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The Future State
Map
The Future State Map
• The purpose of value stream mapping is to
highlight sources of waste and eliminate
them by implementation of a future value
stream that can become reality within a
short period of time.
• The goal is to build a chain of production
where the individual processes are linked
to their customers flow or pull, and each
process gets as close as possible to
producing only what its customers need
when they need it.
Key Questions for the
Future State
1. What is the takt time? based on the
available working time of the downstream
processes that are closest to the customer.
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Key Questions for the
Future State
2. Will you build a finished goods supermarket
from which the customer pulls or directly to
shipping? (The answer to this question depends on
several factors such as customer buying patterns,
the reliability of your processes, and the
characteristics of your product. Building directly
to shipping will require either a reliable, short
lead time, order-to-delivery stream or more
safety stock. Fortunately your order-to-delivery
lead time involves only those processes from the
pacemaker process downstream to delivery)
Key Questions for the
Future State
3. Where can you use continuous flow
processing?
4. Where will you need to use supermarkets
pull systems? in order to control
production of upstream processes.
Key Questions for the
Future State
5.At what single point in the production
chain (the pacemaker process) will you
schedule production? (Remember that all
material transfers downstream of the
pacemaker process need to occur as a flow).
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Key Questions for the
Future State
6. How will you level the production mix at
the pacemaker process?
7. What increment of work will you
consistently release? and take away at the
pacemaker process
Key Questions for the
Future State
8. What process improvements will be
necessary for the value to flow as your
future-state design specifies? (This is the
place to note any equipment and procedural
improvements that will be necessary, such
as reducing changeover time or improving
machine uptime. We use the kaizen lightning
burst to indicate these points in the
process.)
Changeover
Drawing the Future State Map
• What problems can be noted from the
current state map of Acme’s steering
column bracket ?
• Perhaps the most striking problem is the
large amounts of unconnected inventory,
the unconnected processes (each producing
to its own schedule) pushing their output
forward, and the long lead time in
comparison to the short processing time.
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QUESTION 1
What is the takt time for the chosen
product family?
• The takt time calculation starts with the available
working time for one shift of the assembly area,
which is 28,800 seconds (8 hours). From this you
subtract any non-working time, which is two 10
minute breaks per shift. The customer demand of
460 units per shift is then divided into the
available working time to give a takt of 60 seconds.
Available working time: 28 800 – 1200 = 27 600 secs / shift
| Available Working time | 27 600 sec / 460 units per shift |
| Customer Demand |
Acme steering Bracket Assembly Takt Time = 60 secs
• What this takt time number means is that
in order to meet customer demand within
its available time, Acme needs to produce a
steering bracket every 60 seconds in its
assembly process.
• This number includes no time for equipment
downtime, changeovers, or for producing
scrap.
• Acme may decide to cycle assembly faster
than takt, if it cannot immediately
eliminate downtime problems for example,
but the takt time is a reference number
defined by the customer and cannot be
changed by Acme Stamping.
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Note
• Try to cycle your pacemaker process as
close as possible to the takt time.
• A significant gap between takt time and
cycle time indicates the existence of
production problems that cause unplanned
downtime.
• When you compensate for production
problems by cycling much faster than takt,
the incentive to eliminate those problems
evaporates.
• If you cycle faster than takt there should
be a plan for closing the gap!
QUESTION 2
Should the company build steering
brackets to a finished goods
supermarket or directly to shipping?
• At Acme, steering brackets are small (easy
to store) parts that have only two
varieties.
• The customer’s demand rises and falls
unpredictably, and Acme are uncertain
about reliability of future-state changes to
be made.
• So Acme has opted to begin with a finished
goods supermarket and to move closer to
“produce to shipping” in the future.
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• Acme can use the customer’s thirty day
forecast to determine the amount of
production capacity needed in the period
immediately ahead. (Lean plants
periodically adjust the number of
operators in assembly – and redistribute
the work elements – to match output to
changes in demand)
• Acme will determine actual production by
means of kanban coming back upstream to
the weld/assembly cell from the finished
goods supermarket.
• Since the customer buys in multiples of 20-
bracket trays, this is the simple choice for
kanban size.
• That is each tray of twenty left drive or
right drive brackets in the finished goods
supermarket has on it one production
kanban.
• As the shipping department withdraws
trays from the supermarket to stage them
for delivery, the kanban from those trays
are sent back to assembly.
