Operational Excellence Communicating the plan and closing the loop.

Operational ExcellenceOperational Excellence

Communicating the plan and closing the loop

Vas Exec - 2 © The Delos Partnership 2004

The Delos ModelThe Delos ModelFor Business Integration For Business Integration

InnovationInnovation

VisionVision

StrategyStrategy

PrioritisationPrioritisation

DemandDemand

SupportSupport

SupplySupply


Basic EquationsBasic Equations

Item DataBOM’s

And Routes

StockAnd

Capacity

Master Schedule

Forecasts Orders

Suppliers Factories

What do theyWant ?

What haveWe got ?

Whatdoes it need ?

What do we need to do ?


Factory – working the planFactory – working the plan

AND/OR

What do I make next ?

Kanban

WorkTo

Lists


60

30

30

20

Next/Prev WC

8.0

10.0

0.0

10.0

Set up Time

21/4

23/4

27/5

24/5

Order Due Date

10.0

8.0

2.0

7.5

Run Time

18/3

16/3

13/3

12/3

Op’n DueDate

14/3

14/3

09/03

10/3

Op’n Start Date

Q30

10

Top

32672

411

S20

20

Cap

47823

409

R10

40

Cap

43678

403

Q10

20

Barrel

24575

407

Status

Op’n Number

Quantity

Description

Part No.

Order No.

20

20

20

40

Next?prevWC

5.0

2.0

5.0

3.0

Set up Time

04/04

27/4

22/4

23/4

Order Due Date

7.0

7.0

10.0

5.0

Run Time

17/3

15/3

14/3

13/3

Op’n DueDate

14/3

13/3

11/3

10/3

Op’n Start Date Q0

540

Cap

47823

440

Q40

25

Top

32567

430

R20

20

Barrel

34732

425

R30

30

Body

25763

420

Status

Op’n Number

Quantity

Description

Part No.

Order No.

Work Centre Number 10 Description : Turning Date : 12/3

Jobs Currently at Work Centre

Jobs Coming to this Work Centre

Creation of Work to ListCreation of Work to List

Routing

Work Centre Information

Opn No

Work Centre

Operation Set Run

10 45 Inspect 0.5 0.01

20 55 Mix 1.0 0.05

30 65 Pack 1.0 0.02

Item Number

Safety Stock 0 Yield 0Lead Time

2Batch Size

2500On

Hand4000 Alloc. 0

Periods 1 2 3 4 5 6 7 8 9 10

4000Receipt

ReleasePlanned Order

34567 Description : Plastic Container

Gross Requirements

Scheduled Receipts

Projected Available Balance


Operation Due DatesOperation Due Dates

Job Number Description Works Order Due

Date

Operation Due Date

3458 Turn 21/5 11/5

3462 Mill 19/4 12/4

3756 Turn 22/3 11/3

3893 Mill 24/5 12/5

Department 10 – Which job next ?


Work To ListWork To List

Order No. Part No. Description Quantity Op’n Number

Op’n Start Date

Op’n Due

Date

Order Due Date

Set up Time

Run Time Next/Prev WC

Status

407 0040.042 DF88P 20 10 10/3 12/3 24/5 10.0 7.5 20 Q

403 400001 78N_C1 40 10 09/03 13/3 27/5 0.0 2.0 30 R

409 0040.042 DF88P 20 20 14/3 16/3 23/4 10.0 8.0 30 S

411 400001 78N_C1 10 30 14/3 18/3 21/4 8.0 10.0 60 Q

Order No. Part No. Description Quantity Op’n Number

Op’n Start Date

Op’n Due

Date

Order Due Date

Set up Time

Run Time Next?prev

WC

Status

420 0040.042 DF88P 30 30 10/3 13/3 23/4 3.0 5.0 40 R

425 400001 78N_C1 20 20 11/3 14/3 22/4 5.0 10.0 20 R

430 0040.042 DF88P 25 40 13/3 15/3 27/4 2.0 7.0 20 Q

440 400001 78N_C1 40 05 14/3 17/3 04/04 5.0 7.0 20 Q

Work Centre Number 10 Description : Mixing Date : 12/3

Jobs Currently at Work Centre

Jobs Coming to this Work Centre


Work to ListWork to List

• Must show today’s date

• No past due orders

• Requires communication

• Requires Feedback from shop-floor to planner

• Shows which job to work on next– Operation due date is the priority


KanbanKanban

Means “visible signal”

Replaces need for Work to List

Replaced by– Card– Empty square– Tennis Ball– Empty package


KanbanKanban

• Visible instruction to make or move

• Highlights problems

• Requires line balance

• Requires Andon – traffic light operation

• Operator responsible for own quality

• Must not pass on known defects

• Small batch quantity required


Kanban vs WTLKanban vs WTL

• Visible feedback

• Signal driven not date driven

– Both require feedback– Good Quality helps both– Problem solving tools should support both– WTL needs MRP and CRP; Kanban needs

SOP and RCCP


Basic EquationsBasic Equations

Item DataBOM’s

And Routes

StockAnd

Capacity

Master Schedule

Forecasts Orders

Suppliers Factories

What do theyWant ?

What haveWe got ?

Whatdoes it need ?

What do we need to do ?


