2. Focus and align the flow of ideas, processes,
performance and profitability within the business
Learn how to find new opportunities, organize the
concepts learned and prioritize and/or defer others
Objectives:
Enable more product launches with shorter lead
times
Increase first-time quality and on-time deliveries
Enhance and sustain productivity improvements
◦ Output and “Value-add” per worker
◦ Output and “Value-add” per dollar invested
3. What:
A process of ongoing, non-static, constantly
renewed mindset of adding business value
and increased productivity
How:
Trough demonstrated creativity and significant
changes getting ideas & turning them into
reality
Where:
in everything we do, enterprise-wide
4. Risk &
Reward
Continuous
Improvement
•Everyday culture of change
in how and what we do
•Focus on maintaining &
improving process
precision, accuracy and
discipline
•Often savings are not
strictly monitored but just
put back into the business
•Can support & narrow
Breakthrough Innov.
Amount of Resources and Activity
Incremental
Innovation
•Relatively small
improvements
that are faster,
better cheaper,
•Savings show up
in bottom & top
line
Distinctive Innovation
•Significant advances and
improvements by extending existing
technologies/approaches
•Adapting “other industry/sector
technologies/approaches
•Example: “Lean”/JIT/Single-piece-
flow/Pull Systems in health care
Breakthrough &
Disruptive
Innovation
•Fundamentally new
technologies/approaches
•Implementing things
previously thought to be
not possible
•Often a birthplace of
Distinctive & Incremental
Innovation
•Can fuel and clash with
Conti. Impr. and process
discipline
5. Supplier
“Push”
“Customers gambling in
Nevada have figured out
how to develop an
application for counting
cards beyond what Apple
imagined”
Customer
“Pull”
• New colours
• Video features
• More memory
• Longer battery life
• Predictive text
6. Ideas Inventions Innovation Operations
Production
Service
The Ideas-Inventions-Innovation-Operations-Service (IIIOS) Roadmap:
Sales &
Marketing
Research &
Development
Product
Development
Operations
Production
Customer
Service
The Hydrogenics Business Flow:
Productive creativity and focused process discipline
will lead to a successful sustainable harvest of results
7. •To help explain the
Toyota Production
System to employees
and suppliers, the
“House of Toyota”
graphic was created by
Taiichi Ohno and Eiji
Toyoda.
•They chose the house
shape because it was a
familiar one – and also
conveyed stability.
•The roof contains the
primary goals of TPS:
superior quality, cost
and delivery through
waste elimination
8. Change Management Teams
TPM JIT
Point-of-Use
Poka-yoke
Pull System and KanbanCellular and Flow
Autonomation
Standard Work
Self inspection
Visual Workplace
Quick Changeover
Layout
Batch Size Reduction
5S VSM
Continuous Improvement Kaizen Blitz
9. “Future competition will not be
between products and services…
… it will be between processes.”
Dr. Robert Gee, National Graduate School
“In order to develop a culture
that consistently improves
performance, you have to
focus not just on the end
result (solution focus) but also
on how you get there (process
focus).”
Michael Kukhta, Master Black Belt
10. PDSA Cycle:
Plan, Do, Study, Act
Plan a step
Take a step
Study the outcome
What worked?
What didn’t
work?
What did we
learn?
Act on the difference
between what you
expected & what you got
Keep learning
This Way:
Plan
Do
Act
Check
Plan
Do
Re-Act
Check
Not this Way:
Dr Edwards
Demming:
Lack of
knowledge… that
is the problem
There is no
substitute for
knowledge
Study
Analyze
Study
Analyze
11. From Dr. Joseph Juran’s teaching:
Removal of Special Cause only
brings to system back to where it
should have been in the first place
The important problems of
improvement commence once you
achieve statistical control
“There is here, the same widespread
unsupported assumption that the
bulk of defects are operator
controllable, and that if operators
would only put their backs in to it,
the plant’s quality problems would
shrink materially”
◦ (J. Juran, Industrial Quality Control 1966)
Juran’s Trilogy:
1) Quality Planning
Develop Standards, Designs
Processes & Systems that
enable the possibility of
compliance
2) Quality Compliance
Use the Processes & Systems
to measure performance
to Standards
3) Quality Improvement
Improve Performance to
standards (compliance)
Improve Standards, Designs,
Processes & Systems
12. SCOR Model
Customer’s
Customer
Supplier’s
Supplier
Supplier
Internal or
External
Customer
Internal or
External
Your Company
Plan
Make DeliverSource Make /
Repair
DeliverMakeSourceDeliver SourceDeliverSource
Return Return Return
Return Return Return Return Return
Plan Plan
Provides Framework for your Transformation / Improvement Projects.
