Lean and Agile SCM
-
Upload
api-3701815 -
Category
Documents
-
view
2.158 -
download
5
Transcript of Lean and Agile SCM
Lean and Agile Logistics and Supply Chain
By:
Iman Tabari 85125047
Hamid reza Kia 85125030
Instructer:
Dr.Farahani
Spring 2007
What is ‘Lean’ ? [1]
� A set of tools to reduce waste ?
� A philosophy based on lead time reduction from customer
order to delivery ?
� A state of mind ?
� An operational model based on continuous improvement ?
� A manufacturing method based on customer demand?
� An organizational methodology designed to create a
Learning Organization ?
� All of the above ?
� What else is it ?
Lean [2]
�Lean is the set of ‘TPS’ of tools that assist in the identification and then steady eliminationof waste (Muda), quality is improved, production time and costs are reduced
� It is a hot topic in management science in the first decade of the 21st century.
Toyota Production System (TPS)
� IS the philosophy which organizes manufacturing and logistics at Toyota
� including the interaction with suppliers and customers.
�The main goals of the TPS are to design out overburden (Muri), smooth production (Mura) and eliminate waste (Muda)
WHAT LEAN SUPPLY CHAIN IS? [1]
�A lean supply chain process has been streamlined to reduce and eliminate waste (Muda) or non-value added activities to the total supply chain flow and to the products moving within the supply chain .
The purpose of a lean supply chain is to meet
the 8R's is [1]
�Right Materials
�Right Quantity
�Right Time
�Right Place
�Right Source
�Right Service
�Right Price
�Right Quality
JidokaJIT
Lean House
Teamwork
1. Collaboration
2. Best Practices
3. Go See
4. Time and Motion
1. Pull
2. Flow
3. Leveled Flow
4. Frequency
5. Lot Size
6. Lead Time
7. Returnables
8. Integration
1. Plan vs. Actual
2. Visual Control
3. Poka -Yoke
4. Five W’s
5. Five Why’s
6. Shewhart cycle
7. No Muda
Standardization – Standardized Work, 5S
Stability – Variation reduction - TPM
Customer Focus: Hoshin Planning, Takt, Teamwork, Kaizen
Hoshin Planning (Hoshin Kanri )
� a strategic planning methodology that uses a
Shewhart cycle to create goals
� assign them measurable milestones
� and assess progress against those milestones
The discipline of Hoshin Kanri help an organization:
� Focus on a single goal
� Communicate that goal to all leaders
� Involve all leaders in planning to achieve the goal
� Create measurable deliveries (eg. "5 sales this
quarter" instead of "more sales")
� Hold participants accountable for setting realistic
goals and achieving them.
Takt
� Takt time can be defined as the maximum
time allowed to produce a product in order
to meet demand.
• T = TAKT Time,
• Ta = Net Available Time to Work
• Td = Total demand (Customer Demand)
d
a
T
TT =
Kaizen
� the English translation is "continuous
improvement“.
� Kaizen aims to eliminate waste , through
standardized work
Jidoka [3]
� meaning automation with a human touch
� It is a quality control process used in the Toyota Production System which applies the following four principles :
• Detect the abnormality.
• Stop.
• Fix or correct the immediate condition.
• Investigate the root cause and install a countermeasure.
Just In Time (JIT) [3]
� is an inventory strategy implemented to improve the return on investment of a business by reducing in process inventory and its associated costs
� ‘just-in-time’ focus will include:
• Methods
• Manpower
• Packaging
• Equipment
• Visual Workplace
• Project Management
Poka-yoke [4]
� avoiding ( yokeru) inadvertent errors ( poka).
� The concept was originated by Shigeo Shingo as part of the Toyota Production System .
� a method of preventing errors by putting limits on how an operation can be performed in order to force the correct completion of the operation.
Shewhart cycle(PDCA )
� was named for Walter Shewhart, who discussed
the concept in his Statistical Method from the
Viewpoint of Quality Control book.
