Tag: continuous improvement

Fast Results Using TOC for Demand-Driven Manufacturing – Part Two
Manufacturers use constraints management first to gain the most demand-driven change

Last time, we talked about focusing on enterprise improvements rather than local efficiencies using constraints management (TOC). We discussed that continuous improvement tools such as TOC, Lean and Six Sigma work like “sandpaper” on an organization’s processes, smoothing various stages of their demand-driven journey.

I likened TOC to the “coarse” grit of sandpaper—the one to use first to get the best results–faster. Before discussing the other tools (which I’ll address in future articles), I wanted to share how the TOC principles we discussed last time have brought real results to two manufacturers.

Constraints management improves throughput, on-time delivery, more

My first example, a discrete manufacturer of test equipment for semi-conductors, decided that they could do better and that TOC was going to be the philosophy they utilized to do it. They had a lot of difficulty in production and in meeting their client requirements. They began by implementing drum buffer rope (DBR) scheduling. As part of this, they identified a drum for the organization and began managing it as the constraint. It is important to note that TOC people do not regard constraints as bad things per se, instead, they look at them as leverage or control points that allow you to simplify management of your system. There are many people that I come across who think TOC is about identifying and eliminating constraints. However, Goldratt viewed constraints as a positive item in that in an interconnected environment, the constraints provided the leverage points that greatly simplified management of the system. Goldratt once told me that the constraint within an organization should not move any more than once every two to three years.

Once the drum was identified, the next steps were to exploit the constraint and subordinate all other resources to the constraint. As part of this, the company identified a number of policy and process changes. First, they changed what they did when a constraint resource needed a first-article inspection before continuing to run. They began moving the parts requiring inspection to the front of the queue and, in some cases, removing parts from the test equipment in the middle of the test, in order to service the constraint faster. Soon, the team carried this first-in-line mentality throughout the organization with a laser-like focus on clearing anything that got in the way of the constraint producing to current customer demand. Here are their results:
- Increased constraint throughput by 120%.
- Increased on-time delivery from low 70% to 95%+.
- Cut cycle time and lead-time in half.
Before this change, the company was outsourcing 50% of the work for the constraint. They have since brought it all in house where the yields were much higher, plus, they added another 20% of throughput.

All of this was accomplished within four months and without making one physical alteration to production. No 5S, no kaizen events, no SMED, no value-stream maps, no re-laying out of the production process, no Six-Sigma projects. Also, no additional people or capital equipment were needed. The tools of Lean and Six-Sigma were critical to continuous improvement and refinement of the process, but Constraints Management (harkening back to the sandpaper analogy) served as the coarse sandpaper, taking a rough board and making the dramatic change of smoothing it out.

60% on-time delivery to 90+

Another example – During my work with a discrete manufacturer of capital equipment, with hundreds of parts needed to move through a spaghetti-type flow and meet up in final assembly. Chaos and stress reigned throughout this organization, with the head of final assembly serving as chief expediter. Our aim was to increase their on-time delivery rate which was in the low 60% range and their replacement part fill rate which was less than 50%.

We turned it around by focusing on synchronization and the pacemakers of production. We began by “choking work” into production at the rate the system could handle and subordinated all other resources to the constraints and to final assembly. Soon parts were delivered on time to final assembly, and, ultimately the customer. The results?
- On-time delivery up to 95%+
- Increased fill rate to the upper 90% range
- Returned profitability to the organization for first time in four years
- The head of assembly spent time managing assembly rather than expediting parts.
All of this happened in less than six months. Again, not a resource was added, not a single resource was moved; the physical flow of material was unaltered– yet these were the results.

In both of these cases, it was still critical to employ the tools of Lean and Six Sigma to continue the path of continuous improvement, and we’ll talk about that the next time I write to you. However, these cases prove that nothing gets results as fast as the use of Constraints Management. The board will never get as smooth as when Lean and Six Sigma are used after TOC– but to take a really coarse board and make it relatively smooth quickly and efficiently, you need the coarse sandpaper (TOC) –and then the medium (Lean) –and then the fine (Six Sigma)– to make it as smooth as glass.