• Defining the boundaries / scope of the supply chain .
• Evaluate the supply chain’s strengths and weaknesses.
• Industry benchmarks, standardized terms, metrics,
Enables a total enterprise view of a supply chain
13. The systematic elimination of waste and re-alignment of resources to
deliver value to the customer faster, better, & more consistently
Lean also is:
◦ Pursuit of excellence
◦ Continuous Improvement of performance and quality
◦ .
◦ Increasing inventory “turns” and throughput
◦ Simplifying and redefining processes
◦ Measuring & monitoring processes
◦ Empowering the workforce
Leading to Leading to
Eliminate
Waste
Reduced Cycle
Times
Increased
Capacity
Focus: Eliminate waste, non-value add steps, process
constraints and bottle necks that cause problems in work
throughput
Approach: Intuitive and broad - “inch-deep, mile wide”
14. The Five Principles of “Lean Thinking”
1. Define value from the perspective of the Customer
2. Map the value stream
3. Get the stream to “flow” by eliminating waste
4. Allow the customer to “pull” value from the stream
5. Pursue perfection (continual improvement)
15. MEASURE
•Map/measure the
process
•Collect lots of data
ANALYZE
•Organize and analyze the
data and information to
Identify failure modes,
problems, root causes
CONTROL
•Maintain, monitor and
control variation
•Preventively fix root causes
IMPROVE
•Plan, apply, deploy Improvement Tools
•Correctively fix failure modes
DEFINE
•Identify standards, metrics, objectives, CUSTOMER PROBLEMS
Define
Measure
AnalyzeImprove
Control
Results
Define
Measure
AnalyzeImprove
Control
Results
σ Use data-driven, measurement-based, statistical methods
σ Think critically, deeply and analytically to improve performance
σ Eliminate non critical business issues and concerns
σ Focus: Surgical “inch-wide, mile-deep” investigation and resolution
σ Approach:
σ Solve problems at the system and root cause level
σ Relentlessly pursue drastic reductions in variation then control and manage
whatever variation is left over
Applied projects
following the
DMAIC Model
16. In the 1980’s, Engineers and
Management at Intel and Motorola -
realized that variance reduction and
lower defect rates were one of the
keys to the success of Japanese
competitors
Is “Six Sigma Quality” – 3 DPM –
good enough for your process? (e.g.
producing semiconductors?)
Dr. Mikel Harry researched these
successes in variance reduction and
formed them with others into the
“Six Sigma” programs that we are
familiar with today
“Sigma” Quality Level 1 2 3 4 5 6 7
Cost of Poor
Quality
(COPQ)
$’s
?
% First Pass Yield (FPY) 68 95 99
99.977
99.99966
99.379
Defects/million (DPM) 690K 308K 67K 6K 230 3.4
“Sigma” Quality Level 1 2 3 4 5 6 7
Cost of Poor
Quality
(COPQ)
$’s
?
