M14 EKM FUTURE STATE

MAP
Syed Shah Areeb Hussain - 5401198

SUMMARY
In the previous report, the current state map of RAC was produced and the problems within the
system were highlighted. In this report we have suggested the improvements to the RAC
manufacturing plant in the future state map. The suggested improvements can greatly reduce
the lead time of the operation by introducing flow between the processes. This will enable RAC
to meet the customer demand much faster through an efficient and lean process. The total lead
time was reduced by almost 10 times in our analysis. Moreover, it also helped reduce the space
and workload on operators.

TABLE OF CONTENTS
1. ..................................................................................................................................................... 4
2.

INTRODUCTION ....................................................................................................................... 5

3.

LITERATURE REVIEW ............................................................................................................... 6

3.1.

3.1.1.

Current State Map .................................................................................................... 6

3.1.2.

Future State Map ...................................................................................................... 7

3.2.

4.

VALUE STREAM MAPPING................................................................................................ 6

TOOLS AND TECHNIQUES FOR THE FUTURE STATE ......................................................... 7

3.2.1.

Pareto Analysis .......................................................................................................... 7

3.2.2.

Spaghetti Diagram..................................................................................................... 8

3.2.3.

Heijunka Box ............................................................................................................. 8

3.2.4.

Kanban ...................................................................................................................... 9

3.2.5.

Pacemaker Process ................................................................................................. 10

3.2.6.

Supermarkets .......................................................................................................... 10

3.2.7.

FIFO Lanes ............................................................................................................... 10

REVIEW OF CURRENT STATE MAP ........................................................................................ 12

4.1.

WIP IN DAYS ................................................................................................................... 12

4.2.

PARETO ANALYSIS .......................................................................................................... 13

4.3.

PERCENTAGE UTILIZATION ............................................................................................. 14

4.4.

CURRENT STATE MAP (WITH KAIZEN BURST SUGGESTIONS) ........................................ 14

5.

FUTURE STATE MAP .............................................................................................................. 16

6.

DISCUSSION........................................................................................................................... 17
6.1.

SUPPLIER LOOP............................................................................................................... 17

6.2.

PACEMAKER/CUSTOMER LOOP ..................................................................................... 17

6.3.

PROCESS LOOP ............................................................................................................... 19

6.4.

AZ LOOP .......................................................................................................................... 19

6.4.1.

Press Blank .............................................................................................................. 20

SMED ................................................................................................................................. 20

6.4.2.

Press Form .............................................................................................................. 21

SMED ................................................................................................................................. 21
6.4.3.

Machining Cell......................................................................................................... 21

Calculations ....................................................................................................................... 22
Yamazumi Board ............................................................................................................... 23
Standard Ops Sheet .......................................................................................................... 24
6.4.4.
6.5.

Automatic Paint ...................................................................................................... 24

BZ LOOP .......................................................................................................................... 25

6.5.1.

Saw .......................................................................................................................... 25

6.5.2.

BZ Cell...................................................................................................................... 26

Calculations ....................................................................................................................... 26
Cell Layout ......................................................................................................................... 27
Walk Diagrams .................................................................................................................. 27
6.5.3.
6.6.

Heat Treatment ....................................................................................................... 28

ASSEMBLY LOOP ............................................................................................................. 28

6.6.1.

Assembly 1 .............................................................................................................. 29

6.6.2.

Assembly Cell .......................................................................................................... 29

Yamazumi board ............................................................................................................... 30

Standard Operations Sheet ............................................................................................... 30
6.7.

FACTORY LAYOUT ........................................................................................................... 31

7.

IMPLEMENTATION PLAN ...................................................................................................... 32

8.

BENEFITS ............................................................................................................................... 34

9.

REFERENCES .......................................................................................................................... 35

List of Figures
Figure 2-1 - Types of kanban signals - Source: (Nash & Poling, 2011) ............................................ 9
Figure 3-1: WIP in days after each process ................................................................................... 12
Table 3-1: Pareto Analysis of WIP in days ..................................................................................... 13
Figure 3-2: Percentage utilization with respect to the takt time ................................................. 14
(Note: Takt time for processes press blank to automatic paint is 150 sec whereas takt time of
process saw to assembly 3 is 300 sec) .......................................................................................... 14
Figure 5-1: Suppliers loop ............................................................................................................. 17
Figure 5-2: Pacemaker loop .......................................................................................................... 18
Table 5-1: Heijunka Box ................................................................................................................ 19
Figure 5-3: AZ Loop ....................................................................................................................... 19
Figure 5-4: Current state yamazumi board ................................................................................... 23
Figure 5-5: Yamazumi board Adjusted ....................................................................................... 23
Figure 5-6: Standard Operations Sheet (Manufacturing cell)....................................................... 24
Figure 5-7: BZ Loop ....................................................................................................................... 25
Figure 5-8: Cell Layout - BZ Cell .................................................................................................... 27
Figure 5-9: Walk Diagram ............................................................................................................. 27
Figure 5-10: Assembly loop........................................................................................................... 29
Figure 5-11: Yamazumi Board - Assembly cell .............................................................................. 30
Figure 5-12: Spaghetti Diagram .................................................................................................... 31

