Expert session

Basic setup of
Lean
Manufacturing
AX2012

HSO. All rights reserved. No part of this publication may be reproduced and/or
published by print, photoprint, microfilm or any other means without the prior written
permission of HSO.

Basic setup of Lean Manufacturing AX2012|

06-03-2015

Document history

Version Description

Author(s)

Date

1.0

Dennis Koning

06-03-2015

Initial version

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

Table of content
1

Expert team................................................................................................4

Business case............................................................................................. 5

2.1 Overview......................................................................................................................... 5
2.2

Related customers/projects...........................................................................................6

2.3

Related Microsoft KB articles.........................................................................................6

Possible solutions.......................................................................................7

3.1 Setup of a Sales Event Kanban....................................................................................7

3.1.1 Items...................................................................................................................... 7

3.2

3.1.2

Workcell............................................................................................................... 7

3.1.3

Value stream....................................................................................................... 8

3.1.4

Production group................................................................................................. 8

3.1.5

Production flow models........................................................................................ 9

3.1.6

Production flows.................................................................................................. 9

3.1.7

Kanban rules..................................................................................................... 11

3.1.8

Demonstration of the process............................................................................12

Setup of a fixed amount Kanban..............................................................................15

3.2.1

Kanban rules..................................................................................................... 15

3.2.2

Demonstration of the process............................................................................15

Conclusion................................................................................................ 17

Open issues.............................................................................................. 18

Actions..................................................................................................... 19

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

1 Expert team
Dennis Koning

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

2 Business case
2.1 Overview
Lean manufacturing is a systemic method for the elimination of waste ("Muda") within a
manufacturing process. Lean takes into account waste created through overburden ("Muri")
and waste created through unevenness in workloads ("Mura"). Lean is the set of "tools" that
assist in the identification and steady elimination of waste (muda).
A non-exhaustive list of such tools would include: SMED, value stream mapping, Five S,
Kanban (pull systems), poka-yoke (error-proofing), total productive maintenance,
elimination of time batching, mixed model processing, rank order clustering, single point
scheduling, redesigning working cells, multi-process handling and control charts (for
checking mura). 1
Although the term Lean Manufacturing in AX2012 is slightly exaggerated (in my opinion),
Ax can simplify the process without losing to much of the ERP registrations and
traceability.
The essence of Lean manufacturing in AX2012 is based on Kanban pull-systems and a
simplification of the administrative process of picking, transferring and producing items by
using Kanban jobs. Besides Kanban also Value stream mapping is recognizable in the
setup of production flows. Production flows are chains of dependent jobs. If an item
requirement is generated, this requirement is pulled through the production flow by
generating Kanban jobs for each process step.
The supported replenishment strategies are:
Event Kanban rules (pegged to the source requirements) originate from:
Sales order lines
Production BOM lines
Kanban lines
Minimum inventory settings.
Fixed quantity Kanban rules.
Calculate optimal fixed quantity Kanban quantities (based on demand)
Planned/scheduled Kanban (MRP)
The advantage of lean manufacturing:
1. One form is used for planning the Kanban manufacturing jobs
2. Two forms are used for executing the Kanban jobs (manufacturing/pick and transfer).
3. Drag and drop planning of Kanban Jobs
4. Visual overview of availability of required items
5. Only one click is needed for picking the required items from inventory
6. Only one click is needed to complete a process Job (manufactured product).
Because of the simplification there are also limitations/disadvantages:
1. No registration of hours on the process jobs
2. One click means that warehouse and production employees must know exactly what
they are doing. Its easy to make an error

http://en.wikipedia.org/wiki/Lean_manufacturing
the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

2.2 Related customers/projects

2.3 Related Microsoft KB articles
https://hso1com.sharepoint.com/sites/kb/ax/Manufacturing/AX2012_ENUS_Lean
Manufacturing.pdf
https://technet.microsoft.com/en-us/library/hh242439.aspx
Why use and event Kanban: http://ibisinc.com/blog/why-use-an-event-kanban/
eBECS Lean Webinar, part 1:
https://www.youtube.com/watch?v=Hi68o8Ei0vg
eBECS Lean Webinar, part 2:
https://www.youtube.com/watch?v=UK8ccZ5Ka6Q
eBECS Lean Webinar, part 3:
https://www.youtube.com/watch?v=lMurK0evaP0
eBECS Lean Webinar, part 4:
https://www.youtube.com/watch?v=poEPpTj8wvI
eBECS Lean Webinar, part 5:
https://www.youtube.com/watch?v=BWEAa1Duzs4