• This is a signal to make 20 more left drive
(or right drive) brackets
| Assembly |
Customer
Requirements
| Shipping |
Example: Building to a Supermarket
The supermarket schedules assembly (Acme’s choice)
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| Assembly |
Customer
Requirements
| Shipping |
Example: Building directly to Shipping
Production Control schedules assembly
QUESTION 3
Where can Acme introduce
continuous flow?
• The operator balance chart summarises the
current cycle times for each process.
• The stamping operation cycles very quickly and
changes over to serve several production lines.
• So incorporating it into continuous flow, which
would mean slowing it’s cycle time to near the takt
time and dedicating it to the steering bracket
product family is not practical.
• That would result in a vastly under-utilised press
and the need to buy another press for Acme’s
other product lines!
• It makes sense to run Acme’s stamping press as a
batch operation and control its product with a
supermarket based pull system.
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Acme Stamping –
current cycle times
Takt time
60 secs
| weld | 39s. |
| weld | |
| assemble | |
| assemble | |
| stamp 1s. | 46s. |
| 40s. |
62s.
• Notice that that cycle times of the two
assembly workstation are not far apart and
also near the takt time.
• These workstations are already dedicated
to the steering bracket family, so
continuous flow in assembly certainly is
possible.
• The same is true of the two welding
stations, where work could also pass
directly from one welding step to the next
in a continuous flow.
• There is nothing to prevent Acme from
using continuous flow all the way from
welding through assembly, a condition with
no inventory (or a maximum of one piece at
automated process) between steps.
• The lean approach is to place these four
processes immediately adjacent to each
other (typically in a cellular arrangement)
have operators carry or pass parts from
one process step to the next and
distribute the work elements so that each
operator’s work content is just below the
takt time.
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• Dividing the total welding and assembly
work content by the takt time (187 /60)
reveals that 3.12 operators would be
needed to run welding and assembly in a
continuous flow at takt.
• Four operators would be under-utilised, but
a redistribution of work elements will not
be sufficient to eliminate the need for a
fourth operator.
• Our next option is to eliminate waste
through kaizen to bring the work content
under the takt time. A kaizen target might
be to reduce each operator’s work content
to 56 seconds or less (or ≤ 168 seconds
total work content).
• If that fails, use of some overtime may be
necessary .
• With either approach, the fourth operator
and the material handler who currently
moves parts between isolated processes
can be reassigned to other activities that
actually create value.
• To allow production to takt time and mix
levelling, a pacemaker process should
ideally incur little or no changeover time
and change over very frequently.
• So the left-drive to right-drive fixture
changeover time will need to be reduced
from the current ten minutes to a few
seconds.
• Focussed attention on improving the
reliability of the second spot welder
(perhaps through an improved maintenance
approach) will also be needed.
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Acme Stamping –
weld /assembly cell cycle time
after process kaizen
Takt time
60 secs
| weld | |
| weld | assemble |
| assemble |
• Notice that on the future state map the
four welding and assembly process boxes
have been combined into one process box
to indicate continuous flow.
• A small schematic sketch of a cell inside
the process box also indicates the cellular
manufacturing idea.
First View of the Future State
Map Showing Takt Time,
Weld/Assembly Cell, and the
Finished Goods Supermarket.
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| State Street Assembly |
| 18,4000 pcs/mo – 12,000 L – 6,4000 R |
| Tray = 20 pieces |
| 2 Shifts |
| stamping |
| weld & assy. |
| Takt = 60 sec |
| C/T = 56 sec |
| C/O = 0 |
| Uptime – 100% |
| 2 shifts |
| shipping | |
| staging | |
| 1 d | X aily |
| L |
| R |
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QUESTION 4
Where will Acme need to use
supermarket pull systems?
• Acme have decided to produce steering
brackets to a finished – goods
supermarket.
• Two additional supermarkets are also
required – one for stamped parts and one
for coils.
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Stamped Parts
• Pull system design begins with customer
requirements and stamping’s customer is
the weld/assembly process. The cell
currently requires approximately 600 LH
and 320 RH stamped parts per day.
• Containers for the stamped parts should
be sized to allow for close to the fingertips
placement in the cell (for example gravity
fed bins near the operator).
• Small containers allow Acme to keep both
LH and RH stamped parts in the cell at all
times.
• This further reduces LH-RH changeover
time at the pacemaker process, where
frequent changeovers (levelling the mix) is
a key lean objective.
• Each container in the cell – for example a
bin that holds 60 stamped parts, or about
one hour of current steering bracket
assembly – will have a withdrawal kanban
with it.
