Lean Transformation

A Journey

Anand Subramaniam

You are here to enrich the world, and you

impoverish yourself if you forget the
errand.
- Woodrow Wilson

Origins of Lean
Lean concepts evolved from the JIT philosophy
pioneered in Japan by Toyota and embodied in
their Toyota Production System (TPS)
The emphasis of JIT is the elimination of waste
throughout the supply chain
In the 1990's companies adopted the term lean
in place of JIT
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Basis of Lean Thinking

Lean means producing
What is needed
When it is needed
With the minimum amount of materials, equipment,
labor, and space

The goal of an enterprise adopting lean

Make each process as efficient and effective as
possible
Connecting those processes in a stream or continuous
chain that is focused on flow and maximising customer
value
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Lean Principles
Control

Measure
Specify value in the eyes of the
customer
Identify the value stream and
eliminate the waste
Make value flow at the pull of the
customer
Involve and empower employees
(there is no better source of insight
than the employees who are
performing the work)
Continuously improve (kaizen) in
pursuit of perfection

Improve

Analyse

Note..

It is a systematic approach to drive customer satisfaction and operational

excellence

Be flexible and vary the approach depending on your organisations culture

It is a journey / endurance race for continuous learning and improving top &
bottom line

It requires leadership, discipline, and buy in on lean philosophy

Process improvement and people development must go hand in hand

It is on the job, real time learning & training

Lean is 20% Technical and 80% Behaivioral

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Challenges
Viewed as technical transformation (not cultural
transformation)
Looked upon as One-size-fits-all approach
Lack of commitment and understanding of effort required by
C Level and All Levels
Most organisations never get deep enough into the lean
process to achieve true success
Focus on departments rather than value streams
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Internal Challenges
Gap between enterprise resource
planning (ERP) and factory floor
Incompatible and Inconsistent systems
Lack of timely information
to make informed decisions
Lack of strategy to unify
information across manufacturing
Lack of funds and/or
lack of perceived value

Best in Class Strategic Actions

Improve processes that manage the flow
of material and information

Lean Initiative

Optimise performance at
Individual plants and factories
Drive standards and consistency
Across Global manufacturing networks
Improve Sales and Operations
Planning Processes

Improvements from Lean Implementation

Best Practices from Actual Cases
Ranges in % Improvement
20
40
60
80
100
Total Cycle Time
Revenues
Inventories
Invisible Inventories
Blue-Collar Productivity
White-Collar Productivity
Availability
Scrap
Delivery Lead Times
Time-to-Market
Return-on-Assets
Adapted from: National Productivity Review, Industry Week, Deltapoint Actuals

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Lean Transformation Implementation

Implementation
What are the key lean
principles and practices?

Process / Checklist
Enterprise Level Roadmap

How do I transform my
enterprise to lean?

Enterprise Transition to Lean

How do I assess my progress?

Lean Enterprise Self Assessment

Tool

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Lean Transformation - Enterprise Approach

Uncertified
Suppliers

Warehouse

Sales &
Marketing

Certified
Suppliers

Factory
Warehouse
Human
Resources
Accounting
Engineering
Information
Technology

Customer
Service

Customers

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Enterprise Level Roadmap High Level

Long Term Cycle
Entry / Re-entry
Cycle
Adopt Lean Paradigm

Focus on the
Value Stream
Initial Lean Vision
Environmental
Corrective
Action Indicators

Decision to pursue
Enterprise Transformation
Enterprise
Strategic
Planning

Lean Impact

Focus on Continuous
Improvement

Develop Lean Structure &

Behavior
Lean Vision

Short Term Cycle

Detailed
Corrective Action
Indicators

Outcomes on
Enterprise
Metrics
Implement Lean
Initiatives

Lean
Transformation
Framework
Create & Refine
Transformation Plan

Enterprise
Level
Transformation
Plan

Source: MIT Lean Aerospace Initiative

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Enterprise Level Roadmap Detailed

Phase I: Plan

Phase II: Pilot

Phase III: Deploy

Phase IV: Integrate

Phase V: Excel

business renewal

strategy re-vision

vision deployment

implementation/adherence

strategy re-vision

Create mission;
establish values

Mission
Statement

Create leadership
structures

Values
Statement

Envision
the future

RelationShip Map
Organigraph

Play catchball
with deployment
teams

Target/
Means
Analysis

P/O
Matrices
Deployment
Plans

Vision
Statement

Use reliable,
scientific methods
at all levels

Discover/correct
performance
variances

CEDAC
JIT
TPM
CE

5 Minute
Meetings
Weekly
Meetings

Re-vision your
strategy -- again

business renewal

Renew your
business in
real time

Monthly
Meetings

Segment
the market

Define leadership
requirements

Study
Missions
Market
Studies

Define policies,
objectives, targets
and budgets

Play catchball
with action teams

P/O
Matrices

Product/
Market
Matrix

Communicate!
Communicate!
Communicate!