1. INTRODUCTION
The roots of the lean manufacturing principles can be traced back to the Ford production
system developed by Henry Ford himself. It was the first instance in which the complete
production process was integrated into a single flow using the concept of moving assembly
lines. Special-purpose machines and go/no-go gauges were used to fabricate and assemble
different components within a few minutes. The problem with this system was that it greatly
reduced the worker span of control and was unable to provide any variety in the product.
After World War II, the Japanese analyzed Fords Original thinking and introduced simple
innovations to provide both continuity and variability in the process flow. These innovations
were implemented within the Toyota Production System and were later named as the lean
production methodology.
The Lean production system, as introduced by Toyota, was composed of five basic principles
(Womack & Jones, 1996)

To identify the value that the customer desires

To identify the processes that add value to the product and eliminate all wastes (muda)
within the process
To make a continuous flow of product through the value-added processes
To introduce pull systems in place of push between steps where continuous flow is not
possible
Continuously improve to reduce the steps, time and information needed to meet the
customer demand

This philosophy helped Toyota become the largest automaker in terms of the overall sales and
poised it as the exemplar in efficient production systems (OICA, 2012). Today, lean has becomes
an industrial norm and more and more organizations are attempting to implement lean in both
the manufacturing and the service industry.
Over the years a number of different technologies and tools have progressed lean even further
and has ushered a new age in the lean production systems. However, switching from a mass
production to a lean manufacturing system is not an easy feat and hence several companies are
still hesitant in introducing lean technologies. One of the key problems faced is the difficulty in
identifying the wastes within the system and the changes to be made (Ludvig, 2011). To
facilitate a smooth transition from a mass production philosophy to lean manufacturing Mike
Rother and John Shook introduced the concept of value stream mapping in their book Learning
to See (Rother & Shook, 1999). The value stream map is a method of mapping the process flow
and the communications within the processes of an organization. Such a map enables almost

anyone to differentiate the value from the wastes and can be used to develop a picture of how
the process flow should be in the future.
The current report is a continuation of the previous report in which a current state map was
developed for the Reads Automotive Components. Upon analyses of the current state map,
several areas of improvement were identified. These will be introduced and implemented in the
future state map and presented in this report.
2. LITERATURE REVIEW
2.1. VALUE STREAM MAPPING
Value Stream Mapping is a tool used in the industry to understand the flow of material and
information as a product makes its way through the value stream (Rother & Shook, 1999).
There are several benefits to value stream mapping.
1) Firstly, it enables us to visualize the complete flow rather than a single process.
2) It also makes the wastes in the process more visible and easy to recognize.
3) Value Stream Mapping promotes a common language that can be used by everyone to
communicate about the manufacturing processes
4) It brings to light the different decisions within the flow enabling discussions over them
5) It makes the implementation easier by providing the basis for an implementation plan
6) It helps link the flow of information with the flow of material within the process.
7) Lastly, it provides a qualitative overview as opposed to a quantitative one and hence
describes in detail what is needed to create flow.
Value stream maps can be used throughout the implementation process to identify the areas
for improvement and then to develop the implementation plan. It involves the development of
a current state map and a future state map.
2.1.1. Current State Map
The current state map is a picture in time of the current processes involved in the production. It
provides a detailed view of the flow of information from the customer through the production
control and to the supplier as well as the flow of materials from the supplier through the
various processes and then to the customer.
The current state map brings to light the different wastes within the processes and hence
provides a starting point for the implementation of lean techniques. Combining the current
state map with other lean analysis tools such as the Yamazumi board, spaghetti charts and
pareto analysis can prove to be very powerful in determining the areas for improvement.

The current state map and the various analysis tools were described in detail and utilized in
coursework 1, wherein a current state map for Reads Automotive Components was produced.
2.1.2. Future State Map
The future state map is developed using the current state map such that its implementation
results in the elimination of the wastes discovered in the current state map. It provides the
goals to achieve so as to make the process completely efficient. This map provides the basis for
all the actions needed to create a continuous flow.
Though the future state map provides the goal that must be achieved, it is not always that the
value stream is modified exactly as the future state map. This is because while each of the
outcomes of the future state map are implemented, new problems and opportunities arise,
thereby greatly changing the value stream. Oft times some changes take too long or may be too
expensive to implement. Hence while the eventual outcome could be close to the map, it may
not be exactly the same. In this way the future state map provides the blueprint for the change
(Nash & Poling, 2011).
To create the future state map, the first step is to brainstorm on the current state map and
identify the areas of improvement and the possible solutions. These can be illustrated directly
on the current state map in the form of Kaizen bursts. Once all the potential solutions are
recorded, the most applicable and suitable solutions are selected and used to develop the
future state.
The future state map generally makes use of several lean tools such as the supermarket, FIFO
lanes, kanbans and the Heijunka box. These tools and techniques are discussed and described
in the subsequent sections.
2.2. TOOLS AND TECHNIQUES FOR THE FUTURE STATE
The value stream maps illustrate the bigger picture of the current processes and the future
changes. This big picture is then comprehended by several tools and techniques which provide
insight of how the processes work. Some of the key tools and techniques used to find the
wastes in a current state map have been described and used in coursework 1. In this report, the
tools and techniques for identifying the areas of improvement and implementing those
improvements will be used. These tools are
2.2.1. Pareto Analysis
The Pareto Principle was first used by Vilfredo Pareto, an Italian economist in the nineteenth
century, who determined that about 80% of the wealth in the state was in the hands of only
20% of the people. The Pareto Principle was found to be true in several other situations in the

