Implementing lean: twice the output with half the input!

389 Pages·2019·65.424 MB·English

by  Protzman, Charles, Protzman, Dan, Whiton, Fred

Contents Contents
Implementing Lean
Twice the Output with Half the Input!

Implementing Lean
Twice the Output with Half the Input!
By
Charles Protzman, Fred Whiton, and Dan Protzman
A PRODUCTIVITY PRESS BOOK
First edition published in 2019
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© 2019 by Charles Protzman, Fred Whiton, and Dan Protzman
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Library of Congress Cataloging‑in‑Publication Data
Names: Protzman, Charles, author. | Whiton, Fred, author. | Protzman, Dan,
author.
Title: Implementing lean : twice the output with half the input! / Charlie
Protzman, Fred Whiton, and Dan Protzman.
Description: Boca Raton : Routledge, Taylor & Francis, 2018. | Includes
bibliographical references and index.
Identifiers: LCCN 2018020209 (print) | LCCN 2018023038 (ebook) | ISBN
9781315118857 (eBook) | ISBN 9781482252842 (pbk. : alk. paper) | ISBN
9781138294783 (hardback : alk. paper)
Subjects: LCSH: Lean manufacturing.
Classification: LCC TS155 (ebook) | LCC TS155 .P7949 2018 (print) | DDC
658.4/013--dc23
LC record available at https://lccn.loc.gov/2018020209
Visit the Taylor & Francis Web site at
http://www.taylorandfrancis.com
Contents
Introduction .......................................................................................................................vii
1 The Lean Business Delivery System .............................................................................1
2 Learning from Toyota: Lean Philosophy and Foundations .........................................9
3 Lean Accounting and Accounting for Lean ...............................................................23
4 Our Misguided Allegiance to the Batching Paradigm ...............................................31
5 Waste versus Efficiency ...............................................................................................35
6 The Lean Assessment ..................................................................................................49
7 Lean and Change Management ..................................................................................57
8 Transitioning to a Lean Leader ..................................................................................69
9 Getting Ready to Implement a Lean System ..............................................................83
10 BASICS Model: Baseline Data and VSM....................................................................99
11 BASICS: From Assess—Product‑Flow Analysis (TIPS) ...........................................117
12 BASICS Model Assessment: Workflow Analysis—Following the Operator (Staff) .....137
13 BASICS Model Assessment—SMED: Single‑Minute Exchange of Die (SMED) .....149
14 The BASICS Model: Suggest Solutions.....................................................................159
15 Creating Standard Work ..........................................................................................195
16 System‑Based Lean Implementation Approach Utilizing the BASICS
Model—Kaikaku .....................................................................................................209
17 Hoshin Kanri: Strategic Planning/Policy Deployment ............................................219
18 Lean Transactional Processes ...................................................................................233
19 Lean Machine Shops and Job Shops .........................................................................239
20 Visual Management ..................................................................................................253
v
vi ◾ Contents
21 Heijunka, Planning and Scheduling, Sequencing Activities, Mixed Model ............263
22 Lean +QDIP, and Huddles .......................................................................................273
23 Lean Materials .........................................................................................................283
24 Lean and Engineering–DFM/A ................................................................................303
25 Mistake‑Proofing .....................................................................................................313
26 Total Productive Maintenance .................................................................................319
27 BASICS Model: Check and Sustain ..........................................................................329
Acronyms...........................................................................................................................339
Glossary.............................................................................................................................345
Index .................................................................................................................................365
Introduction
Why Implement Lean?
Do you want to increase your working capital, increase your cash flow, and increase your productivity
by 20% to 50%, or more?
Do you want to improve your quality and your cycle time from order entry to cash?
Do you want to streamline your supply chain and decrease overall costs?
Do you want to end all the firefighting once and for all?
Implementing a Lean system and a culture of Lean thinking in your organization can lead you
to obtaining all these goals and more. Many companies around the world have tried implement-
ing some level of Lean with varying degrees of success. Yet, even those who think they have had
great success could still obtain more. We have been invited to assess companies and are told, “I’m
curious to see what else you think we can achieve, we have been doing Lean for the last ten years
or more. We don’t think there is much more improvement left that we can get.”
While we admire the confidence in each one of these cases where we have been told this,
we have been able to work with the organization to achieve 20% to 50% or more productivity
improvements, quality improvements, velocity, and increase inventory turns by a factor of two
to three. We have also been able to provide Lean leadership coaching to their staff including vice
presidents and plant managers.
Your success with Lean starts with you! In order to truly be successful, Lean thinking
becomes everyone’s job, as well as the standard for how you and your organization do business
every day.
Back to our original question … “Why implement Lean?” We say, “Why Not!”
How Do We Achieve These Results?
In this book we will share with you our process, which has been successful for over 20 years. This
book is designed for all levels of Lean practitioners, which should include all of frontline manage-
ment from shop floor to CEO. We introduce proven tools for analysis and implementation that
go far beyond the traditional five-day point kaizen event. We call this method BASICS* and we
invented it over 20 years ago with a high level (greater than 80%) of sustaining. The book pro-
motes the plan‒do‒study‒act (PDSA) problem-solving approach based on managing and acting
on fact with proven, measurable results in safety, quality, delivery, inventory, and productivity,
