INTRODUCTION
Requirement of things and products depend on quality of service, availability and numbers of customers. At current, there are many numbers of companies to produce products and materials. Due to growth in population, demands of finish products are increasing and resources are shorting day by day. So that to compete to growing industries, there is a need of to improve productivity by eliminating the wastes using value stream mapping (VSM) lean tool which emphasize different types of wastes in running process. By observing the wastes we need to reduce the wastes form the manufacturing process.
1.1Productivity: –
It means that what to be obtained against what to be invested. Generally, it is a ratio of output to input. Here output refers to services or finish products or combination of both. And input refers to 5M i.e. manpower, machines, materials, money, and methods. Sometime productivity refers in terms of total revenue generated to the total investment in the form of money. Mathematically it may be written as
Productitvity=Output/Input
Productivity can be increases by different things such as
1.1.1 Increasing in output at constant input
Productivity may be increase as increasing the production rate with constant input. This type of increment takes place by changing the method of operation or by changing the work environment. Good relationship between supervisors and workers, creates motivation among them and due to motivation, workers work properly and enhance the production rate with constant investment of money, that’s why productivity would be increased.
1.1.2 Constant output with decreasing input
This type of productivity increment occurs due to changing the working methods, upgrading the system form manual to the automation for example assume that we make a pool whose selling price is 2500000. If we make to dig that pool with manpower, then it becomes costly as compare to if we make to dig that pool with JCB (a bulldozer machine). It means in case of bulldozer machine input cost is less as compare to in case of manpower that’s why it will be decrease the investment with constant output. And such that productivity will be increased.
1.1.3 Increasing in output with less amount of increasing in input
Such type of productivity increases with changing the conventional methods to advance methods, improving the machine quality with addition of some auxiliary devices which are able to reduce the cycle time. For example, if we cook mutton in handy it takes more time that’s why it needs more heat and due to which energy cost increases, but the cost of that pot is very less. If we use the pressure cooker in place of handy whose purchasing cost is very high as compare to handy but it takes lesser time than handy and that time period, it cooks more mutton than handy. That’s why it increases the output with less amount of increasing in investment.
1.1.4 Eliminating of wastes.
Productivity of a plant may be increased by eliminating the different types of waste which are classified as reducing the needless motion, lead time, over-processing, over-production, WIP, transportation, and defects. By removing of these type of wastes productivity would be increased.
Techniques to Improve Productivity or Production
There are many techniques to improve the productivity of a plant, organization, company or a service provider industry. But I have done a project which is based on production increment of tennis ball manufacturing plant using kaizen method, and also addition of some auxiliary devices which is used to reduce the cycle time of machine that’s why value added (VA) time would be reduced and also non-value added (NVA) time would be reduced. Reducing of VA and NVA time, lead time also reduced. Due to reduction in cycle time, production would be increased with less amount of investment i.e. adding of auxiliary devices and that’s why productivity will be increased. Now I will discuss about different type of productivity improvements techniques which are given as follows.
Kaizen
This word is taken from japan which states that “change for better” with implicit meaning of either “philosophy” or “continuous” in Japanese dictionaries and in everyday use. Many times it is known as continuous improvement is a long-term perspective to work that systematically explores to achieve small, incremental changes in processes in order to improve efficiency and quality.
Kaizen is more than just modus operandi for continuous reformation. It is not a distinct tool or set of tools to enhance quality. Kaizen is a journey and not a target. The objective of Kaizen is to renovate productivity, detract wastes, eliminate unnecessary hard works and humanize the workplace. It is effective at identifying the three basic types of wastes i.e. Muda, Mura and Muri. Kaizen philosophy enables everyone to suppose responsibility for their processes and improve them. With Kaizen, workers, machine operators, supervisor or all employees at all levels of the organization are engaged in constantly watching for and identifying opportunities for change and improvement. Kaizen or continuous improvement is not just a one-time event; more precisely, it is a process that occurs every day.
VALUE STREAM MAPPING
This section will describe Value Stream Mapping in more detail. Value Stream Mapping, known at Toyota as “Material and Information Flow Mapping”, is a method which helps practitioners to identify systemic sources of waste in a process and subsequently how to eliminate these source on a structural basis. A key characteristic of the method is that it looks at a process as a whole, rather than at the level of sub-processes. The method allows for process wide improvement, rather than local optimizations which often negatively affect other areas on the process.
Emiliani et al. show the wide applicability of VSM by using VSM for determining the beliefs, behaviors and competencies possessed by business leaders.
Wastes and Value Streams
VSM revolves around two main concepts, “Waste” and “Value Streams”. According to Sugimori, “Waste is anything other than the minimum amount of equipment, materials, parts, and workers (working time) which are absolutely essential to production are merely surplus that only raises the cost”. According to TPS, there are the following seven wastes with possible examples of each waste:
Waiting: Processes are ineffective and time is wasted when one process waits to begin while another finishes. Instead, the flow of operations should be smooth and continuous. According to some estimates, as much as 99 percent of a product’s time in manufacturing, is actually spent in waiting. A processed part is waiting in a box to be moved to the next step in the process, because not all the parts from the batch of this part have been processed at this step.
Transport: Moving a product between manufacturing processes adds no value, is expensive and can cause damage or product deterioration. A part is processed in one step, transported to the warehouse, put away and transported back to the production floor when the part is processed at the next step.