industry and government. To put in general terms, the Pareto principle states that 80% of the
effects are caused by 20% of the causes (Fryman, 2002).
The strength of the Pareto principle lies in the fact that it can be used to identify the largest
contributors of process variations or other areas which provides valuable insight on where to
spend resources (Fryman, 2002).
The Pareto analysis is performed by arranging the different categories in a descending order
and finding the cumulative values at each level. Upon calculation of the percentages of the
cumulative values, the largest contributors can be identified easily.
2.2.2. Spaghetti Diagram
A spaghetti diagram is a visual layout of the flow of the process as it would appear as one walks
through it from the beginning to the end (Nash & Poling, 2011). The spaghetti diagram enables
the viewer to observe the movement of the operator. This brings to light the wastes of motion
and transportation and can be used to determine the optimal layout of the different
departments such that the distances travelled between processes is minimal. Reducing the
complexity of routes can be extremely advantageous as it reduces the wastes of motion and
transportation while also creates order within the factory floor (Kaplan, 2008).
2.2.3. Heijunka Box
Heijunka is the Japanese term for load leveling or balancing. The Heijunka box is a load
leveling system that enables the factory to make what is needed, when it is needed and in the
exact quantity that it is needed (Luyster & Tapping, 2006).
There are several advantages to such a system. Firstly, it accomplishes a standardized process
that makes any problem within the flow easily visible, allowing immediate corrective action.
Secondly, load leveling also creates a base for other effective kaizen to be implemented. Lastly,
the load leveling system enables quick response to variation in production planning and
scheduling (Luyster & Tapping, 2006).
The Heijunka is responsible for setting the pace of the flow for the product withdrawal and
hence the production process. The heijunka box simply implies that product is withdrawn from
the production line at established increments of time known as the pitch. It is preferable to
keep the pitch as low as possible (Luyster & Tapping, 2006). The pitch (pace of withdrawal) can
be calculated by multiplying the takt time with the no. of products that can fit in a single
container. For example if the takt time is 60 seconds and one container can be filled with 20
products, the pitch of the process will be 20 minutes ((60/60) min * 20). This means that every
20 minutes, a container containing 20 products is withdrawn from the production line. This

helps the production line to constantly measure their performance versus the standard
required.
One of the simplest heijunka systems is the SLMS heijunka developed by Standard Lean
Manufacturing Systems Inc. for the Toyota Production System (Luyster & Tapping, 2006). In this
system a heijunka box is used which has several sections based on the pitch intervals. The
production control places the orders in these boxes and they are withdrawn by the process at
selected intervals i.e. the pitch.
Andon signaling systems can be used if the production line is behind schedule. This notifies the
management that some problem exists within the flow and enables them to react in a timely
manner. To maintain the production while behind schedule, wait boxes can also be used
(Luyster & Tapping, 2006).
2.2.4. Kanban
Kanban in Japanese refers to a visual signal. Kanban is described as a material flow control
mechanism and determines the proper quantity and the proper time for the production of the
required products (Graves, et al., 1995). A Kanban system was initially developed to fulfill the
specific needs of the Toyota Production System and was later adopted into the general lean
manufacturing principles (Junior & Filho, 2010).
Within the setting of a lean manufacturing plant, several Kanban signals are used for relaying
information. Kanbans sent to the purchasing department are collected at the Kanban post
(Junior & Filho, 2010). Within a supermarket, two types of Kanbans are used the withdrawal
Kanban and the production Kanban. The withdrawal Kanban visually informs the workers when
replenishment is required. This informs the workers when raw materials, the work in process or
finished goods need to be withdrawn from the supermarket. On the other hand, the production
kanbans are replenishment signals from a super market to an upstream process and signals the
process to produce additional parts and products (Nash & Poling, 2011). The representation of
the different kanbans in the value stream maps is provided below:

Figure 2-1 - Types of kanban signals - Source: (Nash & Poling, 2011)

2.2.5. Pacemaker Process

While in a push system schedules are sent to each and every process, in a pull system the
schedule is provided to only one process known as the pacemaker process. The way the
production at this process is controlled determines the pace for all the upstream processes. The
pacemaker also determines the processes in the value stream that become part of the time
required to meet the customer demand. For this reason it is mostly preferable to set the most
downstream continuous flow process as the pacemaker (Rother & Shook, 1999).
2.2.6. Supermarkets
A supermarket is a controlled inventory system where kanbans are used to signal the need for
replenishment. These kanbans are generally in the form of visual aids, such as cards, bins, lights
or racks that inform the employees in the value stream that additional inventory or WIP is
required. Supermarkets are used in order to control the inventory in places where continuous
flow is not possible.
Supermarkets are used to control and manage several products in the value stream. The
upstream process connected to the supermarket sends a withdrawal Kanban signal to the
supermarket and receives the required amount of items. Based upon the amount withdrawn,
the supermarket then sends a production Kanban to the upstream process to which it is
connected. This signals the process to start production and supply the required amount of parts
to the supermarket. Supermarkets are represented in a value stream map as:

