Agenda
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• Introduction to Lean principles of waste • Process mapping • Level and Balanced Workload • Break • Lean tool –5S • Standard Work Schedule • Hedgehog concept—Strategy and Direction • Goal Setting for the New Year • Summary and questions
History
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• Henry Ford created the moving assembly line and was “process” driven.
• During WWII, Ford was challenged by the US government to build one B-24 bomber per hour.
• In order to do that, they had to design a production flow and create standard processes.
History
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• Japanese automobile manufacturing learned from the work of Henry Ford and W. Edwards Deming.
• Toyota further refined Japanese automobile manufacturing to develop and refine the Toyota Production System - the precursor to Lean manufacturing.
• Lean has evolved from manufacturing to the service industry, and from the production floor to the administrative office.
Success at LHP Pharmacy
Cut duplicate efforts Decreased response time to providers Savings est. to be $14,000/month
Appeals & Grievance Electronic solution reduced workload, streamlined process Tripled workload without adding additional resources Savings est. to be $20,000/month
Underwriting Reduced cycle time by 5 days Still implementing changes Savings still being determined
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Waste
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• Look early and often for waste
• Anything that does not add value to the product/service
• In many cases, we unknowingly built waste into the process…it looks normal • Need to know how and where to look
• Must look at our work through a
process lens
Identifying Waste
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Identifying Waste
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Waste looks like – Clutter
– People waiting
– Overflowing in-boxes – both email and the one on the desk
Waste feels chaotic – “Hurry up and wait”
– Frustrating
– “Fire drills”
Types of Waste
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Overproduction: Producing too much; producing too soon; batch processing
Transportation: Any nonessential transport or handling
Inventory: Work waiting to be processes, bottlenecks
Waiting: Idle time: waiting on approvals, waiting for other workers Extra Processing:
Added inspections, approvals, reviews, audits
Defects: Any rework; errors
Motion: Any motion that does not add value; chasing signatures, looking for someone
Intellect: Failure to fully utilize the time and talents of people; lack of training; not capitalizing on ideas & creativity
___ Meat
___ Dough
___ Ketchup
___ Electricity to run ovens
___ Electricity to run outdoor lights left on accidentally
___ Person paid to inspect take-out orders
___ Cost of hamburgers not sold
___ Distribution Center
___ Cost of radio, TV, web ads
___ Cost of delivery truck signs
___ Cost of store manager
___ Cost of cleaning
___ Cost of menus
___ Employee training
___ Profit
What would you be willing to pay for when ordering a hamburger?
Value Stream
The flow of materials, activities, events and information through a process to
deliver a product or service to a customer.
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Process Mapping
Before we can manage processes, we must define them Mapping provides a clear, visual way to examine and
document the processes Helps identify redundancies, waste, and weaknesses
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Process Symbols Decision
Embedded Process or Link
Boundary
Task
Connector
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Putting It All Together
Yes
No
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Change Management
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Process Mapping Tips • Keep it simple but include all necessary
detail • Start every task with an action verb • Every decision should lead to ‘yes’ and
‘no’ outputs • Use only the simplest standard
flowcharting symbols • Walk the line
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Your Turn! Map the process of getting ready for
work
• Input = sleepy, bed head
• Output = work ready professional walking through office door
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Level & Balanced Production Design daily workload based on customer demand Minimize non-value-added steps and optimize
resources Standardize the work Utilize multi-skilled employees
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Video
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5S – What is it?
Organizes the workplace Establish orderly flow and eliminate waste
Good foundation to allow employees to contribute to Lean initiatives.
5 steps = each “S” has its own process to complete
It is simple in concept, easy to do, and gets everyone involved
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5S – What is it?
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Set-In-Order
Sort
Shine
Sort
Standardize
Sustain
Name:
Date:
Location of Item:
Reason for Red Tagging:
Straighten
Systematic process for improvement
Obtains buy-in on the importance of standards
Elimination of waste
Smoother work flow
Reduction in employee stress
5S – Why is it important?