This is part two of a three-part series. Here are the links to the entire series.
- Part 1, What Sandpaper Will You Use?
- Part 2, Fast Results Using TOC for Demand-Driven Manufacturing
- Coming soon
-John Maher

John’s passion for demand-driven manufacturing is equal to his interest in how this method improves the lives of employees within these environments. “I’m here to help, not to judge” comments John whose posts reflect why demand-driven matters and are based on his experience working in manufacturing environments and expertise in ERP, MRP, APS, supply chain, manufacturing planning and scheduling systems and constraints management.
April 23, 2018
Turn Your Gemba Walk into a Power Walk

Gemba is a term that is increasingly familiar in the manufacturing world. Loosely translated from Japanese, it means “the place where the work is done.” The originators of the Gemba Walk – the practice of walking the shop floor to identify waste – knew that manufacturing process issues could not be identified or solved in the conference room or behind a desk. Management needs to visit where work is done to get a true sense of what actually happens.

Say, for example, you want to reduce changeover time in a particular work center to increase flow velocity. You know what the average changeover time is based on data collected from the shop floor. You can also see that there is a wide variance between minimum and maximum changeovers. What you don’t know is WHY. The only way to get that information is to head out to the shop floor to watch what happens during changeover and talk to the individuals involved.

Information is Power

The purpose of a Gemba Walk is not to confront employees about their performance, but to learn from them, and there are plenty of sources for information on the best way to conduct an effective walk. Unfortunately, many workers have learned to expect criticism every time management shows up on the shop floor. If your organization has a poor history of management/employee relations, you’re probably going to need to put some extra effort into training your managers on the best way to create an environment where employees feel safe about being open and honest about what happens on the floor.

The other trick is to know, ahead of time, something about what is happening as well as what is possible – and that requires data. In the example I gave above, management had collected actual data from the process, so they had a pretty good idea of how long changeovers took and what could conceivably be possible with the right process improvements.

Having system-gathered data is important for two reasons. First, like eye-witnesses to an accident, employees on the front lines may not be the best source of information because their focus was elsewhere. It’s not that they are purposefully deceptive, it’s just tough to recall details of an incident you didn’t anticipate. If you’re tracking something like changeover time manually, your perception of how long the process takes may be wildly off. Even if you write down the start and end time, manual recording processes are prone to error and misrepresentation.

Having data is also important because it gives you a purpose for your walk. Even though it’s not held in a conference room, a walk with no purpose can feel a lot like attending a meeting with no stated purpose or goal. We’ve all been to one of those. The meeting takes up the allotted time, nothing is decided, and everyone leaves wishing they could get that time back.

You can ask work center personnel open-ended questions about their daily challenges and ideas for process improvement. If you watch them work, you may even identify areas for improvement that they didn’t see. But having a purpose for the walk – in this case, reducing changeovers – gives the discussion structure and direction and helps workers feel like the time is well spent and makes them more likely to get into the spirit of the Gemba process.

Orbital ATK Uses Synchrono to Power Up Their Gemba Walk

The Synchrono Demand-Driven Manufacturing Platform has a number of tools that increase visibility to the shop floor. At the Industry Week Technology Conference and Expo, the Aerospace Structures Division of Orbital ATK, a manufacturer of composite parts for the aerospace industry, spoke to how they use the dashboards made possible by SyncView to support their Gemba Walk process. You can access that video on YouTube.

Screen used in a Gemba Walk at Orbital ATK

The Gemba Walk segment is about nine minutes into the overall video, but if you have the time, the rest of the presentation by Paul Hardy, Orbital ATK’s Application Architect, is really informative as well – especially for those of you looking to leverage the IIoT in your operations. Also, in the second half of the presentation, John Maher, Vice President of Product Strategy at Synchrono, talks about the metrics manufacturers will be using in the factory of the future.

We’ve also posted an on-demand demo of SyncView on our website so you can take a closer look for yourself. Or reach out to us, and one of our Demand-Driven Manufacturing specialists would be happy to give you a personal tour and answer your questions.

April 16, 2018
What Sandpaper Will You Use? – Part One
What to Use to Get the Most of Your Demand-Driven Changes

Demand-driven manufacturing leaders are always refining their tools and tactics to ensure they’re spending their time wisely. This blog marks the first in a three-part series about using the tools of TOC, Six Sigma and Lean to help manufacturing leaders gain the most benefit from their demand-driven transformation.

Three in One

TOC, Lean, and Six-Sigma should all be part of the continuous improvement (CI) journey at your company – and knowing which tools are right for the job will help you realize your CI goals faster. And even though these three methodologies are not the end all, be all of continuous improvement, they offer proven frameworks and tool sets that are very effective at improving organizations.

