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Lean Performance Assessment of

Manufacturing Cells using AHP

Conference Paper · November 2013

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 Lean Performance Assessment of Manufacturing Cells using
AHP

Prof.Rajesh.Dhake1, Pavan.Bhoyar2, Akshay.Shekhar3, Dr.N.R.Rajhans4

1
Associate Professor & Head, Industrial & Production Engg. Dept., Vishwakarma Institute of
Technology, Pune-411037, Maharashtra, India
2
M.E., Industrial & Production Engg. Dept., Vishwakarma Institute of Technology,
Pune-411037, Maharashtra, India
3
B.E., Industrial & Production Engg. Dep., Vishwakarma Institute of Technology,
Pune-411037, Maharashtra, India
4
Professor & Head, Production Engg.Dept., College of Engineering, Pune-411005,
Maharashtra, India

Abstract: Improvement is not possible without measurement. Success of

lean implementation in any organization can be gauged accurately only
through sound performance assessment methodology. A variety of
approaches are found to exist to assess lean performance. The most
common amongst these is lean radar chart wherein the performance of
various units in an organization is mapped for multiple aspects of lean
and compared with the benchmark values. Few organizations organize
competitions amongst departments by offering them with awards,
rewards, rotating trophies, etc. to promote implementation of lean
practices and inbuilt healthy competitive spirit. However, these are
instituted for only specific lean initiatives like 5S, TPM measures like OEE,
PQCDSM, etc. This paper presents application of AHP to assess, compare
and rank lean performance of manufacturing cells producing speedo
cluster product at a Tier I speedo cluster manufacturer.

Keywords- Analytical Hierarchy Process (AHP), Lean Performance

Assessment

1. INTRODUCTION

The company is a leading supplier of speedo cluster products for major two wheeler and four
wheeler manufacturers. It produces more than 65 different varieties of products on 9
manufacturing cells, each cell being dedicated with specific product families. The company has
implemented several lean initiatives and currently assesses the lean performance of each
manufacturing cell on a separate lean radar chart shown in figure 1. The improvements effected
are updated periodically on the chart and compared on regular basis. A new approach is
proposed to compare the performance of manufacturing cells based on eleven lean parameters
applying AHP on the following eleven parameters: Commitment, Empowerment, Training,
Strategy Planning, Continuous Improvement, Metrics, Supply Chain, Standard Work, Material
Flow, Visual Control, and TPM.

2. ANALYTICAL HIERARCHY PROCESS

Analytic Hierarchy Process (AHP), since its invention, has been a tool at the hands of decision
makers and researchers; and it is one of the most widely used multiple attribute decision-making
tools.The AHP methodology compares criteria, or alternatives with respect to a criterion, in a
natural, pair wise mode. To do so, the AHP uses a fundamental scale (that captures individual
preferences with respect to quantitative and qualitative attributes) of absolute numbers that has
been proven in practice and validated by physical and decision problem experiments. It converts
individual preferences into ratio scale weights that can be combined into a linear additive weight
 for each alternative. The resultant can be used to compare and rank the alternatives and, hence,
assist the decision maker in making a choice.

Commitment
10.00
5S and Safety Empowerment
8.00
TPM 6.00 Training
4.00
Visual Controls 2.00 Strategy Planning
0.00

Material Flow Continuous…

Standard Work Metrics

Supply Chain Value Stream…

Set-Up Reduction
Before Score After Score Maximum Score

Figure1: Radar Chart

3. METHODOLOGY

The following approach was adopted to apply AHP for comparing and ranking the manufacturing
cells based on comprehensive lean assessment.

