YOKOTEN

Japanese term meaning “across everywhere”. With Yokoten the knowledgetransfer is carried out and all activities and countermeasures along the continuous improvement process are communicated organization wide and with other branches of the organization and its affiliates.

Yokoten is not just another Japanese word of the lean world. It might seem fancy to have only Japanese terms on the lean journey but one word isn’t that mainstream and well known but crucial when it comes to lean transformation in your organization. Yokoten describes the process of sharing knowledge across your organization. It includes systematics such as lead plans for copying and improving kaizen activities that work in your complete organization.

Think of Yokoten as horizontal deployment of improvement actions. The Yokoten approach is horizontal and peer-to-peer, with the expectation of Gemba Culture that your people go and see for themselves and learn how other departments or plants in your organization improved their processes. The idea behind is global knowledge transfer of improvement actions as basis for individual local solutions.

It is crucial that it is not a top-down thing where in all plants of your organization everything has to be the exact same. That simply will not work. It is more a benchmark where e.g. one plant in your organization is the champion of one manufacturing process (e.g. injection moulding). Therefore this plant is the “Lead Plant” and by this the benchmark for injection moulding organization wide. All other plants with injection moulding are welcome to the “Lead Plant” to learn from their experience and adopt the Kaizen activities to their own individual needs. With this kind of knowledge transfer a sustainable improvement and collaboration in your organization will be established.

In a nutshell, Yokoten can be understood as internal copy and improve. The role as senior manager is to spread the information and build bridges between the different locations/plants and give the transfer of knowledge a little jump start. Make your organization learn and improve from each other, most of the time there are already good examples out there and just want to be explored and further improved.

The long term success will prove that it is not the processes but the people that are continuously developed, that make the difference between a growing and successful organization or a simple copy cat of Kaizen activities.

The effective Yokoten process is a crucial brick for the foundation of a true learning organization. And no matter where you look at, truly successful organizations have a functioning organization wide knowledge transfer installed.

Supermarket

When speaking of a supermarket in lean context we are talking about an independent instrument that is used to control production. In a supermarket raw material and pre-commissioned components can be found in defined areas. The amount is well organized according the replenishment times of each component, in general the inventory is limited and components are refilled as soon as they are used. Following the Pull Principle with the help of the Kanban-System.

Concerning the supermarket we see it as one of the pull strategies that can be implemented as link between two process steps when developing the future value stream. The supermarket is the third option when firstly One-Piece-Flow and secondly FIFO are no options at all.
The supermarket is a great methodology to help your organization to manage a variety of inventory where you don’t need to know in what order the components will be consumed. Through the so called Kanban-Pull-System “internal customers” will take components of the supermarket, which are replenished by the internal logistics following the Kanban-Pull-Principle or in a pre-defined interval. With this integrated pull system of the supermarket as link between logistics and production you can also speak of a general replenishment pull system. But let’s have a look at the supermarket, what it can be used for and how it could look like in your organization.

The supermarket itself is a mix of FIFO lanes for different components stored in Mobile Racks or a typical shelf where components are stored in bins or on pallets. Let’s assume on workstation A 3 different components are assembled, in the supermarket 1 lane would be dedicated to only this component following the FIFO principle. With this explanation you can see why FIFO itself is preferred the supermarket. The supermarket is either steered with two bin principle or kanban cards. According the replenishment time, the replenishment is triggered with the extraction of components and the stock dropping below the minimum quantity.
You see, the key question is when to use a supermarket instead of installing plane FIFO lanes or even follow the One-PIece-Flow.

Here are some examples when this is the case:

• Two main material flow streams come together before or are split after the supermarket

• Your organization follows the made to stock principle, then the supermarket is at the end of production and stores finished goods

• With the help of a supermarket different lead times of suppliers paired with a high variance can be leveled and production can be smoothly supplied

• Upstream processes are lacking quality, downstream process steps can easily replace defective parts/components (interim solution until problem is solved)

• Different change over times, when a downstream process needs a change over the upstream processes can fill the supermarket as a overflow stock that is drained after change over is done

All of this examples have in common that the final target is to eliminate the supermarket itself and improving the material flow in a way that simple FIFO lanes or a Two-Bin-Principle at workstations can be realized.
The size of a supermarket is always determined by the components and their space needed for storage and their replenishment lead times. So it is a good piece of advice to have a clear overview of your components, their recurring demand including their replenishment times and don’t forget about a little safety stock on top.

