Office Lean-Mark Somogyi

Operations Manager

Metal Service Center - 63 Operating Units– Products:

• Plate• structural's• bars, sheet, pipe, tubing and hollow structural steel tubing

Energy Tubular Products – 32 Operating Units• Primarily to the energy industry in Western Canada and the Western United

States.• Distribution of pipe, valves, and fittings

Steel Distributors – 6 Operating Units– Distribution to other steel service centers, large OEMs & fabricators

4th Largest Steel Provider in N. AmericaWe are a publically traded Canadian companyOver 103 branches in N. America3 Locations in Winnipeg

Contract Processing Center1510 Clarence Ave.Unique manufacturing branch

Russel Metals Inc.

Major Processes

• Sawing • Welded sub-assemblies• Parts kitting• Plate & Tube Cutting

Cut To Length

• Quoting• Purchasing• Inventory Management

Adding Value …

Continuous Improvement for Manufacturing Only???

No!!!!• Process – Steps taken to do an action

• Everything can be broken down into a series of steps• Work • Home • Play• Sports

Tip #1 - Scope

• Define what you want to look at?• Where should the process start?• Where will it end?• How much Detail do you want?

• A process to big and you won’t accomplish what you want

• Not enough detail and you will miss key issues

Why is lean easier a plant than in the office?

This is a driveway…….Parts?

Parts with no home

Blocked aisleways

Obvious Waste!

Plant Layout – Obvious Improvement

Floor Marking

SignageVisual

The reality of Process/Delivery cycle-time of traditional processes...

“Office”

“Supply Chain”

“Actual Assembly”

Why is Continuous Improvement Important in the office?

Learn to “see” wasteWaste???

Where????

Lean Office Waste• Data Entry errors• Printing paper• Entering and re-entering

data• Unclear job instructions• Poor office layout (Travel)

• Multiple handoffs• Tribal Knowledge• Wrong Information• Queue• Redundancy

Waiting for information

Example - QuotingMultiple Paper Documents

12 Documents 6 Programs

Multiple Data Source Inputs

Motion

Lots of Motion….

Getting Started

Steps to Finding Waste• Defining the problem• Problem Solving technique

– 5S– Process Improvement– Design Change

• 5 Why’s• Kaizen• Brain Storming• Root Cause

5S - Office

Underlying Principle of 5S

““A place for everything and A place for everything and everything in its place, clean everything in its place, clean

and ready for use.and ready for use.Keep it VisualKeep it Visual””

5S - DefinedSortSort Separate necessary from unnecessary

Set in OrderSet in Order Organize, arrange, label necessary items

Shine Shine Clean, clean, clean with a focus on elimination of unsafe work conditions

StandardizeStandardize Design standard processes

Sustain Sustain Develop discipline to sort, set in order, shine and standardize

SORT

Remove all items from the workplace that are not needed for current production/clerical processes

SHINEMore Than Just Cleaning

How do we prevent build up in the future?

How can I find small problems before they

become big ones?

How to shine1. Assigning work areas (zones)2. Cleaning...

– walls, cabinets,offices, shelves, file drawers– binders, reference materials, bulletin boards

Note: While cleaning, think of ways to prevent build up in the future

Establishing cleaning/sweeping routines and creating checklists (daily, weekly, monthly, etc).

Look for…• unsafe conditions• broken, leaking equipment/ wires• missing items, materials, etc.

4. Setting aside time each day for Shine activity.

Set in Order

Where do our tools/materials need to be stored so we can

access them quickly and easily?

How will people know where things belong?

How will we know when things go missing?

Rules for Locating ItemsOne Step Rule

– keep frequently used items no more than one step away45o Rule

– minimize reach and twisting– position heavy items so people must move their bodies to lift

Strike Zone Rule– store items between the knees and underarms to minimize strain

and reduce riskHeavy Load Rule

– store heavy items in a way that eliminates bending or awkward positioning when lifting

Could someone come into your work area and find what he or she needed in 30 seconds or less?

Would you know where to put back some thing you borrowed?

Set in Order

Set in Order Steps

There are no prescribed steps - Be creative! The trick is to keep things visual.

