A roadmap toward Lean
Reducing waste in a High Variety Low Volume
manufacturing company
‘A case study on implementing the Lean concept at a heavy equipment manufacturer’
Master thesis, MSc. Technology Management
University of Groningen, Faculty of Economics and Business.
Author: M. de Haas
Student number: 1954318
Address: Steentilstraat 13a, 9711 GJ Groningen Telephone: +31(6)25115233
Mail: m.de.haas.1@student.rug.nl Period: July 2012 – July 2013
1st supervisor dr. X. Zhu
2nd supervisor dr. Ir. M.W. Hillen
Address Faculty of Economics and Business, University of Groningen.
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Preface
This thesis has been written for my Master degree in Technology Management at the University of Groningen. I have conducted this research at …, The Netherlands.
I wish to acknowledge those who greatly assisted me during my internship experience. I would like to thank both of my supervisors, …. They have made this experience rewarding and enjoyable by providing expert support and mentoring. I would like to express my gratitude to … for her support in writing this report. Furthermore, I wish to thank all my colleagues at .., for their assistance and posi-tive attitude towards the conducted interviews and observations.
From the University of Groningen I would like to thank my supervisor Dr. X. Zhu for his advice and support, I very much appreciated the feedback moments. Furthermore, I would like to thank Dr. ir. M.W. Hillen for his comments, advice and the time taken to fulfill the role of co-assessor.
I am grateful for my parents who have made it possible for me to study, for being my biggest sup-porters and always believing in me. Lastly, I would like to show my appreciation to my girlfriend, for her ever-present support and patience. Because behind every successful man there is a strong wom-an.
Groningen, 01-07-2013
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Management summary
Purpose - Existing research deals with the applicability of the Lean concept in many types of organi-zations. However, as a business philosophy, Lean mainly addresses the high variety, high volume segment. The application of Lean in high variety, low volume (HVLV) organizations is underexposed (Jina et al, 1997; Gurumurthy & Kodali, 2011). The typical complexity of the products and the variety between subsequent constructions, cause problems in application of Lean related tools and tech-niques, for this the efficacy of Lean in HVLV organizations is subject of discussion (Jina et al, 1997, James-Moore & Gibbon, 1997). The purpose of this research is to present a beneficial application of the Lean concept in an HVLV organization. This research deals with common issues in the early im-plementation phase of the Lean concept, mainly the utilization of the VSM tool. The effectiveness of VSM in an HVLV and project environment is criticized; VSM is unable to address complex value streams, data recorded is deterministic and choosing a representable product family for a HVLV company is a struggle. Solutions to these issues have been devised and applied at the case organiza-tion, the results illustrate the usefulness of these measures. The case study is conducted at ..., an organization which engineers and manufactures once only, heavy constructions for the Maritime and Offshore market.
Design/methodology/approach – The hindering factors in implementing the Lean concept in an HVLV organization are identified by means of literary review. Qualitative research of the case organization provides the essential outline, understanding of its value stream and the perceived waste contained. By means of the Value Stream Mapping (VSM) tool, the waste and waste drivers are identified and quantified. Furthermore, for measuring the duration of various processes and activities, the applica-tion of sample study proves useful.
Findings – By carrying out a qualitative research, we find that ‘variation in operations’ is the main cause of many disturbing factors that initiates waste in the value stream of the case organization. With respect to VSM, a ‘continuous process view’ makes mapping the value stream of a HVLV organi-zation worthwhile. In the case of ..., the targeted product can be simply described as a twenty ton heavy construction. This allows for the analysis of the performance between several fixed time peri-ods, instead of dissimilar constructions. Mapping the value stream on plant level shows that the manufacturing department of ... is the bottleneck of its value stream; Engineering is able to process a random construction at approximately twice the speed. The efficiency ratio of manufacturing is al-most 60%, displaying a large improvement potential. The sample study concerning the processes Fitting and Welding, displays a potential improvement of 10% of value added time. Representing a cost savings of €525.000,- per year on projects, without investing in any additional resources.
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General implications - It is believed that this paper will enable practitioners to understand the diffi-culties associated with implementing Lean into an HVLV organization. However, more importantly showing them how VSM can be effectively applied into an HVLV environment.
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List of abbreviations
BOP Blow Out Preventer
CVT Current Value Added time
DTO Design To Order
GTA Grounded Theory Approach
Hr Hourly rate
HVLV High Variety, Low Volume
KPI Key Performance Indicator
Mh Man-hour
MTO Make To Order
PLET Pipeline End Terminations
TPS Toyota Production System
TVA Target Value Added time
VSM Value Stream Mapping
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List of figures
Figure 1-1: Roadmap of Lean implementation ... 13
Figure 2-1: Conceptual framework ... 15
Figure 2-2: The regulative cycle ... 19
Figure 3-1: Value stream mapping ... 23
Figure 3-2: Production flow ... 24
Figure 5-1: Current stream map ... 40
Figure 5-2: Distribution of steel processed ... 41
Figure 5-3: Distribution of measurements ... 44
Figure 5-4: Distribution of total time by fitters and welders ... 45
Figure 5-5: Distribution of non-value added time ... 45
Figure 5-6: Current stream map ... 46
Figure 6-1: Lean house ... ... 48
List of tables
Table 3-1: The structure of GTA ... 23Table 3-2: Comparison of Lean plant against HVLV plant ... 26
Table 4-1: Origin of the qualitative research data ... 29
Table 4-2: Information concerning interviewees ... 30
Table 4-3: Project structure ‘Kwalitan’ ... 31
Table 4-4: Primary codes assigned ... 32
Table 4-5: Sample evidence of variation ... 33
Table 4-6: Sample evidence of overburden ... 34
Table 4-7: Sample evidence of waste ... 35
Table 5-1: Factors influencing target product ... 38
Table 5-2: Productivity of the engineering ... 39
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1
Background
The Netherlands is known for its long and rich maritime history. After 2003 an economic upturn pro-vided a strong platform for growth in the marine and coastal water transport and developments in the offshore industry. However the financial crisis in 2009 led to stagnation in the transport industry and directly influenced the demand for new vessels. The offshore service industry seems to suffer less from the economic downturn; the number of design and construction contracts remains high. Inevitably also this sector will perceive the decrease of orders through the adjustments of invest-ments by oil companies because of reduced cash flow and limited credit. (MIP midterm review report, 2010)
... is a dominant player in the area of high quality, innovative offshore and maritime solutions, spe-cialized in delivering customized Lifting, Transportation, Drilling and Pipe Laying Systems.
... ...