2.2.7. FIFO Lanes

A FIFO lane (first in, first out) is an inventory management system that ensures that the oldest
WIP that enters the area is the first to receive the value added activity. The amount of WIP that
stays at the FIFO lane is generally limited to a specific amount. When the limit of the WIP is
reached, the preceding process stops production.
The FIFO lanes are very easy to manage as they do not need much Kanban signaling (only the
first process needs to know when to produce). However, in certain situations it is unfavorable
to use a FIFO lane such as

When the two processes have very different cycle times

When lot sizes of each product is different

When parallel processes merge or a single flow splits
When high flexibility and reaction time is required

A general value stream contains a mix of FIFO lanes and supermarkets. Generally all the
processes upstream of the pacemaker process are connected by a FIFO lane. The FIFO lane is
represented on the future state map as

3. REVIEW OF CURRENT STATE MAP

The current state map for RAC was developed in coursework 1 and was analyzed with respect
to the lean manufacturing principles. The current state map along with the tools used to
analyze the map in coursework 1 are presented in Appendix A. Based on the analysis it was
found that at least 6 of the 7 deadly wastes of lean was present in the process stream. These
were the wastes of inventory, transportation, motion, waiting, overproduction and defects.
Before building the future state map, it is essential to identify the areas for improvement in the
current process and analyze which of these will be most applicable.
3.1. WIP IN DAYS
Based on the current state map, the WIP after each process is presented in Figure 3.1.
18
16

WIP (days)

14
12
10
8
6
4
2
0

Process

Figure 3-1: WIP in days after each process

Figure 3.1 provides a clear view of the WIP in days after each process and its impact on the
system. This can be used to perform the Pareto analysis and identify the greatest contributors
to the inventory in the process.

3.2. PARETO ANALYSIS

The Pareto analysis for the WIP in days is illustrated in Table 3.1. The major contributors to the
WIP in days have been highlighted in blue.
Table 3-1: Pareto Analysis of WIP in days

Process

WIP (days)

Cumulative WIP

Cumulative WIP (%)

Cumulative Range (%)

Press Blank
Dispatch
Grind
Heat Treatment
Raw Materials Store

16.9
16
7.7
7.1
5

16.9
32.9
40.6
47.7
52.7

19.31
37.60
46.39
54.51
60.22

6.67
13.33
20.00
26.67
33.33

Raw Materials Store

(BZ111)
Press Form
Insert
Drill
Assembly 2
Automatic paint
Assembly 1
Saw
Assembly 3
CNC Turn
TOTAL

5
4.8
4.7
3.9
3.8
3.6
3.2
2.4
2.3
1.11
87.51

57.7
62.5
67.2
71.1
74.9
78.5
81.7
84.1
86.4
87.51

65.94
71.42
76.79
81.25
85.59
89.70
93.36
96.10
98.73
100.00

40.00
46.67
53.33
60.00
66.67
73.33
80.00
86.67
93.33
100.00

As evident from the analysis, 60% of the processes contribute to 81.25% of the WIP. This shows
that the 20/80 rule is not completely applicable and hence to produce a sizeable impact,
changes must be introduced in several processes. Inventory at Press blank, grind, press form,
insert and drill can be eliminated by introducing cells. Where continuous flow is not possible,
supermarkets and FIFO lanes can be used. Similarly inventory at the Dispatch and the two raw
material stores is reduced by the use of supermarkets and FIFO lanes. However, since the heat
treatment process is sub-contracted, it is not possible to reduce the turnaround time. In this
case we can only connect the preceding and the succeeding processes with a FIFO lane or
supermarket.
Often all the changes suggested in the Future State Map may not be implemented due to lack
of resources or long time for implementation. In such cases a Pareto analysis becomes
extremely useful in order to identify optimization of which processes will produce the greatest
impact. The Pareto analysis performed here shows that to effectively reduce the inventory, the
excess WIP at 6 of the processes have to be eliminated.

3.3. PERCENTAGE UTILIZATION

Another common area of improvement is the utilization of the machines. Often the workload
distributed between the workers is uneven. This results in greater stress at some process while
wastage due to waiting at other processes. Figure 3.2 provides a visual representation of the
utilization of the machines and their comparison to the takt time.
200
180

Percentage Utilization

160
140
120
100
80
60
40
20
0

Processes

Figure 3-2: Percentage utilization with respect to the takt time

(Note: Takt time for processes press blank to automatic paint is 150 sec whereas takt time of process saw to assembly 3 is
300 sec)

We can see from Figure 3.2 that there is great variability in the percentage utilization. While
some operators contribute to only 5% of the takt time, others contribute to almost 200% of the
takt time. This variability results in bottleneck and stress, which in turn reduces efficiency and
quality of products. Therefore, work balancing must be introduced to the value stream.
3.4. CURRENT STATE MAP (WITH KAIZEN BURST SUGGESTIONS)
In the preceding sections several areas for improvement were recognized in the current value
stream. Based on the literature review, all the suggestions are then noted on the current state
value stream map inside Kaizen bursts. These makes it easier to develop the future state map
based on the suggested changes. The current state map with the suggested changes is
illustrated in Figure 3.3.