Inappropriate processing: Overly elaborate and expensive equipment is wasteful if simpler machinery would work as well. For example; cutting a part with a tolerance of 0.1 mm, while the customer only demands a precision of 0.5 mm. here it shows over processing which is inappropriate processing.
Overproduction: Manufacture of products in advance or in excess of demand wastes money, time and space. Producing more than demanded by the customer. This leads to excess inventory and possibly to obsolescence of products.
Unnecessary inventory: Holding months of inventory of parts which are rarely used and available from a supplier on a short term basis without a cost premium. It wastes resources through costs of storage and maintenance.
Motion: unnecessary motion takes place to carry products or goods when tools or parts which are located far away from the place where they are used in the process. Resources are wasted when workers have to bend, reach or walk distances to do their jobs. Workplace ergonomics assessment should be conducted to design a more efficient environment.
Defects: A mistake made in the beginning of the process is not detected until the product reaches a quality inspection at the end of the process.
Mastroianni et al. added an eighth waste to this list: “Not utilizing human resources”. This is the common phenomenon that ideas for improvement from (production) employees are not gathered or not implemented.
Monden, et al. told that as wasteful activities are Non-Value-Added (NVA) activities, there are also Value-Added activities (VA). These are the activities the customer is willing to pay and wait for. Finally, there are activities which are wasteful, but currently necessary to the process. This type of activities is classified as Necessary-Non-Value-Added activities (NNVA). An example of an NNVA activity is when parts are transported to a different production hall, because in that area toxics are used and special safety measures have to be in place to ensure the well-being of the employees. The transportation is wasteful, but essential to the production of the product.
Rother et al. differentiated between VA, NVA, and NNVA activities leads to the second concept of VSM; the Value Stream. A Value Stream is “all the actions (both value added and nonvalue added) currently required to bring a product through the main flows essential to every product” Purely speaking this is the combination of all the steps from the production of raw materials to the delivery of the product to the final customer. To delimit the scope of the Value Stream, practitioners generally focus on the “door-to-door” production process inside a plant. This is practically more attainable and allows to focus on the process you can influence, namely the process inside your own factory.
Value Stream Mapping Process
The Value Stream Mapping process consists of different steps. First, one product family, based on similar processing steps and required equipment, is chosen to be the focus of the improvement effort. This reduces the complexity of the studied process. The product family should be described and delimited clearly to avoid confusion in the following steps.
1.3.2.1 Current State
After choosing the product family the current state of the value stream is described in the typical VSM fashion. First, the information about customer demand is gathered. Essential information is the amount of products produced and the time frame in which this takes place, because this leads to the so-called “takt time”.
Takt Time
It is the average rate at which a product is demanded, spread over a certain production period. For example, if the average daily demand for product X is 450 pieces and the daily production time is 7.5 hours, or 450 minutes, the takt time is 1 minute. To fulfil demand, the process should be able to deliver a product every minute on average. It should be noted that the length of the takt time is unrelated to the amount of work content which is needed to produce one item. All gathered data is represented in one overview, to visualize the entire process and all its relevant aspects.
Then, all process steps the product family passes are defined. Examples of process steps are master batch mixing, half core curing, cutting, grinding, full core curing, cloth wrapping etc. Per process step, some process characteristics are measured. Generally, these characteristics are data such as:
Cycle time
The average elapsed time from the moment one good piece is completed until the moment the next good piece is completed. Cycle time is measured at the last process step in the value stream, and it shows how often one acceptable unit of product can be completed and provided to the customer. Within the value stream, cycle time is used to show how often one unit of “good” work-in process is completed and moved to the next process step in the value stream. Cycle time is perhaps the single most important piece of data that is captured in Value Stream Mapping. From this single piece of information associated with process steps throughout the value stream, you can see how the production process flows at the most basic of levels. Obviously, there are other things that happen throughout the value stream that affect this flow. But with just this one piece of information shown and compared to the Takt time, it is possible to see if there is an opportunity to meet customer demand. It is represented by C/T.
Change over time
Changeover time is the elapsed time from the moment the last good piece of one product run is completed to the moment that the first good piece of a different product is completed. In other words it is the time to switch from the production of one type of product to the next. There are many instances where a changeover should be reported, but none are “scheduled” during the allotted mapping exercise time. The tendency of many mapping teams is to hold a mapping session with operators in the value stream and estimate this change over time. This may be the least accurate piece of information that you can estimate from this type of session. Many operators historically greatly under- or overestimate changeover time, depending on the situation explained. Many operators will underestimate because they think that the time is just what it takes to change out the tooling. It is denoted by C/O.
Available working time
It is the working time allotted to the plant operation which is calculated as working time per day or per shift. The net available time is the time that the doors are open and the value stream is operating. Start with the total time that the doors are open and the lights are on. Subtract out any time that the value stream is not operating due to meetings, breaks, lunch, or other scheduled downtime. If the process continues to operate during breaks, lunch, or other scheduled downtime, do not subtract this time. Idle time or any other time that the process is not operating, but is waiting on something, anything should also remain in the net available time. Just because we are not running the value stream does not mean that we do not count the time. We are looking at “time available” to run the value stream, not actual run time.
Work content
Work content is the total amount of actual value-added and non-value-added labor time associated with a process. Work content adds together the labour time used by each employee working within the process step. It is represented as W/C.