% First Pass Yield (FPY) 68 95 99
99.977
99.99966
99.379
Defects/million (DPM) 690K 308K 67K 6K 230 3.4
Accurate
Precise
17. Processes Processes Process
Start
Process
Finish
Process
Steps
Processes Processes
Organization Customers End-use
Customers
Suppliers
Sub-
Suppliers
Process
Steps
Return Return
Plan
Make DeliverSource Make/Repai
r
DeliverMakeSourceDeliver SourceDeliverSource
Return Return Return Return Return
Return
SCOR Supply Chain Model
18. Single Piece Flow Just-In-Time Eliminate Waste
•Process parts one-at-a-
time or in small lots
instead of in large
batches or economies of
scale
•Quick changeovers
•Balanced and
continuous flows instead
of stop and start
processing
•Have just the right
amount of inventory you
need, when you need it,
where you need it
•Optimize the amount
of inventory required
•Ensure that your
resources are ready to
support the flow
•Never knowingly pass
on a defect
•Improve the capability
of your processes
•Fix failure modes
when they occur
•Determine and resolve
the deeper root causes
= =
The Toyota Production System
Model by Michael Kukhta Reference: Senji Niwa, from the
Shingijutsu Organization. Niwa-san also worked directly for
Toyota’s Taiichi Ohno (TPS creator) for 18 years.
“Classic Lean”
Strength
“Supply Chain
Management” Strength
“Classic Six
Sigma” Strength
19. Numbers, words, quantities,
values stored sitting in piles or
queues waiting for future use
Charts, summaries, spread
sheets, etc. that organize the
data
Presentations, plans and tools
that explain and communicate
the information
Processes, organizations and
team using the information to
improve, manage, build
systems and develop cultures
Push the data “up” to become Wise
Always
loop
back to
check
the data
Wisdom
Knowledge
Data
Information
Where are you
looking from?
The WISDOM TOWER: Changing Perspectives
20. 2) Clearly Define your problem
Example:
Too many mistakes in purchase request specifications are causing rework rates of
34%, high costs and late deliveries (less than 50% on time) to our customers
1) Find:
•Customer Issues
•Performance
Reviews
•Meetings
•New Projects
•Failures, Re-work
•Projects
•Continuous
improvement activities
•Champions
•Stakeholders
•Employees
•SCOR Maps
•Research
•Brainstorm
•Wait until the crisis
hits you
•Value Stream Maps
3) Clearly State the Initial Charter for your
project
(Set targets and timelines!)
Example:
This first phase of this project – by 3Q 2004 - will identify problems and root
causes in the purchase request process, target first pass yield rates of 95%, target
a 50% reduction in the Cost Of Poor Quality and increase on-time deliveries to our
customers to greater than 90%
4) Link improvement targets to customer
needs and organizational objectives
5) Create a Project Charter -
Resources, Milestones
21. What are we Mapping? The flow or path of:
◦ People, Parts, Paper, Information, Electrons (IT, networks, computers)
What status is the Map we are making?
◦ “As Was” – a historical reference or how the process used to be
◦ “Should Be” – the way documentation says it is supposed to be or the way you
think it is working
◦ “As Is” or “Current State” - an accurate reflection of how the process is actually
working. You must “walk” the process on the ground at the working level to
validate the “real” way
◦ “Future State” – a projection of how you would like the process to work
◦ “Utopian State” – the way the process could work if there were no restrictions or
boundaries on time and resources
22. Represents...
Some
Examples
are...
This
Symbol….
Start / Stop
* Receive
Trouble
Report
* System
Operable
Decision
Point
Approve /
Disapprov
e Accept /
Reject
Yes / No
Activity
Process
Step or
Activity
Connecto
r (to
another
page or
part of
the
diagram)
A
A
B
Represents
direction
of flow
23. Enjoy!
Fill kettle
with water &
plug in
Get coffee
from cupboard
I’m going
to have a
coffee
Instant
or
Brewed
Put coffee
into mug
Get mug
from cupboard
Pour hot
water into mug
A
Add cream
& sugar
Is it
to
taste
?