• When a cell operator begins taking parts
out of another bin, its withdrawal kanban is
given to the to the material handler so that
he knows to go to the stamping
supermarket and withdraw another bin of
parts.
• Withdrawal kanban trigger the movement
of parts. Production kanban trigger the
production of parts.
• Acme can attach a production kanban to
each bin of 60 stamped parts in the
supermarket.
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• Every time the material handler removes a
bin from the supermarket a kanban is sent
to the stamping press.
• This instructs stamping to produce 60
parts, place them in a bin, and move to a
specified location (the market address) in
the stamping supermarket.
• Now stamping no longer receives a schedule
from production control.
| stamping | Every 60 pieces |
| weld & assy. | L R | Every 60 pieces |
60 60
• However there is a problem with this pull
system .
• With a cycle time of one second per piece
and a changeover time of one hour,
stamping would take one hour to set up to
run only 60 seconds (60 pieces) of
production.
• Until changeover time on the stamping
press is greatly reduced, replenishing what
is withdrawn from the stamping
supermarket on a bin-for-bin basis is not
practical.
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• Due to changeover time, stamping needs to
produce batches larger than 60 pieces
between changeovers.
• With the initial goal of “every part every
day” stamping’s target batch size would be
approximately 600 LH and 320 RH pieces
(which will still require changeover
reduction)
• Stamping will keep 1.5 days of parts in its
supermarket one half day extra to allow
for replenishment delay and stamping
problems.
• So Acme will use a signal kanban to schedule
stamping. In this case the kanban (often a
metal triangle) for left and right hand parts
is brought from the supermarket to the
stamping press whenever the number of bins
remaining in the supermarket drops to a
trigger (“minimum”) point.
• When a triangle kanban arrives at the
stamping press’ scheduling board, it initiates
a changeover and production of a
predetermined batch size of a specific part.
• Stamping still does not receive a schedule
from production control.
| stamping | Every 600 LH or 320 RH pieces |
| weld & assy. | L R | Every 60 pieces |
60
batch
1.5 days
The stamped-parts supermarket, withdrawal and signal kanban
flows (dotted lines) are drawn on the future state map
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Coils
• To build a plant-level lean value stream the
suture state map must also show a third
supermarket at the receiving dock, which
holds coils of steel.
• Even though Acme’s steel supplier is not
ready to receive kanban and produce
according to them, Acme can still attach an
internal withdrawal kanban whenever a coil
is used
• Production control can then order coils based
on actual usage, instead of based on MRP’s
best guess of what future usage will be. (MRP
may still be used for capacity planning
forecast for the coil supplier, but day-to-day
orders should be based on pull)
• Once production control has made the days
order for coils, the corresponding kanban can
be placed in kanban slots at the receiving dock.
• These indicate the day that coils should
arrive.
• If there are kanban still left in yesterdays
receiving slot, then something is wrong at the
supplier
• Currently the steel supplier is shipping
coils weekly.
• By lining up customers along a “milk run”
delivery, it may be possible to get
necessary amounts of steel on a daily basis,
even if the steel supplier does nothing to
reduce its minimum batch size by slitting
coils.
• Moving to daily delivery eliminates 80% of
the inventory at Acme, while providing
smooth, steady demand for the steel
supplier.
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The Story So Far
• We have now proposed a cell of the type
many firms have implemented in the past
few years, the introduction of pull to
control stamping production and coil
delivery, “every part every day” in stamping
and instituting milk runs for delivery form
the raw material suppliers to Acme.
Acme Stamping Lead Time
Improvement
| Coils | Stamped Parts | Weld/Assy WIP | Finished Goods | Production Lead Time | Total Inventory Turns |
| 5 days | 7.6 days | 6.5 days | 4.5 days | 23.6 days | 10 |
| 2 days | 1.5 days | 0 | 4.5 days | 8 days | 30 |
Before
So Far
Second View of the Future
State Map Showing
Stamping and Raw Material
Supermarkets
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| State Street Assembly |
| 18,4000 pcs/mo – 12,000 L – 6,4000 R |
| Tray = 20 pieces |
| 2 Shifts |
| stamping | weld & assy. |
| Takt = 60 sec | 1.5 days |
| C/T = 56 sec | |
| C/O = 0 | |
| Uptime – 100% | |
| 2 shifts |
| shipping | |
| staging | |
| 1 d | X aily |
| L |
| R |
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| bin batch coil coil Daily Order | ||
| Michigan Steel Co. | Production Control | 6 Week |
| D (Mil | ail k R | y un) |
| Forecast |
(at the press) Information Flow & Toyota
• How can we flow information so that one
process will make only what the next
process needs when it needs it ?