Amount of workers
Amount of workers are the number of worker who are needed for a particular operation or process simultaneously working at that process step. In other word the total number of workers which are needed for a particular operation.
Defect rates
A defect is a unit of work that is scrapped or reworked within any step of the value stream. And defect rate is the ratio of total defective pieces to the total number of pieces produced.
Uptime
Uptime is the percentage of time that a piece of equipment works properly when the operator uses it for the prescribed task. Asking someone how often a piece of equipment works or doesn’t work when he or she walks up to use it can be a confusing question for many people. Typically, operators want to discuss the percentage of the total time (i.e., the total time that the doors are open and the lights are on), rather than the percentage of time that equipment does or does not work
Inventory levels (work in process; WIP)
It is the quantity of materials which are available between two consecutive processes.
Note- Information is also gathered about the delivery frequency to customers and from suppliers. To fully understand the process and to improve data quality it is advisable to collect these data first hand. Material movements between processes are visualized with different types of arrows, depending on the type of material management and handling between the two steps.
After describing the process steps, inventory levels between each step and at the beginning and end of the entire process are measured. Generally, the inventory levels are expressed in volume and inventory time in days, hours or minutes. For example, there are 3600 pieces waiting in front of process step Y which takes half a minute per product and is demanded at an equal rate. With a working day of 450 minutes, it will then take 4 days to process the stock in front of process step Y.
For reasons of simplicity down time and setup time are generally not taken into account. Practitioners argue that inventory levels only need to be measured once to give a general indication of how much time products spend waiting. They reason that even though inventory levels at each separate step can vary, normally the total level of inventory is more or less constant. Also, waiting time often represents such a significant fraction of the time it takes a product to flow through the entire process that even if this fraction varies it still shows that products spend too much time waiting.
Time Line
At the bottom of the process visualization a timeline is drawn. This timeline shows the total time a product takes to flow through the process, differentiating between value added time and non-value added time. This timeline can give striking insights, for example: “It takes us four weeks to perform ten minutes of value added time.” The percentage of value added time respective to the total time can strengthen this argument.
Finally, all information flows are depicted. Essential information flows are the incoming order process, the procurement procedure and the production planning within the focus process. This visualizes possible inefficiencies in how necessary information flows between different departments and other stakeholders.
Now, the entire process and the relevant information and material flows are visualized in one picture. Also, there is some indication of the state of the process. The following step is to devise the future state of the process.
1.3.2.4 Future State
To come up with a future process which is lean and where root causes of waste are eliminated as much as possible.
Rother et al. presented seven guidelines for lean value streams and eight guiding questions to analyse the parameters of the process. The seven guidelines are as follows:
Produce to your takt time: produce at the rate, customers demand your products.
Continuous flow: where possible, let products flow one piece at a time, instead of in batches.
Supermarkets if continuous flow is not possible: A ‘supermarket’ is a lean method to link a process step to an upstream step which still needs to be run in batches. When enough items have been taken from this supermarket, a signal is sent upstream to start production of one batch. In this way, total work in progress is limited and production is closely linked to actual customer demand.
Schedule production at one step only: as all the process steps are closely linked, either through supermarkets or through continuous flows, it is only needed to schedule production at one specific step. This is called the ‘pacemaker processes.
Level the production mix: If multiple types of products are produced in the same flow, it is essential to mix the production of the types as much as possible. For example, if products A and B are produced in one line, it can be tempting to produce a batch of product A during one week and a batch of product B in the next to decrease the number of change overs. However, this leads to higher levels of work in progress and final product inventories. Furthermore, it creates an unlevelled demand for items which are used as input for the process. This, in turn, creates a ‘bullwhip effect’ of increasing fluctuation in demand throughout the entire supply chain.
Level production volume: release fixed amounts of work onto the production department. This allows the department to understand frequently if they are on schedule with their work and whether they should intervene.
Shorten change over time: focusing on shortening change over time allows to decrease batch size and thereby improves stability and enables a levelled production. Linked to the seven guidelines there are eight questions which offer guidance to develop the future state of the process:
What is the takt time?
Will you build to a finished goods supermarket or directly to shipping?
Where can you use continuous flow processing?
Where will you need to use supermarket pull systems?
At what point will you schedule production? What is the pacemaker process?
How will you level the production mix at the pacemaker process?
What increment of work will you release to the pacemaker process?
What improvements are necessary to enable the implementation of the future state?
By answering these questions, the future state becomes apparent. This future state is visualized in similar fashion as the current state. The percentage Value Added Time should have increased significantly. Finally, necessary improvements to reach this future state are depicted in the same overview.
The last element of the Value Stream Map analysis is planning the implementation towards the desired future state. To do so, the future state process is split in different segments, or loops. Then, the order in which the segments are implemented is defined and per segment a plan is made, including steps to take, responsibilities and goals.
There is no recipe for a lean implementation, but there are some guidelines about with what segment to start. It is advisable to start with a part of the process which is well-understood by the people involved in that area and where the odds of success are favourable. Furthermore, it is preferred to start in a field with large potential gains. It should be noted however, that this last criterion can be conflicting with the first two and this should be carefully dealt with.
Line Balancing Method
According to this method firstly we calculate the line efficiency of production line which states that how much profit generated against invested cost. It may be reduced by reducing of number of workstations. The number of workstations are reduced by eliminating not necessary process or by combining of sub workstations in to a main workstation. Typically,
This method is used to reduce the idle time. Due to decrement in the idle time of the production line, the lead time of production line also decrease and also it decreases the cycle time indirectly. By these things of time reduction, the number of cycles produced in a day may be increase and that’s why productivity may be increased.