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

3 Possible solutions
3.1 Setup of a Sales Event Kanban
3.1.1 Items
In my example Im going to use a BOM-item with two products attached to it:
K001 Box of pens
K002 Pen
K003 Box

BOM Quantity: 100

BOM Quantity: 1

Make sure in the default order settings of the BOM-item the order type is set to Kanban

3.1.2Workcell
Go to Organization administration > Common forms > Resources > Resource groups
Create a new resource group and make sure its defined as a work cell.
Attach a calendar and work cell capacity

3.1.3Value stream

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

Go to production control > setup > organization > Value streams

Create a new value stream:

3.1.4Production group
Go to production control > setup > production > production groups
Create a new production group and fill in the accounts:

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

3.1.5Production flow models

Go to production control > setup > Lean manufacturing > Production flow models
Create a new production flow model:

3.1.6Production flows
Go to production control > setup > Lean manufacturing > Production flows
Create a new production flow:

10

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

11

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

3.1.7Kanban rules
Go to production control > setup > Lean manufacturing > Kanban rules
Create a new Kanban rule of type manufacturing and Replenishment strategy Event

12

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

3.1.8Demonstration of the process

Create a new sales order for item K001. After the line is saved, click Product and supply >
View pegging tree

From the pegging tree all Kanbans can be planned automaticaly by selecting Plan entire
pegging tree. Based on the sales order quantity and the Work cell throughput quantity
(chapter 3.1.2 Workcell) the Kanban is automaticaly planned. A production manager can
reschedule this planning later.
The planning of Kanbans doesnt necesarry need to be done from the sales order. It can also
be done manualy in the Kanban Schedule Board.

13

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

Go to production control > common forms > Lean manufacturing > Kanban schedule board
The Kanbans are scheduled, but the planning can be changed by dragging and dropping the
jobs to other days.

Go to production control > common forms > Lean manufacturing > Kanban board for
process jobs
I made sure there was enough inventory to pick.

14

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

By hitting the complete button, the required items are picked and the manufactured product
is now Onhand.

15

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

3.2 Setup of a fixed amount Kanban

3.2.1Kanban rules
I used almost the same setup as chapter 3.1. The difference is the Kanban rule.
The replenishment strategy is now fixed. This setup is also known as a 2 (or more) bin
system.

3.2.2Demonstration of the process

Go to production control > common forms > Lean manufacturing > Kanban schedule board
For item K001 the schedule board shows that the Kanban is below the boundary minimum
(red).

16

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

By clicking the button create Kanban the system suggest the Kanban that need to be
scheduled

Now 5 kanbans are scheduled:

Go to production control > common forms > Lean manufacturing > Kanban board for
process jobs
Create and complete the same way as described in chapter 3.1.8.

17

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

4 Conclusion
Lean manufacturing can support companies by setting up easy replenishment and
manufacturing tasks. The setup takes some time but after that Ax suggest the Kanbans to
plan in a specific period.
For companies who want to compose products, but dont feel the need for a production
setup (and posting hours), Lean manufacturing can be a great solution. Also replenishment
of floor stock can be setup by using AX2012 Lean manufacturing.

18

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

5 Open issues
In this document I described only the basic setup for Lean manufacturing. Based on your
business case I think youll have enough information the start setting up Process Flows and
Kanban Rules.
Important to know is that multiple dependent activities can be added to a process flow.
I also only described the manufacturing process, but its also possible to create Kanban
Rules for withdrawal (transfer goods from one place to another).
The usage of Kanban cards and performing the process using barcode scanners isnt
covered in this document.

19

the results company

Basic setup of Lean Manufacturing AX2012|

06-03-2015

6 Actions
List any actions to be set out within the HSO organization (within or outside Expert team).

20

the results company