Yes
No
InstantBrewed
Process Flow Diagram:
Morning Coffee Flow Chart
24. High-Level Process Map
Can show the link from
suppliers outside your
organization to the customers
you deliver your product or
service to
Mid-Level Process Map
Can show your organization
within the larger organization
you work in
Detail-Level Process Map
Show s the process within your
organization that you wish to
investigate further
Stop
Start
Stop
Start
Start
Stop
Stop
26. VA/NVA Ratio= 46%
DPU = ____
RTYield = _____
SCORE CARD:
I’m going to
have coffee
Fill c.
maker
with
water
Scoop
Coffee
into
c. maker
Get &
place
Filter in
c. maker
Drink
coffee
Is
taste
OK
Brew
coffee
Pour c.
into cup
Add
cream &
sugar
Water Supply
Process
Shopping
Process
Electricity
Supply
Process
Eating
Equipment
Supply
Process
Tasting
Process
Housekeeping Processes
NVA = Non-value Added Time
VA = Value Added Time
VA Time
NVA Time
Temp of Water= ___
Quality of Water= ___
Pressure of Water= ___
Amount of Coffee= ___
Quality of Coffee= ___
Type of Coffee= ___
Defective Coffee= ___
60 sec 30 sec 60 sec 360 sec 10 sec 60 sec
10 sec 10 sec 5 sec 600 sec 30 sec
27. Is your error in the process or in the way you measure it?
Could it be that you actually are “good” but the error in the measurement
system shows that you are not “good”?
Overall Variation
Occurrence-to-
Occurrence ( or Piece-
to-Piece) Variation
Measurement System Variation
Repeatability:
Variation due to gage
or measurement tool
Reproducibility:
Variation due to people or
operators who are measuring
28. 3) Who?
4) When?
5) How Much?
6) How?
2) Where?
1) What?
6) How will you collect it?
Sample Data Collection sheet
Data Collection Sheet
Process Name:
_____________
Process Step:
_____________
Location of
Measurements:
_____________
Measurement
Tool Used:
______________
Measurement
System Error:
_____________
Measurement
Number
Value Units
(e.g. inches)
Time of
Measurement
Person who
measured
1
2
3
4
5
Data Collection Sheet
Create a Data
Collection Plan:
29. The Seven “Muda” (the Japanese word for any activity that consumes resources
but adds not value; also known as “waste”)
◦ According to Taiichi Ohno’s enumeration of the types of waste commonly
found in physical production of tasks and conversion of activity into
services
1. Overproducing ahead of demand
2. Waiting for the next process step
3. Unnecessary transport of materials [and information]
4. Over-processing of parts due to poor tool and product design [extra and
over processing documents and approvals]
5. Inventories [of parts, data, information, people, electrons, cash] more than
the absolute minimum
6. Unnecessary movement of people [parts, data, information, electrons, cash],
during the course of work or processing (looking for things, drawings,
technical help, etc.)
7. Production of defective parts [and services]
30. 8. Not Fully Utilizing your People : (The Greatest Waste of All)
◦ Under-Utilizing:
Not applying and harvesting the full capabilities of your
employees
Training but not using the capabilities learned
Expecting high-performance from untrained or inadequately
trained people
◦ Over utilizing and over-relying on a few employees
Over relying on a select few
High overtimeIncessantly increasing time demands
Unsteady flow and non-level loaded work- hurry-up and
wait
High variation in processes – pressure and stress for people
◦ Uncertainty and conflict versus confidence and trust in the workplace
◦ How are you managing changing business and economic climate?
◦ The organizational culture is different, even within the parts of an organization:
Are you thriving, striving, dormant or
dying?
32. Time Scale
Histogram
Frequency
LSL USL
2 4 6 8 10 12 14 16 18 20
y
Unit of time
e.g. hours, months
a bar chart for numerical
categories
bars need not be in
descending order
shape provides a form of
distribution of data
central tendency and
variability are easily
estimated
specification limits can be
superimposed to estimate
process capability
•time
•distance
•dimension
33. A method to display the “vital few” from the “trivial many.” These
charts are based on the Pareto Principle – 20% of the problems
have 80% of the impact. The 20% represents the “vital few.” The
Pareto chart helps you to arrange data in order of priority or
importance. 90
30
20
10
5
Frequency
Categories
Percentage
75%
25%
50%
20
180
140
100
60
TITLE
n = sample size
(time period)
LEGEND
REFERENCE INFO
date
initials
source
100 %
36. WHY DOES IT
TAKE SO LONG
TO MASK PART?
TAPE DOES
NOT STICK
WHY DOES
TAPE NOT
STICK?
PART HAS
SOAP
RESIDUE
WHY IS
THERE SOAP
RESIDUE?
