Lean Methodology July Monthly

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Value Creation Awareness for the EPC Industry

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Lean Methodology July Monthly

  1. 1. Lean Methodology Value Creation Joe Kalchbrenner Date 7/25/06
  2. 2. What is “Lean”? <ul><li>“ Lean Thinking … redefine(s) the work of functions, departments, and firms so they can make a positive contribution to value creation and … speak to the real needs of employees and customers at every point along the stream….” </li></ul><ul><li>Lean Thinking: Banish Waste and Create Wealth in your Corporation, Womack,James P.;Jones,Daniel T. </li></ul>
  3. 3. Why “Lean”? Lean is becoming a CPI buzzword <ul><li>“ Lean manufacturing is key” Process Industries Center for Manufacturing Excellence, PICME, January 2005 reports 20 to 30% cost savings </li></ul><ul><li>“ Competitive Advantage for the Process Industries” AIChE Nov. 2005 Annual Mtg. Cincinnati OH </li></ul><ul><li>. </li></ul>
  4. 4. EEliminate Waste – Reduce Cost FFaster Time To Market - Pull SShorter Lead Time - Flow IImproved Quality – Operator Control IImprove customer responsiveness and satisfaction CCreate A Design, Sales, Order Entry, Procurement, And production System In Each Product/Market LLocate the Value Stream Near Your Internal And External Customers - Location Goals of Lean
  5. 5. History of Lean, and it’s Main Elements <ul><li>Lean terminology was coined by James Womack and Daniel Jones, in the book: </li></ul><ul><ul><li>Lean Thinking: Banish Waste and Create Wealth in Your Corporation” . </li></ul></ul><ul><li>Lean is based on the Toyota Production System (TPS) that Taiichi Ohno and Shigeo Shingo developed for Toyota after WWII </li></ul><ul><li>Toyota embraced TPS and used “Material and Information Flow Mapping” to establish flow, eliminate waste and add value </li></ul><ul><li>“ Material and Information Flow Mapping” – Value Stream Mapping (VSM) – is used to depict the current and future states of the value stream as an early step of developing and implementing lean systems </li></ul><ul><li>5S - Sort, Set in Order, Shine, Standardize, and Sustain </li></ul><ul><li>Kaizen, (continuous improvement) Frederick Taylor c. 1900, time study </li></ul><ul><li>Kanban, (pull system) for controlling WIP </li></ul>
  6. 6. Concept of Waste <ul><li>Waste is anything other than the minimum amount of equipment, materials, parts, space, and worker’s time which are absolutely essential to add value to the product </li></ul>
  7. 7. The Seven Wastes People Process Product Problems Inefficient layouts Lack of proximity of machines Off-line resources Motion Defects Inventory Transportation Overproduct ion Waiting Time Operator waiting time Long setups and lead times Large batches Making without demand signals Smoothing forecasts/cust. demands Long cycle times Reduced efficiency High overall lead times Costly rework Long delays for rectification Dissatisfied customers High raw material inventory High work-in-process inventory High finished goods inventory Unnecessary movement Extra handling Overprocessing
  8. 8. <ul><li>Does this describe your work area? </li></ul><ul><li>Space is crowded </li></ul><ul><li>Unneeded items are stacked between work stations </li></ul><ul><li>Excess inventory and equipment make it difficult to move, work and improve </li></ul><ul><li>Equipment is dirty and collection point for miscellaneous materials </li></ul>Lean and You…
  9. 9. Before 5-S … After 5-S …
  10. 10. Lean and you… benefits of 5S <ul><li>A place for everything </li></ul><ul><li>Everything in its place </li></ul><ul><ul><li>area identification (queue, racks, scrap, etc.) </li></ul></ul><ul><ul><li>operator facilities (lockers, information boards, etc.) </li></ul></ul><ul><li>Everything visible </li></ul><ul><ul><li>location identification (tools, instruction, etc.) </li></ul></ul><ul><li>Everyone cleans and checks for damage and problems </li></ul><ul><li>Benefits: </li></ul><ul><ul><li>Safety/Quality </li></ul></ul><ul><ul><li>Attacks Waste </li></ul></ul><ul><ul><li>Develops a Sense of Pride </li></ul></ul>
  11. 11. Lean and Fluor <ul><li>Enabling methodology for faster, reliable facility start-ups - reduces risks and expedites return on investment for new production. Executed in parallel with FEED/EPC activities to maximize life-cycle value. </li></ul>Proprietary methodology to identify, quantify, and validate plant improvements for existing plants. On-going partnering alliance designed to improve the performance of plant assets in existing plants with substantial on-going cost savings to customers. PlantREADY. Fluor’s suite of total maintenance solutions designed to improve total asset performance.
  12. 12. Credits <ul><li>Enterprise Services Group </li></ul><ul><li>O&M Business </li></ul><ul><li>Lean Manufacturing </li></ul><ul><li>Mr. Tim Finigan </li></ul>
  13. 13. Accessorize and Add Value <ul><li>Walk the Walk </li></ul><ul><li>Talk the Talk </li></ul>

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