Kickoff
Promotion

Target/
Means
Analysis

P/O
Matrices

Focus
Team
Charter

Technology
Roadmaps

Corporate
Diagnosis
Development
Plan

Target/
means
Analysis

Action
Plans

Finalise policies
and budgets

Plan
Summary

Perform corporate
diagnosis with
top Champions

Assess/analyse
performance

Capture learning
and make it
replicable

Study
Missions
Creative
Thinking
Bottom up
Planning

analysis and reflection

Scan the
environment

P/O
Matrix

Progress
Tables
Site Visits

CEDAC

CEDAC
Newsletter

Use advanced
planning methods

Strategic
Scenarios
Game
Theoretic
Models

Celebrate
Success!

Website

2003 Productivity, Inc. adC IP0201wc

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Source: Productivity Inc.

Example - Enterprise Level Roadmap

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Benefits of Enterprise Level Roadmap

Facilitates enterprise focus
Provides sequence for enterprise
transformation
Increases understanding of what went
wrong in previous transformation attempts
Focuses on people/leadership issues
Provides an organising framework for
enterprise wide transition
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Enterprise Transition to Lean

Begins with a description of a Top Level Flow
of primary activities referred to as The
Roadmap
Focus on the Value
Stream

Map Value Stream

Internalise Vision
Set Goals & Metrics
Identify & Involve Key
Stakeholders

Then, provides descriptions of key tasks

required within each primary activity

Finally, leads discussion of issues, enablers, barriers,

case studies & reference material relevant to each
task in a common structured framework
Source: MIT Lean Aerospace Initiative

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Lean Enterprise Self Assessment

Uncertified
Suppliers

Warehouse

Sales &
Marketing

Certified
Suppliers

Factory

Source: MIT Lean Aerospace Initiative

Warehouse
Human
Resources

Accounting
Engineering
Information
Technology

Customer
Service

Customers

What
What
A lean
vision
A lean vision
Why
Why lean
Communicate
Communicate
lean
enterprise-wide
enterprise-wide

Who
Who Leader
The Enterprise
The Enterprise Leader

When
When
First
step
First step

How
Learn fromHow
successful
Learn
from successful
lean
implementations
lean implementations
Where
Where
Enterprise-wide
Enterprise-wide

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Checklist, Process & Procedure

Lean Structure & Behaviour

Adopt Lean Paradigm

Organise for Lean Implementation (checklist)

Build Vision (process & checklist)

Identify & Empower Change Agents (process)

Convey Need (process & checklist)

Align Incentives (process & procedure)

Foster Lean Learning (procedure)

Adapt Structure & Systems (process & checklist)

Make the Commitment (process)

Obtain Senior Management Buy-in (process)

Create & Refine Transformation Plan

Identify & Prioritise Activities (checklist)

Focus on Value Stream

Commit Resources (process)

Map Value Stream (process & checklist)

Provide Education & Training (procedure)

Internalise Vision (process & checklist)

Set Goals & Metrics (process & checklist)

Identify & Involve Key Stakeholders (process)

Implement Lean Initiatives

Develop Detail Plans (process & Checklist)

Focus on Continuous Improvement

Implement Lean Activities (As-Is/To-Be process, checklist)

Monitor Lean progress (process & checklist)

Enterprise Transition to Lean (process & checklist)

Refine the Plan (process)

Measure Improvement / Self Assessment / Lesson Learnt

(checklist)

Capture & Adopt New Knowledge (process)

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Example Lean Structure

Phase Lean Structure Behaviour

Outcome Change Management Plan

Process
Strategic Alignment
Top Management support & commitment
Sense of Urgency and prorities
Stakeholder Involvement
Organisational Structure
Goals and Objectives
Transformation Plan
Monitoring and Nurturing

Checklist

Customer need assessment

Communication assessment
Readiness assessment
Training Needs Analysis

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Example - Change - Checklist

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Example - Convey Need

Phase Adopt Lean Paradigm

Outcome Build a Vision
Process review (culture, internal & external process, success criteria, stakeholder needs, training needs, case studies
of successful lean implementation, research)
Checklist -

What
What
AAlean
leanvision
vision
Why
Why
Communicate
Communicatelean
lean
enterprise-wide
enterprise-wide