... was founded over two decades ago and was originally based in … (the Netherlands) after an acqui-sition and further growth of the company ... was relocated to its current location. The early conduct-ed projects were mainly in the area of energy, oil and gas, but the range of activities gradually ex-panded to other market segments, like Maritime and Navy. Over the last few years ... experienced a fast growth in both size and revenue. In 2007 the organization consisted of 45 full-time employees, six years later this increased to a little less than 200 full-time employees. Approximately in the same time ... increased its annual revenue by 100%.
Business environment
... designs and manufactures a large range of mainly one-off constructions, which are used world-wide in a variety of market sectors. ... is currently active in four markets: Energy, oil and gas, Mari-time, Navy and Industry. Energy, oil and gas being one of the larger markets, ... focusses mainly on the upstream energy market which entails designing and producing products for geotechnical intigation, drilling vessels, pipe installation vessels up to subsea installation vessels and work over ves-sels. Constructions like pipe-handling equipment, Blow Out Preventer (BOP) handling, Pipeline end Terminations (PLET) handling for installing manifolds into the pipeline, ultra deep-water cranes and motion compensation deep-sea winch systems is just a small selection of what is possible. The Mari-time sector, which also covers a large portion of the orders consists of a wide range of submarkets. Designing and building equipment for vessels working offshore, construction vessels, RORO vessels, dredging and rock dumping and luxury yachts, means working with various rules, regulations and industry standards. For the Maritime sector ... delivered hatch cover systems, offshore cranes, cargo ramps, grain bulkheads and yacht equipment such as cranes and davits. The Navy and Industry sec-tors are less obvious market segments, however share a great deal of similarities with the previous markets, reason enough for ... to also be active in these markets.
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tailor made products and an environment where the knowledge of different levels of expertise can be shared relatively easy.
Customer value
The strategy of a company illustrates its goals and objectives, the chosen course of action and the allocation of resources necessary for accomplishing these goals (Chandler, 1962). An appropriate adopted strategy reflects the value of the customer and refers to the most important market re-quirements. Therefore, both the strategy of ... and the most important market requirements, set by customers and competitors, are used to define the customer value.
The strategy of ... is communicated through its mission statement: ‘Realizing reliable, custom build systems in the area of heavy machinery and the offshore industry. Our scope covers the development of concepts, detailed engineering, productions and worldwide aftersales service’. The mission state-ment implies that the customer must be confident that ... will always deliver reliable constructions conform requirements, assist customers in developing economically justifiable one-off solutions for their specific problems. Furthermore, ... is able to design, manufacture and service these construc-tions. When taking the mission statement in consideration together with the perspective of value, the aspects of ‘reliable’ and ‘custom’ are distinguished. Also, the feature of covering the entire solu-tion, from concept until completion and after service, is pointed out as an competitive advantage. However, customer value is mainly formed by customers and competition, and communicated through market requirements. Slack and Lewis (2011) refer to ‘performance objectives’ instead of market requirements and distinguish five common objectives, which are: dependability, speed, quali-ty, costs and flexibility. Priority setting of these objectives should be done by customers. However, because of research demarcation and time restrictions, the ‘performance objectives’ are ranked with the input of nine managers. All of the managers are familiar with the Energy, oil and gas and Mari-time market. The performance objectives ‘dependability’ and ‘quality’ were ranked most important. The complete list can be found in appendix I.
Using the strategy review and ranked ‘performance objective’ list, the customer value is summarized by the following:
Dependability o Quality o Requirements o Delivery date Tailor made solution Single partner
... can distinguish itself from competitors by providing reliable tailor made solution to their specific problem. Being dependable in this situation refers to being worthy of trust when it comes to provid-ing quality, accordprovid-ing to specifications and deliverprovid-ing on time.
Organizational structure and design
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weak/functional matrix structure. Project managers with limited authority are assigned to oversee the cross functional aspects of a project and control a part of the resources assigned to their project. The organogram of the ... organization is included in appendix II.
... can be typified as a high variety low volume (HVLV) company, constructions are once only or built in small quantities, subsequent projects highly differ from each other in respect to dimensions, com-plexity and lead time.
Lean efforts
In order to stay competitive ... is in search for improvements concerning quality, decreasing costs and lead-time. Figure 1-3 displays a logical roadmap of Lean implementation steps and associated tools. The top box is delineated to indicate the present progress of Lean implementation concerning ....
The incentive to capture the Lean philosophy is present within management, proof of this is one of the operational targets of last year (2011): ‘implementing the Lean philosophy in the manufacturing environment’. Corporate management supports the adoption of the Lean concept and is working on the initial Lean vision along with restructuring the organization to support and strengthen the trans-formation. The next step is to focus on the value stream, hereby identifying waste, setting goals and metrics and formulating KPI’s to monitor the implementation.
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Research motivation and approach
As indicated ... is always searching for ways to improve the current operations, the challenge of de-signing and manufacture qualitative products, with fewer resources in a shorter amount of time. However, recently it seems that it becomes more difficult to comply with the agreed upon delivery dates. The Operational Manager states:
‘Lately, too often deadlines are not met due to problems in production caused by changes in product design and/or process’.
The need for improvement is apparent. Speed as a competitive advantage is becoming increasingly significant, Andel (2002) states: ‘the ability to offer customized products with short lead-times is be-coming an important area of competitive differentiation among suppliers in many industries’. Eskew (2004) agrees by indicating that companies can achieve competitive differentiation based on how well they deliver the right product to the right place at the right time. The management of ... is aware of this change and state:
‘In order to decrease lead time and meet deadlines we want to implement Lean product and process tools in the organization’.
Implementations of the Lean concept has proven to be beneficial for reducing lead time. The Lean concept has been extensively studied since the mid-1980s and evidence is in favor of its use to im-prove quality, increase productivity, and reduce delivery times (Oliver, Delbridge & Jones, 1996; Lowe Delbridge & Jones, 1997; Hancock & Matthew, 1998). However, many companies struggle with implementing the Lean concept in their organization, especially HVLV manufacturers (Jina, Bhattacharya & Walton, 1997).
Designing and constructing heavy offshore equipment is clearly different from automobiles, Toyota being the creators of Lean and here the concept was first applied. Whatever client or contract, all builds differ on some aspect relative to another, and even during the task of development and/or manufacturing, changes by clients occur regularly. Furthermore, the constructions built by ... do not roll off the assembly line at a regular pace with minor differences in specifications. Is the Lean con-cept appropriate when constructions are built to order, are one-off or produced in small quantity and highly customized?
2.1
Research objectives
The goal of this research is to generate knowledge concerning needed or at least sufficient actions in order to solve lead time problems for an HVLV large structure manufacturer.