Thesis description and purpose
The thesis will analyze the current situation at the tennis ball manufacturing section (TBMS), at Nivia Sports, to find production losses. When the losses are found, they will be analyzed to find the underlining problems. The purpose of this project will therefore be to find solutions for the problems, to ensure that a high productivity is reached at a low cost, and that the lines capacity covers the demand of their products.
Delimitation
The thesis work will be done during a 20-week period, at Nivia Sports Private Limited, Jalandhar. The analysis will be done on the tennis ball manufacturing (TBM) line and therefore it includes many workstations with visual inspection & finishing (VIF) station. The description of the current situation is based on data gathered from August 2017 to March 2018 and therefore any changes in the production system past that time will not be considered, for future reference this period will be called the data gathering period.
Goals
The goal is to present a solution to increase the productivity of the TBM line at Nivia Sports. To reach this goal some sub goals has been constructed to help in the thesis. These are:
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An analysis of the different work tasks and how the operators spend their days.
An analysis of the machine data.
An analysis of the changeover procedure.
LITERATURE REVIEW
In this literature review first the history of lean manufacturing, its most commonly used tools, and the results which can be achieved by implementing lean will be elaborated upon. Then, the applicability of lean manufacturing in different fields and types of companies will be discussed. Finally, the methods of implementing lean manufacturing are covered which results in the hypotheses of this research.
LEAN MANUFACTURING
This section will give an overview of the history of Lean and the Toyota Production System (TPS), its most prominent tools and finally the results which can be achieved through implementing lean thinking.
History
After the Second World War Japan suffered from high costs of raw materials due to a lack of resources. This made Japanese companies less competitive on the global market.
Sugimori et al. discussed about Toyota production system that which recognized that in order to compete, company needed to “produce better quality goods having higher added value and at an even lower production cost than those of the other countries” (Normally, this would call for the implementation of mass production techniques, which dominated the industry at the time. To decrease cost, Toyota put a severe focus on the elimination of waste, which is “anything other than the minimum amount of equipment, materials, parts, and workers (working time) which are absolutely essential to production are merely surplus that only raises the cost”
It might sound trivial that the ‘secret’ of Toyota is eliminating all the process steps which do not add value, but studying the Toyota Production System more closely reveals some insights about how fundamentally different it is from traditional manufacturing views. All workers in Toyota factories are allowed to stop the line they are working on if they find a defect, by pulling a cord next to their working station. Also, every employee at Toyota has the right, and is encouraged, to make improvements to the production process
Holweg et al. states that Eiji Toyoda, head of the Toyota Company at the time, was indeed determined to become a mass producer. This would require acquiring expensive production means which were specialized at producing large batch sizes of products. These large batches were necessary to spread the large investment over enough products, and to deal with lengthy setup times. However, the relatively small home market of Japan, combined with capital constraints, initially prevented Toyota from setting up such a mass production facility. They discover that the batch and queue method makes the producer incapable of delivering the product diversity demanded by consumers indirectly. Also Toyota recognized what they had to do: make low cost, low waste, high value products by combining different production techniques into a system which would produce a wide mix of products with low volume per product variety. An important person in the quest of Toyota to reach this was Taiichi Ohno, who joined Toyoda Spinning and Weaving in 1932. High quality should be attained by decreasing batch size, since Ohno had recognized that large batches, amongst having other effects, resulted in high number of defects.
Some believe that Toyota ‘invented’ a new production method, but actually it took some decades to become the Toyota Production System (TPS) as it became known to the rest of the world.
TPS was first not understood by Western companies and academics and the superiority of TPS was sometimes bluntly negated. Then Holweg gives a clear insight in the development of understanding Toyota’s production methods and this will be elaborated upon next.
Karmarkar et al. discussed that Toyoda also recognized some major, structural flaws in the mass production methodology Apart from financial and economic restrictions. To be competitive, mass producers aim to benefit from economies of scale. To reduce unit setup and machine costs, they generally produce in large batches of identical products which work their way through the production facility. As a result, “parts spend most of their time waiting in queues rather than in being actually processed”. In concurrence with Little’s Law, this results in longer lead times. This ‘batch and queue’ method is problematic for a number of reasons. By elongating the time period between fabrication of a part and its use in a following process step increases the risk of loss or deterioration while it also increases the time between fabrication and possible feedback about quality. Furthermore, the level of safety stocks grows more than proportionally with lead times, since the safety stocks have to protect against longer lead times as well as greater variability in forecasts due to a longer prediction horizon. Finally, long lead times decrease a company’s competitiveness due to distant due dates and make companies less responsive to customer demand.
Fujimoto discussed that over a span of several decades, starting in the 1950s, Toyota slowly developed its production system. The production managers at Toyota (such as Kiichiro Toyoda, Taiichi Ohno, and Eiji Toyoda) combined elements of a mass production system with their own ideas.
Spear studied that it is different from traditional plants, where special teams implement improvements and where extensive quality controls check for defects at the end of the line. All employees at Toyota learn to make improvements according to the so called Scientific Method. When employees detect a problem, they try to find out the root cause and a countermeasure of that problem which copes with this cause. They make a hypothesis about the effect of the countermeasure before they implement the countermeasure. Finally, they compare the actual to the predicted effect and investigate the possible difference. As such, they aim to truly understand not only the problem, but also the solution. The hypothesis based improvement process makes it ‘scientific’.