Introduce
Cell

4. FUTURE STATE MAP

5. DISCUSSION
5.1. SUPPLIER LOOP
A closer look at the supplier loop in the future state map is provided
in Figure 5.1. As seen in the future state map, the inventory raw
materials store at the start of the AZ process stream and the BZ
process stream has been replaced by supermarkets. This ensures that
the inventory at the raw materials store is controlled.
In the current state map the inventory at the raw goods store
accounts for five days in the lead time. The need for a high amount of
inventory is due to the fact that raw materials from lanchester steel
are received only once a week. Hence the raw goods store must
contain raw materials for the whole week, equivalent to 5 days. To
eliminate this, it is suggested to instead place a daily order to
Lanchester steel and therefore receive raw materials for each of the
process streams daily. Therefore, it would be only necessary to hold a
single days inventory at the raw goods store. In order to account for
delays or other risks, a safety stock of 0.5 days may be added,
therefore making the total inventory at the raw goods supermarket to
be 1.5 days.
When materials are withdrawn from the raw materials supermarkets,
a withdrawal Kanban post is issued which sends a signal to the
production control to place a daily order to Lanchester Steel. This
ensures that the order is placed based on the actual usage and not
based on the MRPs estimate of the future usage of the raw materials.
Though MRP may still be used to provide capacity-planning forecasts
for the supplier, the day to day orders must be based on pull. This
type of daily receipt of raw materials is called milk runs.

Figure 5-1: Suppliers loop

5.2. PACEMAKER/CUSTOMER LOOP

The pacemaker loop displays the material and information flow between the production
control, the customer and the pacemaker process of the value stream. Figure 5.2 presents a
closer look at the pacemaker loop of the future state map of RAC.
The customer demand is 2520 car sets per month, where each car set consists of the parts
AZ123, AZ124, AZ223 and AZ224. This equates to a daily demand of 504 units of each part per

day. The daily demand for BZ111 components that assemble to AZ123 and AZ124 will be 252
units per day.

Figure 5-2: Pacemaker loop

3 shipments per day are carried out to the customer. Returnable carriers hold 15 assemblies
each.
The production control sets the pitch for the process stream. The pitch for RAC can be
calculated using the takt time and the packout quantity. The takt time for the assembly flow is
150 seconds as calculated in the current state map (Appendix ).
=
= 15 150
= 2,250 = .
Therefore, the daily order is divided based on the pitch and every 37.5 minutes production
control provides instructions for withdrawal of 15 assemblies from the supermarket, through
Kanban posts in the load levelling box. These assemblies are then transferred to the dispatch
for shipment. The withdrawal of parts from the supermarkets triggers signal Kanban that
notifies the preceding process for replenishment. The Heijunka box for the future state map of
RAC Automotive is displayed in table 5.1

Table 5-1: Heijunka Box

8:00 8:37

9:15 9:30

10:08 10:46 11:24 11:54 12:32

13:09 13:47 14:02 14:40 15:18 15:56

AZ 123

Break 2

AZ 223

Lunch

Break 1

AZ 123
AZ 124

AZ 224
BZ 111

5.3. PROCESS LOOP

The process or the manufacturing loop represents the flow of information and materials
through the process stream. The process stream can be divided into three further loops,
namely the AZ Loop, The BZ Loop and the Assembly loop.
5.4. AZ LOOP
The AZ Loop contains the processes press blank, press form, machining cell and automatic
paint. A closer view of these processes is provided in figure 5.3.

Figure 5-3: AZ Loop

The processes press blank, press form, machining cell and auto paint are connected by a FIFO
lane. Upon withdrawal of items from the supermarket after Auto Paint, a batch signal is sent to
the very first process i.e. the press blank. The need of a batch signal arises from the fact that
press blank is a low cycle time shared resource, due to which it must be done in batches. There
are several reasons for using FIFO lanes in between the four processes. Firstly, FIFO lanes add
simplicity to the system as compared to supermarkets, which require much organization and
control. This simplicity ensures smooth flow within the process stream. Secondly, FIFO lanes
can often prove advantageous in batch processes, and since the first two processes in the AZ
loop are batch, it becomes ideal. After the process Auto Paint it is necessary to have a
supermarket. This is because after this process the stream splits into two, with 2 parts going to
assembly 2 and 2 parts going to assembly 1. In base of splitting or joining of process stream,
FIFO lanes become difficult to manage and hence supermarkets are preferable. Moreover, they
also provide a flow of information from the pacemaker process to the first process.
5.4.1. Press Blank
Press blank are high volume high value equipment and is consequently a shared resource at
RAC. Due to this it cannot be placed in a cell and must remain as a separate process. However,
the main issues with the press blank that has been highlighted in the current state map is the
extremely large batch size. Currently a batch size of 2500 is used which results in almost every
product every month. The reason for such high batch times is that even through the process
takes only 3 seconds, the changeover time takes 320 minute. Such high changeover times and
low cycle times result in the need for high batch sizes. In order to prevent accumulation of
inventory due to high batch size, it is necessary to therefore reduce the batch size.
SMED
The concept of SMED (Single Minute Exchange of Dyes) can be used to attain a production rate
of every product every shift for the Press Blank process. Currently the changeover takes 320
minutes, while carrying out the operation on a batch size of 2500 would take (2500 x 3) or 125
minutes. This would add up to be 445 minutes. However, the available time per shift is only 420
minutes. Therefore, the work will have to be carried over to the next shift. This does not
account for the other processes that need to be carried out on the press blank as it is a shared
resource.
One way the changeover time can be reduced is by changing the layout. As shown in the
spaghetti chart, the tool storage and the tooling area are separated from the main factory floor
by three other rooms. Hence a majority of the time is taken in walking between the two areas
and unnecessary motion. To eliminate this waste, the tools required for Press blank must be
available next to the machine. Using 5S principles to create a clean and organized workplace

