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Beyond Lean: Achieving

Operational Excellence
in MRO
Kevin J. Duggan, President

dugganinc.com
2014 Duggan Associates. All Rights Reserved.

Kevin J. Duggan
President, Duggan Associates

Speaker, author, and educator in applying advanced


lean techniques to achieve Operational Excellence
Author of three books:

2014 Duggan Associates. All Rights Reserved.

Design for Operational Excellence: A Breakthrough Strategy for


Business Growth
Creating Mixed Model Value Streams
The Office That Grows Your Business: Achieving Operational
Excellence in Your Business Process

Kevin has assisted many major corporations


worldwide including United Technologies Corporation,
FMC Technologies, Caterpillar, Singapore Airlines, IDEX
Corporation, GKN, Parker Hannifin and more.
Kevin has been published in over 30 trade and
consumer publications and has appeared on CNN and
the Fox Business Network.

Pop Quiz

2014 Duggan Associates. All Rights Reserved.

How will you achieve Operational


Excellence?
A. Continuous improvement activities
B. Improve utilization of resources
C. Global sourcing
D. All of the above
E. None of the above

Pop Quiz

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Continuous improvement
activities are done to:
A. Eliminate waste
B. Improve productivity
C. Increase efficiency
D. All of the above
E. None of the above

Continuous Improvement
Companies have done continuous

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improvement activities for years

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Continuous Improvement

Pareto

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Continuous Improvement

Impact

Effort

Lean Thinking ...


Womack & Jones
Lean thinking is about
having each employee see
waste and eliminate it.

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It is about developing a
culture of continuous
improvement.
1996

Its about flowing Value to


the customer

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The Jump to Operational


Excellence

The Lean Journey

Sustain
Improve

Sustain
Improve

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Sustain
Improve

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Level of improvement

Operational Excellence

Mature lean company

1
5

Time in Years
10

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Level of improvement

Operational Excellence

Operational Excellence

1
5

Time in Years
10

Level of improvement

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Operational Excellence
Operational Excellence

1
5

Time in Years
10

The Jump to Operational


Excellence

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Answering the Tough Questions

In Your Operation

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Why do you do Continuous Improvement?

In Your Operation

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How do you know where to improve next?

In Your Operation

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Why do you strive to create end-to-end flow?

In Your Operation

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What causes the death of flow?

In Your Operation

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What would your shop floor look like if you


applied every CI tool?

In Your Operation

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What would your office look like if you


applied every CI tool?

In Your Operation

What would your supply chain look like


if you applied every CI tool?

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On the receiving dock?


On the suppliers shipping dock?

In production control?

In Your Operation

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Where will your lean journey take you?

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Nine Tough Questions


1.

Why do you do Continuous Improvement?

2.

What is the best way to do Continuous Improvement?

3.

How do you know where to improve next?

4.

Why do you strive to create flow?

5.

What causes the death of flow?

6.

What would your shop floor look like if you applied every CI tool?

7.

What would your office look like if you applied every CI tool?

8.

What would your supply chain look like if you applied every CI tool?

9.

Where do you believe your lean journey will take you?

Operational Excellence

Each and every employee can see the flow


of value to the customer, and fix that flow
before it breaks down.
SM

2014 Duggan Associates. All Rights Reserved.

Kevin J. Duggan

Operational Excellence

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Does your operation Start every time?

Operational Excellence

And if you could, how would you

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spend your time?

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The Eight Steps to Achieve


Operational Excellence
1.
2.
3.
4.
5.
6.
7.

Design a lean flow using lean guidelines.


Implement a lean flow.
Make the lean flow visual.
Create standard work for the lean flow.
Make abnormal flow visual.
Create standard work for the abnormal flow.
Teach employees to maintain and improve the flow to
the customer.
8. Free management to work on offense.