Abernathy et al. studied about TPS and they found that the first barrier to understand TPS was that it was not documented before 1965, when it was communicated, in Japanese, to Toyota’s supplier network. At this point, Toyota had already started a steady increase in market share. During the 1970s concerns amongst Western producers about Japanese imports rose. In 1980, 22.2 percent of personal cars sold in the United States came from Japan. Trade agreements were instituted to restrict the number of imported cars. Toyota worked around these restrictions by setting up assembly plants in the United States.
They understood that the competitive advantage was mostly explained by superior manufacturing practices. In 1985 the International Motor Vehicle Program (IMVP) started to investigate why Japanese companies were outplaying Western companies and how large the gap was. The IMVP was a research program focused on the automobile industry, consisting of researchers from all over the world, based at the Massachusetts Institute of Technology.
Krafcik et al. discussed that a major breakthrough in accepting the superiority of TPS was instigated by a collaboration between Toyota and General Motors (GM), called the New United Motor Manufacturing (NUMMI) joint venture. In this joint venture, initiated in 1984, Toyota and GM reopened a former GM plant to produce cars of both brands. After the first year, the productivity at the NUMMI plant was more than 50 percent higher than the productivity level at another GM plant which was technologically similar. Also, the NUMMI plant had the highest quality standards of all GM’s U.S. plants. Under Toyota’s leadership, labour input per vehicle was reduced to 19 hours, down from 36 hours previously. Defects dropped from 1.5 to 0.5 per 100 vehicles, and absenteeism decreased from 15 percent to 1.5 percent. NUMMI achieved these results without great changes in used technology and by hiring mostly the same 12 workforces of when the plant closed in 1982. This convinced the industrial sponsors involved in IMVP, of the fact that Toyota’s true advantage did not lay in factors such as culture, but in its production philosophy.
One of the academics working for IMVP, was the first to use the term ‘lean production’. ‘Lean production’ is a more generic term for the principles instituted in TPS.
Liker et al. states that lean is “a philosophy that when implemented reduces the time from customer order to delivery by eliminating sources of waste in the production flow”.
Elliot et al. states that the three basic principles of the lean philosophy are flow, harmony (pace set by customer demand), and synchronization (pull flow). He argues that these three principles should be present throughout the entire organization.
Fawaz A. et al. demonstrate that a detailed simulation model can be used to evaluate basic performance measures and analyze system configurations. The availability of the information provided by the simulation can facilitate and validate the decision to implement lean manufacturing and can also motivate the organization during the actual implementation in order to obtain the desired results.
R. Radharamanan et al. discussed that it is important to point out that Kaizen methodology does not require large capital investments in comparison with the innovation (as in the case of reengineering), and the results can be improved significantly in some cases. Thus, the enterprises involved can guarantee better positions in the competitive market, generating profits and minimizing costs.
Turfa emphasizes that lean manufacturing is not a tactic, but should be viewed as an endless journey a company embarks on.
Blas Mola et al. discussed that Willow for bioenergy is a fairly new cropping system, with lower levels of related experience and development than most other agricultural crops. The model developed in this study shows that the production of willow plantations in Sweden has increased during the last years at a good rate, starting with very poor results from plantations established in the mid-1980s but achieving significantly higher production levels in more recently established plantations. From this model, we can better understand the high variability of yields from plantations, resulting from changes in farmer attitudes and practices. Management, together with genetic improvements, are determining factors in the success of commercial plantations; it is expected that more experience among farmers, better advisory service, and improvements in varieties will result in a significant increase in mean yields during the next years. In this respect, the importance of breeding programmes together with training for growers is stressed, as well as mechanisms to encourage best practices in order to reduce the gap between actual and potential yield in commercial willow plantations. Despite its limitations, this study is the first known to the author that analyzes the increase of productivity in commercial willow plantations based on extensive empirical data, and it is a starting point for further research on the topic and for informing economic and policy decisions.
Ohno remarks that apart from the critical focus on eliminating waste, respect for humanity was equally important.
Hall states that Lean and TPS are similar, but not the same. According to him the key differences between lean and TPS are in the focus at the start of the process, the source of the solutions and the level of standardization. TPS usually starts with optimizing each separate process to achieve zero defects and therefore takes a detailed perspective in the beginning, before optimally linking the steps together. Lean starts with a broader view, looking at the entire process and identifying main sources of waste, which often occur at the boundaries of processes. Lean generally focuses on the implementation of tools, coming from a predetermined set of tools, to eliminate waste. These implementations are more likely to be driven by staff, which prevents employees to increase their problem solving skills. TPS focuses strongly on employee skills and allows countermeasures to problems to evolve more organically. Finally, it seems that TPS emphasizes more strictly on the standardization and documentation of work methods. This allows them to continuously ‘test’ if the work methods are adequate or can be improved.