• Years ago, Toyota discovered a very
different method of managing schedules:
stop trying to guess what the customer will
want.
• Instead shorten the lead time within
production and install supermarkets with
small inventories of each product between
processes that cannot be coupled to one
another.
• These will permit upstream processes to
replace in the supermarket what
downstream processes have just withdrawn.
• Then instead of sending customer
information to a centralised MRP system,
which then sends instructions to each
production activity, level the customer
orders and send them only to one place –
either directly to the pacemaker process,
where the requested products will be
produced in time for shipment, or to a
finished goods supermarket, where
requested products will be withdrawn and
staged for shipping.
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Information Flow & Acme
• Currently the customer is sending by fax a
ninety day forecast revised once a month
and frozen for thirty days.
• In addition, it is sending a daily release
during the night by EDI (phone line) to
Acme’s scheduling computer for the next
day’s shipping requirement.
• Finally there are occasional revisions in
shipping requirements on an emergency
basis.
• These are sent by phone from the
customer’s material handling department to
Acme’s shipping department during the day
as the assembly plant discovers that
needed parts are not on hand for whatever
reason.
• What happens to the information sent
from the customer once it reaches Acme ?
• Currently the weekly schedule is fed over
the weekend into the computerised MRP
which then sends instructions by Monday
morning to each department – stamping
welding I & II and assembly I & II – about
what to make the coming week.
• Then, as additional information is received
each night and as each department reports
back periodically to the MRP on what it
actually did that day (because production does
not go as scheduled), the daily production
schedules are continually adjusted to bring
what Acme is making into synchronisation with
what the customer wants.
• If this sounds complicated, it is – because
trying to run operations from MRP systems
doesn’t work well.
• There will be a frequent need for humans to
override the system to avoid shortages and
take into account emergency orders at various
stages of production.
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QUESTION 5
What single point in the production
chain (the pacemaker process) should
Acme schedule?
• Since all the process steps downstream of
the pacemaker process need to occur in a
flow, in the Acme example the scheduling
point is clearly the welding/assembly
process.
• We cannot schedule any further upstream
(at the stamping process because we are
planning to introduce a pull system between
stamping and weld/assembly.
• This single scheduling point will regulate
Acme’s entire steering-bracket value
steam.
QUESTION 6
How should Acme level the
production mix at the pacemaker
process?
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• When the daily delivery is made to the
assembly plant, 30 trays of left-drive
brackets (600 pieces) and 16 trays of
right drive brackets (320 pieces) are
typically staged and loaded onto the truck
at one time.
• If we are not careful, the 46 production
kanban removed from these trays before
loading will be sent back to the weld
assembly cell in a batch, as shown on the
future state map so far.
• If this happens the weld assembly cell will
probably batch produce these parts.
• The cell will produce all 30 trays of leftdrive brackets, and then change over to
make the 16 trays of right brackets, which
would look like this:
LLLLLLLLLLLLLLLLLLLLLLLLLLLLLLRRRRRRRRRRRRRRRR
1st shift 2nd shift
• From the cell’s perspective this seems to
make sense because is minimises the
number of required weld-fixture changes.
• However,from a value stream perspective
batching is the wrong way to go.
• Batch producing brackets in assembly will
increase the impact of problems, lengthen
the lead time and mean that the stampedparts supermarket has to be ready to meet
sudden demand surges.
• “Being-ready” means keeping more stamped
parts inventory in the supermarket, which
again increases lead time, obscures
stamping quality problems and in general
causes overproduction (waste).
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• Instead, if the weld/assembly cell levels
the mix of brackets it produces evenly
over the shift, then the stamping press
(with a shortened set-up time) will have
plenty of time to react to the cell’s pulls
for left-drive and right-drive parts.
• It will have time to replenish what was
taken away without the need for so much
inventory in the stamping supermarket.
• With levelling, which requires much more
frequent changeovers, the cell’s production
mix of trays of brackets would look like
this:
RLLRLLRLLRLLRLLRLLRLLRLLRLLRLLRLLRLLRLLRLLRLLR
1st shift 2nd shift
Note
• Enabling such frequent changeovers in the
cell will probably require keeping all
fixtures and component varieties ready,
near the operator’s fingertips.
