Introducing Kanban to Automotive Product

Development: A New Vehicle Case Study

Leankit Webinar 29 Jun 2016

Hamish McMinn
1
Who? Why?

Hamish McMinn M.A. PMP

Engineering Apprentice MOD Aquila
IT Operations
Project Manager (Automotive & IT) 2003
Kanban epiphany 2012

Objectives:
How Automotive NPD offers rich opportunities for
improving time, cost and quality equations
Challenges transferring agile software techniques into
hardware development
Highlights of our learning

2
What Happened?

Kanban proof of concept

Independent study reported delivery rate and quality up

Delivery rate and quality up with 30% fewer resources

2nd vehicle programme

Quantitative data on time & cost improvements, quality improvements

Rollout to all new vehicle programme

dec jan feb mar apr may jun jul aug sep oct nov dec jan feb mar apr
Users 60 60 60 60 60 60 60 80 80 80 80 80 180 220 280 330 380
Support 2 2 2 2 2 2 2 2 2 2 2 3 4 4 4 10 10

3
So What?

Time: 2-4 years

cost of delay - Clark, Chew, Fujimoto estimated nearly $1M/day in 1987
(over $2M / day in todays dollars)
Cash
45
Cost: 100M - >1B (9 to 11 figure sums) 35
Return

25
Quality: cost of poor quality: 15
Cashflow

defect containment (inspect, palliatives) 5

-5 Time
escaped defects: -15
Investment
Breakeven

warranty -25

-35
cost of lost sales
-45
Sources:
Kim B. Clark, W. Bruce Chew, and Takahiro Fujimoto Product Development in the World Auto Industry
US Bureau of Labor Statistics, CPI Inflation Calculator, www.bls.gov/data/inflation_calculator.htm 4
Project Scaling

Pilot vs PCDS v2
UNV1 UPV0 UNV2 UPV1 UPV2 UPV3

PCDS v2 666/664 Planned

Pilot Actual

PCDS v2 345 Planned

Time

Pilot delivered a 666 scale programme with 345 resource

(30% fewer) and improved timing and quality

5
 Engineering Team Structure

Project
Leaders
Body Chassis Electrical Powertrain

Wheels & Tyres

Cabin Systems

Door Systems

Transmission
Driver Assist
Infotainment
Suspension

Distribution

Switchgear
Frames &
Structure

Driveline
Steering
Ext Trim

Exhaust
Cooling
Climate

Seating
Int Trim

Mounts

Engine
Brakes
Mechs

Hybrid
Safety
Module
Leaders

Lead Engineers
100 - >300 Engineers, multiple sites, countries, continents
Component Engineers Circa 7000 parts to release
700-7000 CAD files
CAD Engineers Requirements, FMEA, Test Plan, Cost, Weight, Supplier

6
The Challenge for Engineers

1. How do they ensure compatibility of their design?

2. How can they collaborate effectively?
3. What parts do they need to interface to? Give clearance to?
4. What is latest design intent?
5. Software complexity (lines of code)
Boeing 787 14M
F35 Fighter 24M
Modern Luxury Car 100M

Source: http://www.informationisbeautiful.net/visualizations/million-lines-of-code/

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Visual Management

8
Improving Collaboration

9
Continuous Feedback

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 Flow and Kanban

1. Queues are the root cause of the majority of economic waste in product development
2. Queues are the analogue of inventory
3. We do not measure or manage queues (practically no one does)
4. Every transaction in product development is a potential queue
5. We have thousands of transactions (opportunities to improve)

To improve data supply stability:

1. Make process visible
2. Limit WiP (optimise batch sizes)
3. Focus on flow
4. Identify and reduce blockages and feedback delay

Donald G. Reinertsen The Principles of Product Development Flow: Second Generation Lean Product Development 2009
David J. Anderson Kanban: Successful Evolutionary Change for Your Technology Business 2010 11
 Applying Software Development Techniques

Constraints in physical product development Mitigation

Minimum viable product Decompose interim releases (internal
Architectural hard points customers)
6 degrees of freedom to control
Material requirements and properties
Material lead times
Production representative prototype parts
Build time and cost
Duplication time and cost
Modular design constrained by all of the above

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 Automotive Product = Non Value Add Time (Waste)

Development Lead Time = Value Add Time

Marketing Business Model

Concept Clay Model Theme Selection

Styling CAD Engineering Change

CAD Design

Prototype Launch Support

Mfr. Eng.

Tooling Process Development Product Quality

Launch Tooling Construction

Supplier Development

Design Concept Time Start of Production

Source: James M. Morgan, Jeffrey K. Liker: The Toyota Product Development System: Integrating People, Process, and Technology 2006, 71
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 Automotive Product = Non Value Add Time (Waste)

Development Lead Time = Value Add Time

Concept Value Added Time is only a very small percentage of the Lead-Time

Styling

CAD Design

Prototype

Mfr. Eng.