During this discussion, I want to explain how the methodologies of TOC, Lean, and Six-Sigma work like sandpaper. TOC is the coarse, Lean is the medium, and Six-Sigma is the fine-grit sandpaper. The company is the board –or piece of wood in a particular state of roughness – and you have to know which paper to use, based on the state of the board. At Synchrono, we use all of these methodologies together—leveraging the right tools at the right time —and apply them strategically in our customers’ demand-driven transformation.

TOC to Start

I have never seen a more effective approach when you are just starting out than TOC. The methodology is all about understanding the entirety of the system and based on that, knowing where the leverage points are in the organization that, if affected, will bring about a rapid change to the entire system. It recognizes the interconnectedness and cause and effect of organizations, their people, resources, processes, and most important, policies.

When you first start a continuous improvement journey, the opportunities for improvement are great. They are everywhere within the organization and once the workers in the system have approval and the tools to change the system; they will do so with great effort. However, if we want to get the most out of these efforts, we need to focus these improvement efforts on the constraints/ leverage points of the organization to yield global results, not just localized effects. Said differently, we need to focus on the areas inhibiting enterprise performance, and I have not seen a more effective approach at doing this – and doing this quickly – than the TOC methodology.

Next time, I’ll talk about how to use TOC to pinpoint the changes necessary to get the most out of your continuous improvement efforts. Then, I’ll address the role of kaizen events and drill down into how Six Sigma – the finest grit of sandpaper – can refine your process change and ensure that each moving part works harmoniously together. Like many jobs, having the right tools makes all the difference in the world. The right methodologies, along with ongoing refinement, will steer your demand-driven environment towards embodying the best in form and function.

This is part one of a three-part series. Here are the links to the entire series.
- Part 1, What Sandpaper Will You Use?
- Part 2, Fast Results Using TOC for Demand-Driven Manufacturing
- Coming soon
-John Maher

John’s passion for demand-driven manufacturing is equal to his interest in how this method improves the lives of employees within these environments. “I’m here to help, not to judge” comments John whose posts reflect why demand-driven matters and are based on his experience working in manufacturing environments and expertise in ERP, MRP, APS, supply chain, manufacturing planning and scheduling systems and constraints management.
April 9, 2018
Guest Blog Part 3: Listen to the Process
Through this guest blog series, my intent is to share some of my experiences implementing supplier quality and Lean manufacturing initiatives by focusing on eKanban systems. My first post offered advice for planning an eKanban rollout (advice that could be applied across any Lean manufacturing project). In my second installment, I reviewed strategies for rolling out an eKanban project that have proven successful for me. In this final entry, my focus turns to continuous improvement.

In thinking about this final entry to my eKanban blog series, it may be helpful to review where we’ve been (irony of this to follow). Previously, we talked about establishing a plan to include what we want to accomplish, why and how we will measure results (Real-world Advice for Getting Started on eKanban). We reviewed the importance of engaging leadership in the eKanban project and strategies for turning frontline contributors into change-agents.

Then, we turned toward execution, reviewing replenishment process mapping and rolling out a pilot with examples of how to engage suppliers (Start Your eKanban Implementation with Value-stream Mapping and Engaging Your Suppliers). I left you with the thought of keeping the goals of the mission in mind and continually reinforcing and communicating key outcomes and progress toward the attainment of those goals. The fact is, you need to keep evangelizing the project; particularly after the software goes live and rolls out across the organization. Keep the momentum strong. Communicate results. Win advocates.

“Knowledge speaks; wisdom listens”

These immortal words from the great Jimi Hendrix couldn’t be truer. With regards to our eKanban project, knowledge and communication were critical to complete the first part of the journey, listening comes next.

As the organization starts to use the new eKanban system, start to listen. Tune into the process and listen for feedback from both internal (inside the four walls) and external (customer and supplier) sources. This is the start to the continuous improvement process.

Through patient listening, you’ll receive good – and sometimes surprising – process feedback that can lead to key quality and performance improvements. As you collect feedback, you will need to start assessing your options. Typically, it breaks down into:
1. What improvements can be done quickly. Tackling some quick wins can be helpful in demonstrating to those providing feedback that the organizations is really listening – and behind the project all the way.
2. What is going to take longer to implement. Sometimes these can become projects in and of themselves. In this case, it’s critical to breakdown the issue to ensure it’s executed correctly: Create a plan; test; validate; implement.
For one manufacturer, I was involved in an eKanban implementation across six facilities. After implementing the software – and listening to the process – an issue came up where suppliers would receive replenishment signals, but wouldn’t know which facility initiated the order. The quick fix was to add a source code to the order. Problem solved.

