# Value Stream Capacity - PowerPoint PPT Presentation

1 / 12

Value Stream Capacity. Understanding Value Stream Decision Making. Understanding Value Stream Capacity. The production quantity that can be achieved at each step in the value stream or production process.

I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.

Value Stream Capacity

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.

- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

## Value Stream Capacity

Understanding Value Stream Decision Making

### Understanding Value Stream Capacity

• The production quantity that can be achieved at each step in the value stream or production process.

• There are usually one or two production steps (cells, machines, or work centers) that constrain the flow through the value stream or business unit.

• We need to identify the production capacity at each step in the value stream (or production flow) so that we can understand the flow through the entire process.

• Where is the data required for this analysis?

• On the Value Stream Maps

### Analyzing the capacity

Productive capacity

Provides value to the customer

Comes directly from customer pull

Non-productive capacity

Change-overs, unplanned maintenance, making for stock, defects/rework, etc. Also meetings, 5S, improvement activity

Available capacity

Capacity that is not currently being use for productive or non-productive activities.

Supplier

Supplier

Customer

Customer

Machine

Shop

Machine

Shop

Machine

Shop

Machine

Shop

Assembly

Assembly

Assembly

Machine

Shop

Machine

Shop

Machine

Shop

Assembly

Assembly

Qty = 30,000

C/T = 70s

Batch = 1500

Set Up = 10,800s

Scrap = 10%

Rework = 20%

Downtime = 15%

Inspection = 10%

Insp Time = 120s

# cells = 8

Crew Size = 4

# of people = 34

Shifts = 1

Qty = 15,000

C/T = 180s

Batch = 600

Set Up = 1200s

Scrap = 5%

Rework = 10%

Downtime = 5%

Inspection=100%

Insp Time = 30s

# cells = 5

Crew Size = 1

# of people = 10

Shifts = 2

Qty = 3,000

C/T = 210s

Batch = 20

Set Up = 600s

Scrap = 0%

Rework = 10%

Downtime = 0%

Inspection=100%

Insp Time = 60s

# cells = 2

Crew Size = 5

# of people = 10

Shifts = 1

Qty = 3,000

C/T = 120s

Batch = 1

Set Up = 0s

Scrap = 0%

Rework = 2%

Downtime = 0%

Inspection=0%

Insp Time = 0s

# cells = 1

Crew Size = 1

# of people = 1

Shifts = 1

DATA BOXES

### OEM Value Stream Map

Purchase Forecasts

Demand Forecasts

S&OP

3,000

per Month

Order

Kanban

Welding

Shipping

Shipping

Shipping

C/T

### Standard Cycle Time

Cycle Time:

How often a part or product is completed by a process. (or: the time taken for an operator to go through all his/her work elements before repeating them.)

• Cycle time includes all processes VA & NVA

• Cycle time is measured by tracking it with a stop watch

• We match the cycle time to the customer takt time

• The process is “under control” if the cycle time is consistent

### Crew size and number of cells

• Crew size - the number of people in the cell or operation required to produce to the cycle time recorded on the Value Stream Map

• # of cells = the number of cells running in parallel. Similar cells, working on the same products and performing the same process step.

Crew size = 5

# of cells = 1

Supplier

Supplier

Customer

Customer

Machine

Shop

Machine

Shop

Machine

Shop

Machine

Shop

Assembly

Assembly

Assembly

Machine

Shop

Machine

Shop

Machine

Shop

Assembly

Assembly

Qty = 30,000

C/T = 70s

Batch = 1500

Set Up = 10,800s

Scrap = 10%

Rework = 20%

Downtime = 15%

Inspection = 10%

Insp Time = 120s

# cells = 8

Crew Size = 4

# of people = 34

Shifts = 1

Qty = 15,000

C/T = 180s

Batch = 600

Set Up = 1200s

Scrap = 5%

Rework = 10%

Downtime = 5%

Inspection=100%

Insp Time = 30s

# cells = 5

Crew Size = 1

# of people = 10

Shifts = 2

Qty = 3,000

C/T = 210s

Batch = 20

Set Up = 600s

Scrap = 0%

Rework = 10%

Downtime = 0%

Inspection=100%

Insp Time = 60s

# cells = 2

Crew Size = 5

# of people = 10

Shifts = 1

Qty = 3,000

C/T = 120s

Batch = 1

Set Up = 0s

Scrap = 0%

Rework = 2%

Downtime = 0%

Inspection=0%

Insp Time = 0s

# cells = 1

Crew Size = 1

# of people = 1

Shifts = 1

DATA BOXES

### Calculate the Capacity for the Machine Shop

Purchase Forecasts

Demand Forecasts

S&OP

3,000

per Month

Order

Kanban

Welding

Shipping

Shipping

Shipping

### Calculate the employee capacity

Step 1. Calculate the Total Available Employee Time

(#employees x #days x Labor Hrs per shift)

Step 2. Calculate the Employee Productive Time

(Qty per Month x Cycle Time x Crew Size)

Step 3. Calculate the Emp. Productive Capacity Percentage.

(Employee Productive Time / Total Available Time)

Step 4. Calculate the change-over time, scrap & rework time, downtime, inspection time.

C/O = (quantity/batch size) x Change-over time

Scrap/rework = (Qty produced / (1- (scrap + rework %) ) * (scrap + rework%) x Cycle Time x Crew Size

D/T = Downtime% x Total Available Time

Inspection= (Total produced + scrap/rework) x Inspection % x Inspection time

Over-production = OP Qty x Cycle Time * Crew Size

5S & Clean-up = 5S Time x #Employees x #days

Meetings = Meeting Time x #Employees x #days

TPM = TPM Time per day * #days

Step 5. Calculate the Total Non-Productive Time

Sum of Step 4

Step 6. Calculate the Emp. Non-Productive Capacity Percentage

Total Non-Prod Time / Total Available Time

Step 7. Calculate the Emp. Available Capacity Percentage.

100% - (Prod. Capacity + Non-Prod Capacity)

MACHINE

CAPACITY

### Machine Shop Capacity

EMPLOYEE

CAPACITY

Cell output is driven by Employee

Time rather than Machine Time.

There is more machine capacity

than employee capacity

### Capacity Calculations when you have Multiple Product Families

Calculate the weighted average of the cycle time, change-over, etc.

### Value Stream Capacity

• Value Stream demand = 3,000 units/month

• Takt Time = 180 sec

• Average product has 5 welded sub-assy

• Average sub-assy has 2 machined components

• Machine Shop makes 30,000 items

• Welding Shop welds 15,000 sub-assy

• Assembly assembles 3,000 units

• Shipping ships 3,000 units

Maximum Capacity is

3,000 units because

Machine Shop can only make 30,000 parts