BUS606: Operations and Supply Chain Management

Analyze each step in the original process before making change

Lean manufacturing main focuses is on cost reduction and increases in turnover and eliminating activities that do not add value to the manufacturing process. Basically what lean manufacturing does is help companies to achieve targeted production, as well as other things, by introducing tools and techniques that are easy to apply and maintain. What these tools and techniques are doing is reducing and eliminating waste, things that are not needed in the manufacturing process.

Manufacturing engineers set out to use the six-sigma DMAIC (Design, Measure, Analyze, Improve, Control) methodology - in conjunction with lean manufacturing - to meet customer requirements related to the production of tubes.

Manufacturing engineers were charged with designing a new process layout of the tube production line. The objectives for project were including:

• Improved quality
• Decreased scrap
• Delivery to the point of use
• Smaller lot sizes
• Implementation of a pull system
• Better feedback
• Increased production
• Individual Responsibility
• Decreased WIP
• Dine flexibility

Before making changes, the team analyze each step in the original layout of the tube production line process.

1. There try to understand the original state process, identify the problem area, unnecessary step and non value added.

2. After mapping the process, the lean team collected data from the Material Review Board (MRB) bench to measure and analyze major types of defects . To better understand the process, the team also did a time study for 20 days period production run.

In the original state, the tube line consisted of one operator and four operations, separated into two stations by a large table using a push system. The table acted as a separator between the second and third operation.

The first problem discovered was the line's unbalanced . The first station was used about 70% of the time. Operators at the second station were spending a lot of their time waiting between cycle times. By combining stations one and two, room for improvement became evident with respect to individual responsibility, control of inventory by the operator, and immediate feedback when a problem occurred. The time study and the department layout reflect these findings.

A second problem was recognized. Because of the process flow, the production rate did not allow the production schedule to be met with two stations. Because operators lost track of machine cycles, machines were waiting for operator attention. Operators also tried to push parts through the first station - the bottleneck operation in the process - and then continued to manufacture the parts at the last two operations. Typically, long runs of WIP built up, and quality problems were not caught until a lot number of defective pieces were produced.

The original state data were taken from the last 20 days before the change. The teams analyze each step in the original and making changes. The findings of the time study on the original process provided the basis for reducing cycle time, balancing the line, designing the using Just In Time kanbans and scheduling, improve quality, decrease lot size and WIP, and improve flow. The new process data were taken starting one month after implementation. This delay gave the machine operators an opportunity to train and get to with the new process layout system.

With the U shaped cell design; The parts meet all the customer requirement. Table in the original process was removed ,almost eliminating WIP. With the reducing WIP and increasing production.

Some of the concepts used to improve the process included total employee involvement (TEI), smaller lot sizes, scheduling, point of use inventory, and improved layout. All employees and supervisors in the department were involved in all phases of the project. Their ideas and suggestions were incorporated in the planning and implementation process to gain wider acceptance of the changes to the process. Smaller lot sizes were introduced to minimize the number of parts produced before defects were detected. Kanbans were introduced (in the form of material handling racks) to control WIP and to implement a pull system. And the cell layout decreased travel between operations.

Operators were authorized to stop the line when problems arose. In the original-state , the operators were still continue running parts when a operation was down. With kanban

control, the layout eliminated the ability to store WIP, requiring the operator to shut down the entire line. The cell layout provides excellent opportunities for improving communication between operators about problems and adjustments, to achieve better quality.

Day-to-day inspection of the original-state process the operators spent a lot of time either waiting for material-handling person, or performing as a material handling. With the U-shaped cell, delivery to the point of use is more better for the operator. The operator places boxes of raw material on six moveable roller carts, where it's easily to get. The six boxes are enough to last a 24-hr period.

To reduce setup times, tools needed for machine repair and adjustments are located in the cell. The screws are not standardized; tools are set up in order of increasing size to quickly identify the proper tool.

For three months the process was monitored to verify that it was in control. Comparison of time studies from the original-state and the implemented layout demonstrated an increase in production from 300 to 514 finished products per shift. The new layout eliminated double handling between the second and third operations, as well as at the packing step. It also reduced throughout time by making it easier to cycle all four operations in a pull-system order. Customer demand was met by two shifts, which reduced the labor cost.

The results of the redesign are as follows:

• WIP decreased by 97%
• Production increased 72%
• Scrap was reduced by 43%
• Machine utilization increased by 50%
• Labor utilization increased by 25%
• Labor costs were reduced by 33%
• Sigma level increased from 2.6 to 2.8

This project yielded reduced labor and scrap costs, and allowed the organization to do a better job of making deliveries on time, while allowing a smaller finished-goods inventory. Daily production numbers and single-part cycle time served as a benchmark for monitoring progress towards the goal. Although the sigma level increase , the 43% reduction in defects, 97% reduction in WIP, and production increase of 72% contributed to the project objective.

Implementing lean is a never ending process; this is what continuous improvement is all

about. When you get one aspect of lean implemented, it can always be improved. Don't get hung up on it, but don't let things slip back to the starting point. There will always be time to go back and refine some of the processes.

Before Lean Manufacturing was implemented at Nypro Oregon Inc., we would operate using traditional manufacturing. Traditional manufacturing consists of producing all of a given product for the marketplace so as to never let the equipment idle. These goods them need to be warehoused or shipped out to a customer who may not be ready for them. If more is produced than can be sold, the products will be sold at a deep discount (often a loss) or simply scrapped. This can add up to an enormous amount waste. After implementing Lean Manufacturing concepts, our company uses just in time. Just in time refers to producing and delivering good in the amount required when the customer requires it and not before. In lean Manufacturing, the manufacture only produces what the customer wants, when they want it. This often a much more cost effective way of manufacturing when compared to high priced, high volume equipment.