Naga Vamsi Krishna Jasti et al. studied that Indian automobile industry is one of the fast developing industries with growth rate of 14-18 percent per year. However, the major automobile organizations are facing problems to fulfil the customer requirements and to stay competition with the global Lean Tools players in terms of cost, quality and services. Some of the notable automobile industries are able to meet the customer requirements in the aspect of delivery time and demand. One of the reasons why most of the Indian manufacturing organizations or auto-component industries are still not able to implement advanced manufacturing systems (like LM) is due to lack of knowledge and information. Hence most of the auto-component industries are spending much of their resources to fulfil the customer requirements. The objective of the research is to check the application of VSM in Indian auto component industry. The study clearly shows that VSM is important LM tool, which can be used to identify various wastes in the production system of Indian manufacturing industries. The study results clearly proved that all types of lean wastes can be identified with the help of VSM. Currently, it is in improvement phase and giving commitment for its uninterrupted efforts in elevating technological frame and quality improvement. The results obtained from the study may help other companies to find methodology to implement the LM tools like VSM.
5S
This method aims to improve work area efficiency by strictly selecting what material is essential at certain workstations. This material is given a specific location close to where it is required. Non-essential materials are placed on less prominent locations. In the translated version, the five ‘S’s stand for Sort, Straighten, Shine, Standardize, and Sustain. The 5S methodology is aptly summarized by the following statement:
Mastroianni et al. states that 5S stands for “A place for everything and everything in its place”
Kaizen
Kaizen is the Japanese expression for “improve for the better”. It is the daily effort to constantly improve the process of a company. Origins of wasteful activities are identified and sought to be eliminated.
Womack et al. discussed about kaizen according to them on top of the daily effort, special Kaizen events, called Kaikaku events can lead to more breakthrough improvements. In such events, a specific process is studied in great detail to achieve more substantial improvement.
Just-in-Time (JIT)
By producing products and parts ‘just in time’ it is ensured that only the necessary amounts of products and parts are produced. Furthermore, parts arrive to the process where they are needed at the right time and are placed in the order in which they are needed. This decreases the amount of waste associated with excess inventories.
Single Minute Exchange of Dies (SMED)
In order to be able to produce in unitary batches with the flexibility demanded by the customers, it is essential to have extremely short change-over time.
Holweg, et al. describe about SMED in 2007 which states that a great advancement in change-over reduction was achieved by Shigeo Shingo, who was hired as a consultant at Toyota. His method studies the process of a change-over with great detail and identifies wasteful activities and activities which can be performed while the machine is running. Eliminating or relocating these activities can reduce change-over times from hours to minutes.
Klefsjö et al. describe that one of the tools often mentioned in combination with lean is Six Sigma, a method developed at Motorola and made famous by the implementation at General Electric. It is a method to identify and eliminate variability in a process and has the goal to improve quality.
Kumar et al. studied that this method is especially useful when the source of defects and variability is not apparent). Due to the strong statistical analyses required, Six Sigma projects are led by specially trained professionals.
Smith et al. emphasize a research which shows that the most effective way to improve processes is to implement a combination of lean and Six Sigma tools, often termed Lean Sigma. Most companies combining lean and Six Sigma start by improving their process with lean tools.
This eliminates a large fraction of errors and waste, but chronic problems might still exist. These chronic problems are then attacked by Six Sigma tools. As implementing Lean Sigma starts with the implementation of lean, also for this combination it is relevant to understand how to start with lean.
Spear et al. described that it should be emphasized that lean is more than just the tools, and should be seen more as a philosophy. For Toyota, none of its tools are key to its production system. It sees the implemented tools as countermeasures to problems not yet solved. Tools are not viewed as solutions, because that would imply a permanent fix. For instance, counter to popular belief, Toyota does have inventories of parts and subassemblies. These inventories are countermeasures to the problem that transportation time from supplier to assembly line is still higher than zero seconds and that no supplier can guarantee infinite quality and reliability. Many companies trying to imitate Toyota’s production system have focused on the tools, instead of on the principles. This may lead to a production system which is rigid and inflexible and, possibly more important, does not evolve and improve to cope with changing external factor.
Effects of lean
Soriano et al. states that the real benefit of lean stems from strengthening the entire system. Lean methods ensure that shortcomings of the systems reveal themselves quickly by the profound influence they have. This should trigger a quick response of the company to eliminate the shortcomings. The effect of this approach already became apparent in the early research on Toyota’s production performance
Lathin et al. claimed that traditional mass producers should be able to reduce their lead time by 90 percent and inventory levels by 90 percent, and increase labour productivity by 50 percent.
Ahlstrom has done a case study research showed substantial improvement potential as a result of lean practices as well. He reports a case where 85 percent reduction in the number of defects, 94 percent reduction of manufacturing lead time, and 50 percent reduction in sales lead time are achieved.
Abdulmalek et al. described a case study based on industrial experiments. On the basis of that results and finding they report a potential of reducing production lead time with 70 percent of and work-in-progress levels by 90 percent.
These statistics are taken from a variety of companies with little information of the initial state of the companies. Therefore, they have little predictive value of the improvement potential for any given organization contemplating a lean initiative. Then again, achieving a fraction of these substantial improvements could already be attractive for many companies.
Allen et al. have expressed scepticism about the lean approach. Critics claim that success statistics of lean are overstated either due to neglecting unsuccessful lean efforts or by overly attributing improvements to partial conversion to lean.
Landsbergis et al. studied other critique on the lean approach which concerns employee wellbeing. Some research reports that production employees encounter intensified work pace without gaining autonomy. Others even accuse companies such as Toyota of dangerous conditions for workers and accident cover-ups. These reports are contradicted by other research, which claim that even though work pace is high in lean environments, conditions are within an acceptable range.