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Placing a team of workers in control of their own workplace.
Helping a team and company focus on the causes of waste and its subsequent elimination
Establishing standards for basic housekeeping and orderliness
Demonstrating to customers and co-workers that a clean office environment is a foundation for good workflow
Improving employee morale by ensuring the office area is safe, clean, and something to be proud of.
This is accomplished by…
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5S – How is it used?
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Sort “when in doubt, move it out” Weeding out of items Creating guidelines for item removal Get involvement from management
1. Sort
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Straighten “a place for everything with everything in its place”
Establishes locations Visual controls with labeling Create current and future state area maps
2. Straighten
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Shine “to be Lean you must be clean” Basic “Spring” cleaning Creating standards to keep it clean
3. Shine
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Standards “standardize to improve” Guidelines and checklists Make standards visual
4. Standardize
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Sustain “sustain for success” Training Audits
5. Sustain
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5S - Summary
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SORT STRAIGHTEN SHINE STANDARDIZE SUSTAIN
Criteria for disposalof not-needed itemshave beenestablished.
Decide and organizewhere to keepnecessary items
Clean work area. Established workgroups to developand documentstandardized workmethods.
Area inspections arerandom andcompleted by workgroups and/or shopfloor leaders.
Tag and identify not-needed items.
Decide and organizehow to keepnecessary items.
Develop cleaningassignments andchecklist.
Work methodsestablished for S’sone through three.
5S level isestablished andposted in the area.
l
Establish a safe andsecure holding areafor not-neededitems.
Make it easy. Inspection duringcleaning.
Documented andstandardizedcontrols for S’s onethrough three.
Work area 5S ismaintained.
Evaluate andremove unneces-sary items from thesite.
Make it obvious. Cleaning is aneveryday part of thejob.
Developstandardized workprocedures for allwork areas.
Internal inspectionprocess is standard.
Identify problemareas and documentprevention actions.
Identify problemareas and documentprevention actions.
Identify problemareas and documentprevention actions.
Share best practiceswith internal andexternal workgroups.
Root cause problemsolving process inplace.
Standard Work Measure and perform to standards Conducted in a standard manner
o Specific o Documented
Work to improve the standards, continuously
o Measureable o Repeatable
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Types of Standards Specification Descriptions Quality Methods Tools Communication Terminology
Subject Rules / Policies Business
management Regulatory Compliance
Technical Materials Components Products Services
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Standard Work: Guidelines 1. Adjust to human ease and effectiveness, not
machine efficiency. 2. Standardize all repetitive work. 3. Keep the equipment and systems in
excellent/updated working condition 4. Make visible and accessible 5. Revise regularly
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Hedgehog Concept
Hedgehog vs Fox—Jim Collins Identify your focus and stick with it Build your business and strategy around the
concept Don’t try to do everything—Focus, Focus, Focus
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Source: Good to Great by Jim Collins
Hedgehog Concept
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What You are Deeply Passionate About
What you can be the Best in the World at
What Drives your Economic Engine
Sweet Spot
Source: Good to Great by Jim Collins
Hedgehog Concept Examples
Walgreens: “The best most convenient drugstores, with high profit per customer visit.” Walgreens beat the market by over 15 times from
1975 to 2000 • Wells Fargo: “Run a bank like a business with a
focus on the western US.” • Wells Fargo beat the market by 3.99 times from
1983 to 1998
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Source: Good to Great by Jim Collins
Goal Setting Remember your hedgehog concept Write down your goal Determine steps needed to
accomplish goal Write your goal every day Visualize yourself achieving the goal Disciplined activity Focus, Focus, Focus
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Continuous Improvement Mindset
Find and remove waste
Remove defects, reduce variation, and improve quality
Delight customers
Make value chain more effective
Better apply ourselves, working smarter
Make a difference and make it better
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Questions/Comments