As already mentioned there are two principles that are already well-known for implementing and steering a supermarket. The first one we have a look at is the Kanban-Principle and the second the so called Two-Bin-Principle, in which the bins itself trigger the replenishment.

A supermarket running on Kanban Cards can be seen shematically in the picture below. Every component stored in the supermarket is represented by an individual card, on which all required information is listed in order to trigger the replenishment process. The Kanban-Card can be seen as order slip for suppliers. Usually Kanban-Cards are placed on the so called Kanban Board. This kind of a supermarket can be seen most of the time.

The Two-Bin-Principle is a kind of supermarket where the bins itself are utilized the same way the Kanban Cards are used. In this approach all components have e.g. two assigned bins, filled with the dedicated components for this exact bins. The full bins are placed at the workstation, components are used and the empty bins are placed on the empty conveyor, ready to be collected by the Mizusumashi. the Mizusumashi refills the bins with the defined components and brings the full set back to the workstation. This kind of “decentralized” supermarkets are typically used for small and C-parts, which are consumed by not only one but several workstations, e.g. screws, washers, etc. as the financial impact of c-parts are low and the space needed is small.

In the end the supermarket is the last possible way to implement a Pull System after failing on implementing a One-Piece-Flow or FIFO. The target is and always will be to reduce the size of the supermarket by changing it into a FIFO system or change the material flow in to One-Piece-Flow. Therefore the supermarket can be seen as needed but temporary. The size of a supermarket is always defined by the size of the components itself, the replenishment time incl. some safety surcharge and the consumption lead time of the production. By simply removing or adding Kanban Cards or Kanban Bins the level of WIP can be adjusted.

Value Stream

A value stream includes all activities (value adding as well as non-value adding) in your organization that are required to deliver your product or service to the end customer.

With the help of the value stream you are able to describe all process steps required for the creation of your product or service, from raw material to the delivery of finished goods. With the Value Stream Map you are able to find potential sources of waste and try to eliminate those by concentrating on the value adding processes. Focus on customer needs and what your customers are willing to pay for. In the ideal state the your production is completely smoothed out and material as well as information stays in a state of continuous flow. Optimization of this state is always driven through productivity. Even when continuous flow is the ideal state, intermediate storages, work in progress or buffers are not evil and even can be a result of optimized material flow.

Push and Pull

To read the full article please go here. Push and Pull is a way in which you can optimize your production and produce according the value stream and flow principle when storages become tight or order books full. Just in time can avoid costly warehousing but gives you also a straight dependency on delivery performance from upstream processes or suppliers.

The pull principle describes the process from the customer's point of view. The order triggered by the customer pulls the components through production. With the push principle, the goods are pushed through production. The pull principle saves the storage of finished goods and thus also transport and search effort.

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.

Coaching

There is no denying that the abilities of a coachee to perform and learn are enhanced when they are encouraged by a coach to form solutions to the problems which they are confronting. This is exactly what coaching is. A coach may not be an expert, but for sure they can be regarded as the technical point of contact and are asked for their opinion and advice.

It has now become quite common to see supervisors coaching their employees. There can be a five steps procedure been seen in order to define and achieve goals.

At this point I want to recommend the book written by Anne Loehr and Brian Emerson, "A Manager’s Guide to Coaching" demonstrates how managers or supervisors can help their employees enhance their skills and develop themselves without the need for any additional training.

An employee’s success depends on “aptitude, attitude and resources.” Attitude matters most. In fact, a better outlook can make up for shortfalls in skills or materials.

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But let us go back to the five steps of the coaching process.

Step 1: Define the target state

In Step 1 we focus on defining the required outcomes. Get the clarity to define goals or future states. It is proven that those individuals who are clear regarding their goals are most likely to achieve them to those who have not defined their goals in a clear manner. Not having well-defined objectives can result in unpleasant side effects, for instance, preoccupying yourself with details. A successful and effective goal must be created by the coachee itself and must concur with their personal values. It is important to make certain goals a bit challenging, as easily achieving results cannot sometimes prove to be less motivating. On the flip side, it is also essential that some goals must have manageable and realistic partial steps so that, in general, it can be considered as achievable.