� It is the continuous improvement cycle of Plan,
Do, Check, Act (PDCA).
� also referred to as the Deming Cycle.
Muda (Waste)
� is a Japanese term for activity that is
wasteful and doesn't add value.
�Waste (Muda) reduction is an effective
way to increase profitability.
5S
� Seiri : tidiness, organization.
� Seiton : orderliness.
� Seiso : cleanliness.
� Seiketsu : standards.
� Shitsuke : sustaining discipline .
Total Productive Maintenance (TPM)
� TPM is “deterioration prevention” and
"maintenance reduction", not fixing machines.
� also referred to as the"Total Productive
Manufacturing" or "Total Process Management ".
TPM has five goals:
� Maximize equipment effectiveness.
� Develop a system of productive maintenance for
the life of the equipment,
� Involve all departments that plan, design, use, or
maintain equipment in implementing TPM.
� Actively involve all employees.
� Promote TPM through motivational management.
Lean Logistics Concept 1 of 3 – Lot Size [1]
Lean Logistics Concept 2 of 3 – Frequency [1]
Lean Logistics Concept 3 of 3 – Level Flow [1]
� One of the biggest challenges facing organizations today is the need to respond to ever increasing levels of volatility in demand.
� To meet this challenge the organization needs to focus its efforts upon achieving greater agility such that it can respond in shorter time-frames both in terms of volume change and variety change
What is agility?
� Agility is a business-wide capability that embraces organizational structures, information systems, logistics processes and, in particular, mindsets.
� A key characteristic of an agile organization is flexibility
� Indeed the origins of agility as a business concept lie in flexible manufacturing systems (FMS).
What is agility?
� Later this idea of manufacturing flexibility was extended
into the wider business context and the concept of
agility as an organizational orientation was born.
� Agility should not be confused with ``leanness'‘.
What is agility?
� The lean approach is level scheduling combined with the
elimination of muda.
� lean approach is for those markets where cost is the
primary order winning criteria.
� there are many other markets where the order winner is
availability
What is agility?
� Webster's Dictionary:
it defines lean as ``containing little fat'‘
whereas agile is defined as ``nimble'
� Naylor et al.:
Agility means using market knowledge and a virtual
corporation to exploit profitable opportunities in a
volatile market place.
Leanness means developing a value stream to
eliminate all waste and to ensure a level schedule.
What is agility?
The agile supply chain
Agile SC
Market
sensitive
Virtual
Process
integration
Network
based
� market sensitive is meant that the supply chain is capable of reading and responding to real demand.
� The use of information technology to share data between buyers and suppliers is, in effect, creating a virtual supply chain. Virtual supply chains are information based rather than inventory based.
� Electronic Data Interchange (EDI) and now the Internet have enabled partners in the supply chain to act upon the same data.
The agile supply chain
� Shared information between supply chain partners can only be fully leveraged through process integration.
� process integration is meant collaborative working between buyers and suppliers, joint product development, common systems and shared information.
� This idea of the supply chain as a confederation of partners linked together as a network provides the fourth ingredient of agility.
� the route to sustainable advantage lies in being able to leverage the respective strengths and competencies of network partners to achieve greater responsiveness to market needs.
The agile supply chain
Market qualifiers, market winners, Total value
� Hill (1993):
it is important for every business to understand
what the baseline is for entering into a
competitive arena these are the ``order qualifiers‘
To actually win the order requires specific
capabilities and these are the ``order winners'
� We can borrow from these important ideas to
develop a wider supply chain oriented concept of
``market qualifiers'' and ``market winners'
Market qualifiers, market winners, Total value
� When businesses in a supply chain focus upon the
end-user there are many metrics that can be
considered
� they may be aggregated as Service, Quality, Cost and
Lead-time
Market qualifiers, market winners, Total value
Lean SC And Agile SC
� the lean paradigm is most powerful when the
winning criterion is cost.
� when service and customer value enhancement
are prime requirements for market winning then
the likelihood is that agility will become the
critical dimension.