Conti et al. describe that the opposing findings limit a conclusive answer to the question if the lean approach has a positive or negative effect on employees. An extensive survey showed that the effect on employees is determined mostly by management behaviour, not by an intrinsic effect of the lean approach.
In summary, by implementing lean thinking in an organization substantial results can be attained in terms of lead time reduction, efficiency increase and quality improvements. If managed correctly, this approach can also have a positive effect on the workforce.
APPLICABILITY OF LEAN
Lean terminology is used in many areas to overcome the production that to be demanded. It is mainly used to reduce the waste and produce only demanded quantity. It is applicable in all types industry like manufacturing and service providing industry.
Womack et al. expressed that the applicability of the lean philosophy in other countries, industries, and company sizes was questioned from the moment it revealed itself to the world outside Toyota.
This section will investigate the applicability of lean to different conditions.
Country specific conditions
When confronted with early studies about Toyota’s production performance, various Western researchers and automotive industry representatives negated the intrinsic advantage of Toyota’s system. Given explanations, some even in official hearing, revolved around country specific advantages, such as favourable exchange rates, cultural differences, and government policies.
Abernathy et al. studied that Toyota itself believed that their production system was particularly ample in dealing with external issues specific to the Japanese economy and in capitalizing on traits specific to Japanese workers. Furthermore, Toyota indeed had the benefit of, for instance, a supportive government. Possibly, the proposed explanations where relevant enough to use them as a protection from accepting another’s superior thinking.
Voss et al. showed that lean thinking also offers benefits for non-Japanese companies located outside Japan. They claim that lean thinking has now become implemented across Western industries.
Industry specific conditions
The lean philosophy was developed in an environment strongly focused on manufacturing. As it is often termed “lean manufacturing” or “lean production” it seems to keep the connotation of being applicable only to production environments. However, vast amounts of research have shown the benefits attainable by applying lean to service environments. Examples are call centres, healthcare institutions, car repair shops, software development companies and universities. Another non-production field in which lean is becoming increasingly relevant is the activity of developing new products.
Conversely, there are some industry conditions which can impede the use of lean thinking.
Lee et al. devised an “uncertainty framework” which indicates what type of strategy is most suitable for (members of) a supply chain. The horizontal axis represents demand uncertainty. Low demand uncertainty has characteristics such as predictable and stable demand, long product life, low profit margins, and low product variety. Conversely, products with high demand uncertainty have variable and unpredictable demand, a short selling season, high profit margins and high product variety. Supply uncertainty is found on the vertical axis. Supply chains with low supply uncertainty show less quality problems, more sources of supplies, more reliable and flexible suppliers, and a more mature production process than supply chains with high supply uncertainty.
Lee argues that only members of a supply chain with low supply and demand uncertainty should pursue an efficient, or lean, supply chain strategy. If there are uncertainties in the supply chain, these should be eliminated by uncertainty reduction strategies, before a supply chain can become lean. If uncertainties cannot be sufficiently reduced, a different supply chain strategy should be selected.
To summarize, the literature shows that lean thinking can be used in a wide variety of industries. However, some external factors might prevent (a member of) a supply chain to become lean. These factors should be investigated before embarking on an effort to become lean.
Size specific conditions
Most research on lean thinking focuses on large organizations. As indicated before, due to lean thinking organizations are able to be more responsive to customer demand while requiring less equipment capacity and employ a more stable number of employees. Both elements, less equipment capacity and more stable number of workers are relevant for SMEs. SMEs generally do not have the financial capital available to acquire high 18 equipment capacity. Also, since SMEs often are family owned and have an (almost) family like relation with their employees, they generally aim to have a stable number of workers. Not having to hire temporary workers or having to fire people when sales are down being also less costly. This supports the assumption that implementing lean thinking is appealing for SMEs.
White et al. have done a research about degrees of implementation of lean methods which shows a negative correlation between organization size and degree of implementation. It seems that smaller organizations are less able to implement a wide variety of lean methods, either due to a lack of organizational capability or financial resources, or due to an inapplicability of lean for smaller organizations.
Rose et al. suggest that a lack of financial resources impedes lean implementation in SMEs and that SMEs should therefore focus on the methods which require little investment, such as 5S.
Shah et al. have done a research which shows that when considering the combined effect of implementing different methods, large organizations are at a disadvantage. Smaller organizations seem to gain more operational improvement as an effect of implementing lean methods. Hence, even though smaller organizations implement less lean methods, they seem to be able to achieve superior performance improvements by the combined effects of the methods they implement.
García et al. described a research which states that less focused on lean thinking, showed that SMEs can generate value by decreasing their inventory levels. Lower inventory level is a common effect of lean thinking.
Based on the available literature it is difficult to state conclusively that lean is or is not particularly applicable for SMEs. Some research shows that smaller companies struggle more to implement lean methods. Other research reveals positive effects of lean in SMEs. This thesis aims to contribute to investigating if SMEs should pursue the implementation of lean thinking.
The following section will describe the problems faced in implementing lean, the factors critical to successful implementation and various implementation methods. Finally, by evaluating the implementation methods by the critical success factors the most appropriate method will be identified.
LEAN IMPLEMENTATION
Implementing lean and achieving relevant results has proven to be difficult.
