visual management what s effective l.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Visual Management: What’s Effective? PowerPoint Presentation
Download Presentation
Visual Management: What’s Effective?

Loading in 2 Seconds...

play fullscreen
1 / 52

Visual Management: What’s Effective? - PowerPoint PPT Presentation


  • 408 Views
  • Uploaded on

(Slide added—not in evening presentation). Visual Management: What’s Effective?. Most effective: Kanban (visual-flow management) – big thing 5S – Visual management of thousands of small things that add up to big things

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

PowerPoint Slideshow about 'Visual Management: What’s Effective?' - JasminFlorian


An Image/Link below is provided (as is) to download presentation

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 - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
visual management what s effective

(Slide added—not in evening presentation)

Visual Management: What’s Effective?

Most effective:

  • Kanban (visual-flow management) – big thing
  • 5S – Visual management of thousands of small things that add up to big things
  • Visual recording of every glitch; organizing same via Pareto, fishbone, etc.

Effective: In workplace, visual plots of process trends; displays of employee cross-skilling

Less effective: Management metrics on display (highly aggregated, tend to trigger “tampering” with in-control processes)

Schonberger & Associates

slide2

Inventory Turnover – Paccar

Up 2.1% per year

for 38 years

Schonberger & Associates

slide3

Days of Inventory

Terex

Bought Genie 10/02

Schonberger & Associates

slide4

The Confused State of Lean:Comparing Regions, Industries, CompaniesPDM, Puget Sound APICSWednesday, Dec. 12, 2007

Presenter

Richard J. Schonberger

177 107th Ave., N.E., #2101

Bellevue, WA 98004 USA – Tel/Fax +425-467-1143

Schonberger & Associates

slide5

This presentation includes research and topical materials incorporated into a forthcoming Richard Schonberger book (John Wiley & Sons):

Best Practices in Lean Six Sigma Process Improvement:

A Deeper Look

. . . with Telling Evidence from the Leanness Studies

Schonberger & Associates

slide6

Topics and Tendencies

  • Birthplace of lean has grown fat
  • U.S., hotbed of lean sliding; Europe doing better
  • Lean bureaucratized: Fat on administration
  • Long-term lean: Good in A-D OEM’s, not suppliers; good in automotive suppliers, not OEM customers
  • Long-term lean: Cash & customer allegiance at compound interest
  • Lean can do worthy service even if firm going bankrupt
  • Several ways to get lean, not just the “lean core”
  • Internal lean getting the attention; external lean promises much more
  • Inability to keep lean going, hold lean gains. Why?

Schonberger & Associates

sustainable lean best to worst by region
Sample Recent

Sectors Score Size Trend

1 Nordic countries .79 66

2 United Kingdom .67 80

3 Southern Europe .66 72

4 Brazil/Canada/Mexico/Israel .66 92

5 United States .59 566

6 Asiana/South Africa .58 106

Global Average .58 1,269

7 Germany/Austria .55 62

8 Benelux/Ireland .49 34

9 Japan .37 191

Sustainable Lean – Best to Worst, by Region#

#Positive 10-to-50 year trend, 2 points; same but lapse last 5-7 years, 1 point; negative 10-or-more-year trend, minus ½; 5-or-more-year reversal of long negative trend, plus ½

*Includes companies acquired/merged/dissolved/privatized in last 5 years

As of 9/18/07

slide8

The “Leanness Studies”: 1260+ global companies rated on long-term (at least 10 years) inventory turnover

  • Points & Grades:
  • 2 points (10 or more years up) = A
  • 1 point (Same but flat or down past 5-7 years) = B
  • Zero points (No pattern, 10 or more years) = C
  • 1/2 point (Down 10 or more years) = D or F
  • + 1/2 point (Good up recovery, 5 or more years = B+,
  • C+, D+, F+

Schonberger & Associates

lean six sigma bureaucratized
Lean/Six Sigma: Bureaucratized

Elevated to management programs, lots of . . .

  • Planning
  • Organization (e.g., Widget University, Deere Production System)
  • Projects run by professional staff
  • Name-dropping, jargon, puffery, foreign terms
  • Management (high-level) goals & metrics
  • Numerical benchmarks
  • Follow the leader the fads
  • All lead to high cost administration (SG&A)

Schonberger & Associates

lean six sigma bureaucratized continued
Lean/Six Sigma: Bureaucratized (continued)

Less . . .