The same manufacturer also required a fix that took a little more time, due to some software adjustments. They wanted to add a date and/or the revision number of the part to the eKanban label. So, we created a plan with our software partner (Synchrono), tested it, and when it was validated, we implemented. An easy fix that needed to be worked into the software development cycle.

While listening is a very important part of the continuous improvement process, data gained from the eKanban system also has value in identifying areas for performance improvements.

For example, a manufacturer using their eKanban system for tracking their on-time delivery rate, was able to identify suppliers who were consistently late. Worse, because these suppliers were known to be late, purchasers (with the best intentions) would trick the system and override the Kanban quantity. Of course, they ended up with too much on hand inventory. Through access to the eKanban system data, we were able to get to the root cause of the problem and take corrective action.

Go Mountain Climbing

Sometimes the continuous improvement process may leave you feeling like things are never good enough. Not true! Just take a moment to take in the view.

The analogy I use in teaching Lean Manufacturing is mountain climbing. When you’re climbing, you’re just focused on getting up the mountain in the most expedient way. And, in doing so, you may start to lose steam.

Re-energize yourself (and your team) by looking back occasionally to see what you’ve accomplished. Look at the new terrain you’ve traveled; the boulders you’ve moved – and how much you’ve saved the company!

You’ll find that sometimes reflecting back is just as important as looking ahead.

Jim Shore is the Principal of Quality Lean Solutions, a Consultant Firm that specializes in Medical Device companies, Supplier Quality and Lean Manufacturing principles. Mr. Shore is co-author of “Proactive Supplier Management in the Medical Device Industry” (2016: Quality Press). Jim has 25 years of quality and supplier management experience in medical devices, semiconductor, aerospace and defense for firms and organizations including Titan Medical, Nypro Healthcare, Boston Scientific, Aspect Medical, Brooks Automation, Raytheon and ACMI Gyrus (now Olympus). He is Six Sigma Black Belt and Quality Manager/Operations Excellence-certified by the American Society for Quality (ASQ), as well as an ASQ-certified Quality Auditor and Mechanical Inspector. A veteran of Operation Desert Storm, he served in the U.S. Marine Corps for more than 15 years.
February 19, 2018
3 Ways to Put Big Data to Work in Your Factory

Is enthusiasm for Big Data wavering?

In 2015, McKinsey Global Institute claimed that the IIoT had the potential to create as much as $3.7 trillion in economic value in the global manufacturing sector by 2025. They also predicted that 80 to 100% of manufacturers will have implemented IIoT applications by then and already be reaping the benefits of data-driven insights into their operations.

When Gartner surveyed manufacturers in 2016, nearly three quarters said that their organization had invested or were planning to invest in Big Data, perhaps putting the manufacturing sector a bit ahead of schedule.

However, the Gartner survey also uncovered signs that Big Data investments may not yet be providing the anticipated returns. A full 85% of projects were still at the pilot stage. And, as further evidence that enthusiasm for Big Data may be wavering, only 11% of those who said they had invested claimed their Big Data investments were at least as important as other IT initiatives.

To drive ROI, begin with a purpose in mind

From our perspective, a large part of the reason Big Data/IIoT projects fizzle out is because team leaders and company executives don’t have a clear vision of the purpose of the initiative. They gather data as though it were a valuable raw material, but then they struggle to make anything useful out of it.

In this post, I’ll cover the three ways you can use Big Data to improve operational performance.

#1 Predictive analytics – The most common benefit espoused by Big Data enthusiasts is gaining insight into what might happen so you can prepare. Bernard Marr, a noted speaker and columnist for Forbes, describes it this way. “Big Data works on the principle that the more you know about anything or any situation, the more reliably you can gain new insights and make predictions about what will happen in the future.”

Predictive maintenance is probably one of the best-known applications of predictive analytics and Big Data. Before the IIoT, manufacturers had to guess how long a piece of equipment would last and when it would need maintenance. Unplanned downtime was common and costly.

Intelligent machines (even if that intelligence is retro-fitted) provide alerts on when the equipment is performing outside of normal parameters, e.g., running at a higher temperature indicating excess friction. And when connected to smart manufacturing tools like SyncOperations™, automated workflows and alerts to maintenance address the issue before it becomes a problem. From a demand-driven manufacturing perspective, this turns unplanned downtime into planned downtime and gives the planner/scheduler time to adjust and optimize flow.

Related resource: How Technology Will Connect Your Enterprise and Create the Demand-Driven Factory of the Future – Today.