The following objectives support in accomplishing this main goal:
Perform a literature study regarding Lean implementation in HVLV manufacturing organizations, examining any hindering factors so that Lean tools and techniques can be adapted.
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Draw value stream maps of different levels in the organization, clearly visualizing both infor-mation and material flow through the end-to-end value stream. Identifying areas of unwanted inventory buildup and causes of non-synchronized activities
Provide a set of recommendations based on the Value Stream Mapping (VSM), hereby eliminat-ing the major waste in the system and shapeliminat-ing an organization in which information and materi-al is able to flow.
The main research question is formulated as follows: “What actions should ..., an HVLV large struc-ture manufacstruc-turer, take to reduce lead time?” The anticipated result of this research is to comple-ment the existing scientific knowledge concerning waste reduction in HVLV companies and providing suggestions of ways to reduce waste at ... in order to reduce lead time. By focusing on lead time and the reduction of waste other issues will also be partly dealt with, such as: cost reduction, quality im-provement and motivation imim-provement among personnel. Next the conceptual framework depicts the approach chosen to answer the main research question.
2.2
Conceptual framework
The causes of lead time problems can be highly interrelated and branched out, lead time depends upon many different factors which mutually influence each other. Waiting time, setup time, amount of rework, information sharing, carrier relationship, resource availability, non-synchronized activities, fluctuation in demand are just a few lead time factors recognized by several authors (Morris & Ter-sine, 1990; Tersine & Hummingbird, 1995; Ferrin & Pearson, 1997; Johnson, 2003). Setting bounda-ries between the research object and the environment can be a struggle, as recognized by Hutjes and Van Buuren (1992). Because of the extensive list of potential factors it seems impractical to recite them all in a theoretical framework. Therefore, the theoretical framework depicts a rather broad and basic view. Lead time Demand Capability to transform variation Understanding resources and processes Understanding markets
Figure 2-1: Conceptual framework
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and capability to transform are in perfect alignment, all resources of a company would be fully uti-lized, no waste would exist and the lead time would be equal to the fastest possible process time of the system. However when demand and capability to transform are not aligned, waste arises. A dis-persed situation is not uncommon for HVLV manufacturers and leads to waiting time, rework and overburden, among others. Many authors endorse the importance to align the market requirements and manufacturing capabilities (Hayes & Wheelwright, 1979; Miller & Roth, 1994). The primary rea-son that makes alignment of demand and capability of transformation impossible is that both are subject to variation. Measures must be taken in order to reduce the deviation between both factors (Hopp & Spearman, 2008; Slack & Lewis, 2011).
Demand
The demand derives from choices made concerning strategy and the resultant market requirements. The strategy of an organization formulates its direction and scope, which defines its advantage over other organizations in the way it handles resources and the environment, this in order to meet the needs of the customers and fulfill stakeholders expectations (Johnson & Scholes, 2008). The choice of strategy effects demand side features, such as, the product range, customer order size, level of schedule changes required and important order-winner aspects (Slack & Lewis, 2011). Therefore, the magnitude of variation in demand depends to a large extent on the strategy adopted by an organiza-tion.
Market requirements constitutes the external aspect; Slack and Lewis (2011) refer to market re-quirements as ‘performance objectives’ which they summarize into five objectives: quality, speed, dependability, flexibility and costs. Their relative importance changes depending on how the compa-ny wishes to compete. Clearly, when the customer qualifies speed as important, the organization will emphasize on this objective, speed as a performance objective obviously has its influence on lead time. However, all market requirements are interrelated and for that have effect on lead time. For instance, aiming for flexibility as an order winner usually results in a longer lead time opposed to the manufacturing of more standardized products, and producing products of high quality usually implies higher costs and longer lead times.
Capability to transform
What customers require is a very important factor to fully understand. However, given that require-ments are understood and known by the company and several competitors, the capability to trans-form becomes the order winning variable. Outpertrans-forming competition with providing products fast-er, with better quality and less costs is what makes the difference between winning or losing orders. The pipeline analogy to describe the capability to transform has been used before by Mather (1988) and Sandras (1992).
pipe-17
line. The largest obstruction has to be recognized and eliminated in order to speed up the rate of throughput but only to the extent of the subsequent narrowest section of the pipeline.
This all seems straightforward but in reality it is a challenging job, the obstructions are regularly en-tangled in many steps of the processes and related processes, the obstructions keep changing as processes and activities are redesigned and the flow of material and information fluctuates as well. One cannot just carelessly widen the pipeline until the desired rate of finished products is accom-plished. This certainly will result in waste in one or more sections of the pipeline and competing on costs will become more difficult. Some managers think that increasing input will result in an increase in output rate. This is not the case, eventually what goes in must come out, however more input only means an increase in work in process (WIP) not an increase in the output rate.
This leads us to the manner in dealing with variation of workload and process times. A quick delivery is important, therefore many companies keep finished goods inventory, in this way they can provide the customer with the product instantly. In other words variation is contested by buffering through inventory. An HVLV manufacturer is careful when it comes to inventory because the future demand for a certain low volume product is harder to estimate and the consequences of making a mistake has a greater negative effect. Furthermore, a Design-To-Order (DTO) manufacturer is even complete-ly unable to keep inventory. So another way to deal with variation is to keep overcapacity, whenever an order is placed there will always be enough personnel and raw material to instantly comply to the request. This measure is adequate but also highly inefficient, the excess resources are valuable, and will inevitable be reflected in the cost price of the product. A third way to deal with variation in de-mand is to stretch lead time. When the number of personnel and resources are fixed then the planned lead time should be broadly selected, to be able to meet demand. In other words, buffering for variation is done by keeping inventory, over capacity are trough an increase in lead time, all of which are not desirable. (Hopp & Spearman, 2008)
The best way to produce is to adjust the diameter of the pipeline to the desired output rate. A pipe-line which allows for the input flow-rate to match the output-flow rate, without any excess capacity. Because the product is always subject to change, the pipeline itself must also be continuously modi-fied, which in turn introduces new obstructions. This is precisely the core of the Lean philosophy, continuously rethinking the way in which to add value in order to pursue perfection (Womack & Jones, 1996).
2.3
Sub questions
The formulated sub questions derived from the conceptual framework, guide the research to the answering of the main-research question.
The management of ... suggests to implement the Lean concept in order to solve the lead time prob-lems. However, implementing the Lean concept in an HVLV organization can be a struggle (Jina et al, 1997). Therefore, the first sub question concerns the potential difficulties ... can encounter when adopting the Lean philosophy.