• However, when all components are kept on
the line you may need some failsafe devices
to prevent the wrong ones from being
assembled.
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• Here the benefit of a value stream should
become evident.
• By levelling the production mix at the
pacemaker process, which may seem
unnatural at that location, the entire value
stream will show improved lead time,
quality and cost.
• These benefits are amplified in the value
streams that are longer and more complex.
• How can we ensure that kanban coming
back to the weld assembly cell, which are
the production instructions, come back in a
sequence that levels the mix of products
over the shift ?
• At Acme there are two places where the
batch of kanban can be intercepted and
this levelling take place.
• We will assume that Acme has decided to
use a load-levelling box to help maintain a
level production mix, paced withdrawal and
genuine pull.
Option A
• Production control can place withdrawal
(“move”) kanban corresponding to the
customer order in a load levelling box near
the shipping dock in a mixed, left
drive/right drive sequence.
• A material handler then pulls these kanban
out of the levelling box one-by-one at the
pitch increment (20 minutes in this case)
and moves trays of brackets from the
finished goods supermarket to the staging
area one-by-one according to the
withdrawal kanban.
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| shipping |
| staging |
L R
weld & assy.
| production control |
20
20
20
20
daily order
OXOX
Option A
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batch of
one at a time kanban
kanban
• As each tray is pulled from the
supermarket, the production kanban on
those trays are brought to the cell in time
increments and a left-drive/right drive
pattern that mirrors exactly the mix and
pitch increment that production control
has set up.
• (This levelling option is the one shown in
Acme’s future state map.)
Option B
• Production control can send today’s
customer demand to the material handler,
who pulls all the corresponding trays out of
the finished goods market at once and
stages them for shipment.
• Pulling the trays produces a batch of
production kanban, which are placed in a
load levelling box near the cell, in a mixed,
left-drive/right-drive sequence.
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• The weld/assembly material handler then
pulls production kanban out of the levelling
device one at a time at the pitch
increments and as a result assembly
produces in a left drive right drive mixed
pattern.
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| shipping |
| staging |
L R
weld & assy.
| production control |
OXOX
Option B
20
batch of
kanban
one at a time
kanban
20
20
daily order
• The drawback of Option B is that an entire
batch of finished good is moved to shipping at
once.
• Lean manufacturing strives to avoid or
minimise batching as much as possible, always
getting closer and closer to continuous flow.
• Also if Acme is eventually able to shrink its
finished goods supermarket to less than one
day of inventory withdrawing a one day
quantity all at once will not be possible.
• However Option A requires someone to
repeatedly move one tray at a time (at the
pitch increment), from the weld/assembly cell
to the finished goods supermarket, and from
finished goods to the shipping dock.
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QUESTION 7
What consistent increment of work
should Acme release and take at the
pacemaker process?
• How will Acme provide takt image to the
weld/assembly cell, and how frequently will
it check production there ?
• Returning all 46 kanban (two shifts worth)
to the cell at once would provide no takt
image to the cell.
• Batching the volume of work instruction
like this must be avoided.
• A natural increment of welding/assembly
work in Acme’s case is the 60 second takt
time x 20 pieces per tray = 20 minutes.
This is the steering bracket pitch, which
corresponds to one kanban for one tray of
20 steering brackets.
• This does not mean that every 20 minutes
someone walks over to the weld/assembly
and asks how are things going on ?
• Not exactly !
• What this means is that Acme will practice
paced release of work instruction, one
kanban at a time and paced withdrawal of
finished goods at its weld/assembly cell.
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• Each column in Acme’s steering bracket
load levelling box represents a 20 minute
pitch increment.
• The two rows are designated for left-drive
and right-drive kanban.
• Every 20 minutes, a material handler brings
the next kanban (the next increment of
work) to the weld/assembly call and moves
the just-finished tray of brackets to the
finished goods area.
• If a tray is not finished at the 20 minute
pitch increment, then Acme knows there is
a production problem that needs attention.
Load-Levelling Box for Steering Brackets
Weld/assy cell gets kanban from left to right pitch increment
one column per pitch
increment pitch – 20 min
kanban
One row
| per | shift 1 | 7 | 720 | 740 | 8 | 820 | 840 | 910 | 930 |
| left drive | L | L | L | L | L | ||||
| shift 2 | 3 | 320 | 340 | 4 | 420 | 440 | 510 | 530 | |
| right drive |
product
type
R
R
R
QUESTION 8
What process improvements will be
necessary for Acme’s value stream
to flow as the future-state design
describes?