RINSE CYCLE
INADEQUATE
POWER
WASHER RINSE
CYCLE
BROKEN
WHY IS POWER
WASHER
BROKEN?
WHY IS RINSE
CYCLE
INADEQUATE?
OLD MACHINE
NOT REPLACED
WHY IS OLD
MACHINE NOT
REPLACED
CONGRESSIONAL
BUDGET PROCESS IS
FLAWED
37. Overview of How FMEA Works
Process
Step or
Input
Potential
Failure
Mode
Potential
Failure
Effects
Potential
Causes
of
Failures
Current
Process
Controls
Severity
Rating
(SEV)
Occur-
rence
Rating
(OCC)
Indetect-
ability
Rating
(DET)
Risk
Priority
Number
(RPN)
What
is the
Input?
What
can go
wrong
with
the
Input?
What
is the
Effec
t on
the
Out-
puts?
How
bad is
it?
What are
the
Causes?
How
often
do they
Occur?
How can
they be
found or
prevent-
ed?
How
well can
they be
prevent
-ed?
Where is
our
greatest
Risk?
38. Item
No. Problem/Opportunity Benefit
Person(s)
Responsible
Due
Date
%
Complete Comments
1
2
3
4
5
6
7
8
Kaizen Event Newspaper
Team: Kaizen Event:
Team/Work Group Members
Wwww, Xxxx, Yyyy, Zzzz
Updated:___/___/___
Display Board for _____ Team
Pareto DiagramFrequency
Histogram
Frequency
LSL USL
y
Control Chart
UCL
CENTRELINE
LCL
39. Seiri Seiton Seison Seiketsu Shitsuke
Sort Straighten Shine Standardize Sustain
( )
Separate the necessary from the
unnecessary
Organize in your layout in a logical
sequence
Clean, fix and change your
workplace
Build systems and processes to
support 5S activities
Ensure that the
standardized methods,
tasks and techniques
are followed
40. Organize by
frequency
of use
Set
Baseline
Contin-
uously
Improve
Keep?
Place in
Local 5S
Holding
Area
Place in
“Last Chance”
5S Holding Area
Record,
Archive
records
Clean, Label, Tidy
Fix, Map, Paint, File,
Systematize,
Standard
Operating
Procedures
Audit,
Monitor
No
Yes
…improve our
workplace
organization
and safety
We want
to:
Allocate
time &
Resources
Develop
5S Plans
&
Standards
Separate
/Sort Keep?
Destroy,
Scrap,
Dispose
No
Yes
41. Level 1 (Workstation Achievements)
◦ Data and reports (hard & soft) are sorted into piles, sections, drawers and
multiple file locations: Cluttered
Level 2 (Workstation Achievements)
◦ Data & reports are sorted into files, binders and single locations
◦ Metrics, basic labelling, some visual controls
◦ Appearance is cleaner and more organized
Level 3 (Workstation Achievements)
◦ All files, data and reports are organize and labelled
◦ Metrics, information and 5S maps are available and posted
◦ Maintenance of 5S activities, audits of 5S performance
Level 4 (Work Group Achievements)
◦ Common standards for metrics, filing, labelling, file naming
◦ Simple, clear and effective Visual Controls & Driver Measure Boards
◦ Maintenance of Work Group 5S activities, audits of 5S performance
Level 5 (Site and Business Unit (BU) Achievements)
◦ Common standards for metrics, filing, labelling, file naming
◦ Simple, clear and effective Visual Controls
◦ Maintenance of 5S activities, 5S audits
Can usually find
things
Can find things in
a reasonable
amount of time
Can find any file
or doc. In 30
seconds
Close colleagues
can find any file
or doc. In 30
seconds
Any colleague
can find any file
or doc. In 30
seconds
42. 1. Specify value from the standpoint of the end customer by
product family.
2. Identify all the steps in the value stream for each product
family, eliminating every step and every action and every
practice that does not create value.
3. Make the remaining value-creating steps occur in a tight
and integrated sequence so the product will flow smoothly
toward the customer.
