BUSMGT 3230 Operations Management Learning to See Notes Part I Value Stream all the actions currently required to bring a product through the main flows essential to every product 1 The production flow from raw material into the arms of the customer 2 The design flow from concept to launch Involves looking at the big picture and improving the whole process o Material and information Pencil and paper tool that helps clarify the flow of material and information as a product goes through the value stream o Visual representation of the path a product takes from supplier to customer Selecting a Product Family It is important to only focus on one product family a group of products that pass through similar processing steps and over common equipment in the downstream process o Make sure to write down how many different finished part numbers there are in the family how much is wanted by the customer and how often The Value Stream Manager value stream and improving it A person in a facility who reports to the top person and who is in charge of understanding a product family s o Many companies are organized by departments and functions instead of by the flow of value creating steps for product families and so no one is responsible for the value stream perspective Therefore individual processing areas are operated to be optimal independently instead of optimal from the value stream perspective Two kinds of kaizen o Flow kaizen value stream improvement Focuses on material and information flow o Process kaizen elimination of waste Focuses on people and process flow Using the Mapping Tool Steps 1 Draw the current state gather information on the shop floor a Draw the future state ideas and information come while gathering the current state information 2 Prepare and begin to use an implementation plan that describes on one page how to plan in order to achieve the future state 3 As the future state becomes a reality develop a new future state continuous improvement Part II The Current State Map Drawing the Current State Map Always draw in pencil Mapping beings with the customer requirements 1 Next draw the basic production processes o Material flow Draw from left to right on the bottom half of the map in the order of processing steps not according to physical layout of the plant Also include a data box with relevant data that will help in drawing the future state map Make sure to indicate warning triangle on the map the locations where inventory accumulates Seconds are used as the time unit since these points show where the flow is stopping Draw on either end of the map the processes that show movement of the finished goods to the customer and the processes that show movement of supplies to the current company Draw from right to left in the top half of the map space go see scheduling when managers make manual adjustments based on inventory count information can also be indicated on the map Helps to identify the material movements that are pushed by the producer not pulled by the Push refers to when a process produces something regardless of the actual needs of the customer o Information Flow customer o Timeline Draw under the process boxes and inventory triangles to compile the production lead time Helps to estimate total production time if more than one upstream flow use the longest time path when estimating total lead time Also compute the value creating time processing time Part III Lean Value Stream Overproduction producing more sooner or faster than is required by the next process The most significant source of waste Results in shortages since processes are busy making the wrong things Lengthens lead time impairing your flexibility to respond to customer requirements Characteristics of a Lean Value Stream Goal is to have one process only make what the next process needs when it needs it o Link all processes from final customer to raw material Takt Time synchronizes pace of production to match pace of sales Takt Time Available Working Time per Day Customer Demand Rate per Day Guidelines 1 Produce your takt time Serves as a reference number that gives you a sense for the rate at which a process should be producing Producing to takt requires o Providing fast response within takt to problems o Eliminating causes of unplanned downtime o Eliminating changeover time in downstream assembly type processes 2 2 Develop continuous flow wherever possible Continuous flow is the most efficient way to produce Process box icon used to indicate continuous flow on future state map o Individual process boxes on current state map combine into one for future state map 3 Use supermarkets to control production where continuous flow does not extend upstream Reasons why some areas in the value stream do not allow for continuous flow where batching is necessary are o Some processes are designed to operate at very fast or slow cycle times and need to change over to serve o Some processes such as those at suppliers are far away and shipping one piece at a time is not realistic o Some processes have too much lead time or are to unreliable to couple directly to other processes in a multiple product families continuous flow Control production of these processes by linking them to their downstream customers via supermarket based pull systems install a pull system where continuous flow is interrupted and the upstream process must still operate in batch mode do not use a schedule attempt to predict demand Let the downstream process withdrawals out of a supermarket determine what the upstream process produces when and in which quantity used as a hedge against problems such as downtime or buffer stock which is used to protect Safety stock against sudden fluctuations in customer orders o Temporary and placed under strict rules for when it is able to be used Sometimes it is not practical to keep inventory of all possible part variations in a pull systems supermarket ex customer items items with a short shelf life and costly infrequent parts o Sometimes can use a FIFO lane aka CONWIP between two decoupled processes to maintain a flow between them can only hold a certain amount of inventory before process must stop and wait for some inventory to be used helps to reduce overproduction o Sometimes can use a sequenced pull aka golf ball systems because sometimes colored balls disks are used to provide production instruction between two processes This is when the supplying process produces a predetermined quantity often one