Understanding Kaizen and Lean Manufacturing for Continuous Improvement
Improvement (Kaizen)/ Three Stages of the S-Curve Defined in Incremental Improvement
Represented by an S-curve:
- Gradual improvement at first.
- Accelerated improvement as understanding increases.
- Finally, a plateau is reached where improvement stops because gains are too costly for the results.
These incremental gains represent the Japanese concept of kaizen.
- When the limits of incremental improvements are reached, something fundamentally different must be adopted.
- This new approach will have an S-curve as well, and the process starts over.
- When new technology arrives, it is not always embraced by companies in the market.
- Failure to recognize the future of the new technology (or methodology) can result in a collapse of market share.
- Improvement is necessary to reduce costs.
- Determining where to apply improvements is resolved by customer focus.
- Incremental improvement will plateau because improvements are too costly for the gain.
Improvement as Strategy
Manufacturing strategy – creating the operating capabilities a company will need for the future.
Example – reduce production lead time and inventory.
- Reduce batch size.
- Computerized material requirements planning.
- Convert to lean pull production.
- When the limits of incremental improvements are reached, something fundamentally different must be adopted.
- This new approach will have an S-curve as well, and the process starts over.
- When new technology arrives, it is not always embraced by companies in the market.
- Failure to recognize the future of the new technology (or methodology) can result in a collapse of market share.
Outsourcing and Make/Buy Assessment
This is a transfer of technology rather than a make/buy.
Make/buy determines if an existing supplier can supply the good/service at less cost than doing it in-house.
- This does not mean a technology transfer.
- Outsourcing in this context is to transfer the technology to another company in the belief that they can do it cheaper or to allow a change in direction.
When something is outsourced, improvements are under the control of the new supplier.
The new supplier often matures into a competitor in the market, such as Toshiba, that makes televisions under many American company names and also has their own brand.
Outsourcing can be risky as it may bring a new competitor into the market.
When something is outsourced, improvements are controlled by the new supplier.
Advantage:
- Make/buy determines if an existing supplier can supply the good/service at less cost than doing it in-house.
- This does not mean a technology transfer.
- Outsourcing in this context is to transfer the technology to another company in the belief that they can do it cheaper or to allow a change in direction.
Disadvantage:
- When something is outsourced, improvements are under the control of the new supplier.
- The new supplier often matures.
- Outsourcing can be risky as it may bring a new competitor into the market.
Value Engineering
Value Engineering (VE) and Value Analysis (VA) are methods to determine the value content of the elements of a product or process.
Value is what people are willing to pay for something rather than the cost of something.
Value engineering is concerned with initial design and engineering.
- VE – first-time design and engineering of a product.
- VA – ongoing improvements of a product.
All production and support activities add to the cost but not necessarily to the value.
VA and VE look at the cost versus value-added.
- Information gathering. Examine each element of the product., Cost, Requirements, Features.
- Worth is estimated based on the least expensive known alternative.
- Identify elements with the highest cost-to-worth ratio as opportunities to lower costs or increase worth.
Value Analysis
The first step of value analysis: Evaluate the target element by first determining what it does.
- If it is a step in the process, the answer should explain why that step is there.
- If it is a part, the answer will explain what it does and why it is needed.
- If it is a product, it explains what the product does and why the customer will buy it.
Can it be made better, faster, or cheaper?
Problem-Solving Tools Typically Used in Lean Systems
Lean systems typically rely on seven problem-solving tools.
- Check sheet
- Histogram
- Pareto Analysis
- Scatter diagram
- Process flow chart
- Cause-and-effect analysis
- Run diagram
Histogram
Typically, the frequency distribution of a variable. The tools in a spreadsheet usually have histogram-type graphing capability.
Histograms do not indicate the cause of the variation or problem but provide a graphical means of viewing the data.
Check Sheet
A check sheet is a free-form sheet where data and observations are collected and tallied.
It is tailored to the particular problem under review.
In a manufacturing environment, this might be a list of defects.
This sheet must be designed to minimize observer subjectivity.
A spreadsheet may be a good tool for this job.
The main purpose is to ensure that the data are collected carefully and accurately by operating personnel for process control and problem-solving.
The form of the check sheet is individualized for each situation and is designed by the project team.
Check sheets are designed to show location.
Pareto Analysis
A tool to help find the vital few items in a field of many items.
This can be very helpful in determining what problem to address first.
The chart is similar in appearance to a histogram.
Vilfredo Pareto was an economist who is credited with establishing what is now widely known as the Pareto Principle or 80/20 rule.
When he discovered the principle, it established that 80% of the land in Italy was owned by 20% of the population.
Scatter Diagram
Used to reveal the relationship between variables.
The raw data can be processed through a statistical analysis package to get correlation results.
A graphical analysis is often a good visual analysis tool.
Process Flow Chart
This shows all of the steps in a process. It is helpful in locating the source of the problem.
Cause-and-Effect Analysis
Documents all of the possible contributors (causes) to the outcome (effect).
This is also known as a fishbone diagram.
Run Chart
Shows the results of observations taken over some prescribed interval.
This is helpful in identifying defects associated with the time of day or shifts.
Value Stream Map (VSM)
Value stream mapping (VSM) is another tool used in conjunction with problem-solving and analysis tools.
VSM is a type of flowcharting system.
- Shows process and materials flow.
- Looks at value-added and non-value-added.
Quality Improvement
Improvement implies that something has been changed for the better.
One form is the improvement of the output-to-input ratio.
Improvement may also include better working conditions, waste reduction, etc.
Survival and success in the global market require continuous improvement to reduce costs and meet changing requirements.
- Customer-focused quality is the criterion for determining where to apply improvements and reduce waste.
- Quality is determined by the customer.
- An organization that does not continue to improve consistent with customer demand will become extinct.
SPC
- If parts and materials meet specifications, the product should meet specifications.
- Quality emphasis uses statistical process control (SPC).
Cost of Quality
Why is it important?
- Lost customers
- Warranty Work
- Good Will
- Reputation
- Repairs
- It is Expensive!
- Bad quality will kill your business!
TQM
Total Quality Management (TQM) is the application of quantitative methods and human resources to improve all the processes within an organization and exceed customer needs now and in the future.
TQM is a management approach to focusing all functions and levels of an organization on quality and continuous improvement.
Total quality implies quality for both external and internal customers.
Requires total participation from everyone in the company.
List Five Forms of Waste that Lean Manufacturing Focuses on Identifying and Eliminating
- Production defects
- Transportation
- Inventory
- Overproduction
- Wait time
- Processing
- Motion