3.1 Identify parameters for lean assessment

The following eleven parameters were considered as criteria for comparison of manufacturing
cells on the basis of lean assessment: Commitment, Empowerment, Training, Strategy Planning,
Continuous Improvement, Metrics, Supply Chain, Standard Work, Material Flow, Visual Control
and TPM

3.2 Pair wise Comparison of Lean Parameters & Formation of Matrix

Each parameter is compared against every other with Saaty’s intensity table by 5 experts to
eliminate bias. The detailed comparison matrix is shown in table 1.
Table1: Comparison Matrix of Parameters
Visual Controls
Standard Work
Empowerment

Material Flow
Supply Chain
Commitment

Improvement
Planning
Strategy
Training

Continuous

Metrics

TPM

Parameters for Lean

Performance Assessment

Commitment 1.000 3.000 0.500 2.000 7.000 2.000 2.000 4.000 7.000 3.000 5.000
Empowerment 0.333 1.000 0.167 0.500 1.000 2.000 0.500 2.000 0.500 2.000 2.000
Training 2.000 6.000 1.000 4.000 4.000 2.000 5.000 5.000 2.000 4.000 3.000
Strategy Planning 0.500 2.000 0.250 1.000 6.000 0.500 0.500 2.000 2.000 4.000 2.000
Continuous Improvement 0.143 1.000 0.250 0.167 1.000 0.500 0.250 0.500 0.500 1.000 1.000
Metrics 0.500 0.500 0.500 2.000 2.000 1.000 0.500 2.000 0.500 3.000 2.000
Supply Chain 0.500 2.000 0.200 2.000 4.000 2.000 1.000 2.000 2.000 3.000 3.000
Standard Work 0.250 0.500 0.200 0.500 2.000 0.500 0.500 1.000 0.500 1.000 2.000
Material Flow 0.143 2.000 0.500 0.500 2.000 2.000 0.500 2.000 1.000 5.000 2.000
Visual Controls 0.333 0.500 0.250 0.250 1.000 0.333 0.333 1.000 0.200 1.000 0.250
TPM 0.200 0.500 0.333 0.500 1.000 0.500 0.333 0.500 0.500 4.000 1.000
3.3 Calculating Geometric Mean, Weights, and Principal Eigen Value

Table 2 shows the relevant calculations. Column 3 in the table shows weight for corresponding
parameter of lean performance assessment.
Table 2: Geometric Mean, Weights & Eigen Value

Parameters of Lean Geometric Eigen Value

Weights
Performance Assessment Mean (λ)
Commitment 2.590667571 0.192350599 2.387905803 12.41434038
Empowerment 0.818937503 0.060804065 0.733442133 12.06238655
Training 3.072545535 0.228128834 2.830337233 12.4067492
Strategy Planning 1.253451072 0.093065612 1.140841346 12.25846279
Continuous Improvement 0.458001964 0.034005502 0.401107683 11.79537595
Metrics 1.037548236 0.077035366 0.938801975 12.18663615
Supply Chain 1.445567606 0.107329785 1.336095555 12.44850672
Standard Work 0.599143826 0.044484933 0.537490606 12.08253152
Material Flow 1.18823077 0.088223168 1.005043996 11.39206424
Visual Controls 0.418761789 0.031092017 0.374369676 12.04070079
TPM 0.585610512 0.043480118 0.533949921 12.28032356
13.46846638 1 λmax → 12.44850672

3.4 Calculation of Consistency Index & Consistency Ratio

Table 3 shows the calculated values of consistency index and consistency ratio. The consistency
is checked according to the acceptable CR range which varies according to the size of matrix i.e.
0.05 for a 3 by 3 matrix, 0.08 for a 4 by 4 matrix and 0.1 for all larger matrices, n>= 5. The
calculated consistency ratio 0.0959 is below the specified value of 0.1. Hence, the decision
maker’s judgement is consistent.

Consistency index is calculated by formula

! "# $ % & ( ) & *
Consistency Index (C. I. ). = = (1)
! "# $ % & ' * '

Consistency ratio is calculated by ratio of Consistency Index (C.I.) and Random Index (R.I.)
-" . .% / 0 1 & -.0.
Consistency Ratio (C. R. ) = = (2)
2 1") 0 1 & 2.0.

