14 MANAGEMENT PRINCIPLES OF LEAN PRODUCTION SYSTEM

Compiled by: 1) Pushkal Patidar Sr.Engineer (T&C-O&M)

2) Sumit Singh Chouhan Engineer (T&C-O&M)

14 MANAGEMENT PRINCIPLES OF LEAN PRODUCTION SYSTEM

PRINCIPLE: 1
Base your management decisions on a long term philosophy
A) B) C) D) A mission greater than earning a pay check Doing the right thing for the customer Dont let business decisions undermine trust and mutual respect Use self reliance and responsibility to decide your own fate

PRINCIPLE: 2
Create continuous process flow to bring problem to the surface
A) Most business processes are 90% waste and 10% value added work B) Non Value adding Waste Overproduction Waiting Unnecessary transport Over processing Excess Inventory Unnecessary movement Defects Unused employee creativity C) Use Takt time-(rate of customer demand) to achieve One piece flow Benefits of one piece flow Builds in quality Creates real flexibility Create higher productivity Frees up floor space Improve safety Improve morale Reduce cost of inventory

PRINCIPLE: 3
Use pull system to avoid overproduction
A) The principle- customer pull and replenishment:i) As a compromise between the ideal of one piece flow and push create small stores of part between operations to control the inventory. ii) Use simple signals-cards, empty bins, empty carts called Kanban. B) Kanban:- Use Kanban in factories and also in non-factory areas persistently to reach closest to a true onepiece flow thereby achieving zero-inventory

PRINCIPLE: 4
Level out the workload (Heijunka)

A) RemoveMUDA-Non value added. MURI- Overburdening people or equipments MURA-Unevenness

B) Heijunka- Leveling Production and Schedules Advantages:-1) Flexibility to make what the customer wants when they want it. This reduces the
plants inventory and its associated problems. 2) Reduced risk of unsold goods. 3) Balanced use of Labour and machines. 4) Smoothed demand on upstream processes and the plants suppliers.

PRINCIPLE: 5
Build a Culture of stopping to fix Problems, to Get Quality Right the First time.
A) Jidoka-Stopping the process to build in quality :- Empower employees to halt the process whenever they see a defect. B) Using countermeasure and Error-Proofing to Fix Problems:- Devise ways and means that make it nearly impossible for an operator to make an error-Poka-yoke. C) Keep Quality Control simple and Involve Team Members:i) Go and see ii) Analyze the situation iii) Use one-piece flow and andon (it is a signal from an operator that help is needed to solve a quality problem) to surface problems iv) Ask why 5 times

PRINCIPLE: 6
Standardized tasks are the Foundation for Continuous Improvement and Employee Empowerment.
A) Standardization is the basis for continuous improvement and quality:- Standardize and stabilize work process and then use it as a basis for further improvement through Kaizen. Later build the improvement in the process and standardize it again. Thus taking the work process to a higher level of efficiency, this again serves as a basis for further improvement. Thus the process of improvement continues taking the work processes to increasingly higher level of efficiency. B) Standardization as an Enabler:- Within the standardized procedures provide freedom to innovate and to be creative to meet challenging targets consistently for cost, quality and delivery.

PRINCIPLE: 7
Use visual control so no problems are hidden.

A) Clean it up, Make it Visual-The 5 S:- (Refer the figure below) Sort(seiri) Straighten (Orderliness)(seiton) Shine (Cleanliness)(seiso) Standardize(seiketsu) Sustain(shitsuke)

B) Visual control systems- improving value added flow:i) Visual control is any communication device used in the work environment that tells us at a glance how work should be done and whether it is deviating from the standard. ii) In the broadest sense, visual control refers to the design of just-in-time information of all types to ensure fast and proper execution of operation and processes C) A3 Reporter:- Capturing all you need to know on one sheet of paper:- A full report documenting a process which would succinctly state the problem, document the current situation, determine the root cause, suggest alternative solution, suggest the recommended solution, and have a cost-benefit analysis D) Keeping it visual through technology and human systems:- Using technology for visual aids.

Sort
Clear out rarely used items by red tagging

Sustain
Use regular management audits to stay disciplined

Straighten

The 5 Ss

Organize and label a place for everything

Standardize
Create rules to sustain the first 3 Ss

Shine
Clean it

PRINCIPLE: 8
Use only reliable, thoroughly tested technology that serves your people and processes.
A) Adoption of new technology must support your people, process and value:- Introduce a new technology only after it is proven out through direct experimentation with the involvement of a broad cross-section of people. B) People do the work, Computer moves the information:- Avoid blind reliance on information technology. C) The role of technology- Adapting it appropriately:- Adapt the technology to suit your operations and to build in flexibility

PRINCIPLE: 9 Grow leaders who thoroughly understand the work, live the philosophy and teach it to other.
A) Growing your leader rather than purchasing them:- Find key leaders within the company who understand work and who are soaked in the companys philosophy. Find them at right time and groom them for the position.

TECHNICAL

MANAGEMENT

PEOPLE

PHILOSOPHICAL

TPS (Toyota Production System)

Technical

Stability JIT Jidoka Kaizen Heijunka

Management True North(finding hard facts) Tools to focus management attention Go and see Problem-solving Presentation skill Project management Supportive culture

Philosophical Customer First People are more important asset Kaizen Go and see focus on floor Give feedback to team member and earn respect Efficiency Thinking True (vs. apparent) Condition Total(vs. individual) team involvement People

Long-term asset Learned skill Machinery depreciates Loses value People appreciate Continue to grow

B) First lesson of management- Putting customers first:- Developing in new executives an appreciation of customers view point. Achieved by making them deal with the customers first hand.

