Delwadia

Kunal Delwadia (PGP13029)

Prof. R.K.Padhy
Lean Operations
13
th
July 2014
Hewlett-Packard: Stockless Production Experiment
Push System
Material is pushed into down stream workstations regardless of whether resources are available.
Pull System
Material is pulled to a workstation just as it is needed.
Business executives spend lots of time to analyze the businesses to make them more efficient through
formal or informal processing to achieve the desired reduction in wastages. This may be done with a
specific project or continuous improvement. Processes create value only through deliverables.
HP, to change from Push system to pull system did an important experiment. They made effort to change
their production line to value centric deliverables that enterprise effort to identify wastages and eliminate
them. Lean concept identifies 9 types of waste processes in the production line.
1. Over production
2. Waiting time
3. Transport
4. Extra processing
5. Inventory
6. Motion
7. Defects
8. No- value products and services
9. Talent underutilization
When it comes to inventory, its a stockless production based on the push vs pull system.


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1. What is effect of reduction of inventory to throughput time and idle time of the work centers?
In traditional set up manufacturing process is based on the push production system. That means person
folding the paper doesnt have any connection with the person whether folding it again, drawing star and
folding it again in different workstations and whether the next person in the process is ready for the more
input from upstream. Workstation 1 folds the paper and pushes it to the Workstation 2 to fold it in order
to make the desired product and so on. The result is inventory (Stack of papers waiting to be folded again)
Inventory is very expensive manufacturing set up because it includes storage space, monitoring for
spoilage, or damage from just sitting around. Inventory stack would cost for unnecessary labor and other
resources usage.
It increases the time between the workstations and throughput. The below graph shows the result of
experiment done in the class room environment


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WIP- Push
WIP
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WIP- Pull 3
WIP
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From the data taken during the experiment, the throughput time of the production system drastically
reduced from 1 min 49 seconds (Push system) to 1 min 22 seconds (Pull 3) and 22 seconds (Pull 1).
Moreover, Work in process inventory stock up was reduced from as high as 12 units to 3.
Push systems
1. Generated large quantity of scrap before errors are detected
2. Requires maintenance of large and complex database
3. Requires diligence to maintain effective product flow.
Individual workstation inventory increased in push system however, with pull 3 we were able to reduce
the WIP approximately half of it. But the results were enormous in pull 1 system, which hold the WIP to
as low as 3 and decrease the throughput time as compare to other two systems.
Regarding the bottleneck process
Bottlenecks determine the throughput of the production system. Recognizing this fact and making
continuous improvement will increase the cash flow.
A bottleneck in a production process means the resources that require the longer time in operations for the
certain demand. Usually, phenomena such as increase of inventory before a bottleneck and insufficiency
of parts after a bottleneck are often seen. In our case of experiment slowest person in the production
process was the bottleneck (in this case workstation 3).
Average time taken for the process: 9.05 (highest among all 4 workstations).
Work in progress inventory before the bottleneck: 12 highest and 3 (Pull 3)
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WIP-Pull 1
WIP
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Pull 1 Work in Progress inventory reduces to 1.
The important aspect is that bottleneck determines the throughput time of production system. Which is
increasing in our case while push production system was used. However, if the time taken by Workstation
3 reduces the whole systems improve and throughput time will decrease as lowest as 22 seconds.
If a bottleneck is not recognized enough, production manager could miss a chance to increase their
throughput. There are many cases where energy is used for small cost cut and a chance for a large cash
flow is missed due to lack of recognition of bottleneck. Cost per hour of bottleneck equals the cost of loss
of one hour of entire production system and also loss of the throughput in entire production system.
Recognition of bottleneck increases
1. Efficiency and productivity
2. Increase profit significantly
3. Space reduction/ process reduction
4. Cost reduction
5. Operating rate improves the cash flow
6. Full capacity utilization.
In our experiment, workstation 3 is the bottleneck average cycle time = (total operating time/Quantity
of production produced) taken by it 9.05. Production rate= 1/cycle time=1/9.05, Workstation 4 is ideal for
some time. However, other workstations work continuously but inventory piled up under the push
production system.
Improvement Opportunity
Merge the operations of Workstation 3 &4.
Pull system reduced the cycle time
1. Reduce cost
2. Increase throughput
3. Streamlined processes
4. Improved communication
5. Reduced process variability
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6. Schedule integrity
7. Improve on-time delivery
Line balancing important element in the flow based production environment. It reduces production time,
maximizing output or minimizing the cost of production.
Parameters
1. Process flow and cycle time at each workstation:


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Push W 1 Push W2 Push W3 Push W4
Avg cycle Time (Push)
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Pull W1 Pull W2 Pull W3 Pull W4
Avg Cycle Time (Pull 3)
Avg
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The classical line-balancing problem consists of assigning each operation to a workstation such that the
number of workstations is minimized and precedence constraints are satisfied. The sum of time for all
operations of this workstation must not exceed the given cycle time. The difference between the cycle
time and workstation time is called idle time. The balance delay time will be minimal if and only if the
number of workstations is minimal too. The dual problem is minimization of the cycle time for a given
number of workstations.
Improving Bottleneck workstation is the main objective balancing the line To achieve the objective, the
cycle time data at each workstation need to be taken for making the analysis or sub-graph result which
will define the bottle neck workstation. There are number of parameters that can be balanced at the
workstation which are balance by time, balance by work content, balance material, and balance by
inventory. Balance by time is referring to the cycle time of the workstation. In this term it needs to
utilize the time study method of data collection. All the time that are involved in the process will be
taken. After that a certain amount of allowance is given to the process especially for the manually
operated workstation.
The last parameter that can be balance is inventory. While excessive inventory is waste, having some
inventory can help in line balancing. To balance by inventory, the new design of the space a workstation
to allow an operator to work on more than one unit.
Merge of station 3 & 4 can reduce the cycle time and improves throughput significantly.
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pull W1 Pull W2 Pull W3 Pull W4
Avg Cycle Time (Pull 1)
Avg
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Workers often do not communicate with one another. Is communication between work centers
important? How to improve it?
Communication is key to engaging frontline employees, to inspiring their best work. But, communicating
with front line is challenge. Communication is anything that prevents complete understanding between
parties. Friction exists at a number of levels between people and roles. Moreover, friction makes it harder
to align strategy and keep employees engaged.
Install Symbolic representation of work done, rather than communicating physically. Such as McDonalds
use the display screen in the production line to show orders to workers. Install system, which will enable
the voice signal to production manager in case of error in the production line.
Communication takes effort. But it is effort well-spent given the benefitsa more pleasant, more
productive work setting in which everyone feels valued, ideas are shared openly and relationships are
characterized by trust. When you practice good communication, notice the effect. The results that come
from communicating wisely will be the proof that communication really is the key to good management.
Difference in Push Vs Pull
Push systems, each workstation took more time and inventory pilled up gradually. Cycle time increased
in each station. Moreover, the productivity of worker reduced even if they were working for almost all the
time on the production line. However, with reduction in lot size (3 Units- Pull 3) the cycle time,
throughput time, operating rate and productivity improved. In case of pull 1, it further reduces and makes
the production line more efficient than both the system. In case of error, it detects before the production
and mitigates defective products from the line. Pull improved the cycle time, overall output, cost
reduction , space utilisation, less defects, labour productivity and optimum use of the available resources.