  • Work-force involvement & process ownership
  • Work-force knowledge & commitment
  • Continuous process data collection
  • Quick, low-level, low-cost implementations
  • Innovative approaches
  • Global best-practice benchmarking(beyond your industry, country)
  • External (supply/customer pipelines) activity
  • Results?

Schonberger & Associates

slide11

Long-term Lean: Compound Effects

Schonberger & Associates

slide12

Inventory Turnover

Up 2.0% per year

for 32 years

Up 2.7% per year for 26 years

B

A

A

Schonberger & Associates

lean and close surrogate inventory
“Lean” and Close Surrogate, Inventory
  • Lean’s main benefits:
    • Reduce response time—in all things
    • Find problems before they fester, before trail of causes grows cold
    • Halt dependence on age-deteriorating item forecasts
  • Inventory (catch basin for multitude of ills) Each inventory unit . . .
    • Lengthens discovery time, fouls causal trail (lean/quick beats lot traceback)
    • Adds lead time (& carrying costs), loses touch with customer & real demand

Schonberger & Associates

improving the inventory trends
Improving the Inventory Trends
  • Inventory is an echo
  • Inventory reduction as managed goal fails:
    • Is easily manipulated
    • Must be seen as result of process improvements in every corner of the greater enterprise

Schonberger & Associates

slide15

Besides Dana . . . other major vehicular suppliers in or emergent from bankruptcy:

Collins & Aikman, Delphi, Dura Automotive, Eagle-Picher, Federal Mogul, Modine, Tower Automotive

Collins & Aikman, Eagle-Picher, Federal Mogul, Modine much better off because of many-year compounded lean benefits (insufficient data for Delphi, Dura, Tower)

Schonberger & Associates

slide16

Aerospace-Defense OEM’s

Schonberger & Associates

slide17

Inventory Turnover

Turns

C+

Up 5.7% per year

14 years

C

A

Schonberger & Associates

slide18

Inventory Turnover

Game-Changer

Modular deliveries from modular, 1st tier suppliers. Unloads millions of parts, reshuffles core competencies for mutual gain

C

C

C

Schonberger & Associates

slide19

Aerospace-Defense Suppliers

Schonberger & Associates

slide20

Inventory Turnover

Turns

D+

C

D

Schonberger & Associates

slide21

Turns

Inventory Turnover

C

D

C

Schonberger & Associates

slide22

Car OEM’s

Schonberger & Associates

slide23

Inventory Turnover

Down 2.7% per year, 16 years

Chrysler acquired by Daimler in ’98, sold in ‘07

D

Down 3.4% per year, 18 years

D

C

Schonberger & Associates

slide24

Inventory Turnover

C

C

C

*Overstated – Based on sales, not cost of sales

Schonberger & Associates

slide25

Inventory Turnover

Down 4.0% per year, 13 years

D

C

A

Up 2.1% per year, 27 years

Schonberger & Associates

slide26

Car Assemblers

(25 in Leanness

Database)

Grades:

4 A’s

2 B’s

12 C’s

5 D’s

2 F’s

Vehicular Components

Producers (91 in

Leanness Database*)

Grades:

29 A’s

5 B’s

39 C’s

13 D’s

5 F’s

*52 in Mergent list of 1000

largest global corporations

Schonberger & Associates

slide27

Inventory Turnover

Up 2.7% per year for 27 years

A

A

Up 3.0% per year for 24 years

A

Up 3.1% per year for 26 years

*Overstated: Based on sales, not cost of sales

Schonberger & Associates

slide28

Inventory Turnover

B

C

A

Up 1.6% per year for 34 years

Schonberger & Associates

slide29

Inventory Turnover

Up 2.1% per year for 30 years

B

Up 2.7% per year for 26 years

A

A

Schonberger & Associates

54 motor vehicle companies rated on long term leanness
54 Motor-Vehicle Companies Rated on Long-Term Leanness

Harley-Davidson

Paccar-Kenworth Honda

Tennant

Magna Int’l.

Thor Industries

General Motors

Hindustan Motors

JLG Industries

Ford Motor

Hitachi Zosen

Terex

Tata Motors

Kawasaki Heavy

Kubota

Iveco

Nissan

Fiat

Renault

Porsche

Peugeot-Citroen

Alvis

Isuzu

DaimlerChrysler

AGCO

Volvo

Claas KgaA

Nacco Industries

Mitsubishi Motors

Navistar

Yamaha Motors

Scania

Winnebago

Trinity Industries

Toro

Millat Tractors

Polaris

Komatsu

Caterpillar

Deere

Audi

BMW

Manitowoc

Fleetwood Enterpr.