Lean SC And Agile SC
Which paradigm?
1. Use of market knowledge:
• The nature of the end-user or market sector as a whole
will have a direct impact upon which paradigm will be
the most apt for any supply chain or part of a supply
chain
2. Integrated supply chain/value stream/virtual corporation
• Businesses must work together to form an integrated
supply chain focusing on meeting the demands of the
end-user or final customer.
• With the integrated supply chain both the information
and material flows will be simplified, streamlined and
optimized reducing waste and lead times.
Characteristics of equal importance
Characteristics of equal importance
3. Lead time compression:
• Leanness calls for the elimination of all waste or in
lean terminology `muda
• agile manufacturing requires a responsive supply
chain This also calls for lead time compression in
terms of information flow as well as material flow.
Characteristics of equal importance
Characteristics of similar importance
1. Eliminate muda:
• Lean manufacturing is called lean as it uses less, or the
minimum, of everything required to produce a product
or perform a service
• Quite clearly the agile manufacturer would also aim to
eliminate as many non-value adding activities as
possible
• in an agile system there will have to be a careful
consideration of stock and/or capacity requirements to
ensure the supply chain is robust to changes in the end
users‘ requirements
Characteristics of similar importance
2. Rapid reconfiguration:
• Agile manufacturing means that the production process
must be able to respond quickly to changes in
information from the market
• Therefore, the ability to rapidly reconfiguration the
production process is essential.
• In lean manufacturing the ability to change products
quickly is also key as any time wasted in changing over
to a new product is muda and therefore should be
eliminated
Characteristics of different importance
1. Robustness:
• An agile manufacturer must be able to withstand
variations and disturbances and indeed must be in a
position to take advantage of these fluctuations to
maximize their profits.
2. Smooth demand/level scheduling:
• Lean manufacturing by its very nature tends to reduce
demand variation by simplifying, optimizing and
streamlining the supply chain.
Characteristics of different importance
Characteristics of different importance
Comparison of lean supply with agile supply:
the distinguishing attributes
• Here are three proven ways in which the
paradigms have been brought together to provide
available and affordable products for the end
customer:
1. The Pareto Curve Approach
2. The De-coupling Point Approach
3. Separation of “Base” and “Surge” Demands
Practical Ways of Marrying the Lean and Agile
Paradigms
• Typically an analysis of the business will show that
the 80/20 (or similar) rule holds.
The Pareto Curve Approach
• decoupling point separates the part of the supply
chain that responds directly to the customer from the
part of the supply chain that uses forward planning
and a strategic stock to buffer against the variability
in the demand of the supply chain.
• The positioning of the decoupling point therefore
depends upon the longest lead time an end-user is
prepared to tolerate and the point at which
variability in product demand dominates
The De-coupling Point Approach
• Downstream from the decoupling point all products
are pulled by the end-user, that is, they are market
driven.
• Upstream from the decoupling point the supply
chain is initially forecast driven.
• A parallel concept to the ‘material’ de-coupling point
described above is that of the ‘information’
decoupling point
The De-coupling Point Approach
The De-coupling Point Approach
• Base demand can be forecast on the basis of past
history whereby surge demand typically cannot.
• Base demand can be met through classic lean
procedures to.
• surge demand is provided for through more flexible,
and probably higher cost, processes.
• Strategies such as these are increasingly being
employed in the fashion industry where the base
demand can be sourced in low cost countries and the
surge demand ‘topped up’ locally nearer to the
market.
Separation of “Base” and “Surge” Demands
Practical Ways of Marrying the Lean and Agile
Paradigms
References
1. Robert Martichenko, Lean Logistics,ppt,sit LeanCor LLC
2. Ronald G. Askin and Jeffrey B. Godberg, 2002, deisign and
Analysis of lean production systems , wiley
3. Donald waters, 2003, Inventory control and
management,Wiley,2nd.
4. Nikkoan kogyo shimbun,Ltd. 1988, -yoke: improving product
quality by preventing defects,productivity press .