Operational Excellence

2014 Duggan Associates. All Rights Reserved.

Step 1: Design Lean Value Streams

Design Lean Value Streams

Implementation
Plan

Future State Map

2014 Duggan Associates. All Rights Reserved.

Current State
Map

Product
Family
Definition

x
x
x
x
x
x
x

x
x

A
x
A

x
A
x

x
A
x

x
x
A
x
A
A
A
x

x
x

x
x

x
x
x
x
x

x
x

x
x
x

x
x
x
x
x
x
x
x
x
x
x
x

x
x

x
x
x

x
x

Ship

A
x
A
x
x
x
A

A
x
A
x
A

x
A
x
x

x
x
x
x
x
x

Inspection

x
x
x
x
x
x
x

x
x
x

x
A
x
A
x

x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x

Test

x
x

x
x
x
x

Final Assembly

x
x

x
x

Paint

x
x

Sub Assembly

x
x
x

A
x
x
A
A
x

Carburize

x
A
A

x
A
A
x
x
A

A
x
A
A

Stamp

x
x
x

x
A

Polish

x
x
x

A
x

Hone

x
x
x
x

Manual Deburr

x
A
x
x

CNC Dual Spindle Lathe

Heat Treat

x
x
x
x

x
x

CNC Lathe 1

Machine Deburr

x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x

Mill (x3)

x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x

Drill

Grind (x2)

Part Number
767-577
458-743
187-192
199-225
281-849
981-156
623-405
606-723
689-529
554-086
345-008
418-690
583-930
565-451
480-231
212-660
799-398
238-561
542-429
623-444

Saw (x2)

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Product Family X-Map

x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x

X
X
X
X

X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X

Test

Final Assembly
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X

X
X
X
X

Ship

X
X
X
X
X
X
X
X
X
X
X
X

Paint

Family
Pump
Pump
Pump
Pump
Pump
Pump
Pump
Pump
Pump
Pump
Pump
Pump
Cylinder
Cylinder
Cylinder
Cylinder
Piston
Piston
Piston
Piston

Sub Assembly

Part Number
542-429
480-231
623-405
458-743
565-451
767-577
981-156
238-561
583-930
606-723
345-008
199-225
799-398
187-192
554-086
212-660
689-529
623-444
418-690
281-849

Inspection

2014 Duggan Associates. All Rights Reserved.

Product Family X-Map

X
X
X
X
X
X
X
X

X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X

25
25
25
25

15
15
15
15
20
20
20
20
40
40
40
40
23
23
23
23

Test

Final Assembly
8
8
8
8
16
16
16
16
35
35
35
35
100
100
100
100
18
18
18
18

10
10
10
10

Ship

10
10
10
10
30
30
30
30
45
45
45
45

Paint

Family
Small Pump
Small Pump
Small Pump
Small Pump
Medium Pump
Medium Pump
Medium Pump
Medium Pump
Large Pump
Large Pump
Large Pump
Large Pump
Cylinder
Cylinder
Cylinder
Cylinder
Piston
Piston
Piston
Piston

Sub Assembly

Part Number
542-429
480-231
623-405
458-743
565-451
767-577
981-156
238-561
583-930
606-723
345-008
199-225
799-398
187-192
554-086
212-660
689-529
623-444
418-690
281-849

Inspection

2014 Duggan Associates. All Rights Reserved.

Work Content Times

15
15
15
15
5
5
5
5

15
15
15
15
15
15
15
15
15
15
15
15
15
15
15
15
15
15
15
15

Work
Content
48
48
48
48
81
81
81
81
135
135
135
135
153
153
153
153
73
73
73
73

There should
be no more
than a 30%
variation in the
work content.

Product and Process Families


A product family is a group of products that go
through similar downstream processes or
assembly steps.
A process family is a group of products that go
through similar upstream shared processes.
FAMILY A

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FAMILY B
FAMILY C
Upstream (Shared Resources)

Downstream (Assembly)

Current State Map


6 Week
Forecast

Michigan
Steel Co

90/60/30 day
Forecasts

Production
Control

Weekly Fax

Steel Street
Assembly

Daily
Order

MRP

500 ft coils

18,400 pcs/mo.
- 12,000 L
- 6,400 R
Tray = 20 pieces
2 Shifts

Weekly Schedule

Tues &
Thurs.

Daily Ship
Schedule
1x
Daily.

Stamping

I
Coils
5 Days

S.Weld #1

I
1

4600L
2400R

1100L
600R

Assembly #1

S.Weld #2

I
1

1600L
850R

Assembly #2

I
1

1200L
640R

I
1

C/T = 1 secs

C/T = 39 secs

C/T = 46 secs

C/T = 62 secs

C/T = 40 secs

C/O = 1 hour

C/O = 10 mins

C/O = 10 mins

C/O = 0

C/O = 0

Uptime = 85%

Uptime = 100%

Uptime = 80%

Uptime = 100%

Uptime = 100%

2 Shifts

2 Shifts

2 Shifts

2 Shifts

2 Shifts

27,600 sec.avail.