PRINCIPLE: 10
Develop exceptional people and team who follow your companys philosophy.
A) Developing excellent individual work while promoting effective team work:- Establish a good balance between individual work and group work and between individual excellence and team effectiveness. B) Work group are the focal point for solving problem.

Team Member (5-8) Team Leader (3-4)

Group Leader (5-8)

Asst .Manger (4-10)

Smallest Group(4 LTs,18TMs)

Largest Group (5LTs,23TMs)

Manager

Typical Toyota organization-assembly operation

Team Member(TM)

Perform work to current standard. Maintain 5S in their work area. Perform routine minor maintenance Look for continuous improvement opportunities Support problem solving small group activity Process start up and control. Meet production goal. Respond to andon calls by TM. Confirm quality-routine checks Cover absenteeism. Training and cross training. Work order for quick maintenance. Ensure standardized work is followed Facilitate small group activities Ensure parts/materials are supplied to process Manpower/Vacation scheduling Monthly production Planning Hoshin kanri(policy deployment) planning Team morale Confirm routines quality and TL checks Shift to shift coordination Process trials(change in process) Administrative: policy, attendance, corrective action. TM development and cross-training Report/ track daily production results Cost reduction activities Process improvement projects: productivity, quality, ergonomics etc. Coordinates major maintenance Coordinates support from outside group Coordinates work with up-stream and down-stream process. Group safety performance. Help cover TL absence Coordinate activities around major model changes.

Team Leader (TL)

Group Leader

C) People drive continuous improvement:- Invest in people. Training exceptional people and building individual work groups to be the back-bone of management approach, an approach that integrates your social systems with technical system. Develop a social system and culture of continuous improvement to support positive problem-solving behavior and improvement motivation.

PRINCIPLE:11
Respect your extended network of partners and suppliers by challenging team and helping them improve.
A) Find solid partners and grow together to mutual benefit in the long term:- Scout good vendors. Have a few of them and not too many. Further, do business with them on a long term basis so that they have a chance to understand your specific requirements and are able to dovetail their production with your requirement.

This requires their having to make some investments or sacrifice some other customers. Therefore give them business on sustained basis and not try to rope in new vendors all the time to achieve aggressive price cuts. Because in the long run material from such suppliers can create havoc with your product and your market standing may take a serious beating. Therefore, have the philosophy of growing together with your supply chain network. B) Partnering with supplier while maintaining internal capability:- Decide critically which products/components/technologies to outsource and which to produce/develop internally from strategic view point C) Working with suppliers for learning of TPS:- Teach your suppliers Lean Production System by calling them to your factory or by deputing your executives to their factories. D) Saving Sick supplier through TPS:- Saving a sick supplier earns you a committed business partner in the long run and increase your attractiveness in supply chain market. E) Developing an extended learning enterprise means enabling other:-

Next level of improvement Learning enterprise Enabling System

Progressing need satisfaction

Clear Expectation

Regressing need satisfaction

Stability Stable, Reliable Processes

Fair and Honorable Business Relations

Supply chain need hierarchy

PRINCIPLE:12
Go and see for yourself to thoroughly understand the situation (Genchi Genbutsu). A) B) C) D) E) Deeply understanding and reporting what you see Watch and think for yourself Think and speak based on personally verified data Leaders are not excused from Genchi Genbutsu Hourensou- Rapid Genchi Genbutsu for executives 1) To get reports of what is going on 2) To get updates periodically (at a predetermined frequency or ad-hoc) 3) In case of problem to consult across departments company-wide or to advise those across the company seeking solution if you have one. Pooling of experiences company-wide.

PRINCIPLE:13 Make decision slowly by consensus, thoroughly considering all options; Implement rapidly.
A) Thorough consideration in decision making. Finding out what is really going on, including genchi genbutsu. Understanding underlying clause that explain surface appearances asking why 5 times. Broadly considering alternative solution and developing a detailed rationale for the perfect solution. Building consensus within the team, including company employees and outside partners Using very efficient communication vehicles to do one through four above, preferably on one side of one sheet of paper.

B) Broadly consider alternative solution with set-based approach. C) Nemawashi- Make decision slowly by consensus, thoroughly considering all option D) Communicate visually on one piece of paper to arrive at decisions. E) The Deming cycle-PDCA- Planning, doing, checking, acting F) A Great deal of learning up front makes for easier decision making.

PRINCIPLE:14
Become a learning organization through relentless reflection (Hansei) and continuous improvement (kaizen).
A) The Principle- Identify root cause and develop countermeasures. B) Getting to the root cause by asking why 5 times. C) Practical problem solving in 7 steps.

1.

Initial problem perception

2.

Clarify the problem

Grasp the situation

The Real problem

3. Locate Area/ Point of cause

POC
Why? Why?

Direct cause
cause cause cause cause

Basic Cause and Effect Investigation

Cause Investigation

Why? Why? Why?

4.5 Why? Investigation of Root Cause

Root Cause

5. Countermeasure

6. Evaluate

7. Standardize

D) Practical Problem-solving Process

E) Hansei- Responsibility, Self-Reflection, and organizational learning. F) Process vs. Result orientation: The role of metrics. 1) Global performance measure-How is company doing? 2) Operational performance measures-How is the department doing. 3) Stretch improvement metrics- How is the business unit doing. G) Hoshin Kanri- Directing and Motivating organizational learning

Targets for Organization

Time, Quality, cost, innovation

Executive staff

High level plan

Improvement ?,who? Method?, Target, Time?

Manager/supervisor

Plan-Do
Work plan by item, Action, Measurement, Countermeasure

Work Team Check

Improvement ?,who? Method?, Target, Time? All 3 Levels

Policy Deployment Process

h) Creating a learning organization is a long term journey

Create flow (Act)

Surface Problem Evaluate Result (Plan)

(Check)

Counter-measure (Do)

Create flow and PDCA