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Chapter three covers the Lean philosophy and provides understanding on how this concept can re-duce lead time. The next step in implementing the Lean concept at ... is to focus on the value stream and its wastes; therefore, section 3.2 contains the available means by which ‘waste’ in a supply chain can be identified. The hindering factors of Lean implementation in an HVLV company are recognized by means of a literature study, which is elaborated in section 3.3.
Customer demand, to certain extend, dictates the lead time of a product and/or service. The value perceived by the customers of ... is examined, in order to gain understanding of the influence cus-tomer demand has on lead time.
2. What is value to the customers of ...?
The customer value is previously handled in Chapter one and is regarded as a given. It is not the in-tention of the researcher to influence or otherwise alter the customer value, in order to improve lead time. Therefore, the outline of demand in the conceptual model is depicted as a dotted line.
The lead time of a product and/or service is also the result of a company’s ‘capability to transform’. The value stream of ... is examined in order to assess the amount of waste present within and which processes are most disturbing for the lead time.
3. What does the value stream of ... look like?
4. Which process(es) are most disturbing for lead time at ...? 5. What kind of waste can be identified in these processes?
The value stream of ..., the most disturbing processes of that value stream and the associated waste drivers are the subjects of the Chapters four and five. Chapter four entails a qualitative study con-cerning waste in the value stream of .... Chapter five entails the application of the VSM tool in an HVLV organization.
Finally, lean tools and techniques are used to recognize and reduce waste. Introducing these tools and techniques and secure their application in the organization requires a solid plan of action.
6. Which tools, techniques and methods can be identified to reduce lead time? 7. How can this tool, technique and/or method be applied at ...?
After the value stream is visualized and sources of waste are identified, Chapter six entails a pro-posed plan of action. Chapter seven comprises the conclusion and suggestions on further research.
2.4
Methodology
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Figure 2-2: The regulative cycle (van Strien, 1997)
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Review of key concepts
This chapter contains three sections. Section 3.1 encompasses a review of the Lean concept and related tools and techniques. Hereafter, section 3.2 addresses the tools by which waste can be identified in a value stream. Section 3.3 displays the characteristics of a HVLV manufacturing company. After which the contrast between a conventional Lean organization and a HLVL organization is demonstrated, providing possible hindering factors. Finally, this chapter contains the findings on the applicability of the VSM tool in an HVLV organization. The VSM tool is treated separately because this tool encompasses the first step in Lean implementation, namely the analysis of the value stream.
3.1
The Lean concept
3.1.1 Lean history
The Lean concept described by Womack and Jones (1990) originated from the Toyota Production System (TPS), an approach to operations devised by Shigeo Shingo and Taiichi Ohno (1988), both were employed at Toyota in the 1950s during the great depression preceding WWII. During this time resources were scarce and the only way for the Toyota motor company to survive was to make drastic changes in the efficiency and productivity. The Lean manufacturing principles arose here, a production philosophy focused on increasing productivity, reducing lead times and costs, and improve overall quality (Sriparavastu & Gupta, 1997).
The thought process of Lean was thoroughly described by James P. Womack and Daniel Jones in the book The machine that changed the world (1990) and was originally seen as a philosophy suitable only for manufacturing, however in the last decade it has become newly fashionable as an approach that can be applied in many types of organizations (Slack & Lewis, 2011). Lean manufacturing principles have been adopted by various sectors of industry such as, shipbuilding , construction and aerospace (Liker & Lamb, 2001; Bertelsen & Koskela, 2004; Crute, Ward, Brown & Graves, 2003). Based on empirical evidence it is recognized that the competiveness of an organization improves when the Lean concept is applied (Jones, 1994; Oliver et al., 1996; Lowe et al., 1997). However, there are also many cases in which the implementation did not provide the desirable change towards improvement (Bamber & Dale, 2000; Dunstan, Lavin and Sanford, 2006). Spear and Bowen (1999) indicate that the success of Lean not only results in making use of tools and techniques like kanban, poka-yoka, 5s, SMED, VSM etc. Rather, the underlying rules which constitute the structure, organization and people’s mentality how tasks are arranged and performed make an flexible and creative environment possible.
3.1.2 Lean principles
21 1. Specify value from the standpoint of the end customer.
2. Identify the value stream needed to produce the end product and when possible eliminate the steps that do not create value for the customer.
3. Flow, make the value creating steps occur in tight sequence so that the product will flow smoothly through all processes.
4. Pull, when flow is achieved start with letting downstream processes pull value from the upstream processes.
5. Pursue perfection by repeating the process until value is created with no waste. 3.1.3 Mura, muri and muda
When you randomly ask people to explain the essence of the Lean concept in only one sentence, most people will reply with ‘eliminating waste ’, which is not surprising when taking in consideration the extensive elaboration on muda (waste) in the Lean literature (Womack & Jones, 1996). However, muda is not the only waste described by Taiichi Ohno (1988). In his description of the Toyota Produc-tion System (TPS) he also refers to mura (variaProduc-tion) and muri (overburden) .
Mura: Variation in operations, is the unevenness in operations caused by Sales, Engineering and Pro-duction that is quite unrelated to any desires being expressed by customers (Womack, 20110). For example, in many companies managers are still trying to “make the numbers” at the end of reporting periods. This causes Sales to write too many orders toward the end of the period and production mangers to go too fast in trying to fill them, causing unevenness in operations. High levels of varia-tion make a supply chain unstable and unpredictable. Especially, for a HVLV manufacturer an in-crease in variation in operations will undercut the efforts of the entire organization to eliminate waste.
Muri: The overburden of systems, processes, people and/or equipment by asking a greater level of performance from a process than it can handle under normal conditions. Overload arises mainly be-cause of poorly organized processes and as a result of the elimination of waste by decreasing the capacity. Implications are taking shortcuts and informally modifying decision criteria which are both a danger to quality, costs and lead-time.
Muda: One of the key actions in Lean and TPS is the identification of waste. Any activity or step per-formed to create a product can be viewed as value added or non-value added, the non-value added activities can be regarded as waste and are to be eliminated. Taiichi Ohno identifies seven types of waste: Overproduction, Waiting, Transportation, Inventory, Motion, Over design/processing, and Scrap/rework. The waste of ‘Unused human talent’ is added many times to the original seven wastes. Further elaboration on these wastes can be found in the book ‘The Toyota way’ by Liker (2004).