can further reduce the changeover time. Finally, it would require an analysis of the external and
the internal work elements to appropriately distribute the work while the machine is operating
and when it is stopped. It is assumed that upon performing the aforementioned techniques, the
changeover time has been reduced to less than 10 minutes.
Once the change over time has been reduced, we can create continuous flow by sizing the
batch such that it is completed within the takt time. From the current state map, we know that
the takt time for the process is 150 seconds and the cycle time is 3 seconds. Therefore the
appropriate batch size would be 50. Using this method we can now produce every product
every shift.
5.4.2. Press Form
Similar changes can be introduced to the press form process. As with the press blank process,
this is a high change over low cycle time process that operates in batches of 2500 units.
SMED
The cycle time of press form is 5 seconds while its changeover time is 290 seconds. As with the
press blank, the major causes of high changeover times are the wasteful motion. By eliminating
long walks, applying 5S techniques and appropriately converting internal work elements to
external, we can assume that the changeover time has been reduced to less than 10 minutes. In
order to match the total time with the takt time, we can use a batch of 30 units which would be
produced in 150 seconds.
Note: It may seem that the press blank and the press form processes are producing much faster
than needed, since they produce in batches of 50 and 30 every takt instead of just one product
every takt. However, in practical the machines are not operated continuously as they are a
shared resource and will be used for other processes as well. Therefore, whenever needed they
produce in batches and transfer it to the FIFO lanes. The maximum capacity of the FIFO lane
can be calculated by adding the batch sizes of the two processes and the safety stock.
Max. no. of units (FIFO1) = 50 + 30 + 20 = 100
Where 20 is assumed the safety stock.
5.4.3. Machining Cell
The machining cell consists of the processes insert and drill. Since the cell does not contain any
automatic process, it is a standard cell.

Calculations
Firstly it is necessary to decide the number of operators for the cell. This can be calculated using
the formula:
. =

38 + 60
150

= 0.65 = 1 operator

Next, we need to calculate the target takt time and verify is the operation time is less than the
target takt time. To do these we need to calculate the overall equipment efficiency. Assuming
an equipment efficiency 95% we have
=
() = 0.95 0.99
() = 94.05%
() = 0.95 0.95
() = 90.25%
() = 92.15
=
= 150 0.9215
= .
The Total operation time is 98 seconds which is well below the target takt time.

Yamazumi Board
Takt Time
200
150
100
50
0

Insert
Operator 1

Drill

Takt
Operator 2

Figure 5-4: Current state yamazumi board

Figure 5.4. shows the current work distribution of the two processes and its relation to the takt
time. It is clear from the yamazumi board that the two operators are underutilized and work for
less than half the takt time. Therefore, in the future state machining cell, the two operations
are clubbed together and performed by a single operator.

Chart Title
Takt Time

150
100
50
0
Operator 1
Insert

Drill

Figure 5-5: Yamazumi board Adjusted

Figure 5.5 shows the yamazumi board that has been adjusted for the machining cell. A single
operator performs both the two operations. The total cycle time for the cell is 98 seconds which
is still well below the takt time of 150 seconds. However, it is not possible to combine either the
preceding or the succeeding process with the cell and hence the subsequent FIFO lane size is
adjusted to prevent overproduction from the machining cell.

Standard Ops Sheet

Insert
Raw
Materials
Store

Gangway

Drill

Finished
Goods
Store

Operator route

Safety alert

Quality check

Operator

Standard
WIP
2

Figure 5-6: Standard Operations Sheet (Manufacturing cell)

The standard Operations sheet provides the general layout of the cell. As seen in the standard
operations sheet, a general L shaped plan will be used wherein the operator retrieves raw
materials from the raw goods store, performs Insert operation, switches to Drill operation and
then places the units in the finished goods store.
5.4.4. Automatic Paint
The cycle time for the automatic paint is 280 seconds. This is well above the takt time of 159
seconds. Moreover, it is not possible to accommodate the automatic paint in the
manufacturing cell as the complete walks, manual operation times, and load unload times
would exceed the target takt time.
Though the cycle time of the automatic paint is 280 seconds, it produces 2 units in that time as
it can hold two parts at a time. Moreover, the twin pallet system allows for efficiently loading

and unloading while the operation is continuing, i.e. loading and unloading becomes and
external process. Due to this even though the cycle time of the machine is higher, it will be able
to meet the demand within the pitch and does not require a purchase of an extra machine.
However, to ensure that there is no waiting, the inventory before and after the automatic paint
must be appropriately managed.
The automatic paint is connected to the preceding process by a FIFO lane. The FIFO lane has a
maximum size of 100 units and it ensures that enough WIP is always available to the automatic
paint.
The succeeding process is connected by a supermarket. Therefore, we must ensure that the
supermarket has enough WIP to meet the needs of the succeeding processes. For this reason, a
WIP of 50 units for each product is selected. Moreover, the reorder point is set to 20 units. This
ensures that there is no shortage of parts to the processes after the automatic paint.
5.5. BZ LOOP
The BZ loop contains the saw, BZ cell and the heat treatment. It is responsible for producing the
BZ 111 parts which then attach to the AZ 223 and AZ 224 parts in Assembly 1. A summary of all
the operations and cells within the BZ loop are presented below.