Suzuki Motors

Nissan Diesel

Daihatsu Motors*

Fuji Heavy-Subaru

Hino Motors*

Volkswagen

Toyota Motors

Oshkosh Truck

Champion Enterpr.

Toyota Industries*

Schonberger & Associates

As of 5-3-07

*Toyota subsidiaries

autos crucible of lean best to worst trends
Autos, Crucible of Lean – Best to Worst Trends

1 Harley Up 3.9%, 20 years

3 Honda Up 2.1%, 27 years

10 Ford Up 1.9%, 32 years (down sharply last 4 yrs.)

13 Tata Up 5.5%, 13 years (slump ’98-’03)

17 Nissan Up 2.8%, 11 years (after 20 years down)

23 Isuzu Flat erratically 28 years (up last few years)

26 Volvo Flat 12 years (after 10 bad yrs.; better last 6)

32 Scania Flat 11 years (after 6 good years)

36 Millat Tr. Flat very erratically, 17 years

40 Deere Down 2.8%, 13 years (up last few years)

42 BMW Down 3.4%, 18 years (less decline last 14)

51 VW Down 3.8%, 10 years (after good 16 years)

52 Toyota Down 4.0%, 13 years (after 6 flat years)

Schonberger & Associates

As of 5-3-07

unsung stars of lean a few examples

American Greetings (greeting cards, etc.) Up 3.2% per yr. for 20 yrs.

Andrew Corp. (satellite telecom equipment) Up 2.6%, 24 yrs.

Applera (life-science instruments, consumables) Up 4.0%, 18 yrs.

CCL Industries, Canada (aerosol containers, labels) Up 2.4%, 20 yrs.

Cleveland: Brush Engineered Products (2.9, 20);Eaton (2.1, 30);

Nordson (3.8, 17); Parker Hannifin (3.4, 17)

Gunnebo, Sweden (cash/personal security equipt.) Up 3.1%, 24 yrs.

Hitachi Cable, Japan (wire & cable) Up 1.8%, 26 yrs.

Illinois Tool Works (diverse industrial products) Up 3.2%, 20 yrs.

Kulicke & Soffa (wafer saws, die bonders, etc.) Up 4.4%, 20 yrs.

L.S. Starrett (coordinate measuring machines, tools) Up 1.7%, 35 yrs.

Messer Griesheim, Germany (metalworking, other) Up 1.9%, 32 yrs.

Rolm & Haas (chemicals) Up 1.8%, 20 yrs.

SKF, Sweden (bearings) Up 2.5%, 29 yrs.

Thomas & Betts (electric connectors, steel towers) Up 2.5%, 30 yrs.

Woolworths, Australia (supermarkets, other retail) Up 2.3%, 20 yrs.

Xerox (copiers) Up 2.0%, 40 yrs.

Unsung Stars of Lean – A Few Examples

Schonberger & Associates

As of 10-25-07

slide33

The “lean core” (basic Toyota system) and other potent ways to get lean

Schonberger & Associates

the lean core partial list
The Lean Core (Partial List)
  • Physical resources:Plants-in-a-plant/ cells, kanban/pull system, quick setup, small lots/containers, point-of-use tools/materials/equipment
  • Human resources:Few job classifications, cross-training/job rotation, operator-based quality and maintenance (TPM)
  • Supplier partnership:Supplier reduction/ certification, external kanban, dock-to-line deliveries

Schonberger & Associates

more pathways to leanness
More Pathways to Leanness
  • Collaboration in pipelines: 2X to 10X greater lean opportunities
  • Movement of production: To most capable entities (e.g., contract electronic services)
  • De-proliferation: Ripple effects of DFMA; reduced numbers of product models, customers, suppliers (via intensive 80-20 analysis at ITW)
  • Process data: Superior to conventional high-level goals & metrics

Schonberger & Associates

still more lean avenues
Still More Lean Avenues
  • Pipeline Synchronization/Collaboration:Specialty of Dell, Wal-Mart, Zara (Spain), H&M (Sweden), 7-Eleven
  • Mining Outside Knowledge/Talent/ Experience:Terex acquisition of Genie
  • 3D Product Design/Planning: In manufacturing, even more in construction
  • “Big Idea” Business Models: Such as Dell-direct

Schonberger & Associates

slide37

Inventory Turnover

Danaher: Faded lean star?