Creation of Vendor Creation of Vendor ScheduleSchedule

Supplier Schedule

Bills of MaterialPlanning Data• Lead Times• Order Quantities• Safety Stock

CITRIC.CCitric Acid

934.5794 GCPurchased

40000178N_C1R1.239.7720 GM

Manufactured

0040.042143.8x108.0/400/0.165

1 EAPurchased

SIRALOX.PSiralox 30/200 (Si stabilised)800 GCPurchased

ZEBETA.PBeta Zeolite (CP814E)200 GCPurchased

200028AS1Z3_R1.1214.1000 GCManufactured

P10.2406DF88P(min)/40/1:0:0

1 EAManufactured

PU2406DF88P(min)/40/1:0:0

1 EAManufactured

PT/PTNIT.SPt as Pt Nitrate65.4206 GMPurchased

Item Number

Safety Stock 1000 Yield 0Lead Time

4Batch Size

3000On

Hand1000 Alloc. 0

Periods 1 2 3 4 5 6 7 8 9 102500 0 2500 0 5000 0 0 0 0 03000 3000

1000 1500 1500 2000 2000 3000 3000 3000 3000 3000 3000Receipt 6000Release 6000 0 0 0 0 0 0 0 0 0Planned Order

0040.042 Description : 143.8x108.0/400/0.165

Gross Requirements

Scheduled Receipts

Projected Available Balance


Vendor ScheduleVendor Schedule

Part

No.

1/7 8/7 15/7 22/7 29/7 5/8 12/8 19/8 26/8 Sept Oct 12 m

Total

34567 3000 3000 6000 3000 6000 6000 6000

14563 10 10 30 60 60 1040

17634 35 70 70 35 35 140 140 1680

19875 20 20 40 40 160 180 1920

14376 10 10 10 40 80 620

Supplier : ACME Suppliers Limited

Orders Pay for materials Visibility


Vendor SchedulerVendor Scheduler

• Manages Exception messages

• Reviews and manages performance

• Operates MRP for their items

• Releases vendor schedule

• Point of contact for suppliers


BuyerBuyer

• Negotiates on basis of Total Value Proposition

• Works with suppliers to get mutual improvement

• Reviews Performance on vendor rating system

• Spends 80 % of time outside of office


Buyer reviews strategic Buyer reviews strategic optionsoptions

Core Products

And materials

Non – Core Products and Raw Materials

Production materials

Manage with a few key partnerships

Outsource to favoured partner

Non Production materials

Outsource to favoured partners

Review, reduce and outsource


Critical PartnersCritical Partners

1. Create formal partnership agreement2. Share information on long-term strategy3. Create visibility of requirements from IEP

process4. Encourage development of Best Practise5. Manage their production through your

planning system6. Daily review of production from their

planning system – particularly sub-contract partners


Line Stoppers Line Stoppers

1. Clear definition of on-time delivery2. Emphasise with supplier that they must

deliver 100 % of the time on time to right quality

3. Drop-dead time/date needs to be clear4. No tolerances on early or late5. Vendor Schedule is key6. Cost of delay to production should be

calculated and charged to supplier


Establish Improvement Establish Improvement programmeprogramme1. Use Delos assessment

2. Establish plan based on gap analysis

3. Review opportunities for change in • Systems• Processes• People

4. Agree project plan for improvement based on ERP/Lean/Quality programme


Business Excellence – source Business Excellence – source of valueof value

They want We provide by having

Long term visibility Integrated Business Planning

Stability Firm master schedule,

Accurate data

Long term relationship Strategic view of purchasing, rather than tactical


Opportunities for Opportunities for ImprovementImprovement1. SMED

2. Quality Tools

3. Batch versus Flow

4. 5 “S” and Housekeeping

5. Root Cause analysis


Set up- DefinitionSet up- Definition

• The time taken between the completion of the last good quality piece and the start of production of the next good quality piece

• Time can be categorised into– External set up time– Internal set up time


SMED – how to achieveSMED – how to achieve

• Take a video• Record all activities related to change-over• Record as internal or external• Set up group of operators• Brainstorm ways to reduce internal, or

convert internal to external• Implement• Do it again and again


Quality Tools requiredQuality Tools required

• Simpler ideas force higher quality

• Quality is in the process not the product

• Operators need to do root cause analysis to identify process problems– Hence pareto charts– Histograms– Run charts


Quality problems identified from Quality problems identified from the process chartsthe process charts

0

5

10

15

20

25

Mon Tue Wed Thu Fri Mon Tue Wed Thu Fri

0

5

10

15

20

25

UCL

LCL

Result

Problems


Today’s job shop Today’s job shop environmentenvironment

Drilling Department

Turning Department

Sanding Department

Finishing Department

GoodsOut


Tomorrow’s flow Tomorrow’s flow environmentenvironment

Flow Line 1Flow Line 1

Flow Line 2Flow Line 2


Eliminate WasteEliminate Waste

“5 S’s”– Organisation– Orderliness– Cleanliness– Standard Clean up– Discipline

Japanese

Seiri - sorting, i.e., proper arrangement

of all items, storage, equipment, tools, inventoryand traffic

Seiton orderliness Seiso cleanliness Seiketsu standardization Shitsuke self-discipline


Root Cause AnalysisRoot Cause Analysis

LateDeliveries

LateDeliveries

PeopleProcesses

Unrealistic Promises

Lack ofTraining

Systems Data

Order Entry

Pricing

No Customer RequiredDate

AvailabilityInaccurate Order Due Dates

Wrong Product Codes

DeliveryLack ofTraining

Functionality


HousekeepingHousekeeping

“Pick it up your mother does not work here”

Clean, tidy ordered workplace

Locations for everything– Tools – shadow boards– Supplies – clear locations– Materials– Gloves, Overalls etc - cupboards

Operational Excellence Communicating the plan and closing the loop.

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