing to pay for and what is just waste?

Before you start implementing KPIs in your organization a helpful way is to categorize KPIs in two ways: leading and lagging indicators.

Leading Indicators
Leading Indicators are Performance Indicators that are tracking your process. So these are real time figures showing you deviation to given standard or if there is something missing in order to produce your goods or services. They have a real time effect on your delivery performance. The fun part with leading indicators is that you have real time results why it can also take months for a report showing how your organization is doing in general.
For example, talking about injuries, when an operator is involved in an accident during a process step. This incident will be documented on an incident rate report of the organization, for e.g. factory. So when you think about it you recorded an incident after it happened. This is a necessary process in the majority of organizations due to governmental regulations and safety laws. The question to ask is now what do you do with this information? Do you really know what caused it? The information is quite old. This is why the incident report is not a leading indicator but a lagging indicator.

Lagging Indicators

As just mentioned Lagging Indicators are result-oriented, because of this they are shown after something happened. With lagging indicators you react after an amount of time as you are reacting on something that is already in the past. Coming from automotive this is typically a customer claim in the field, you will have a lot of work to do to find out what actually caused the failure, if no proper traceability is installed. Attention: With those failures it is often miss leading that through assumptions symptoms are fight that are not real. Everybody from Task Force Managers to shop floor firefighters knows that. In this case you are not adding any value nor do you implement a sustainable solution.

Having this two categories in mind we can say that the majority of KPIs are lagging indicators. This is not only in the field of manufacturing. The most miss leading assumption thereby is that with Lagging Indicators we get the most information.
But openly asking - isn’t it better to prevent the accident before it happens? This is absolutely speaking for Leading Indicators - and by focusing on Leading Indicators your focus in daily operation will shift to your process and not the overall outcome. In fact: when focusing on improving your process as a side effect the overall outcome will increase automatically.

Where to start with KPIs?

First things first - don’t overdo it!

Start to ask yourself what is your daily business? What processes are constantly and repetitive in use? The same principle with Gemba Walks go to your employees and talk to them - ask what is doing well and what not. What can improve their work?

The situation can be daily checked with line reviews or the so called meeting cascade. Where on the lowest level with the shift hand over performance KPIs are reported and issues during the shift are addressed. This figures are then visualized on the e.g. “Cell Board” near the outline of the cell itself. Typically if you have an U-Shape Layout at the spot of raw material and finished goods.

If something goes wrong latest after one shift the focus will be on this process. This automatically prevents new incidents from having a threatening impact. This is the advantage from getting things done right away or afterwards when the game is already over.

Finally to bring it in a nutshell, try to bring your KPIs from lagging into leading. This will shift the focus on the whole organization towards daily processes and improving them with the help of daily Kaizen activities. Measuring the process constantly in real time gives you the opportunity analyze trends and adjust processes to be ahead of the game instead of being surprised by the market.
Analyze your data existing decide what to go for. Implement your KPIs and make sure they go hand in hand with a meeting cascade. This ensures the consistency of data used and that they are actually used to trigger actions. Based on the KPIs you will be able to drive focused improvement actions through shop floor management, visual management, standardized work and structured problem solving.

DMAIC

Define, Measure, Analyze, Improve, Control. Incremental process improvement using Six Sigma methodology.

DMAIC can bee seen as a data-driven improvement strategy and for sure is part, or will be a part, of your organizations SIX SIGMA quality initiative. DMAIC is an acronym for: Define, Measure, Analyze, Improve, and Control.

DMAIC is a cyclical process such as the PDCA is. The reason to go for the DMAIC is to strive for the best result possible with a structured approach.

These process steps are:

DEFINE: the customers and their CTQ (Critical to Quality) and the core process involved.

• Who are your customers?

  • What are their requirements for products or services?

  • What are their expectations?

• Go for a value stream and map the process flow through the complete business process

MEASURE:

• Define a plan on how to collect data from your core process

• Go for different sources of data in order to be as specific as possible on defects and metrics

ANALYZE:

• While analyzing the data along the process map make sure to identify the real root cause of defects and

• point out opportunities for improvement

• Compare shortfalls with the results of customer surveys

• Determine gaps between targeted performance and current performance

• Prioritize potential improvement measures

• Identify variation and their source

IMPROVE:

• Gemba Walks

• Improvement Kata

• Kaizen Workshops

• Target is to improve the current process in a simple and effective way

• Develop a prioritized action plan

• Do it!

If you want a structured approach, just read our PDCA article.

CONTROL:

• Stay tuned on your process improvement measures

• Make sure that they stay on track

• Prevent falling back to the “old way”

In the end, when you are in charge, require the full documentation. Make sure that everything implemented is well documented and a clear monitoring is installed that deviation can be fast identified.

Having or installing a sustainable problem solving culture in your organization will be key for the future. Make sure to institutionalize problem solving or a kaizen culture through training, training and more training.

Pareto Principle

The Pareto Principle describes that 80% of problems can be closed with 20% of the causes. This principle is named after Vilfredo Pareto who found out that 80% of Italy’s wealth belonged to 20% of the population.

With this in mind it is worth to have a look at it.

Let us start with an assumption, according to the Pareto Principle it allows us to assume that

• 20% of input creates 80% of the output

• 20% of customers create 80% of your revenue

• 20% of causes create 80% of failures

• 20% of your employees create 80% of sales

• and so on…

But before you run away now and think you have the answer hold a second. With the 80/20 rule you might tend to say that it always have to be 100 - it’s not. Make a deep analysis before making such statements! 20% of your employees can also make only 20% of sales or 60%. So before you fire 80% of your employees keep in mind that the Pareto Principle only gives you an idea on the distribution.

The whole idea behind it is that most things in life are not distributed evenly!

When we talk about value adding activities and the final product is 100% What is with all the necessary tasks, that are not adding any value to the final product but have to be done to run the company.

Or think about failures and finding the root cause, where to start to take actions? This is great when you think about a Failure Pareto and you want to satisfy your customer as quick as possible. Of course you are focusing first on the most failures and most of the time - not always - the other failures will disappear as well.

But most important of all, your customer gains trust in you that you have the competencies to do the job.

The key point is that most things are not in a 1/1 actio = reactio relationship.

So what can we use it for this 80/20 rule?
The Pareto Principle in first place supports you on realizing that most of the outcome are based on a minority of inputs. This means:

• 20% of input creates 80% of the output > try to reduce those non value adding activities

• 20% of customers create 80% of your revenue > install a key account manager that the customers knows he/she is important to your company > your customers success is your companies success

• 20% of causes create 80% of failures > Focus on fixing those failures first

• 20% of your employees create 80% of sales > get those employees a reward

We could continue on and on. To bring it to the point > focus on the 20% and not on everything at the same time.

Some examples that might help you for a better understanding:

• Instead of spending a whole night to prepare a presentation and thinking about where to start > focus on one topic and do it. You will get a feedback anyway during the pitch. This feedback gives you the chance to take it and improve it.

• Instead of focusing on one solution that might be the best and go through all the details. Make a list of three and go through the pros and cons with your colleagues that probably know the topic better anyway and based on their opinion make a decision with what to go on.

Maybe this examples are nuts for you but we want to emphasize that you should focus only on the important 20% and forget - for the moment - the other 80.

Last but not least - the Pareto Principle is not a law of nature it is a guideline to steer your focus and to save time on problem solving or simply getting your job done faster.