Tooling

Launch

Design Concept Time Start of Production

Source: James M. Morgan, Jeffrey K. Liker: The Toyota Product Development System: Integrating People, Process, and Technology 2006, 71
14
 Automotive Product = Non Value Add Time (Waste)

Development Lead Time = Value Add Time

Concept Value Added Time is only a very small percentage of the Lead-Time

Styling

CAD Design

Prototype

Mfr. Eng.

Tooling

Launch

Design Concept Time Start of Production

Source: James M. Morgan, Jeffrey K. Liker: The Toyota Product Development System: Integrating People, Process, and Technology 2006, 71
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 Virtual Series

Data Data Data Data Data

Freeze Freeze Freeze Freeze Freeze

CAD Progression CAD Progression CAD Progression CAD Progression

UNV1 UNV2 UPV2 UPV3
Virtual
Analysis Analysis Analysis Analysis

Issue Issue
Issue Resolution Issue Resolution
Resolution Resolution

VP Prototyp
M1 Prototype Release
Release
Physical

Virtual Series Loops M1 Build and Test

10-16 weeks duration

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 Defect Created

Virtual Series Defect Detected

Defect Resolved

Data Data Data Data Data

Freeze Freeze Freeze Freeze Freeze
Detection
Resolution
Delay Delay
CAD Progression CAD Progression CAD Progression CAD Progression
UNV1 UNV2 UPV2 UPV3

Analysis Analysis Analysis Analysis

Issue Issue
Issue Resolution Issue Resolution
Resolution Resolution

Virtual Series Loops Current batch sizes and feedback delay render virtual series data delivery systemically
10-16 weeks duration unstable, forcing a stark choice: scale upstream resource, or tolerate delays

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The Hockey Stick

Reduced delta represents

improved compatibility at the Av loop slip 2 weeks
Data flow is driven by Sprint
glidepaths, not single deadline. same point
100% Data integrity improved

Late hockey stick

Sprint 1 Sprint 2 Sprint 3 delivery results
Sprint 4 in
asynchronous
engineering i.e low
Gateway Data Readiness

quality, incompatible
data.

-12 -9 -6 -3 +2
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Countdown (weeks)
Shortening Feedback: Sprints

19
Shortening Feedback: Sprints

20
21
Effect of Batch Size

22
 Effect of Batch Size

20

Batch size 1
18

Undetected
Batch size 1 with Errors

Defects
16 Batch size 5
Batch size 5 with Errors
14
Batch size 10
12
Batch size 10 with Errors
10

0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56

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Metrics

100%
Combined Status
90% Combined Completion Prediction
80% Combined Compatibility Target %
70% Compatibility Achieved
60%

50%

40%

30%

20%

10%

0%

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Metrics

100%
UPV2 Geometry - Chassis Assessment Readiness
90%

80%

70%

60%

50%

40%

30%
Chassis Completion Prediction
20%
Chassis Compatibility Target %
10%
Compatibility Achieved
0%

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Metrics

100%
UPV2
UPV2 Geometry
Geometry -- Electrical
Chassis Assessment
AssessmentReadiness
Readiness
90% Electrical Completion Prediction
80%
Compatibility Achieved
70%
Electrical Compatibility Target %
60%

50%

40%

30%
Chassis Completion Prediction
20%
Chassis Compatibility Target %
10%
Compatibility Achieved
0%

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Daily Stand up Meetings

In front of the board, three questions:

1. What did we accomplish yesterday?

2. What will we do today?
3. What obstacles are impeding our
progress?

Objective is not to discuss details in the

meeting, but to agree offline help required

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So What is the Board Telling Us?

The board is a signalling system, its effectiveness relies on our ability to read the signals and
raise the questions it prompts. E.g.:

What needs to happen to progress these items?

Why is this item blocked?
Who has the next action?
What is date to green?
When will overdue be ready?

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The Big Picture

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Highlights of Our Learning to Date

Visual Management
Accelerate feedback
Decompose large batches
WIIFM
Success breeds success
Peoples behaviour (not tools) delivers outcomes
Replicate good practice
Deep vs superficial learning

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Summary

Reduced batch size

Shortens feedback loops
Reduces defects / rework
Increases throughput and quality

Adopt Kanban / visual management to enable intense collaboration

Result complex programme achieved in less time with

Improved quality
30% fewer resources

Contact: hamish@flowlogic.co W: Flowlogic.co

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Questions and Answers

Contact: hamish@flowlogic.co W: Flowlogic.co

32
Summary

Reduced batch size

Shortens feedback loops
Reduces defects / rework
Increases throughput and quality

Adopt Kanban / visual management to enable intense collaboration

Result complex programme achieved in less time with

Improved quality
30% fewer resources

Contact: hamish@flowlogic.co W: Flowlogic.co

33