Table 3: Consistency Index, Random Index & Consistency Ratio

Power of Matrix n 11
Principal Eigen Value λmax 12.4485
Consistency Index CI 0.1449
Random Index RI for n 1.51
Consistency Ratio CR 0.0959

3.5 Final Overall Weight & Ranking Calculation

Pairwise comparison of each parameter of lean performance assessment is done for all eight
manufacturing cells in the company. The details are furnished in table 4. The lean performance
parameters are scored on a scale of 1 to 10, 1 being the lowest (less desirable) value and 10
being the highest (more desirable) value. A separate lean radar chart will be maintained for each
manufacturing cell. The scores will be updated on a periodic basis on all radar charts. Thus, the
final overall weights are likely to change from one time period to the other. Accordingly, the
ranking of manufacturing cells will also change. The basic idea of comparing the manufacturing
cells on some common uniform criteria can thus be served by using AHP as multi attribute
decision making model which is used with individual lean radar charts.

The final overall weights and ranking of the manufacturing cells is shown in the table. The top
three ranked manufacturing cells according to the current assessment are cells 8, 5 and 6 in that
order.
 Table 4: Final Weight & Ranking of Manufacturing Cells

Manufacturing Cell Mfg. Mfg. Mfg. Mfg. Mfg. Mfg. Mfg. Mfg.
Cell 1 Cell 2 Cell 3 Cell 4 Cell 5 Cell 6 Cell 7 Cell 8
Commitment 3.80 3.40 3.50 3.50 3.90 4.00 4.20 4.30
Empowerment 3.40 4.30 3.80 4.10 4.00 3.90 4.10 4.60
Training 4.00 3.40 3.70 4.20 4.20 4.20 3.70 3.90
Strategy Planning 3.40 4.30 3.50 4.00 4.00 4.00 3.80 4.20
Continuous Improvement 4.20 3.40 4.00 3.60 4.00 3.90 4.20 4.50
Metrics 3.40 3.80 4.10 4.50 4.10 4.10 3.70 4.10
Supply Chain 3.60 3.20 4.00 3.40 4.10 4.00 3.90 4.00
Standard Work 4.00 3.50 3.80 3.60 4.10 4.00 4.20 4.20
Material Flow 4.30 4.30 3.70 4.00 4.30 4.20 3.70 3.90
Visual Controls 4.60 3.90 4.10 3.70 4.10 3.90 3.80 3.90
TPM 4.30 4.00 4.00 4.20 4.10 3.70 4.10 3.80
Final Weights 3.845 3.6733 3.7521 3.8976 4.083 4.0453 3.911 4.103
Ranking 6 8 7 5 2 3 4 1

4. RESULTS & CONCLUSION

The paper presents an approach to use AHP as a multi-attribute decision making tool to compare
and rank lean performance of manufacturing cells producing speedo cluster product at a Tier I
speedo cluster manufacturer. The assessment of manufacturing cells based on lean performance
enables comparison of cells and rank them on uniform criteria. It is proposed to compare and rank
the manufacturing cells on a periodic basis (say monthly, to start with). The top 3 ranking
manufacturing cells will be awarded with circulating trophies and cash prizes. This will in build a
sense of healthy competition and motivate all manufacturing cells to strive for continuous
improvement.

5. REFERENCES

1. Omkarprasad S. Vaidya, Sushil Kumar, Analytic hierarchy process: An overview of

applications, European Journal of Operational Research 169 (2006) 1–29
2. T.L. Saaty, The Analytic Hierarchy Process, McGraw-Hill, 1980
3. Rajesh Dhake, N.R. Rajhans, Suppliers Delivery Performance Evaluation &
Improvement using AHP, International Conference On Advanced Engineering
Optimization Through Intelligent Techniques, AEOTIT, July 01 – 03, 2013
4. Womack, J. and Jones, D. (2003). Lean Thinking: Banishing Waste and Create Wealth
in Your Corporation. New York: Free Press
5. Womack, J.; Roos, D.; and Jones, D. (1990), The Machine That Changed the World.
New York, NY: Rawson and Associates.
6. Demirci, Tugba, A Model for Assessing and Evaluating Production Process
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relevance of relationship management." lnt'l Journal of Production Economics (v55),
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9. Toni L. Doolen, Maria E. Hacker, A Review of Lean Assessment in Organizations: An
Exploratory Study of Lean Practices by Electronics Manufacturers, International Journal
of Manufacturing Systems, Vol.24/No.1, 2005

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