22 3.1.4 Lean tools and practices
Originated from the Lean concept there are numerous tools and techniques available that can be used to identify and eliminate waste. However, the first step subsequently to the incentive of imple-menting the Lean paradigm in an organization is the mapping of the value stream (Rother & Shook, 1998). Making a value stream map induces a common vision and direction and by those involved an understanding of the current situation. ... is situated in the initial phase of the implementation pro-cess, creating an internal vision is an important next step, therefore the focus of this research is on the applicability of the VSM tool at an HVLV organization.
VSM is a method created by practitioners at Toyota. It includes the mapping of the material flow through production, and the information flow from delivery back to the initial request (Rother & Shook, 1998). A value stream map should look across different functions and departments, in order to focus on the entire organization hereby avoiding sub optimization. By displaying the different steps of the value stream and the required accompanied information, potential wasteful activities can be identified. The map of the current state then serves as the basis for a future state map, where waste is eliminated and resources are pulled through the system, hereby smoothing the flow. The alteration to a Lean organization is guided by the difference between the current state and potential future state of the value stream (Rother & Shook, 1998; Arbulu, Tommelein, Walsh & Hershauer, 2003; Braglia, Frosolini & Zammori, 2009)
Other tools and techniques related to the Lean concept and applicable to either identify or eliminate waste are: 5S, Kaizen, Poka-Yoke, Heijunka, work standardization, visual controls, and 5 why’s. The explanation of each of these tools and techniques are included in appendix III.
3.2
Ways to identify waste
Hines and Rich (1997) argue, that in order to draw up a VSM and make improvements to the supply chain, at least an outline understanding of the particular wastes must be gained before any mapping activities can take place. An understanding of the current situation is gained by performing a qualita-tive research, section 3.2.1 describes the methodology of the qualitaqualita-tive research. The VSM tool is reviewed hereafter in section 3.2.2.
3.2.1 Qualitative research
Qualitative research can be used in many situations, what makes it particularly appropriate for this case is that little quantitative data is available regarding the research subject. Also, the information is needed relatively quickly, hence starting measuring performance now with common project dura-tions of a few months simply takes too long. Furthermore, the research problem is complex and clut-tered. (Yin, 1994; Reulink & Lindeman, 2005)
23 Grounded theory approach
One of the most elaborated methods of qualitative analysis and used to guide this research is the Grounded Theory Approach (GTA) (Glaser & Strauss, 1967). The GTA can be used for building new theory and is suitable for addressing complex and cluttered problems (Straus & Corbin, 1990; Yin, 1994). Qualitative data allows the researcher to explore complex relationships between variables in their natural setting. The grounded theory is cyclical in the sense that data collection, analysis and reflection on observations continuously alternate, the research is complete when no more new in-sights can be obtained (Eaves, 2001). The data obtained is structured with the help of the administra-tive support tool ‘Kwalitan’, a computer program by which the obtained data is presented in a struc-tured way. The program makes the material easy to reorganize, which can be done as often as need-ed. Furthermore, the software guides the analysis according to the GTA (Peters & Wester, 1994). Table 3-1 demonstrates the phases that can be identified with respect to the GTA.
Stages of the grounded theory approach
Codes The researcher defines the research framework and tries to derive as
many relevant key points as possible from the material.
Concepts An attempt is made to group the collected codes of similar content
Categories Group concepts into categories and an attempt is made to develop a
theory
Theory Collection of explanations by theory that clarify the research data.
Table 3-1: The structure of GTA
3.2.2 VSM tool
VSM is a technique used to analyze and (re)design the flow of information and materials through an organization. The source of waste are identified by following material flow, from raw material until end product delivery and the information flow, from delivery back to customer request. It can be of an entire supply chain, only the internal operations of an
organization, or even of a single process performed within the organization. VSM is a comprehensive tool by which process-es are explored in a Lean manner, the understanding of pro-cesses and their relationship can be increased and effort is focused on improvement (Rother & Shook, 1998). According to Braglia et al (2006) VSM is one of the best tools to map a process and identify the main criticalities. McManus and Mil-lard (2002) enhance that by making use of VSM a manager is able to visualize a complex real system in a less complex 2-D format, which is more manageable and offers a common lan-guage for communicating improvement efforts.
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VSM involves the completion of four phases, which are displayed in figure 3-1: 1. Identify the target product (product family)
2. Draw current state map (CSM) which shows each step of the material and information flow. 3. Asses the current map in terms of waste, flow and pull.
4. Draw a future state map (FSM).
Rother and Shook (1998) stress the need to focus on one product family. Mapping all the products flowing through the organization is too complicated, unless it involves the mapping of a value stream containing slightly different products. Once the product family is chosen, one can start with mapping the current state. The boundaries of a single plant current state map should include the arrival of raw material and the shipment of complete products. Mapping starts with the customer require-ments.
Within a production flow, the most obvious flow and at the same time most visible flow is the movement of materials. However, this is not the only flow streaming through the organization. In order to tell each process what to do with the material it is essential to use the information flow. Within the VSM tool the information flow is just as important as the material flow. The material flow is drawn up and starts with placing the order for raw materials right up until delivery of the end product to the customer. The informational flow is drawn up, starting at the customer and following the way back to the initial order. Figure 3-2 displays this approach of mapping.
The core of the mapping tool consists of drawing the basic production processes, which are indicated when using a process box. A process box ideally represents one area of continuous material flow and stops when processes are disconnected and material flow stops. A process box is represented by a unique symbol, the VSM tool has its own language con-sisting of icons and symbols representing processes and flows, a list of the most common icons and symbols is included in the appendix IV. The point of getting Lean is not mapping which is just a technique, but implementing a value added flow. Mapping helps us to see and focus on the most wasteful processes and provides a vision of an ideal, or at least improved state. (Rother & Shook, 1998)
3.3
HVLV organization
Current research deals with the applicability of the Lean concept in many types of organizations oth-er than car manufacturoth-ers. New tools and techniques based on the Lean approach are developed and the Lean philosophy extends to other functions of organizations besides manufacturing, such as product development and support activities. However, as a business philosophy Lean mainly ad-dresses the high variety, high volume segment (Kotha, 1994). Jina et al (1997) indicates that for the most successful Lean implementations the complexity of product variety and speed of delivery is mitigated by the high production volumes. Furthermore, the quantity of case studies in the category of project production is disappointing (Gurumurthy & Kodali, 2011). The applicability of Lean concept into an HVLV manufacturer is considered and put into context in the remainder of this section.