Fluke: Up 3.2% per year, 18 years

Acquired by Danaher

Schonberger & Associates

slide38

Pipelines/Collaboration:

Greatest Lean Opportunities

Schonberger & Associates

lean inside vs lean in the pipelines
Lean Inside vs. Lean in the Pipelines
  • Inside: “Lean core”
    • Perfected mostly at Toyota in 1960s
    • Gets 90% of companies’ effort
    • Easy stuff: You own it, see it, measure it
  • Pipelines: Tight supply/customer chains
    • Typical manufacturer: 2X to 10X more opportunity to improve than inside
    • Much supply-chain talk, little progress
    • Hard stuff; “hot potato,” no one responsible; phony metrics

Schonberger & Associates

lean supply chain accounting re inter company inventory lead time
Lean Supply-Chain Accounting(Re Inter-Company Inventory/Lead-Time)

Problem. In numbers-driven companies

inventory accounting often main obstacle to

lean supply chains. What to do . . .

  • Gamesmanship. Recognize accounting-based game—getting inventory on other party’s books—just hides the problem
  • Impacts. Reveal high cost & non-cost impacts of that hiding
  • Metric. Employ joint inventory to halt the gamesmanship

Schonberger & Associates

inter company lean building on a lean core foundation
Lean efforts in logistics pipelines benefit greatly when piggy-backed upon strong lean achievements inside.

That is, lean inside provides an anchor of demand predictability and stability for pursuit of lean outside.

Inter-Company LeanBuilding on a “lean core” foundation

Schonberger & Associates

lean inside lean supply chain example graco minneapolis sprayers compressors
Lean Inside  Lean Supply ChainExample: Graco, Minneapolis (sprayers, compressors)

Phase 1. Became among world’s best in “lean core”

Phase 2. Closed many branch warehouses

  • Benefits (expected): large inventory reductions
  • Greater benefits (unexpected):
    • Relying on Graco’s quick response (same-day ship for orders in by noon), distributors slashed their inventories
    • Frequent orders smoothed/leaned out Graco’s production, purchasing, administration, etc.

Schonberger & Associates

slide43

Why Does Lean Fade?

Are There Antidotes?

Schonberger & Associates

lean s soft underbelly
Lean’s Soft Underbelly
  • Many smallish practices; no “Big Idea”:Hard to keep all up-and-running; easy to cherry-pick
  • Focused on wastes:Doesn’t resonate with sales/marketing, finance, senior execs, owners/investors, the public, customers
  • Needs rivers of process data:Gets trickling streams
  • Easily bogged down:In analysis (and popular analysis tools) with over-reliance on projects

Schonberger & Associates

popular lean 6 sigma tools
Operational Tools (Lean Core)

Cells/product-focused units

Quick changeover

Kanban (queue limitation)

Cross-training/job rotation

5S/visual workplace

Takt-time scheduling

One-piece flow

Fail-safing

Total productive maintenance

Supplier partnership

Analysis Tools

6 sigma (statistical analysis) projects

Kaizen events

Value-stream mapping

Spaghetti charts

Value-add/non-value-add analysis

Popular Lean/6-Sigma Tools

Schonberger & Associates

lean s native and potential strengths
Lean’s Native and Potential Strengths
  • Native: Simple, common-sense, quick-acting, low cost, all-stakeholder beneficiaries

Schonberger & Associates

tapping lean s full potential
Tapping Lean’s Full Potential
  • Re-focus: On universal customer wants/ deliverables: ever better quality, quicker response, greater flexibility, higher value
  • Data recording: Of every process glitch or hiccup—job of all employees
  • Workteam-based continuous improvement: In parity with dis-continuous project-team improvement
  • Look outside your industry: E.g., leading-edge retailers, and 3P distributors
  • Highest-potential gains: External pipelines

Schonberger & Associates

big idea business models highly favorable to lean
“Big-Idea” Business Models Highly Favorable to Lean
  • Dell-Direct:Spawned many innovations for synchronization of suppliers, customers, Dell
  • Every-day low prices (EDLP):In its cause, Wal-Mart became global innovator in logistics, IT
  • 80-20 in all things: ITW cuts to good customers, suppliers, products, parts, plants, machines . . .
  • Unique business models(easy to understand, hard to deny, flywheel-like momentum, all-stakeholder beneficiaries): They crown Dell, Wal-Mart, ITW as new, global kings of lean

Schonberger & Associates

slide49

Inventory Turnover – Dell Inc.