Work at it station by station, department by department

Follow company standards for common areas

Set in Order

1. Gain agreement from employees affected before making changes to the process.

2. Agree on “Best” way to do process3. Document those process (Standard) using as many visuals

as possible4. Communicate the standards and post them somewhere that

is easily accessible.5. Focus on continuous improvement and strive to make the

process better.

We need to find the best way to do a process and have everybody do it the same way.

Standardizing the process helps prevent Sort, Set in Order, and Shine from becoming annual events.

Standardize

Sustain

How do we sustain the improvements we’ve

gained from implementing 5S?

Set a goal, measure progress, and post results!

Keys to Success

• Management commitment• Employee Ownership• Accountability at all levels• Measured and posted

results• 5S as a part of daily routine

• Get sheet that says:“Current State”

• Teams of 2

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Tools• Charters• Value Stream Mapping• Value Graphs• 5 Why’s

Project Power Charter

5S Project -Sponsor: Project Deadline:

PURPOSE:

WORKPLAN: List Recommended Key Steps

EXECUTE: List Team Members

OUTCOME: List Deliverables

John Smith August 31, 2007

• Become more organized• Provide structure into work areas• Standardize methods, procedures, approach• Optimize efficiency through better organization of materials, processes, and work flow

• Create a Lean Team• Provide 5S Training• Apply to one area• Expand to another area• Continue to standardize, organize, and optimize

• What we actually accomplished• MAKE IT MEASURABLE!!!!!!

Re-check Date

Champion: David Wilson

CharterEffort: Easy Medium Difficult

Cost: Cheap Medium Expensive

Make it Measurable!!!!!

Value Stream Map

Value add

Non value add but necessary

Non value add

DefiningValue Added vs Non Value Added• What the customer willing to pay for!

– Can your competition do it better

Non-Value Added Waste: 93.5%

Non-Value Added But Necessary Waste: 5%

Value-Added Activities: 1.5 %

Tip # 1 - Go to the Process!!!

• Don’t rely on memory• Watch 1 or 2 cycles of the process• Ask questions• Take Pictures• Document

– The process– Issues

Tip #2 – External vs Internal Customer

• External Customers: – External customers are those persons who come from the

outside to fulfill their needs.

• Internal Customers: – One department, individual or process within an organization

supplies another such within the same organization with goods, information or services.

Understanding internal customers needs is important in improvingprocesses

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Value GraphPrioritize SolutionsPrioritize Solutions

StrategicDon’t Do

Quick Hits Gems

5 Why’s• Root Cause• In this example, the problem is that your client, is unhappy.

• Why is our client unhappy?– Because we didn't deliver our services when we said we would.

• Why were we unable to meet the agreed-upon timeline or schedule for delivery?

– The job took much longer than we thought it would.

• Why did it take so much longer? – Because we underestimated the complexity of the job.

• Why did we underestimate the complexity of the job? – Because we made a quick estimate of the time needed to complete it, and didn't list the individual

stages needed to complete the project.

• Why didn't we do this?– Because we were running behind on other projects. We clearly need to review our time estimation

and specification procedures

Tip #3: Visual Work Instructions• Keep them visual

– Screen shots– Pictures

Tip #4 – Present Results• Post results on bulletin board• Do a presentation to stake holders• What

– Steps Taken– Before and After– Restults

• Benefits– Pride– Employee exposure– Employee Understanding

BeforeA paper form that changed handsan average of 8+ times per issue

After An e-form that updates the database automatically and generates multiple reports with ease

Tip #5 - Automation

Tip #6 – The Big Picture

• Do not optimize one area at the expense of the whole

Tip #7 - Training• External Training

– Consultants• Internal Training

– Lunch & Learns• Benefits

– Understanding– Everyone on the same page– Changing Culture

Tip #8 - Patience

• It doesn’t happen over night• Small steps• Sometimes you will go backwards• People don’t like change

Resource List • CME – Canadian Manufactures & Exporters

– www.cme-mec.ca

• Customers• Suppliers• Cross Industry

www.qnet.ca For conference handouts, upcoming events, and more.

Speaker Contact Information:• Mark Somogyi• Operations Manager• 204-223-5412• msomogyi@russelmetals.com• www.russelmetals.com