Who
Who
The
Enterprise
The EnterpriseLeader
Leader

When
When
First
Firststep
step

How
How
Learn
from
Learn fromsuccessful
successful
lean
implementations
lean implementations
Where
Where
Enterprise-wide
Enterprise-wide

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Example - Implement Lean

Phase Implement Lean Initiative

Outcome Baseline and improvement level using 5 S - Increase productivity, product quality & safety at
work : reduce manufacturing cost: improve on-time delivery
Process

Level
Baseline
0
Beginner
1

Clearout and Classify - Clearing items no longer required : Tagging items that may be required and storing away from workplace
Configure - A place for everything & everything in its place
Clean and check - Identify cleaning zones, establish cleaning routines
Conformity - Roll out across the organisation
Culture and practice- Monitor process adherence & continually validate

Checklist
Sort

Standardise

Sustain

Spills, waste, trash, etc.

produce unsafe
conditions.

No methods or
procedures documented.

No routine
review/correction of
unsafe conditions.

Needed and un-needed

items found in work area.

Needed and un-needed

items are placed
randomly throughout the
workplace.
Needed items stored in
an organised manner.

Work area and machines

are not cleaned on a
regular basis.

Methods of work not

completely documented.

Occasional, unscheduled
5S activity.

Area and equipment

cleaned daily.

Methods of work
documented but not
consistently used.

5S activities conducted
on regular basis.

Needed items have

dedicated positions
which are clearly
indicated.
Needed items can be
retrieved within (cell
target) seconds and (cell
target) number of steps.
Method for
adding/deleting
indicators for needed
items

Standard work layout

posted and maintained.

Methods of work posted

and consistently used by
some cell team
members.
Methods of work
consistently used by all
cell team members.

5S assessment
conducted occasionally
and results posted.

Needed /un-needed
items separated, unneeded tagged.

Visual
3

Red tag area created, all

un-needed items
removed.

Preventive
5

Shine

Placement of items
causes unsafe
conditions.

Basic
2

Systematic
4

Simplify

Unsafe items in work

area.

List of needed items

developed, maintained,
posted.
Un-needed items are not
allowed in area.

Daily inspections of plant

and area occurs.
Root cause sources of
dirt, grease & spillage
have been eliminated.

Methods of work are

regularly reviewed and
improved.

5S assessment
conducted on a regular
basis and recurring
problems are identified.
Root causes of problems
revealed by 5S
assessment are
identified and eliminated.

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Example - Value Stream Map

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Lean Building Blocks

Continuous Improvement
Performance Management
Pull/Kanban
Quality at Source
Standardised Work
5S System

Cellular/Flow
POUS

Quick Changeover

Batch Reduction
Visual

Teams

Plant Layout

Performance Measurement
POUS point of use storage

TPM

Value
Stream
Mapping
Source: Techhelp

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Waste Elimination
Typical Value Stream Ratio
Value-Added (VA) to Non-Value-Added Activity (NVA)

3%
VA

97% NVA
Most Process Improvement Teams Attack this . .
.

97% NVA
. .and Ignore this

. . . Achieve this

Source: C. Fiore; Lean Strategies for Product Development, ASQ, 2003

Source: John Willey & Sons - 2009

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Reference - Lean

www.lean.org
www.productivityinc.com
www.productivitypress.com
www.leanadvisors.com
Building the Lean Machine, Advanced Manufacturing, January 2000.
Fiore, Clifford, Accelerated Product Development: Combining Lean and Six Sigma for
Peak Performance, Productivity Press, NY, NY, 2005.
Hamilton, Bruce, Toast Kaizen, An Introduction to Continuous Improvement & Lean
Principles, Greater Boston Manufacturing Partnership, University of Massachusetts,
Boston, MA, 2005 (DVD).
Insights On Implementation-Improved Flow: Collected Practices and Cases, Ralph
Bernstein, Editor, Productivity Press, 2006.
Jacobs, Robert F. and Chase, Richard B., Operations and Supply Management: The
Core, McGraw-Hill/Irwin, NY, NY, 2008.
Nahmias, Steven, Production & Operations Analysis, 5th Edition, McGraw-Hill/Irwin, NY,
NY, 2005.
Nave, Dave, How to Compare Six Sigma, Lean, and the Theory of Constraints,
Quality Progress, March 2002, pgs 73 78.
Thinking Beyond Lean - How Multi-Project Management is Transforming Product
Development at Toyota and Other Companies (Cusumano, M. A. & Nobeoka, K. 1998)

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To improve is to change. To be perfect is to

change often.
- Winston Churchill

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Good Luck
http://www.linkedin.com/in/anandsubramaniam

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