Choosing Lean Manufacturing

Presented to you by :

Ankur Dhir Quality Solutions , Chandigarh

 Purpose

• Convince the executive team of the

imperative need to embrace Lean
Manufacturing as the Business
Methodology of choice

 Outline Lean implementation steps, challenges,

cost and time.
 Agenda
• The Present
– Current Market Conditions
– The Profit Equation and Consequences

• Lean Manufacturing Overview

– The Basics of Lean Manufacturing
– Expected Lean Benefits

• The Path
– What makes a company Great
– Lean Implementation Methodology, steps,
Costs and Timeline
– Obstacles to Implementing Lean and
Overcoming them
 The Present

Current Market Conditions

The Profit Equation

Consequences
Current Market Conditions
Drastic increase in
Competition

Drastic Increase
in Globalization

Consumers have
more choices

The Market forces a

“Price cap”
 Profit Equation

Before Now
Price = Profit =
Cost + Profit Price - Cost

Profit Equation
 Consequences
We must :

Find a way to keep our costs down

Be more productive
Lean Manufacturing Overview

The Basics of Lean

Manufacturing

Expected Lean Benefits

The Basics of Lean Manufacturing
It means :
- Eliminating work processes that
add no value to the product
- Simplify those processes that
do

Typically >95% of Total Lead Time is Non-Value Added!!

RUN Order Processing, Transport, Storage, Waiting, Rework,

TIME Machine Setup, Inspection, Machine Breakdowns, etc...

Total Lead Time

The Basics of Lean Manufacturing
It results in the :

- Highest quality part

- Lowest total cost

- Shortest Lead Time

 Typically, > 95% of the total Lead Time is
Non Value Added

Order Total Lead Time Cash

Initial Value Waste Reduce all

Process
processes by 25%
General Waste and Value
Process Value Waste Both Decrease
Reduction

Waste Only Target & Reduce Waste Value Maintained

Reduction
Value Waste Resources Decrease
Maintain Value

Value Apply Resources Value Increased

Creation
Value Waste Resources Focused
to Create More Value

Total Lead Time

Opportunity for improvement by reducing waste

and creating additional value
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 The Basics of Lean Manufacturing
Observations

Problem Solving

Lean Tools

Team Culture

Involvement of all Employees

It targets the sources of wastes

 Expected Lean Benefits

Percentage of Benefits Achieved

0 25 50 75 100

Lead Time Reduction

Productivity Increase
WIP Reduction
Quality Improvement
Space Utilization

Flexibility Skill Enhancement Visual Mgmnt

From “AMERICA’S BEST - INDUSTRYWEEK’S Guide to World-Class Manufacturing Plants”

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 Expected Lean Benefits
Strong Competitive Advantage

Increased Productivity ( 10% - 50%)

Improved quality
Shorter time to market
Improved on-time delivery
Reduced space requirements, shorter travel distances
Improved workflow, reduced order processing errors
Better customer service through streamlining
 Expected Lean Benefits
Significant cost savings that last

Reduced inventory cost ( 30% - 80%)

Less damages due to handling
Reduced Setup time (30% to 90%)
Team working culture
Delegation of accountability
Better use of resources - plant, skilled labor, utilities
Reduced manpower turnover, Less attrition costs
 The Path
What makes a Company Great

Lean implementation steps, timeline

Obstacles to Implementing Lean

QS Advantage

Cost of implementing Lean

What makes a Company Great

What is your vision for your company?

How are we going to achieve it?

What is our strategy

 Lean Implementation Steps
 Process  Steps  Requirement

Clarify Specific Needs Top management

Commitment

Choose Lean Proper Planning

Specialist Specify Value
Map Value Stream
Pick up a Lean Recognize and Well Defined
Project eliminate waste Matrics
Create Flow & Pull
Form & Train Teams Perfection Plan for Reward &
Recognition
Implement Learning Continuous
Monitoring

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 Lean Implementation Timelines

Allow 6 - 8 months to implement

lean manufacturing practice

Allow 5 - 6 months to see results:

Cost savings, Productivity
improvement, Increased margins
 Obstacles to Implementing Lean

Obstacles Implement Support

o Temporary losses on the  Commit to Lean

profit-and-loss statement.
o Obsolete inventory  Create bold vision
become more visible.
o Natural resistance to Communicate
change
o Traditional Cost Focus on core business
accounting
o Fear of losing the Reward the performers
command and
Measure progress
 QS Advantage
• Our consultants are recognized for their unique
experiences and continuing development of lean concepts
with an enterprise perspective.
• We have significant experience in manufacturing
industries.
• We are interested in making you both competitive and self
sufficient as soon as possible.
 Cost of implementing Lean

Costs involved Working Smart

Varies from company to company

Expect to hire a lean specialist
Subsequent lean initiatives are
sponsored by previous savings
Minor capital purchases
Undertaking lean
manufacturing to increase
productivity
Outsource activities that are
not related to core business
Customize product mix