which we define as +QDIP.
* Protzman, Charles, Protzman, Dan, Keen, William. 2018. The BASICS Lean Implementation Model: Lean Tools
to Drive Daily Innovation and Increased Profitability. Routledge Press.
vii
viii ◾ Introduction
The book starts by reviewing the Lean Business Delivery System (LBDS) followed by basic
Toyota precepts and principles. The Toyota philosophy, combined with business practices, includes
problem-solving approaches that have sustained this system well over the last 60 years. A thorough
walkthrough of our implementation philosophy and approach provides valuable tools for achiev-
ing success on the Lean journey.
This book is based on The Lean Practitioner's Field Book, which we published in 2016, and
which we have condensed and consolidated in this edition.
This book is designed for all company team members and introduces proven tools for continuous
improvements in business. Business managers, leaders, and owners should read this book with a keen
focus on understanding the principles and embracing them for both top- and bottom-line growth.
The principles in this book have been used by the authors, from hospitals to service industries
to manufacturing plants. These principles can greatly impact businesses by providing proven prin-
ciples, techniques, and approaches, yielding substantial improvement to any company, small or
large, in any sector. The book promotes a Lean philosophy, based on a methodology for acting on
fact, that will improve the overall performance of your business enterprise: private or public, profit,
nonprofit, or government entity.
The Toyota Production System (TPS) is often synonymous with Lean; however, Lean is not
just for automotive companies. This system will work for any company, service industry, or gov-
ernment/military entity, even yours. Since many of the processes described and discussed in the
book are unique, and every business has a unique culture, one must tailor the principles and tools
to the environment in which one implements. This methodology has produced significant results
for many companies all over the globe.
The corporate strategy, set by the CEO and approved by the board of directors of each orga-
nization, is tied directly to the financial operation of the organization. Senior management is
responsible for driving the corporate strategy set by the CEO and the board and overall direction
of the organization, with the financial performance managed by the head of finance, usually the
chief financial officer (CFO).
Financial Statements Are Important Business Metrics
There are three main financial statements used to manage a business: the income statement, often
referred to as the profit and loss statement (P&L); the balance sheet; and the cash-flow statement.
Public companies release quarterly and annual financial statements that are of great interest to
analysts, shareholders, and stakeholders of the company.
The income statement details how the business has operated over a discrete period of time,
often a quarter or a year. The income statement receives the greatest amount of public attention,
as most shareholders are interested in the sales and/or profitability of the company, which is easily
found on the income statement. Almost all employees intuitively understand that businesses (other
than nonprofits or government agencies) must make a profit to continue operations and survive.
The balance sheet is different, in that it provides a snapshot of the business operation at a spe-
cific time, often the last day of the financial statement closing, which is typically at the end of the
month, quarter, or year. The balance sheet is rarely discussed by those in the business, other than
the corporate finance team; however, there are many important pieces of the balance sheet that
depict the health of the organization.
The cash-flow statement is the third primary financial statement that summarizes the cash
transactions during the specific accounting period and also provides additional detail of the opera-
tions and the specific investing and financing activities of the business.
Introduction ◾ ix
The accrual basis of accounting is an important concept to understand and a standard account-
ing method used in many firms. The accrual basis of accounting involves recognizing revenues and
associated costs when the services are provided or when the goods are delivered, and is completely
independent from the timing related to cash collection.
Let’s Start with a Manufacturing Business That Is Not Lean
What do the financial statements typically look like? Starting with the income statement, in gen-
eral, we would expect to see essentially flat year over year sales, with lower margins than peers. On
the asset side of the balance sheet, we would typically see low amounts of cash, high inventory, and
large amount of capital (machines). On the liability side, there would likely be relatively high short-
term debt, which would not support large dividends to shareholders or cash to finance growth. The
cash-flow statements would reflect a continuous monthly requirement to drive cash into the busi-
ness to support basic operations, such as making payroll for the employees and paying suppliers.
How to Get the Most from Lean
First of all, you must receive executive support and commitment. The more commitment, the
better the results.
1. If you have a CEO and board of directors that are knowledgeable in Lean principles, with
your best people dedicated and supported to implementing the initial improvements, and
a pull is created in the line organization for results only achievable through Lean thinking,
the business will see excellent returns. The CEO must buy in and lead by example for it to be
successful. In this environment employees look forward to sharing the improvements they
have made with the CEO since his/her last visit.
2. If you have a CEO and board of directors that support Lean and put some of their best
people into the effort, they will initially see good results but struggle to sustain them.
3. If you have a CEO and board of directors that do not understand Lean or do not support it
properly and put people on it that are easiest to free up, they will see spotty results, not sustain
them, and then blame the Lean practitioner(s) and Lean in general for their poor results.
Process-Focused Data
The best results are recognized in organizations that develop a standard method for collecting
process-focused data to monitor gains that ensure sustainment and ultimately adopt a culture
of continuous improvement in accordance with the BASICS and plan–do–study–act (PDSA)
models and must be coupled with leadership accountability to ensure an organization’s success.
Focusing on process metrics is a very difficult change for most executives since there is so much
pressure on short-term results.
The CEO and Lean Results
Although many large US-based manufacturers utilize Lean techniques, there is still significant
room for improvement, according to these survey results3:
◾ 73% of US manufacturers actively deploy Lean or Six Sigma.
◾ 49% of senior manufacturing executives are satisfied with their Lean programs.