27,600 sec.avail.

27,600 sec.avail.

27,600 sec.avail.

27,600 sec.avail.

5 days

7.6 days
1 sec

1.8 days
39 secs

Learning to See Mike Rother John Shook Lean Enterprise Institute 1998

2.7 days
46 secs

2 days
62 secs

Shipping

2700L
1440R

4.5 days
40 secs

Staging

Production
Lead Time
= 23.6 days
Processing
Time = 188 s

Improving the Flow of Value

2014 Duggan Associates. All Rights Reserved.

Using practical lean guidelines to


develop a Lean Future State.

Lean Guidelines

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Takt time
Finished goods strategy
Continuous flow
FIFO
Pull
Schedule only one point
Interval
Pitch

Takt Time
Customer demand rate
Synchronizes the pace of production to the
pace of sales
Available Time
Takt Time =
Sold Units
=

6600 minutes/wk
= 440 min
15 pieces/wk

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CURRENT DEMAND PROFILE

Units
Sold
Jan Feb March April May June

Takt Capability
May need to have preset capabilities to match
changing customer demand
Takt Capability Mode 2
Takt Capability Mode 1

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Engines
Received

Takt Capability Mode 3

Jan Feb March April May June July Aug Sept..

Finished Goods Strategy

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To Shipping

assembly

Customer

shipping

To Supermarket

shipping

assembly
supermarket

Learning to See Mike Rother John Shook Lean Enterprise Institute 1998

Customer

FIFO First In First Out


FIFO
-Sets the sequence of production
-Controls the amount of inventory

Process B

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Process A

FIFO

Shared Resource Calculations


Branch Takt = 20.9 min./pc.

C/T =
25
min.

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C/T =
10
min.

Small
Shaft

Large Shaft

C/T =
18
min.

Cylinder

C/T =
25
min.

C/T =
29
min.

C/T =
8 min.

Small
Impeller

Medium
Impeller

Large
Impeller

Scheduling Only One Point

customer

supermarket

flow
customer

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pull

FIFO

FIFO

flow
Learning to See Mike Rother John Shook Lean Enterprise Institute 1998

Aerospace: Engine Overhaul


Schedule 3 points
Induction

FIFO

FIFO

FIFO

FIFO

flow
Repair

FIFO

flow
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pull

7
Assembly

FIFO

flow

Establishing an interval
Weekly
Demand

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Product
A

Plastic Arm

1000

Steel Arm

600

Aluminum Arm

300

Titanium Arm

100

Production capability - 400 per day

Establishing an interval

Product

Description

Mon

Tues

Wed

Plastic Arm

400

400

200

Steel Arm

Aluminum Arm

300

Titanium Arm

100

Total:

200

400

400

400

Thurs

400

400

Interval = 1 week
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Fri

400

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Establishing an interval

Product

Description

Mon

Tues

Wed

Thurs

Fri

Plastic Arm

200

200

200

200

200

Steel Arm

120

120

120

120

120

Aluminum Arm

60

60

60

60

60

Titanium Arm

20

20

20

20

20

Total:

400

400

400

400

400

Interval = 1 day

Pitch

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Types
Standard Pitch: Qty * Takt
Inverse: When takt is long (Our demand is one aircraft
every two days)
Floating: Large mix in process times
Attributes of Pitch
Physical
Visual
Anticipated
Binary

Creating the Future State Map


6 Week
Forecast

Michigan
Steel Co

90/60/30 day
Forecasts

Production
Control

Weekly Fax

Steel Street
Assembly

Daily
Order

MRP

500 ft coils

18,400 pcs/mo
- 12,000 L
- 6,400 R
Tray = 20 pieces
2 Shifts

Weekly Schedule

Tues &
Thurs.

Daily Ship
Schedule

Quality

S.Weld #1

<168 secs
Assembly #1

S.Weld #2

Assembly #2

I
1

C/T = 1 secs

C/T = 39 secs

C/T = 46 secs

C/T = 62 secs

C/T = 40 secs

C/O = 1 hour

Weld
C/O = 10 mins
C/O = 10 mins
Changeover

C/O = 0

C/O = 0

Uptime = 85%

Uptime = 100%

Uptime = 100%

Uptime = 100%

Uptime = 80%

E.P.E=2 Weeks

2 Shifts

2 Shifts

2 Shifts

2 Shifts

27,600 sec.avail.