#2 Continuous improvement – Continuous improvement is the cornerstone of any Lean initiative and has become a best-practice throughout the industry, even in those organizations that don’t consider themselves Lean. Big Data gives you the data you need to measure what matters and the ability to work with real data as opposed to someone’s best guess about what’s happening on the factory floor.

Of course, it goes without saying that a BigData initiative is only as good as the data the manufacturer has to work with – and if the right data can be accessed by the right people at the right time. In a typical manufacturing operation, data may be stored in dozens of places. Managing issues impacting production is easier with software like SyncManufacturing™ that can leverage its own data in addition to that stored in an ERP or other external system – and use it to make real-time adjustments to ensure production is flowing and resources are synchronized throughout the factory and extended supply chain.

Related resource: Metrics that Drive Action

#3 Real-time responsiveness – Finally, most manufacturing operations can be considered something like “controlled chaos.” Rush orders come in. People get sick. Raw materials shipments are delayed. Scheduling to known constraints is a piece of cake compared to optimizing flow when the unexpected happens. Demand-driven manufacturing can take signals from the shop floor to automatically synchronize production based on what is actually happening in your operations.

Related resource: Set the Right Pace for Production

Just as you wouldn’t buy a piece of equipment without knowing what it’s for, you shouldn’t launch a Big Data initiative without knowing what you want to accomplish. Beginning with a clear idea of what you want to accomplish can help keep enthusiasm high and ensure you see a return on your investment and efforts.

October 16, 2017
Why Demand-Driven Manufacturing is Focused on Metrics for Action

Driving Continuous Improvement.

In Demand-Driven Manufacturing, there is only one measurement that is important to drive performance: Throughput. There are two subordinate measurements: Inventory and Operating Expense. These three measurements cover the gambit of what needs to be measured because they are directly related to customer orders, cash captured inside the organization, and the cash it takes to turn inventory into sales.

Demand-driven managers know that having too many metrics leads to conflicting measurements. From a Demand-Driven Manufacturing operations perspective, you want to pay strict attention to strategic control points for improving Throughput. We call these Metrics for Action.

Metrics for Action

Metrics for Action are not intended for overall business analysis or for simply reporting. Rather, they are metrics grounded in Lean Manufacturing, Constraints Management, and Six Sigma principles that serve as operational indicators that can be acted on to improve production flow and ultimately, Throughput.

Example: A specific actionable metric for Demand-Driven Manufacturers is Constraint Productivity; a metric that determines whether a constraint resource is operating at its optimal capacity. Manufacturers monitoring Constraint Productivity want to get to the point where they are releasing work onto the shop floor at a rate that equals the constraint resource’s optimal production level. This is the pace at which the constraint keeps flow moving throughout the entire production process. Think of it like a metered freeway entrance ramp – your car is let on to the freeway at a rate where you can easily merge and traffic keeps flowing. Without the meter, there would likely be a traffic jam, impacting everything up and down-stream.

Ultimately, the constraint is the pacemaker of the system, so by understanding Constraint Productivity, you understand the flow of the entire system.

Alignment Between Metrics for Action and Continuous Improvement

Sustainable metric improvements require a continuous improvement methodology—a cycle that is never fully complete. Continuous improvement (also referred to as Kaizen) is a process for becoming increasingly competitive by improving efficiency and quality through systemic, incremental changes. In demand-driven environments, continuous improvement efforts look to address the most significant disruptions to production flow. Toward that end, Demand-Driven Manufacturers monitoring Metrics for Action have a leg up. The goal of this concise set of actionable metrics is to provide real clarity around the elements that drive flow – and to quickly make adjustments to improve organizational excellence and enhance demand-driven results.

Example: If you applied a continuous improvement process to the Constraint Productivity example, you would work to understand the capacity of the constraint(s) and adjust the pace until you’ve achieved an optimal rate of flow (e.g., end-to-end production flow). In doing so, you may also create a competitive advantage in your market through improved lead times and/or increased capacity.

Like Demand-Driven Manufacturing itself, Metrics for Action are based on synchronization and managing constraints to drive flow. Improvements in these areas lead to improvements in the core metrics of Throughput, Inventory and On Time Delivery which in turn, leads to improvements in other key areas. Are your metrics really working for you? We welcome your comments – and any examples you have of how you’ve used actionable metrics.

Additional resources:

White paper: Demand-Driven Manufacturing Metrics for Action provides additional background on Metrics for Action and examples.

Article: CONLOAD™ is a software scheduling algorithm that will determine the pace of constraint resource(s) and automatically release work into production at an optimal rate to keep production constantly flowing.

April 4, 2017

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