25 3.3.1 Characteristics of an HVLV organization
A manufacturing company in which the end products are produced in small quantities, and the prod-ucts vary in a wide range of features is usually typified as an HVLV company. The variety/volume as-pect has clear implications for the characteristics of an organization, these difference in features are indicated by various authors (Hayes & Weelwright, 1979; Heizer & Render, 2006; Jina et al, 1997)
Process strategy
Heizer and Render (2006) describe four process strategies which are characterized by rate of custom-ization and size of volume. An HVLV manufacturer usually adopts a process focus strategy, the prod-ucts follow many different paths to the production and similar processes or equipment are grouped together. Typical examples of process focus organizations are hospitals, banks and machine shops. Advantages are greater flexibility, more general purpose of equipment and lower initial capital in-vestment. Disadvantages are high variable cost per unit, more highly trained personnel, more diffi-culties for production planning and control, and low equipment utilization. (Heizer and Render, 2006) Process structure
Hayes and Weelwright (1979) observed that the variance in process structures adopted by manufac-turers equals the variety of environments in which each of these manufacmanufac-turers operate. Process structure being the manner in which the material moves through the plant (Hopp & Spearman, 2008). Hayes and Wheelwright (1979) define four manufacturing environments by their process structure, a disconnected flow line best suits the process structure of an HVLV manufacturer. At connected flow lines products are produced in a limited number of identifiable routings. A clear dis-advantage of a disconnected flow line is that individual processes within the routing are not handled by a paced material handling system, so that inventories can build up between stations.
An HVLV organization can be characterized by the following points:
High variety customized products, both product type and total volumes are low.
A process focus strategy in which a facility is designed to satisfy disparate needs typically adopts a disconnected line flow structure.
A ‘Make To Order (MTO)’ environment with an agreement on delivery date.
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Comparison between the characteristics of the ... organization, a HVLV organization, and a typical Lean plant.
Characteristic
... organization High variety low volume organization Lean organization Typical annual volume 15-20 units (20 ton) a year. From 20-500 to 5,000-20,000 units per year.
From 100,000 to
1,000,000+ units per year
Product variety and complexity
Very high. A few prod-ucts have similar dimen-sions and features. All manufactured in the same plant.
Very high, though some bespoke products are delivered also. All manu-factured in the same plant.
Medium, with no bespoke products. Specialist prod-ucts separated into dedi-cated plant.
Degree of vertical integration
Medium to high. High degree of specialist nature of products.
Can be low, medium or high - the specialist na-ture of products often inhibits any increase or decrease
Medium and decreasing
Manufacturing planning systems
Low volume with make to order
Low volume with make to order
Stabilized by a degree of make to stock with primari-ly assemble to order
Order-winning criteria
Variety, customer be-spoke product, 'Extra' features, Dependability.
Variety, customer be-spoke product, 'Extra' features, Delivery speed.
Variety, Delivery speed, 'All in' product features.
Table 3-2: Comparison of the ... organization, an HVLV organization and a Lean organization.
(Jina et al, 1997)
3.3.2 Challenges adopting Lean in HVLV systems
The difficulties associated with applying Lean in an HVLV organization is probably best illustrated by Jina et al (1997). The difficulties of applying Lean principles in an HVLV organization are threefold: the differences between HVLV organizations, variability, and difficulty of shielding the manufacturing system.
The differences between HVLV manufacturers
27 Variability
Taiichi Ohno referred to as mura (variation) is in general much more present at an HVLV manufactur-er, causing unpredictable and sub optimal behavior of the manufacturing system. Four types of root causes related to variation can be identified (Jina et al, 1997): (1) changes in schedule as the delivery date gets closer, (2) the differences in products between one period and the next, (3) the difference in volume between one period and the next, (4) The frequency of changes in design within the dura-tion of a project. The variadura-tion in each of the four factors is more likely to cause a bigger percentage of change at an HVLV manufacturer than at a typical Lean plant because of the beneficial dampening effect of higher volumes.
Shielding manufacturing
Because of the make to stock characteristic a typical Lean plant is able to de-couple the internal sup-ply chain from the outbound supsup-ply chain, and by means of the more controllable input the Lean plant is better able to level the workload. An HVLV manufacturer usually produces by MTO or DTO which makes it almost impossible to adopt the decoupling policy, which does not only apply to the boundary between internal- and outbound supply chain , but also between activities within the in-ternal supply chain. Therefore the variation through the disturbing factors has much more impact on the HVLV system and makes the adoption of a ‘drum beat’ type manufacturing system much harder. The challenges displayed are good reasons for not blindly implementing the Lean philosophy into an HVLV manufacturing system, after all the potential revenue can be disappointing considering the great deal of effort needed to overcome the challenges. Whether or not these factors also impede the application of Lean at ... will become clear during the further elaboration of this research. Next, the challenges concerning the use of the VSM tool in an HVLV organization are presented.
3.3.3 Applicability of VSM in an HVLV environment
VSM offers several advantages when compared to other mapping techniques. Lists have been pub-lished by several authors such as Rother and Shook (1999), Braglia et al (2006;2009) and Khaswala and Irani (2001), a selection of the most frequently mentioned advantages are stated here.
VSM acts as the basis of Lean, providing guidance to Lean implementation. Correct execution of VSM will clearly show the waste in a value stream along with an indication of root causes. (Roth-er & Shook, 1999; Braglia et al, 2006, 2009; Khaswala & Irani, 2001)
VSM displays both the material flow and the information flow needed to plan, control and assess the manufacturing processes. This provides insight and enables you to design a system where these two flows seamlessly integrate, creating a smooth flow of orders through production. (Rother & Shook, 1999; Braglia et al, 2006, 2009; Khaswala & Irani, 2001)
VSM links products planning and demand forecasts to production scheduling and shop floor con-trol. By using parameters such as takt time, the rate at which processing stages in manufacturing should operate can be determined. (Braglia et al, 2006; Khaswala & Irani, 2001)
However, the effectiveness of VSM in an HVLV and project environment is also criticized.
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product BOM’s and flow diagrams that result in complex value streams. (Braglia et al, 2006; Khaswala & Irani, 2001)
Data recorded on the map are deterministic. Consequently, VSM ignores the variability of a pro-cess, which is exactly the aspect that leads to numerous wastes (Braglia et al, 2009)
A difficulty recognized by the researcher is the identification of a product family.
At a project based manufacturer the identification of a product family can be cumbersome be-cause of the almost infinite variety and low volume aspect. Hence, tracking a project through the manufacturing processes will provide times of inventory and processes that are not characteristic for the already performed and/or upcoming projects.
3.4
Literature gap
Although, significant work has been done concerning the implementation of the Lean concept in all kinds of organisations, there remain areas underexposed. The following conclusions can be drawn from a review of the existing literature.