4. As flow is introduced, let customers pull value from the next
upstream activity.
5. As these steps lead to greater transparency, enabling
managers and teams to eliminate further waste, pursue
perfection through continuous improvement.
43. Cycle Time is the actual production rate – It is the time
between two successive finished items coming out of your
production cell.
Cycle Time is dictated by the slowest (longest) operation
in the cell.
40
min
20
min
25
min
15
min
30
min
1
54
3
2
•What operation controls the
cycle?
•What is the Critical Path?
•How can you relieve or shift the
bottleneck?
44. Source: Improve Phase 26jul07
Bottleneck
◦ The point which is currently reducing the flow or slowing
the entire process
◦ A managed buffer before a bottleneck is necessary
◦ A bottleneck WILL exist in every process
◦ Bottlenecks move !
◦ High WIP can mask the bottleneck
◦ Flex to the bottleneck
◦ The people working at the bottleneck take breaks, not the
bottleneck
45. Pull Systems
Production scheduling method used to link downstream
activities to upstream activities
Work begins based upon a demand signal (kanban) from a
downstream customer, either internal or external
Avoids overproduction, work backlog, and disconnects within a
process
Nothing is produced until the downstream customer signals a
need
46. Takt Time
◦ Drum beat of production
◦ Based on actual internal or external demand
Available production time
customer demand
Takt Time =
47. Kanban
◦ A signal to produce
◦ An empty square, bin, shelf, cart, or kanban card
◦ Response time should be worked out & agreed in advance
◦ Compensates for inability to pull
◦ Can extend through electronic notification to suppliers
using automatic messaging and triggers
48. Setup Time
◦ Tool changes & preparation to process first piece
◦ Starts when last piece of previous job is complete; ends
when first good piece of next job is complete
Internal set-up: While machine is shut-down
◦ Strive to minimize this as process is not producing parts
External set-up: While machine is working
◦ Maximize through kitting, point-0f use tools/parts and
preparation
49. Mistake proofing
◦ Eliminate/minimize chance for human error
◦ Poka yoke =
to avoid (yokeru) inadvertent errors (poka)
◦ Detection Poka yoke
Notifies of imminent process failure but requires
operator interaction to avoid mistakes
◦ Prevention Poka Yoke
Stops the process before failures occur
Does not allow defects to pass through the process
50. Elements of Lead Time
◦ Lead Time = total process time from initiation to design to
build to ship to payment
◦ Batch & Queue – Accumulate orders, then wait to be
processed
◦ Setup time – prepare to process next job
◦ Run time – processing time per unit
Often less than 1% of cycle time
Only value added step of Lead time
51. ◦A cell organizes
equipment and
operations in a process
sequence for a specific
output
◦This is opposite
“Process centered
Islands” where
equipment / activities
are grouped by
functional operations
Bottleneck Management:
• Maintain buffer in front of
bottleneck
• (never starve the bottleneck
!)
• Improve bottleneck operation
• Cross train on bottleneck
• Creates a visual work place
• Continuous Improvement
• Cell technical & logistical
support
• Balance activities / operations
• Focus on balanced, continuous
pull through the cell
52. •Only after specifying value and mapping the
stream can lean thinkers implement the third
principle of making the remaining, value-creating
steps flow.
•Such a shift often requires a fundamental shift
in thinking for everyone involved, as functions
and departments that once served as the
categories for organizing work must give way to
specific products; and a "batch and queue"
production mentality must get used to small lots
produced in continuous flow.
•“Flow" production was an even more valuable
innovation of Henry Ford¹s than his better-
known "mass" production model.
54. “It isn’t the changes that do you in, it’s the
transitions.”
(From: “Managing Transitions: Making the Most of Change” by William Bridges)
Time
What is your path? Who is with you?
How many are with you?
Ending,
Losing,
Letting Go
The
Neutral
Zone
The New
Beginning
• “Before you can begin
something new, you have
to end what used to be”
• “Before you can learn a
new way of doing things,
you have to unlearn the
old way isn’t the changes
that do you in, it’s the
transitions.”
• “Change causes transition,
and transition starts with
an ending”