Step 2: Status Quo

The main aim in the second step is to identify the delta between the current state and the ideal solution within the structure of the current situation analysis. It is also important to assess the psychological and real cost that comes to light, especially when the client is clung to their current situation. Doing this can challenge the client to provide the energy required for the change. With that being said than just a small amount of time must be spent on assessing the Status Quo, and most of the focus must be given to achieving the desired outcomes. You should not expect any solutions at this particular stage.

Step 3: Costs of Opportunity

At this stage, the client needs to develop feelings for their own resources and their possibilities of gaining control of it: "When you feel resourceful, you feel in control, and when you feel in control, you feel confident." The feelings of control are mainly developed on the basis of the knowledge that there are different options and choices. The coach motivates the coachee to identify various options, by which the probability of determining between the non-action and action would already be recognized and appreciated. For the purpose of identifying different options, brainstorming has proven to be extremely helpful. It involves writing everything which crosses your mind regarding the particular subject in a creative and playful manner without evaluating them. The next step involves coachees opting for the options that look more beneficial and effective. These options are then assessed, and their consequences are analyzed concerning various criteria. Because one thing is certain – every option comes at some cost. Make sure that the coachee is willing to pay it.

Step 4: Taking Action

It is time the coachees make their mind as to which one of the options looks better to them that can help them achieve their goal. At this point in time, the role of the coach is to motivate the coachee to state exactly what they intend to do. It must be understood that it is the responsibility of the coachees themselves to execute the individual steps. The duty of the coach is to identify the signals from the coachee that shows resistance. In such scenarios, it is helpful to refer back to the first stage of outcomes for the purpose of confirming whether the objective and goal is extremely unrealistic or obscure.

Step 5: Review

By assenting to review the plan of action after a certain period of time, a little bit of pressure is applied on the coachee to take action. The critical thing for the success is the genuine conduct of the review rather than just an announcement. It is essential to take the first step in the near future in order to avoid losing the planned actions in the daily activities of the business. For that reason, the momentum for the forthcoming actions can stay consistent. The senior-level personnel or the coach can take help of the review in order to keep the obligation and track the coachee's progress and can also regard it as, for instance, for their own superior. The coach ultimately continues to maintain control, and the coachees becomes capable of achieving clarity regarding their own activities.

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

Demings 14 Points

In this article we introduce you to Deming's 14 management principles and how they have impacted the Lean Management System.

The person Deming

William Edward Deming was an American professor, engineer, and consultant who studied electrical engineering and mathematical physics before becoming a consultant. He participated in a variety of topics, including statistical process control, systems thinking, and the human psyche. His work as a quality management consultant for Japanese firms was possibly his most well-known accomplishment. As a result, the Deming Prize has been given out to this day.

Nowadays the PDCA-Cycle is well known globally (or Deming Circle). But fun fact – it initially was called the Shewart-Cycle based on his cooperation with Dr. Walter Shewart.

Deming’s 14 POINTS OF GOOD MANAGEMENT

Deming offers 14 principles that he has identified as success elements for effective organizational transformation in his book "Out of the Crisis." Here they come:

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1. To be competitive, set an unchanging business aim of consistent product and service improvement.

2. Put the new philosophy into practice. We are in a new phase of economic development, and (western) management must adapt to new circumstances.

3. Stop relying on quality assurance. Quality is not checked at the completion of the process but is built in from the initial stage.

4. Stop giving out contracts based on the lowest price. Instead, analyze a product's or service's entire cost. For each product, use only one supplier with whom you can develop a long-term and trusting connection.

5. Consistently and constantly improve the framework for manufacturing things.

6. Introduce "Training on the Job."

7. Introduce a fresh leadership style. The focus of leadership should be on assisting people and equipment in doing their tasks effectively.

8. Take away the system's fear. A culture that freely acknowledges mistakes aids in the identification of root causes, long-term solutions, and hence continuous improvement.

9. Remove the barriers that exist between departments. Purchasing, development, production, and sales must all work together to identify and address problems in production and service at the earliest possible time.

10. Employees who want zero errors or increased levels of productivity should avoid slogans and goals. Recognize that many of these goals are impacted by the system rather than by the individuals and that this incompetence demotivates employees.

11. Employees are no longer held to fixed quotas or performance targets. To make it clear to employees why tasks are important and should be completed, replace them with effective leadership.