79

5.8%, 17 years

Schonberger & Associates

slide50

Inventory Turnover

Turns

Wal-Mart: Up 2.8% per year for 16 years

A

A

Illinois Tool: Up 3.2% per year for 20 years

Schonberger & Associates

slide51
Sample

Sectors Size

1 Telecom 35

2 Distribution/wholesaling 54

3 Petroleum 46

4 Semiconductors 40

5 Paper 28

6 Electronics 23

7 Paper-converted products 55

8 Metalworking/machining 264

10 Machinery 115

Pump/hydraulic/pressure 63

Electric 82

Sheet metal 68

Instruments/test equipment 43

Plastic/rubber/glass/ceramic 224

Vehicular components 103

Forest products 49

Sample

Sectors Size

Apparel/sewn products 48

Vehicles (light) 39

Food/beverage/tobacco 137

Furniture 19

Personal-care products 33

Liquid/gas/powder/grains 327

Aerospace/defense 57

Retail 139

Motors & engines 66

Heavy industrial vehicles 53

Basic metal processing 63

Medical devices 47

Wire & cable 30

Chemicals 108

Textile 41

Pharmaceuticals 67

Long-Term Lean Trends – Evidenced by Positive Inventory Turnover Patterns Without Recent Lapses – Best to Worst, by Sector#

#Positive 10-to-50 year trend, 2 points; same but lapse last 5-7 years, 1 point; negative 10-or-more-year trend, minus ½; 5-or-more-year reversal of negative trend, plus ½

*Includes companies acquired/merged/dissolved/privatized in last 5 years

Schonberger & Associates

As of 9/16/07

related articles by schonberger
Related Articles by Schonberger

“Faltering Lean,” Industrial Engineer, Nov. 2007, p. 22.

“Doing Off-Shore Assembly Right, Industrial Engineer, Aug. 2007, p. 26.

“Japanese Production Management: An Evolution—With Mixed Success,” Journal of Operations Management, 25, Issue 2, March 2007, pp. 403-419.

“Supply Chains: Tightening the Links,” Manufacturing Engineering, Sept. 2006, pp. 77-92.

“Lean Extended: It’s Much More (and Less) than You Think,” Industrial Engr., Dec. 2005, pp.26-31.

“Lean så in i Norden,” (“The Nordic Countries: Lean Leaders”) Verkstäderna (Sweden), No. 5, May 2005, pp. 46-50 (co-author).

“U.K.: Less Keen on Lean?” The Manufacturer (U.K.), Special Issue, 2005 Lean Manufacturing Report, April, 2005, pp. 5-9.

“Quadrant Homes Applies Lean Concepts in Project Environment, Interfaces, Nov.-Dec. ‘04, 442-450.

“Make Work Cells Work for You,” Quality Progress, April 2004, pp. 58-63.

“Mandate to Grow,” Cost Management, March-April 2004, pp. 43-44.

“Is South African Manufacturing Lean?” Management Today (S. Af.), Feb., 2004.

“The Right Stuff, Revisited,” Manufacturing Systems, Sept. 2003, pp. 26-30.

“Canada Needs to Go on a Lean Diet,” Advanced Manufacturing, July-Aug 2003.

“How Lean/TQ Helps Deter Cooking the Books,” Cost Mgmt., lead article, May-June 2003, pp. 5-14.

“Your Lean Team: Use It or Lose It,” Target, cover-story article, 1st qtr., 2003.

“Kanban at the Nexus,” lead article, Production & Inventory Mgmt. Journal, 3rd-4th qtrs., ‘02, pp. 1-12.

“Jack Spratt Diet: Schonberger Talks Lean with the Likes of Toyota,” cover story article, The Manufacturer (U.K. edition), Nov. 2002, pp. 34-37.

“Lean and Fat Factories,” cover article, The Manufacturer (U.S. ed.), Nov. 2002, pp. 16-19.

“Leaning the Wrong Way,” Decision Line, Sept.-Oct. 2002, pp. 15-17.

“The Lean League,” in White Paper: “The Road to World Class Manufacturing 2000,” The Manufacturer (U.K.), 2002, pp. 26-31.

“Lean Is as Lean Does,” Manufacturing Engineering, June 2002, p. 104.

Schonberger & Associates