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Lean Introduction
2
Agenda
History of Lean
Lean Principles
Wastes and tools
Value Stream approach
Case – Lean in Mexico
Where to find more
3
Lean & Six Sigma is based on over 50 years of improvement thinking and experience
Lean
Six S
igm
a (00’s)
Deming/Juran(‘50s)
(14 points,statisticalquality)
Ohno(’60/‘70s)
(ToyotaProductionSystem)
Motorola –Six Sigma (‘80s)
GE (‘80s – ‘90s)Intensity of Change
Kotter etc. Transformation & Leadership
Six Sigma (applied method for growth and productivity)
Customer Partnering (GE Toolkit, QMI, Customer CAP
Change Acceleration Process – CAP (Change method and tools)
Process Improvement (NPI, Supply Chain, Suppliers)
Best Practices (benchmarking, across and outside of GE, ending NIH)
Work-out (Kaizen type, cross functional teams, boundarylessness, values)
Strategy No 1 or No 2 in each business. Fix, close or sell
(Allied Signal)
Just in Time (‘80s)
Total Quality Management (’80s)(culture change/benchmarking,Baldridge/EFQM, ISO9000)
Lean Manufacturing (‘90s)(Kanbans, Pull systems, Visual management)
(“Machine that changed the world”,“Lean Thinking”, Value Stream Mapping)
(SPC,QualityCircles, Kaizen)
BPR (‘90s)(down-sizing, “to be“processes, process owners)
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The continuous flow of products, services and information from end to end through the process
Nothing is done by the upstream process until the downstream customer signals the need, actual demand
pulls product/service through the value stream
The complete elimination of waste so all activities create value for the customer by breakthrough and continuous improvement projects
Define value from the customers perspective and express value in terms of a specific product or service
Flow
Pull
Perfection
Value
Value Stream
Map all of the steps… value added & non-value added… that bring a product or service to the customer
Lean Principles
5
Lean Basis of action
Constancy of Purpose – the leadership drive the change accondingly with the long term goals
Respect for People – every individual is a unique set of experiences and improvement ideas may come from anyone
Proactive Behavior – looking for improvement opportunities every day
Voice of the Customer – listen to the customer consistently ensure the focus on the right thing
System Thinking – understanding the whole value stream enables creating smooth flow of value
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The goal of Lean is to flow more value to the customer for less resource by eliminating waste and reducing end-to-end time
A service value stream: e.g. processing an application
day 1 day 30lead time (LT)
processing an application
day 1 day 8lead time (LT)
Small
Small to mediumLarge
Before Lean project
After Lean project
Adds value to the customerNo value; needs to be done
No value; no need to be done
Where the gains come from
The bottom line: better customer service costs less not more!
Customer Requireme
nt‘as fast as possible’
‘no mistakes’
‘easy transactio
n’
Customer Requireme
nt‘as fast as possible’
‘no mistakes’
‘easy transactio
n’
Value demand better handled
Failure demand removed
Value demand better handled
Failure demand removed
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The 7 Wastes: The “Flu Virus” of the Office Environment
Additional toxic effects:
Physical fatigue
Emotional fatigue
Increased frustration
Increased stress
Placement of blame
Decreased self-worth
Indecisiveness
In Lean terms, waste is anything that adds costs or time without adding value. The ultimate Lean target is the total elimination of waste
Tip: T I M W O O D
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Lean Tools
A3 Thinking
Value Stream Mapping
Quality at Source
Standardised Work
5S: Sort; Set-in-order; Shine; Standardise; Sustain
Visual Control & Management
Cellular/Team Concepts
Levelling, Management Timeframe and Takt Time
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Each Value Stream is launched with the following workshop program
1d 1d 4d 3d 2d 2w 4w 2w 2w
Mob
ilis
ati
on
W0 –
Kic
k o
ff
Work
sh
op
1
Work
sh
op
2
Work
sh
op
3
Work
sh
op
4
Pre
pare
Test
Cell
Ru
n T
est
Cell
An
aly
ze T
C
Pre
pare
Roll o
ut
RO RO RO RO RO
RO Report Out to Stakeholders
Mobilisation Assess Phase Test Cell Phase Impl.
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Roles and ResponsibilitiesValue Stream Sponsor, Lean Champion and StakeholdersTo drive the realisation of Lean by:
Identifying and mobilising value-streams and opportunities therein Appointing suitable Value Stream Managers and mentoring them Steering value streams through Assessment, Implementation and Ongoing Management to realise
benefits Attending the report out meetings Championing Lean with colleagues – sharing learning's and education
Value Stream ManagerTo implement Lean in support of the broader business strategy by:
Leading the assessment of a core value stream in the business Implementing short, sharp improvements in the value stream that bring lasting change Being a role-model for Lean that embeds this way of managing continuous improvement
Value Stream Team MemberTo implement Lean in support of the broader business strategy by:
Participating in the assessment of a core value stream in the business Co-running short, sharp improvements in the value stream that bring lasting change Supporting the ethos of Lean amongst colleagues across the organisation
Lean Coach To develop the capability of the Value Stream Sponsor and Manager To support the VSS and VSM to deliver the value stream effectively
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Current Conditions Backlog was increasing 10% monthly
More then 1500 Tickets on Backlog
Customer pressure to reduce backlog
Client provided a daily list of “prioritized tickets”. It was one of the causes of backlog increase, as tickets not finished would be switched to "new prioritized ones“.
Low Team Morale 6.4 (scale 0-10) – August/2010
22 People from Level 2 need extra 12 people from Level 3 in order to close the tickets impacting Level 3 and the Customer
Background With more than 109 years in the market, XXX is one of the Mexico
largest player in the insurance sector 5 year contract (until Nov 2013) Single contract covering both Strategic Outsourcing and Application
Services Application support for day to day operations (levels 1.5, 2, and 3) Application Maintenance of 900 applications
Goals and Targets Reduce Backlog from –10% to 5% monthly;
Improve Ticket Lead Time from 85 to 72 hours;
Savings of USD 650k within 15 months
Proposed Countermeasures Tickets open – New tickets opened by Client. Demand of tickets open per day
Tickets resolved – tickets solved, but not closed every day
Tickets closed – tickets solved and closed every day
Tickets in backlog – all tickets that are not closed
Results Backlog reduction and USD 340k Benefits on cost avoidance up to April/2011 Team Morale went higher from 6,4 (August/10) to 9 (February/11)
Analysis and key concepts implemented Group teams in Cells facilitating the communication among the team members
Adoption of visual display to make the targets and the actual performance clear
Work on a single ticket at a time instead of multi-tasking among several tickets
Clear prioritization of tickets
Conversion to an improved flow of operations
Standardized work
2010 – Tickets of L2 Support
OpenTicket
Review Ticket& Assign
Investigate &Solution
Test & CloseTicket
OpenTicket
Work onsolution
Test & CloseTicket
35% backlog reduction
60% backlog reduction
1606 tickets when Test Cell started
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Other sources – Look for improvement opportunities and also...
http://www.lean.org.br/ - Lean Institute Brasil
http://www.lean.org/ - Lean Institute
Lean ITSteve BellMichael Orzen
Thank you
