LEAN and AGILE

manufacturing

DMEM
What is Lean Manufacturing?
Builds on roots but with specific focus on:

Lead time reduction

 Regular production
 New products
Flexibility improvement
Variability reduction
Cost reduction
 Lean production
Lean production can he defined as an adaptation of
mass production in which workers and work cells are
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made more flexible and efficient by adopting

methods that reduce waste in all forms.
The Machine that Changed the World, lean production
is based on four principles :
1. minimize waste
2. perfect first-time quality
3. flexible production lines
4. continuous improvement

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 Minimize Waste
These wastes from:
(1) production of defective parts,
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(2) production of more than the number of items

needed,
(3) unnecessary inventories,
(4) unnecessary processing steps,
(5) unnecessary movement
of people,
(6) unnecessary transport of materials, and
(7) workers waiting

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 Perfect First-Time Quality
In the area of quality, the comparison between mass
production and lean production provides a sharp
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contrast.
In mass production, quality control is defined in terms
of an acceptable quality level or AQT i.e. a certain
level of fraction defects is sufficient, even
satisfactory.
In lean production, by contrast, perfect quality is
required. The just-in-time delivery discipline used
in lean production necessitates a zero defects level in
parts quality,

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 Flexible Production Systems.
 In mass production, the goal is to maximize efficiency. This is
achieved using long production runs of identical parts. Long
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production runs tolerate long setup changeovers,

 In lean production. procedures are designed to speed the
changeover. Reduced setup times allow for smaller batch sizes.
thus providing the production system with greater flexibility.
Continuous Improvement.
In mass production, there is a tendency to set up the
operation, and if it is working, leave it alone. Mass production lives
by the motto ”if it ain't broke, don't fix it." By contrast. lean
production supports the policy of continuous improvement
Called kaizen, it means constantly searching for and
implementing ways to reduce cost, improve quality, and
increase productivity.

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Lean Characteristics & Benefits
Characteristics Benefits (higher …)

Customer Driven

Profit Driven Customer Satisfaction

Team Based Profitability

Fewer Players Greater Control

Devolved responsibility
What is World Class Manufacturing?

Being the best

Delighting the
customer?

Being the lowest

cost producer
Schonberger’s
agenda?
What is World Class Manufacturing?

Flexibility & control to

satisfy customer on
time, every time

Managing through
people, teams and
aligning all to goals

Reduction of waste in
the manufacturing
system

Product quality right

first time, every time
How to go lean

Objective Method

Setting the direction,

Understand customers and
1 targets and checking
what value they want
results

Define the internal value An internal framework for

2
stream delivering value

Eliminate waste, make info

Appropriate method to
3 & products flow, pulled by
make necessary change
customer needs
Extend the definition of
Externalise the value focus
4 value outside your
to the whole value stream
company
Strive for perfection in the
Continually aim for
5 product and in all
perfection
processes and systems
Cornerstone of Lean Manufacturing
Value stream mapping
 Construct process map of the value stream
Avoid using existing maps, may be out of date or have
misconceptions
Many mapping tools (process activity,
 Analyse the process map supply chain response, quality filter, etc.)
Focus on customer
Identify value-added and non-value-added activities
 Calculate the value-add ratio
 Reduce and eliminate wasteful steps

Conduct all improvements in context of value-add ratio

(several value streams exist in a value chain,

e.g. key product line to key customer)
Agile – a step on from lean?
Roots of agile in America defence industry –
developing the ability to react and reorganise to
successful equipment bids
Lean and agile have common components
 See “Lean Thinking Roots” slide (quality, reliability,
improvement, etc)
 But lean is process focused, agile is boundary focused
Ability to thrive in constant, unpredictable change
Key attributes of agile
 Customer value focus (solutions not products)
 Flexibility to adapt to fundamental market changes
Not simply changes in product mix
 Competing from multiple fronts, possibly virtually
 Organisational knowledge, including ability to adapt IT
systems to support new processes
 Agile manufacturing
Agile manufacturing can he defined as
(1) an enterprise level manufacturing strategy of
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introducing new products into rapidly changing

markets and
(2) an organizational ability to thrive in a competitive
environment characterized by continuous and
sometimes unforeseen change.
The four principles are:
 Organize to Master Change
 Leverage the Impact of People and Information
 Cooperate to Enhance Competitiveness
 Enrich the Customer

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Different views on lean -vs- agile
The journey
Traditional Lean Agile

A spectrum of companies
Lean Agile
Make to stock Make/Engineer to order,
Low variety High variety, Service culture
Mass, repetitive “Product Innovator”?
“Cost minimiser” “Customer intimate”?

Complementary
Make to forecast Make to order
Stock
(to decouple)
Material
suppliers
Lean Agile customer

Upstream variation Downstream variation

Establishing Foundations for Lean, Agile …
Need the classic pre-requisites for any programme
 Strategy
Culture
 Commitment change
 Objectives
 Communication
 Empowerment
Use of
 Establish framework champion
 Activity plan, cost, time and execution
 Measurement and evaluation system
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comparison

DMEM
Key to Lean Manufacture is measurement
Need clear, objective focus on value
Example: OEE (Overall Equipment Effectiveness)
 A composite measure of the ability of a process to carry out
value adding activity
 OEE = % availability x % output achieved x % perfect output
 If change to a process increases OEE it is worthwhile

Actual Available Production Time Planned Downtime

Theoretical time minus planned downtime and shutdowns PM, Shutdowns,
This is the realistic best available production time (100%) Holidays

Machine Running Time Unplanned Losses

Actual production hours minus downtimes Breakdowns, HR, Availability
This is possible production if 100% performance Set-up time

Net Operating Time Speed losses

Machine speed against theoretical speed Idling, minor Performance OEE
This is the possible output if 100% quality stopages
performance

Useful Production Time Quality Losses,

Material in minus product out adjustments, Set-up Quality
This is the real output waste
Lean Thinking roots in Toyota Philosophy
 Doing it all for the Customer Item
Runner
Qnty
100
Day 1
20
Day 2
20
Day 5
20
Repeater 27 7 7
 Levelled production Stranger 5 5
Load 132 27 27 25

 Pull system Cap’ty 135 27 27 27

store
 Continuous-flow production K K kanbans
withdraw & process

 Takt time work

centre
replacement work
centre
batches

 Multi-skilling
 TQM Upper action limit

average
Upper warning limit

 TPM time

 Poka Yoke action?

Competitiveness

 SPC
 Standardised work
 Kaizen
Uncompetitive Competitive
Time