12. Remove any barriers preventing employees from becoming proud of their work.

13. Introduce a holistic sublimed program that challenges and motivates each person's personal growth.

14. To enhance transformation, take the services of everyone in the organization.

Getting Demings principles IN THE LEAN MANAGEMENT SYSTEM

According to Deming, the 14 points of excellent management have evolved over time. While in the first point, he discusses relatively small-scale measures that facilitate a company's success, in the second point, he discusses large-scale measures that aid a company's success, the final principles are more basic statements about good business management.

In a lean workplace, we can apply any or all of the principles. Starting with a business vision that explains why the company exists and how it intends to improve over time. Continue with a new perspective on quality. Rather than employing a large number of quality control personnel to inspect the product at the end of the manufacturing process and, if needed, rework the product, the goal should be to incorporate quality into the product, this means that the manufacturing process should be built in such a way that manufacturing errors are avoided from the start (Poka-Yoke) or recognized quickly, allowing for a fast reaction rather than allowing the product to flow to the end of the line. This, of course, necessitates highly qualified staff who can best learn these abilities of immediate quality control directly at the process, as well as a culture that allows for the detection of errors without having to face negative consequences.

The style of thinking in value streams is another aspect of the Deming principles that becomes obvious. It explains how departments must coordinate to predict future difficulties in product manufacturing and services at an early stage. This demands strong cooperation among purchasing, development, sales, and production departments. He also states in principle four that decisions (such as purchasing) should not be made solely on the basis of the lowest offer but should always examine the whole expenses of a decision. What use is a 5 cent purchase price reduction if I have to budget for a 6-month replacement cycle in my warehouse? I have over 5 cents in expenses for storage, transportation, and stalled capital.

Another significant point is the shift in leadership perceptions. Deming is given the following quote:

It is the process, not the people.

Giving employees targets or piecework rates, in his opinion, makes no sense because they have no control over the results, which are decided by the system. Many people would now believe that if there are no goals, nothing will function. The distinction, in my opinion, is in the type of goals. If a corporation has a goal to grow by 10%, you might consider how to improve the system to meet this goal. You don't just hinder all of your employees' goals by 10%; you think about how you might reform the system.

Deming probably assumes that an employee is always prepared to give his all and that management is only demotivating him because it sets expectations for him that are unachievable in the current system. He goes on to say that staff wants to learn more and are always looking for ways to improve. This is a viewpoint that I can understand. When I consider the many employees I've met, I'm struck by how willing the young employees are to give their all and go hungry. Employees who have been disrupted for a long time by "the system" now only do what is necessary and seek challenges outside of work because they are not challenged or motivated at work.

I can only advise everyone to review the 14 Deming management principles again and again and to ask themselves which of the concepts are continuously followed and which are not.

Brown Paper Method

What is the Brown Paper Method?

In this article we want to talk about the Brown Paper Method (BPM) in the context of process management.

The Brown Paper Method is an easy to use tool for process development or management for your organization. During a workshop processes are drawn on a large piece of paper (typically from big brown paper roll sticked to a wall) and then analyzed.

Important: Draw the process as they really are not as you think the are. Do a Gemba Walk before this session.

So let us take it as a tool for process management. To be able to understand processes and procedures in your organization and to find out the weak points of them, it is depending on details. Getting those details can be tricky as they might be hidden in the process or in your employees minds and not always so obvious. As mentioned take the Gemba Walks and have a close look on the processes because it usually comes with a taste of complexity. With the Brown Paper Method you then have a simple tool to visualize the complexity in a simply way.

The Brown Paper Method is a pragmatic and result-oriented approach for process audits, presentations or analysis. It is based on a workshop where all involved persons of a process come together in person and collect their findings and doings on brown paper and draw the big picture of the process in total. Through the discussions, that will appear during the workshop, details will be pointed out that matter and defects or weakness will be described and visualized.

With the BPM, the actual process is collected, visualized and analyzed. Target processes can be also developed together. With the Big Picture of the process on brown paper all becomes clear for those involved and the tricky parts of the process are worked out and presented.

Based on the findings of the initial workshop the results are taken to the next level of process modeling. This includes the definition of the target process, implementation of automated workflows and process optimizations.