Figure 5-7: BZ Loop

5.5.1. Saw
The first operation in the BZ loop is saw. However, this is a shared resource and hence cannot
be introduced in a flow. Therefore it has to be kept as a separate process. To introduce smooth
flow, a supermarket is used after the Saw operation.
Raw materials are withdrawn from the raw materials supermarket and then undergo the saw
operation which has a cycle time of 15 seconds. To meet with the takt time of the flow it is
suggested to carry out the saw operation in matches of 20 units. Therefore the total time of the

operation will be 300 seconds which corresponds to the takt time. Moreover, there is no
changeover time and hence no modifications are needed.
The saw operation is followed by a supermarket with a maximum capacity of 50 units. The
reorder point of the supermarket is 10 units since the replenishment time of the previous
operation is small.
5.5.2. BZ Cell
The BZ Cell contains the operations CNC Turn and Grind. Since it contains both automatic and
manual times, the cell is a nagare cell. Based on the high cycle time, a new CNC turn machine
will be needed to complete a single walk within the takt time.
Calculations
The first step is to calculate the number of operators for the nagare cell. For this it is necassry
to present a clear view of the manual and the automatic operations.
Operation
CNC
Grind

Manual Time
10s
250s

Automatic Time
535s
-

Therefore the total manual time for the operation is 260 seconds.
Calculating the no. of operators = 260/300
= 0.8667 = 1 operator
Therefore only a single operator is required.

Next we need to calculate the target takt time of the cell. We assume the performance of the
equipment to be 95%
OEE (CNC) = 0.95 x 0.9 = 85.5%
OEE (Grind) = 0.95 x 0.92 = 87.45%
OEE (Avg) = 86.48%
Target takt time = 0.8648 x 300 = 259.43 seconds

Cell Layout
RMS

CNC

FGS

Grind

Figure 5-8: Cell Layout - BZ Cell

A standard U shape layout is selected for the BZ cell. It is assumed that walks between the
machines takes 3 seconds.
Walk Diagrams

Figure 5-9: Walk Diagram

The operator first takes raw materials from the raw materials store and loads them in CNC 1.
Then he moves on to the Grind and performs manual work for 250 seconds. After completing
his work he places the units in the finished goods store and starts the second cycle. In the
seconds cycle the operator uses the CNC 2 machine while the automatic process in CNC 1 still

continues. By the end of the second cycle the CNC 1 has completed the automatic work and is
used in the third cycle.
The total time for the operator assuming 3 second walks will be
3 + 10 + 3 + 250 + 3 + 3 = 272 seconds
Therefore the operator has a lag time of 18 seconds. However, this is higher than the target
takt time of 259 seconds. Therefore, steps must be taken to improve the performance and
quality pass rate of the machine so that the target takt time is higher. This would require better
maintenance or replacement with a new machine in the long term.
It is to be noted that the CNC Turn machine has a very high changeover time of 120 minutes.
However, since the BZ loop is dedicated to only a single type of product, changeovers within
the loop will not be required and hence there is no need to apply SMED principles to the CNC
Turn. However, 5S principles may still be applied to promote a more well organized layout.
5.5.3. Heat Treatment
The final process in the BZ Loop is the Heat treatment. The heat treatment is a subcontracted
process and hence it cannot be optimized to reduce cycle times or inventory. Currently the heat
treatment takes 120 minutes and has a turnaround time of 3 days. This turnaround time is non
value added but cannot be changed as the process is subcontracted.
It is not possible to connect subcontracted systems with a supermarkets as the subcontractors
may not agree to use the Kanban signals for providing replenishment. Moreover, due to a high
turnaround time it is also needed to have some amount of WIP as a safety stock. Hence the
best option to connect subcontracted processes is through a FIFO lane. This ensures that there
is always enough WIP to meet the demands of the processes further down the stream.
5.6. ASSEMBLY LOOP
The assembly loop consists of Assembly 1 and the Assembly cell.

Figure 5-10: Assembly loop

5.6.1. Assembly 1
Assembly 1 is responsible for the assembling of AZ 123 and AZ 123 parts with the BZ 111 parts.
This process cannot be introduced in a cell. This is due to the splitting of the process streams
before and after the cell, which would make it extremely difficult to manage if put in a cell.
The takt time for Assembly 1 is 300 seconds, while is cycle time is 290 seconds. Therefore the
operation is within the takt time and has 10 seconds of lag time. This is ideal and hence does
not require any optimization.
Assembly 1 receives AZ 123 and AZ 124 units from the automatic paint through a supermarket
and received BZ 11 parts from the heat treatment subcontractor through a FIFO lane. Since
there a split in the process stream before the process and convergence after the process, it is
necessary to keep Assembly 1 separate from the other assemblies. This is done also due to the
fact that its takt time is different than the takt time of Assembly 2 and Assembly 3.
5.6.2. Assembly Cell
Assembly 2 and Assembly 3 have been grouped together to form and assembly cell. This is
because the two processes have a very low cycle time and hence are well below the takt time
even after grouping the two together. This is the pacemaker process as the supermarket
succeeding the cell receives the order every pitch from the production control.
The Assembly cell withdraws AZ 123 and AZ 124 parts from the supermarket after assembly 1,
and withdraws AZ 223 and AZ 224 parts from the supermarket after Automatic paint.
Therefore, the use of supermarkets in the previous processes helps create a smooth continuous
flow. A FIFO lane in place of the supermarkets would have been possible but would be

extremely difficult to manage. The Assembly cell is followed by a supermarket. When units are
withdrawn from the supermarket for dispatch, a signal is sent to the Assembly cell for
replenishment. The reorder point of the super market is selected to be 10 units.
Yamazumi board
160