Corboy et al. state that only ten percent of companies is successful when attempting to implement lean. One of the major barriers to successful implementation is the misapplication of tools. The misapplications can be of three kinds; using the wrong tool for a certain problem, using one tool to solve all problems and using all tools on every problem. Misapplying lean, manufacturing tools may waste additional time and money and it may decrease the confidence employees have in implementing lean manufacturing.
The problems with the correct usage of tools shows that there is a need for guidance. For a lean implementation method to be useful it should at least offer this guidance. Below, critical success factors of improvement programs in general and for lean efforts specifically are linked to further implementation methods characteristics.
Implementation method characteristics
Indicate what tools to use
A problem of lean implementations is that companies start with using one tool or a group of tools and push them through the entire organization. They then find out that their process does not improve.
Hayes et al. studied that It should be taken into account that elements of lean tools and practices have systemic relationships and therefore cannot be implemented in isolation. Research shows that the effect of combined implementation of tools explain about 23 percent of the increase in operational performance. The critical number of implemented lean tools seems to be four. Companies implementing at least four lean tools show significantly higher productivity growth than their counterparts not implementing lean or not implementing enough lean tools. Merely starting with one of the popular lean tools is not sufficient. The implementation method should therefore take a holistic view of the process and indicate possibilities to implement various lean tools.
Show benefits beforehand
Emiliani et al. expressed that lean implementation efforts are tedious and require perseverance. On average, SMEs need three to five years to implement lean to a reasonable extent and to be able to maintain the effort on a long term basis.
Portioli et al. emphasized that in SMEs as well as in large scale enterprises (LSEs), similar findings are reported for larger organizations Therefore, an essential factor in reaping benefits from a lean implementation is strong upper management 20 involvement. Furthermore, top management involvement is key in overcoming inevitable resistance to change, through leading.
Sim et al. expressed that in order to convince top management, the initiative should have a clear link to the mission and goals of the company and it should be clear how the initiative will lead to a structural increase in profit. Preferably, the benefits of implementing lean methods are quantified before the actual implementation takes place. This allows management to understand the increase in performance when changing from the current system to a new, unknown system.
Achanga et al. state that an implementation characteristic which holds the necessary changes to the process should be visualized to allow management to create a mental picture of the future process. This is especially relevant for SMEs, since they possibly have less opportunity to set up pilot programs, for instance in one department or on one production line. Such a pilot would possibly span the entire company, as SMEs sometimes only have one production line or department.
Enhance cultural change
Bhasin et al. described that critical for successful lean implementation is cultural change and acceptance of the new mindset throughout the organization. This change, and the acceptance of new tools, can be impeded by mistrust of employees.
Kumar et al. experienced this in one of their case studies. Support of the production employees was achieved by convincing them their jobs would not be endangered by the lean implementation. Instead, they would be rewarded for improved performance.
Karlsson et al. proposed a reward scheme aligning individual performance rewards with organizational goals. This element is more a managerial choice than a characteristic of an implementation method. It is included to emphasize the importance of cultural change.
Summarizing, the implementation method indicates what lean tools to use where and visualizes the necessary changes, it quantifies the (financial) effects of the changes up front and possibly it supports the cultural change process.
Implementation methods
Various authors have proposed methods to implement lean thinking in organizations. The most important methods will have described and evaluated according to the characteristics as described before.
Ahlström suggests that during the first phase of the project most focus should be on achieving zero defects and delayering the organization. Later, the focus should shift to continuous improvement. During the entire project, management should put efforts in eliminating waste, creating multifunctional teams, implementing pull scheduling, giving a lot of responsibility to team leaders, and instituting a vertical information system in which relevant information is shared amongst all employees. However, he does not offer a hands on approach on what tools to implement where and in what order. Neither does he propose a method to quantify the achievable benefits nor does his method include a clear visualization of the required changes or the potential benefits.
Karlsson et al. proposed that companies should start lean efforts by implementing ‘quality circles’. These are small groups of employees who meet on a regular basis to discuss improvement possibilities. This increases the involvement of the employees in the lean implementation and subsequently the number of suggestions for improvement. Furthermore, for certain lean elements, such as ‘elimination of waste’, ‘continuous improvement’, or ‘multifunctional teams’, they identify key determinants and levels of implementation. This method gives some indication of how to increase the level of ‘leanness’, but lacks guidance in what tools to use or how to quantify the effect of the changes.
Detty et al. proposed third method to implement lean is simulation. By modelling the current and future process and simulating them digitally, this method gives a precise prediction of the performance increase. The advantage of simulation is that results are detailed and offer strong insights in future performance. However, simulation is expensive and therefore possibly not practical for SMEs. Also, such simulation still requires an analysis of the system to choose what lean tools are needed. Simulation only provides validation of the expected results.
Rother et al. described another method for companies to implement lean is Value Stream Mapping. The first step of VSM is to identify the current state of a selected process or product family. This results in a visual representation of all information and material flows and gives an insight of the ratio between value added and non-value added time. This current situation is then analyzed based on seven questions regarding the need and possibility of product flow in the process. This analysis results in a future-state map. The VSM process then analyzes what improvements should be made in the current process to enable the implementation of the future state. The final step includes planning and implementing the future state process. As described, VSM gives an indication of what tool to use where. The future state map is a visualization of the necessary changes and their effects. However, VSM lacks an evident connection to cultural change.