The number of case studies in the category of project and job shop organizations are far less than in the category of mass customization. Most of the research comprises the automotive sector and their component suppliers (Karlsson & Ahlstrom, 1997; Gurumurthy & Kodali, 2011)
The application of the VSM tool in HVLV organizations is underexposed. As far as is known by the researcher, the authors: Braglia, Carmignani, Frosolini and Zammori (2006, 2009) depict the larg-er part of the few authors addressing the difficulties of using the VSM tool in an HVLV organiza-tion.
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4
Identifying waste through qualitative research
The emphasis of this chapter is on the identification of waste in the value stream of .... Knowledge is gained through the analysis of data acquired from interviews of ... personnel and observations on the shop floor. Section 4.1 describes the set of working methods related to the GTA, whereupon the re-sults of the research are described in section 4.2. The conclusions are summed in section 4.3 . The attained data is furthermore used to acquire an understanding of the processes conducted at ... and VSM purposes.
4.1
Methodology of the GTA
4.1.1 Data triangulation
The issue of validity concerning qualitative research is taken into account with the application of da-ta-triangulation(Patton, 1990; Braster, 2000). Multiple sources are used to collect data and different tools and techniques are applied in order to interpret the data. Table 4-1 displays the different types of data used for analysis and the number of documents the data comprises of in Kwalitan.
Data used for analysis No. of documents
Semi-structured interviews 9
Review report ‘quality assurance and improvements, 2011’ 1
Participating observation 1
Table 4-1: Origin of the qualitative research data.
The many unstructured interviews (incl. chats on the work floor) are not included in the data analysis, but serve as guidance for understanding, structuring and explaining the collected data.
4.1.2 Semi-structured interviews
The semi structured interviews include 9 interviews with mainly employees belonging to middle management. The first phase consisted of 7 interviews, after partly analyzing the received data, the two remaining interviews were conducted with the Supply Chain manager and Sales manager. Rea-son being that certain topics required clarification and more detailed information.
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Interviews for preliminary problem analysis
Department Function Years of service Date
N/A Project manager 5 30-7-2012
N/A Project manager 2 1-8-2012
N/A Project manager 2,5 22-8-2012
Engineering Manager mechanical Eng. 10,5 31-7-2012
Production Production manager 2 7-8-2012
Work preparation Planning engineer 6,5 4-9-2012
Production Manager prod. work floor 4 30-8-2012
Sales Manager Sales 5 29-12-2012
QA/QC Supply Chain manager 2 7-11-2012
Table 4-2: Information concerning interviewees
4.1.3 Observations, unstructured interviews and documents
The research data consists of observations, unstructured (spontaneous) interviews and existing doc-uments. Observations involved the recording of behaviors and conditions of processes which mainly took place on the manufacturing floor, however with retracing the root cause of the encountered problems, other departments represent a substantial part of the data. According to Yin (1994), un-derstanding the complexity of situations on the manufacturing floor, may best be attained by con-ducting observations. However, observations can also be biased. The main drawback of observations is the subjective component, referring to the researcher’s judgment on what is important (Worley & Doolen, 2006).
The observation period lasted 4 weeks, this in contrast with the unstructured interviews which took place throughout the full length of the research. The unstructured interviews, which can be typified as informal conversations, were not written out in full. Notes were kept of remarks which in the per-ception of the researcher were of value to the study.
A review report ‘quality assurance and improvements, 2011’ was provided in which the organiza-tions own view on functioning was treated, and in which existing flaws for each department are translated into actions. The document was slightly altered in order to make the data more managea-ble. It was reassuring to notice that many of the problems indicated in the report were also ex-pressed by the interviewees.
4.1.4 Transcribing and theory development
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characteristics of the observation unit (e.g. function, years of service etc.). Memos were also used for recording the meaning of different concepts applied and to connect the analytical framework con-structed with the obtained data in an early stage (Peters and Wester, 1994). All of the above resulted in almost 50 pages of electronic notes and written interviews.
4.1.5 Coding and analysis
Absolute rules for assigning codes and/or grouping and categorizing the data, do not exist for qualita-tive data analysis (Worley & Doolen, 2006). The primary goal of the analysis is that the result of the research be an accurate representation of the attained data and that it is communicated in a com-prehensive and understandable manner (Patton, 1990).
The data can be structured in numerous ways, however keeping the research question in mind, a certain standpoint must be chosen in order to get the wanted output. Therefore the data was initially coded using the three different types of wastes described by Taiichi Ohno (1988), using the labels waste, variation and overburden. The labels could be frequently linked to various statements, notes and observations, however the classification was still too general to make sound conclusions.
The second coding stage was initiated through separately viewing the text fragments belonging to one of the labels, hereby coding the various causes of the three wastes in a comprehensive manner. After numerous times editing and correcting the codes in a iterative manner, patterns between codes, concepts and categories became visible.
The method of coding is consistent with the GTA, searching for subcategories and their relationships, allowing for the theory to emerge are characteristic for qualitative research (Straus & Corbin, 1990). The results and the interpretation of these results are presented in the next section.
4.2
Results qualitative research
Table 4-3 illustrates the elements of the qualitative research after analysis. Structuring of the ob-tained data resulted in the conception of 73 different codes, these codes where assigned 134 times and linked to 192 text fragments.
Project structure quantity remarks
Work files 3 Interviews, review report and observations.
Documents 11 Interviews (9), review report (1), observations
(1)
Segments 53 Documents are subdivided in segments
Number of codes 67 Number of individual codes
Number of times assigned 147
Number of linked fragments 241 Parts of text assigned to codes
Table 4-3: Project structure ‘Kwalitan’
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Assigning fragments to codes can be done multiple times in a document, for example 29 fragments were linked to ‘waste’, the fragments originated from eight documents.
The complete list of assigned codes can be found in appendix X.
Primary codes frequency fragments
Variation 11 20
Waste 8 29
Overburden 6 13
Table 4-4: Primary codes assigned
4.2.1 Variation
In conducting the initial coding attempt, it became immediately clear that a great number of times ‘variation’ was perceived to be linked to the problem of extensive lead time. All the interviewees mention problems arising from variation, mostly visible in production. Table 4-5 provides a summary of difficulties attributable to variation.
As mentioned in the literature review, variation can emanate from fluctuation in demand and varia-tion in operavaria-tions. The fluctuavaria-tion in workload, which can originate out of both, is perceived as chal-lenging, both engineering and production indicate that in their perception a significant number of problems arise from fluctuation in demand. The evidence illustrates that the manager of the engi-neering department finds this problematic, however he understands that projects will never come in perfect sequence of each other. One of the production foreman states that the fluctuation not only has consequences for lead time, but also for loss of knowledge: ‘Just when newly hired employees start getting familiar with the way of work at ... we have to cut them loose, because the amount of work decreases, whenever workload increases it is not always certain that the same employees will return.’