Takt Time 160

140

140

120

120

100

100

80

80

60

60

40

40

20

20

0
Operator 1
Assembly 2

Operator 2
Assembly 3

Operator 1
Takt

Assembly 1

Assembly 2

Figure 5-11: Yamazumi Board - Assembly cell

Figure 5.10 shows the comparison of the workloads before and after. Initially, the two
operators have a very low work load which results in much waste. When both the operations
are clubbed together to be performed by a single operator, the work load is still below the takt
time with 5 seconds of lag time.
Standard Operations Sheet
Since the cell consists of only a single operator performing both assembly 2 and assembly 3, the
layout of the cell is extremely simple with a single desk with raw materials and finished goods
store on either side.

5.7. FACTORY LAYOUT

Goods
In

In order to accommodate the cells and implement the different parts discussed above, the
factory layout must be changed to be better suited for cellular manufacturing.

Machining Cell

Automatic Paint

Goods
Out

Press Shop

Dispatch

Inspection

Assembly Cell

X-Ray

Assembly 1

NDT

Figure 5-12: Spaghetti Diagram

The spaghetti diagram shows the flow of products through the layout of the factory floor. Based
on the future state map, a change in the factory floor layout has been proposed. The suggested
layout ensures a smooth flow of units through the factory floor. The use of 5S principles and
well organized work space with tooling present right at the point of use has eliminated the
need for a separate tool room, tool store and a guage room. Moreover, the use of a
supermarket at the start has also eliminated the need of a raw materials store. Due to this the
overall space taken has been greatly reduced. The flow of products through the factory flow is
in a single line and is therefore ideal. Assembly 1 has been placed at one end of the factory
floor which enables it to be efficiently connected to another part where the BZ 111 units will be
produced.

6. IMPLEMENTATION PLAN
VSM Loop

Objectives

Measures and targets

Pacemaker loop

Minimize inventory at dispatch

Supplier loop

Minimize inventory at raw

materials store

Assembly loop

Create continuous flow

Place Assembly 1 and Assembly 2

in Assembly cell

Assembly loop

Establish pull system

Use a supermarket before and

after assembly cell

AZ loop

Create continuous flow

Establish cellular manufacturing.

Place Insert and drill in a cell

AZ loop

Reduce batch size

Perform SMED optimizations for

press blank and press form

AZ loop

Establish pull system

Connect Press blank, form,

machining cell and automatic paint
through FIFO.

BZ loop

Create continuous flow

Place CNC and Grind in BZ Cell

BZ loop

Establish pull system

Uses supermarkets to connect saw

and BZ sell. Use FIFO to connect to
subcontrated heat treatment

Process loop

Manage parallel flow

Establish supermarkets between

AZ loop, BZ loop and Assembly
loop

Pacemaker loop

Production levelling

Introduce Heijunka box with a

pitch of 37.5 minutes.

Implementation Plan Review

Person

Use Supermarket before dispatch

Establish milk runs, Use
supermakret in place of raw
materials store

Scheduled Date

Person
in
Charge

Implementation Schedule ()
1

10

11

12

Completed
On

7. BENEFITS
The Future state map shows several benefits as compared to the current process. These
benefits are described below:
Lead Time Reduction Initially the total lead time of the process was 64.2 days. This was
extremely high and was the cause for the need of large inventories. However, the lead time in
the future state map is only 6.6 days which shows that the lead time has been greatly reduced.
Low inventory The future state map has eliminated the need for separate areas for inventory.
This therefore greatly reduces the costs, as a dedicated area for inventory is not required.
Change over Times The changeover times for 3 equipment have also been greatly reduced by
using 5S and SMED principles. This therefore has enabled the production rate of every product
every shift and has greatly reduced the time to meet customer demand.
Bottlenecks By making sure that every product is produced to takt time, the bottlenecks in
the process have been eliminated and hence has this has reduced the stress on workers as well
as waiting times. This can result in better quality of the products and lesser reworks as the
operator is not too stressed.

8. REFERENCES
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Kaplan, G. S., 2008. Advanced Lean Thinking: Proven Methods to Reduce Waste and Improve
Quality in Health Care. 1 ed. s.l.:Joint Commission Resources.
Ludvig, A., 2011. Challenges of implementing lean principles in product development - the case
of Visual planning. Cambridge, 18th EurOMA Conference.
Luyster, T. & Tapping, D., 2006. Creating You Lean Future State: How to move from Seeing to
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Nash, M. A. & Poling, S. R., 2011. Mapping the Total Value Stream. s.l.:CRC Press.
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[Accessed 22 Dec 2014].
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