27
Achieving the material and information flows
we envisage for Acme Stamping requires
the following process improvements:
• reduction in changeover time and batch
sizes at the stamping process to allow
faster response to downstream usage. The
goals are “every part every day” and then
“every part every shift”.
• Elimination of the long time (10 minutes)
required to change between left-drive and
right-drive fixtures in welding, to make
possible continuous flow and mixed
production from welding through assembly.
• Improvement in on-demand uptime of the
second spot-weld machine, as it will now be
tied to other processes in a continuous
flow.
• Elimination of waste in the weld/assembly
cell, to reduce total work content down to
168 seconds or less. (Which allows use of 3
operators at the current level.)
We mark these items on our future-state
map with the kaizen lightening burst icon.
• We should also figure out how to use
existing stamp technology – designed to
produce stampings in much higher volume
then the customer for this product desires
– in a less wasteful way.
• The secret here is to have the stamping
press, which also stamps parts for other
product families in the plant, make smaller
batches of the two parts our value stream
needs and make them more frequently.
• The will require additional reduction in
changeover time.
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• In fact, methods to reduce set-up times on a
stamping press are well known and a reduction
time to less than 10 minutes per setup can be
achieved quickly.
• With that the press can make only about 300
left-drive stampings and 160 right-drive
stampings (the per shift production need)
then produce parts for other value streams;
then make more lefts and rights on the next
shift.
• EPE will now equal every part every shift.
• This way the amount of inventory stored
between the stamping process and the
weld/assembly cell would be reduced by 85%.
The Future State Map
| 20 20 bin batch coil Production Daily Order 6 Week 20 1 X daily OXOX 20 20 | Michigan Steel Co. | |
| D (Mil | ail k R | y un) |
State Street
Assembly
18,4000 pcs/mo
– 12,000 L
– 6,4000 R
Tray = 20 pieces
2 Shifts
stamping weld & assy. shipping
Takt = 60 sec
C/T = 56 sec
C/O = 0
Uptime – 100%
2 shifts
L R
staging
coil
Control
Forecast
(at the press) 1 day
daily order
EPE = 1 shift
C/O < 10min
2 days
90/60/30 day
forecast
daily
order
production
lead time = 4.5 days
processing
time = 169 secs
1.5 days
1 sec
1 day
168 secs
2 days
changeover
weld
changeover welder
uptime
total work
≤ 168 secs
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• The beauty of asking Question 8 last is
that your process improvement efforts
become subordinate to the overall value
stream design as opposed to vague, standalone improvement activities.
• Teams can now be dispatched to work on
these process improvements with a clear
understanding of why they are making
these improvements.
• However be sure to kick-off improvement
projects by creating a “pull” for the
improvements.
• That is instead of “pushing” a team to reduce
set up time on the stamping process, begin
instead by stating that in 30 days the batch
sizes on the stamping process will be reduced to
300 and 160 pieces.
• This creates a sense of urgency about making
the process improvement.
• Likewise stating that in 14 days the welding and
assembly will be placed into a continuous flow
will pull the elimination of weld-fixture design.
Summing Up
• When we compare the summary statistics
for Acme’s current state and its future
state the results are quite striking. In
particularly levelling production in the
weld/assembly cell and developing the
ability to stamp every part every shift will
allow Acme to further reduce the amount
of coils and stamped parts held in its
supermarkets.
• However this puts great pressure on
maintaining equipment reliability and
predictability for production to takt.
30
Summing Up
• With shortened production lead time
through its shop floor, the pacemaker
process operating consistently to takt time
and fast response to problems, Acme can
comfortably reduce the amount of finished
goods inventory it holds to two days worth
(1200 LH, 640 RH.)
• (If Acme’s customer were to level its
schedule, this finished goods inventory
could be reduced further.)
Summing Up
• Compared with the interim improvements,
levelling production at Acme has further
reduced production lead time by another
3.5 days and nearly doubled inventory
turns.
Acme Stamping Lead Time
Improvement
| Coils | Stamped Parts | Weld/Assy WIP | Finished Goods | Production Lead Time | Total Inventory Turns |
| 5 days | 7.6 days | 6.5 days | 4.5 days | 23.6 days | 10 |
| 2 days | 1.5 days | 0 | 4.5 days | 8 days | 30 |
| 1.5 days | 1 day | 0 | 2 days | 4.5 days | 53 |
Before
Continuous
Flow & Pull
With
Levelling