The process representation on the wall covered with brown paper can contain the following process characteristics:

1. What triggers and ends the process

2. Single process steps

3. Events 

4. Suppliers and customers

5. KPIs can be important for the process flow (Defect rates, process times, etc.)

6. Process Input such as raw material, semi finished goods, pre-assemblies, toolings but also information and data such as reports or KPIs

7. Output and outcome such as finished goods or services

8. Employees actually executing process steps in the process flow

9. Employees that have an indirect influence on the process

10. Other teams or departments related to the process

11. and so on…

For the upcoming analysis following parts of the brown paper are discussed, additional information added and highlighted:

1. Critical activities that have a direct impact on the final result of the process including costs and time

2. Missing or missleading inputs such as information or defective parts

3. Wrong process steps that are distort the result

4. Incorrect or missing process step outputs

5. All potential to improve the process e.g. Kaizen activities marked with a KAIZEN flash

Which of these characteristics finally are listed in the process representation is up to the team as well as the weighting of each. This will then prioritize the potentials identified and when they will be tackled.

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.

True North

"True North" - a concept that plays a key role in the journey of lean management and the road of improvements.

The principle of the true north goes back to the beginnings of the Toyota journey and means nothing less than the direction go for in order to reach real operational excellence.

True North defines the scope of your journey and the boundaries where you want to take your organization to the next level or where you want to have it. Some see it comparable as a mission statement or a reflection of purpose of your organization but for sure the foundation of your strategic planing.

You've got to be very careful if you don't know where you are going, because you might not get there.
Yogi Berra

Make sure that you understand that depending on your perspective the True North can be for everyone different based on their point of view. But in Lean Management or Operational Excellence with True North you define a specific set of ideals that are providing a compass for your organizational change. No matter if you talk about strategy, processes, culture or geographical challenges.

With the help of the True North principle it is clear to what you should do and not what you can do. In the Lean World you might have heard about the term of the Ideal State the Ideal State defines a state of perfection in your complete organization. Thinking about processes - a process is then as simple as possible when you can’t take anything more off it. This is state you are aiming for.

The continuous improvement process has no end, and you will constantly drive the PDCA cycle over and over again - only the starting point shifts to the next level.

But no matter what, it is like sailing on the ocean, without navigation you won’t reach the shore. The ironic part of it: you will never reach the shore - speaking of being done improving. True North is a way of running your organization not some final defined target state. It describes your daily practice of beating yesterday.

Target Agreement

A Target Agreement is a management technique where employees and management together reach an agreement on how to achieve the organization’s targets. It thereby consists of two key elements:

1. The TARGET

2. and the ACTIONS

Targeted state including the measures taken to achieve the set targets. Think about KPIs - a combination of quantitative measurable targets and an action plan following the PDCA.

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.

Set up time reduction

First things first. In order to reduce set-up time the set-up process itself must be observed and analyzed (e.g. by using the EMIPS - eliminate, minimize, integrate, parallelize or synchronize - methodology).

After you have analyzed the process make sure you write down all identified kinds of waste. Try to define the ideal state of the new procedure. Only after verification through testing of the new procedure make it a standard and implement it in your TPM framework. By doing so your operators are now responsible for the new set-up procedure, assumed that your operators are properly trained.

The whole focus on set-up time reduction comes from the customer requirements to manufacture a higher variety of goods in smaller batches. In order to meet those requirements set-up or change over must be kept as short as possible.

But let us go a little bit more into the details.

The pure set-up time is defined as the time needed to change from the last part of a batch to the first part of the following batch.

The set-up includes all activities needed, preparation, action on side and adjustments needed. By doing this you automatically differentiate between so called “external” and “internal” activities.

The following steps should help you to make it easier to reduce set-up times

1 Classify each part of the set-up process to either internal or external. Internal steps are those that only can be done while the production is or has to be inactive. External steps are done without interrupting production.

2 Convert internal steps to external ones. The whole idea is to minimize the time needed shutting down operations. This is why we want to take internal steps out as much as possible.

3 Reduce the time needed for the remaining internal steps. There are for sure some steps you can not take out, for those the manufacturing has to be stopped. The whole focus is now on this internal steps and how to reduce them to an absolute minimum. Here the SMED methodology (Single Minute Exchange of a Die) can help. Too find out more you can read here.

4 Eliminate adjustments. Last but not least try to get stable process parameters. With effective process control in place you can get rid off adjustment activities.

A Pareto Diagram can be useful to prioritize the setup time reduction activities. Don’t start everywhere at the same time! Start with the biggest loss and you will see over the time how it will change. It also gives you a great opportunity to see the progress that you are making on set-up time reduction.

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.