27,600 sec.avail.

27,600 sec.avail.

27,600 sec.avail.

27,600 sec.avail.

7.6 days
1 sec

1.8 days
39 secs

2.7 days
46 secs

2 days
62 secs

Shipping

5 days

1x
Daily.

Total work

Uptime

Stamping

Level
Load Box

Staging

Production
Lead Time
= 23.6 days
Processing
Time = 188 s
4.5 days

40 secs

The Lean Value Stream


6 Week
Forecast

Michigan
Steel Co

90/60/30 day
Forecasts

Production
Control

Daily Fax

Steel Street
Assembly

Daily
Order

500 ft coils

Daily Orders
aa

7
aa

Quality

Total work
<165 secs

Stamping

6
Shipping

Weld + Assembly

FIFO

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5
1.5 days

4
Uptime

1 sec

1.5 days

2
2.0 days

Weld
Changeover

Production
Lead Time
= 5 days
Processing
Time = 166 s

165 secs

Learning to See Mike Rother John Shook Lean Enterprise Institute 1998

18,400 pcs/mo
- 12,000 L
- 6,400 R
Tray = 20 pieces
2 Shifts

2014 Duggan Associates. All Rights Reserved.

Lean Guidelines for the Office

Takt Capability
Continuous flow Processing Cells
FIFO
Work Flow Cycles
Standard Work for Flow
Single Point initialization
Visual Indicators
Changes in Customer Demand

Processing Cell
Purchasing
Estimator

Sales

Engineer
2014 Duggan Associates. All Rights Reserved.

Forms

In
Out

The Details - Lean Implementation


Checklist
Installation Review Check List
Task Number

Team Members

Kit Tray
Traced
Cut out
Photo Documented
Labeled

Kit Cart

Designed

Built

Built

AOS Review

2014 Duggan Associates. All Rights Reserved.

Work Surface

Designed

Tooling

U/R Hardware review

Specials Tooling Identified/documented

U/R Hardware list electronic documentation

Tooling Identified

Sequence review

Color Coded

In for update

Tooling Presentation

Hardware Trays

PPE

Filled

Identified

Labled

Plaque created

The Details - Balancing the Work


Assembly Lean Design
Day 1
Event Kickoff meeting
- Review Vision / Objectives

Day 1 Agenda

Day 2
Re-cap of Day 1 Results/Progress
Review Day 2 Agenda

Day 2 Agenda

Review VSM Concepts / Lean Principles

Continue / complete Op Sheet Review

Define/Calculate Takt Time

Begin Installation / Mechanic Balance Charts


- Target Hours vs. Actual Hours discussion

Create Aircraft Zones to assist with


Install sequence determination (Team)

Determine Install Sequence for 1st Position:

consistent increments of work determination

Begin Point-of Use Design by Assembly

- Installs to be shifted to Major assembly

- Pull kits out for each install

- Installs moved back from other Units

- Create lists for required Tools / Hardware

- Installs moved forward to other Units

& Consumables by install / install group

Break up into teams for physical design (Team)


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- Balance work content against Takt time based upon

Develop Tool / Material Presentation options

- Identify Team leaders and members

- Sketch options for material/tool presentation

- Divide up installations by skill

- Work with support reps to prototype options


- Test in use / revise as needed

Perform brief Op Sheet review (Team)

- Document EH&S issues throughout

- Identify/document major problems by AOS (red pen)


- Missing components/tools/op steps wrong, etc.
- Determine consistent time increments by Op Step

Day 1 Wrap-up (Team)

Day 2 Wrap-up (Team)

The Eight Steps to Achieve


Operational Excellence

2014 Duggan Associates. All Rights Reserved.

1.
2.
3.
4.
5.
6.
7.

Design a lean flow using lean guidelines.


Implement a lean flow.
Make the lean flow visual.
Create standard work for the lean flow.
Make abnormal flow visual.
Create standard work for the abnormal flow.
Teach employees to maintain and improve the
flow to the customer.
8. Free management to work on offense.

Level of improvement

2014 Duggan Associates. All Rights Reserved.

Operational Excellence
Operational Excellence

1
5

Time in Years
10

2014 Duggan Associates. All Rights Reserved.

Operational Excellence

Questions?