Saturday, February 20, 2010

One Place to Get Started

There is not one way to start moving toward organizational excellence.  Here is one approach to getting started.

Learn to look at your organization with new eyes.  Where is the activity that does not add value to the product?  The amount of activity that does not add value can be thousands of times of the amount of activity that does add value. Figure out how to eliminate activity that does not add value.

For example, transportation of material does not add value.  Of course, product has to be moved from one operation to the next, but often we increase transportation by having unnecessary space between any two operations.  Because we have the space, we don't move each piece to the next step immediately, we allow the product-in-process to accumulate in containers, to the point where it can no longer be moved by hand.  Now we need a forklift to come and move the container.

I have worked on many projects in which we put value-adding processes closer together.  We can then pass the material from process to process one piece at a time, known as "one-piece-flow."  After a welding operation, some steel tubes had to be washed before the next step in the production process. The welded tubes were accumulated in a basket, on a cart.  A cart with a full basket would be moved to a wash tank. The basket of parts was hoisted into the tank.  After being dipped briefly, the basket was allowed to drain over the wash tank. 

We experimented and found that acceptable cleaning could come from dipping the sub-assembly in a bucket of cleaning solution, next to the welder. The piece was then put on a rack within reach of the next operator.

With this small improvement of the overall process, we eliminated the accumulation of parts, the baskets into which the parts were accumulated and the carts on which they sat, the transportation to and from the wash tank and the queue in which the parts sit before and after the wash tank.  We did not eliminate the wash tank itself, as there were still other parts that required washing, but the possibility of eliminating it became evident.

Some people in finance did not like this solution, arguing that the equipment involved had not been fully amortized, and it would be wasteful not to use it.  The Plant Manager saw the greater waste in the production process and insisted that the improvement was real.

When transportation is eliminated, equipment to move the product may no longer be needed.  Taiichi Ohno, the Toyota manager who started what was to become the Toyota Production System, worked as a consultant after he retired.  Once when he was asked where to start making improvements, Ohno removed the key from a forklift, put it in his pocket and said, "Figure out how to work without this."  Putting operations closer together can lead to getting rid of forklifts that are no longer needed. In some cases conveyors do the transportation.  These can also be eliminated.

With one-piece-flow the product does not sit between operations for minutes, hours, or even days, where no value is being added. Not only that, when material sits around, bad things can happen to it.  It can rust, rot, get run into or run over, be dropped and damaged or broken or even become obsolete.  Now we have not only not added value to the material, we have taken value out of the material.

One-piece-flow also makes other waste that was invisible visible in ways that we can deal with it.  When we put operations close together, we discover that they have different cycle times.  We will discuss line balancing and producing only what is needed in the next post.

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