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Data
Taiichi Ohno
Objectives
Understand the importance of measurements to each level of operations and management Understand measurables
Example
Police in Alexandria, Virginia (outside of Washington, DC, USA) were told that they had a quota of 25 traffic tickets per officer per month. What do you think was the result?
Did this improve traffic safety?
Tell me how I will be measured, and Ill tell you how Ill perform
-People will perform to how they are measured (if you want to improve an area, pay attention to it) (Hawthorn principal) -Traditional methods cause resistance to change > 'Old' metrics provide comfort > Metrics often used as basis for incentive
Performance measurement must tie directly to the goal of creating value for customers A change in the value of a performance measure should be felt by the customer of the process
If metrics show a change and the customer doesnt perceive a difference, then were not measuring the right things or weve defined our customer incorrectly
Improve
Solve
Understand
Measure
Good performance measures are: 1. Simple Use metrics that are easy to capture, compile, and
update. Complex calculations or excessive work may lead people to avoid them and measurable affect on the chosen measures
2. Directly impacted Process changes should have a clear 3. Informative Suitable metrics may not always reveal the
source of an issue, but they need to alert us when problems exist measures
Alignment: Everyone can understand if they are supporting the goals. Feedback and Control: share information in real time to catch problems before they affect customer. Performance improvements: metric records are basis for PDCA improvement activities.
Go to see the actual place Make first hand observation Talk to the people Look for current measurement tools and methods Know the real situation - dont rely on old data or reports (or even new ones).
Quality First Time Through (FTT) Delivery Build to Schedule (BTS) Flexibility Lead Time Total Cost
Productivity
Material Use Machine effectiveness (oee)
Downtime
Definition:
Measure ability to produce defect free products the first time without repair.
Key Requirements:
Implementation of well-defined standards Stable/ capable processes Sound maintenance of equipment Empowered and skillful workforce
2. Rework: Any part produced out of standard, that must be repaired offline or online with/without stoppage is considered rework. (rework inside of Takt time is not included)
Quality Rate =
Total # half pairs produced (Defect + Rework) Quality Rate = Total # half pairs produced
Measuring in pieces
For embroidery, HF, Upper Molding and the like, include in Prefitand for those that come from a supplier or a brownfield part of the factory just measure the bad parts received as defects.
Total # pieces produced/received defects
Quality Rate =
Quality Rate =
Total # half pairs produced (defects + Rework) Total # half pairs produced
Outsole:
Total # half pairs produced: Defect : Rework: 1,000 22 0 =978
Prefit:
Total # pieces produced: Defect : Rework: 8,000 5 42 =7953
PU:
Total # half pairs produced: Defect : Rework: 1,000 48 60 =892
Stitching:
Total # half pairs produced: Defect : Rework: 998 2 120 =876
Phylon:
Total # half pairs produced: Defect : Rework: 1,000 98 0 =902
Stockfit:
Total # half pairs produced: Defect Rework 978 5 140 =833
Final Assembly:
Total # half pairs produced:
Defect Rework
973
10 150 =813
Definition:
Measure the ability to produce products to a plan which considers volume, mix and sequence.
Key Requirements
No
Overproduction Process capability Reliable material delivery Empowered and skillful workforce
Volume Performance =
Mix Performance =
A.CL BW 20
Xcellerator 30
A.Trblnc 9 50
Xcellerator
A. Trblnc 9
A. Cl BW
30
60
Volume Performance =
Actual # of units produced = 95, Scheduled # of units = 100 Volume performance = 95/100 = 0.95
A.CL BW 20
Xcellerator 30
A.Trblnc 9 50
Xcellerator
A. Trblnc 9
A. Cl BW
30
60
Mix Performance =
Actual # of units build to mix = 5+30+50= 85, Actual # of units produced = 95 Mix performance = 85/95 = 0.89
BTS = (volume performance) x (mix performance) Volume performance =0.95 Mix performance = 0.89 BTS = 0.95 x 0.89 = 0.85 = 85%
Lead time
Definition:
Measure the time required for material and products to flow through the plant from raw material warehouse to finished goods warehouse.
Key Requirements:
Continuous material and information flow A focus on plant/operation constraint areas Work groups focused on waste Level /sequenced production Reduction in inventory levels Small batch size More frequent material delivery/withdrawals
FG Storage
W I P
Cut
W W I Stitch I P P
Assemble
W W I Pack I P P
Finished Goods
Lead time
Upper Value Stream L/T: Lead time of (R/M Storage W/H + Cut +Prefit + Stitching + Stockfit +Final Assembly + F/G W/H) Outsole L/T: Lead time of (O/S + S/F + F/A + F/G W/H) PU L/T: Lead time of (PU + S/F + F/A + F/G W/H) PHYLON L/T:Lead time of ( PHYLON + S/F + F/A + F/G W/H) Total DTD is the longest of the 4 measures above.
Upper Value Stream L/T: LT of ( Raw Mtrl Storage W/H + Cut + Prefit + Stitching + Stockfit + F/A + F/G W/H)
Prefit
Stitching WIP
WIP
WIP
WIP
WIP
S/F
F/A
WIP
WIP
WIP
F/G W/H
S/F
WIP
WIP
* Daily customer demand is 3,000 pairs / 8 hours working day Lead time Lead time Lead time Lead time Lead time Lead time Lead time Lead time Lead time of of of of of of of of of Cutting : Prefit: Stitching : Stockfit: Outsole: PU: Phylon: Assembly : F/G W/H : 4 hours ( 0.5 day ) 2 hours (0.25 day) 6 hours ( 0.75 day ) 2 hours (0.25 day) 5 hours ( 0.62 day) 4.5 hours (0.56 day) 4.5 hours (0.56 day) 2 hours ( 0.25 day ) 1.5days
Upper Value Stream Lead Time: 0.5 + 0.25 + 0.75 +0.25 + 0.25 + 1.5 = 3.5 days Outsole Lead Time: 0.62 + 0.25 + 0.25 + 1.5 = 2.62 days
PU Lead Time: 0.56 + 0.25 + 0.25 + 1.5 = 1.06 days Phylon Lead Time: 0.56 + 0.25 + 0.25 + 1.5 = 2.56 days
Key Requirements:
All production system tools (physical and cultural) Activity based focus
Total Cost per Unit: {material + Labor + overhead + B grades + customer returns }
# of good units produced in a given period
Notes:
Material Cost :all material actually used (not the specification or FOB calculation) including additional issued material. Non-material cost : Labor + Overhead + B grades + Customer returns