Variation in operations is clearly a matter of concern related to lead time. Especially in manufacturing there seems to be a lot of variation in the execution of certain tasks, which not only ensures variation in cycle time but also in quality. Furthermore, the evidence illustrates that the responsibility associ-ated with a function is not always clear, an issue which is addressed in the review report. The factor ‘unclear procedures and job descriptions’ is furthermore related to ‘bad communication’ and ‘lack of responsibility’. It seems that many of the issues concerning communication and responsibility origi-nate from the unclear procedures and job descriptions.
Causing disruptions mainly in production are the continuous changes of design, especially late in the process. From the sample of evidence it can be concluded that this is highly disturbing for the whole process, especially in the perception of work preparation.
33 4.2.2 Overburden
The next label addressed is ‘overburden’: asking a greater level of performance from a process that it can handle. Evidence illustrated in table 4-6 concerns the high workload experienced by engineering, and in relation to production this was especially perceived as time pressure. The evidence samples concerning engineering originate mainly from perceptions of the production manager and project managers. The manager of engineering not explicitly mentions the high workload however refers to the unrealistic delivery times. During coding it was noticed that while overburden was omnipresent in processes of the organization, it is not mentioned in the review report
The overburden of engineering however not only arises from unrealistic delivery dates, under esti-mating the workload is also a common mentioned source. The project managers agree that estimat-ed workload not always reflect reality and that especially the basic design phase is hard to plan and control.
Overburden concerning production is visible in the quantity of production personnel working over-time. From five months of observing there were only a few weekends that no one worked overover-time. The overburden has its effect on the motivation of the employees, several employees indicated that they lost interest in their work because of the pressure and disorderly organization.
Variation Number of
sources/pieces of evidence
Sample evidence
Varying workload production 7 11 A problem related to lead time is fluctuation in
work-load, causing projects to cluster and which causes delay.
Unclear procedures and job descriptions
7 8 Causing variation in operations. There are insufficient
documented work instructions, these have to be pre-pared and communicated through toolbox meetings. Foremen should monitor the compliance and perform training on the job.
Varying workload engineering 2 5 The manager of engineering understands that it is hard
for Sales to predict when a client will proceed to an order, however it would be easier to manage engi-neering when the workload would be more leveled.
Continuous changes of design 1 3 The frustrating thing is that this never stops, even
when we have just made a purchase request, materials have been ordered, and a detailed planning is already on the production floor, engineering can come with a change that disturbs the whole process.
Wide range of products 1 1 Effort has to be made to increase standard products,
in order to benefit from the knowledge acquired in the past.
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Overburden Number of
sources/pieces of evidence
Sample evidence
workload high engineering 3 5 Another significant problem is that Engineering has
more work than they can currently handle.
time pressure prod. 2 2 Another error of ... is that they use the faulty material
anyway because of the time pressure, in this way these problems will never be solved.
unrealistic delivery times sales 2 4 A huge problem for Engineering is the sometimes
unrealistic delivery times adopted by Sales.
Table 4-6: Sample evidence of overburden
4.2.3 Waste
The eight types of waste defined in the literature review were also used to identify the most obstruc-tive factors in the processes of .... It must be said that from the three labels used to structure the data, the evidences of waste presented by the data was most clearly opposed to the other two la-bels. Maybe because wastes are easily visible through observation, while variation and overburden are more of a feeling, which is mostly more difficult to explain (Ohno, 1988). The evidence is pre-sented in table 6-8.
The first waste which is repeatedly indicated by the interviewees is ‘waiting time’. Frequently pro-duction is waiting for materials, drawings, certificates concerning materials and welding instructions. A project manager states that the waiting time concerning material is improving, however drawings and especially E&H drawings are often too late, a reason why projects stall in production. A foreman indicates the consequence of late delivery of drawings, being the relocation of production person-nel. After the drawings arrive it is often difficult to assign the original employees back to the project resulting in loss of knowledge. Tersine and Hummingbird (1995) already indicated that non synchro-nized activities is one of the major enemies to lead time.
Not one of the original seven wastes, however many times added is the waste ‘underutilized person-nel’ also many times referred to as ‘people’s skills’ . Evidence illustrates that it proves difficult to make effective and efficient use of the mental, creative and physical abilities of employees. For ex-ample, the manager of engineering indicates that attracting experienced engineers proves to be diffi-cult, many of the newly hired engineers whom have just finished their education and therefore have little experience. Training them takes a huge amount of time and therefore does not always have priority, however the manager indicates that checking drawings for errors probably takes even more time. For this reason when the workload is high and time is scarce, it is likely for shop drawings to contain more errors.
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The waste of ‘motion’ is clearly visible in production, particularly the search for tools and materials by fitters and welders. A foreman states that probably half of the time he is busy ensuring that pro-duction personnel have enough material to continue work. This includes searching for material, checking whether deliveries are complete, checking for material certificates and performing many unnecessary movements of material.
Rework because of errors which occur in Engineering as well as in Manufacturing, however errors made by engineering are usually only noticed in production. The sample demonstrated here refers to the variation in workload mentioned before. Errors occur due to loss of knowledge related to a con-struction, because production personnel are relocated many times between projects.
The last factor demonstrated in the table refers to both ‘rework’ and ‘motion’. A clean and tidy work place ensures that the search for equipment and material is minimalized, at the same time a messy work floor ensures more errors because for example non certified equipment is used.
Waste Number of
sources/pieces of evidence
Sample evidence
production waiting for mate-rial and/or information
5 7 As I see it, production should only start when all
in-formation needed to build the construction is present, namely: shop drawings, material including certificates and a detailed planning. Many times, because of time pressure, production starts building with only a part of the needed materials and/or drawings, the reason why production will stall after a while.
waste of talent 5 6 Many of the engineers have little experience and it is
hard to attract experienced engineers that are familiar with the unusual products ... produces.
overdesign by engineering 4 4 A part of the workload problem concerning
Engineer-ing comes from the occasional overdesign. The engi-neers design a construction which exceeds the re-quirements set by the client and described in the orig-inal contract.
storage material ambiguous 3 7 Looking at my own job it is a big hassle for me to find
material intended for a project.
errors in production 3 3 Welders and fitters are thrown back and forth too
much between projects, parts are worked on by dif-ferent employees, which will probably lead to errors and create the lack of responsibility.
messy work floor production 2 6 Equipment and measurement tools lay mixed up on
