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  • Shigeo Shingo: "Unfortunately, real waste lurks in forms that do not look like waste. …We must always keep in mind that the greatest waste is the waste we don't see." Tom Peters: "The accumulation of little items, each too trivial to trouble the boss with, is a prime cause of miss-the-market delays." Taiichi Ohno: "In reality, however, such waste [waiting, needless motions] is usually hidden, making it difficult to eliminate. …To implement the Toyota production system in your own business, there must be a total understanding of waste. Unless all sources of waste are detected and crushed, success will always be just a dream." "They [chronic inefficiencies such as poorly-placed equipment] turned out to be the little things that get under a worker's skin but are never quite important enough to make him come to management for a change " (emphasis is mine). Halpin, J. F. 1966. Zero Defects . New York: McGraw-Hill
  • SMED prior to Shigeo Shingo: "In a certain shop with which we are familiar a piece had to have several holes of different sizes drilled in it, a jig being provided to locate the holes. The drills and the sockets for them were given to the workman in a tote box. The time study of this job revealed several interesting facts. First, after the piece was drilled the machine was stopped, and time was lost while the workman removed the piece from the jig and substituted a new one . This was remedied by providing a second jig in which the piece was placed while another piece was being drilled in the first jig, the finished one being removed after the second jig had been placed in the machine and drilling started " (Robert Thurston Kent, introduction to Gilbreth's Motion Study (1911)). Takt time = the time that the factory allots for each job or workpiece. "As rhythm in music drives the whole orchestra to synchronize with the swing of the conductor's baton, cycle time in a factory will drive the production line with a smooth, steady flow of goods. In fact, the Japanese also refer to cycle time as 'tact' time [also takt time], reflecting the rhythmical swing of the baton." Suzaki, Kyoshi. 1987. The New Manufacturing Challenge . New York: The Free Press. Page 136.
  • A Google search for shanties songs timing sailors "wooden ships" found a couple of web sites that show the use of shanties (or chanteys) in pacing work on sailing ships. "On many occasions the Shantyman would play an instrument (usually a fiddle) and sit in the middle of the capstan while the sailors heaved with synchronized teamwork to the Shantyman's music and song." Music can also be used to coordinate some very complicated activities, such as ballets in which different groups of dancers perform different routines that must, however, take place together. Marching bands that turn themselves into complex formations during football halftime performances (as opposed to simply marching in step during a parade) are another example. This suggests that it is quite possible to "choreograph" a set of manufacturing processes, especially when automation eliminates all human variation from processing and transportation times.
  • Franklin's principles may well have influenced Henry Ford in the development of the lean enterprise.
  • The Franklin quote continues, "Remember what Poor Richard says, 'Buy what thou hast no need of, and ere long thou shalt sell thy necessaries.' And again, 'At a great penny worth pause a while:' He means, that perhaps the cheapest is apparent only, and not real; or the bargain, by straightening thee in thy business [reducing your available cash, i.e. straightening your circumstances], may do thee more harm than good. For in another place he says, 'Many have been ruined by buying good penny worths.'" Henry Ford's My Life and Work (1922) echoes this concept: "We have carefully figured, over the years, that buying ahead of requirements does not pay— that the gains on one purchase will be offset by the losses on another, and in the end we have gone to a great deal of trouble without any corresponding benefit. … We do not buy less if the price be high and we do not buy more if the price be low. We carefully avoid bargain lots in excess of requirements. It was not easy to reach that decision. But in the end speculation will kill any manufacturer. Give him a couple of good purchases on which he makes money and before long he will be thinking more about making money out of buying and selling than out of his legitimate business, and he will smash. The only way to keep out of trouble is to buy what one needs— no more and no less. That course removes one hazard from business."
  • False economy of money vs. time: Frederick Winslow Taylor observed that machinists often ran their equipment with the goal of maximizing tool life. Taylor's position was that the equipment should be operated to maximize productivity and that the tools should be reground or replaced when necessary. Taylor and J. Maunsel White developed the Taylor-White process for treating tool steel to allow even higher speeds.
  • "If a device would save in time just 10 per cent. or increase results 10 per cent., then its absence is always a 10 per cent. tax. If the time of a person is worth fifty cents an hour, a 10 per cent. saving is worth five cents an hour. … A building thirty stories high needs no more ground space than one five stories high. Getting along with the old-style architecture costs the five-story man the income of twenty-five floors. Save ten steps a day for each of twelve thousand employees and you will have saved fifty miles of wasted motion and misspent energy." Henry Ford, 1922, My Life and Work
  • This was found, incidentally, at a military site:$FILE/MPS%20Offload.txt (The context was the role of supply in battle) Henry Ford installed snap gages, go/no-go gages that kicked nonconforming pieces out of the assembly line before they were combined with other parts.
  • Frederick Winslow Taylor's Principles of Scientific Management says that a mason probably lowered and raised 150 pounds of body weight with each five-pound brick.
  • Frederick Winslow Taylor's Principles of Scientific Management says that a mason probably lowered and raised 150 pounds of body weight with each five-pound brick.
  • Gilbreth's non-stooping scaffold put the bricks at about waist level. Positioning the work at waist level was later adopted by Henry Ford.
  • Gilbreth's non-stooping scaffold put the bricks at about waist level. Positioning the work at waist level was later adopted by Henry Ford.
  • But all [employees] took two steps to the right to secure their cloth, returned to the tables, folded the stuff and deposited it on another pile two steps to the left. That had always been the practice; no one had ever thought to question it." The System Company. 1911. How Scientific Management is Applied . London: A. W. Shaw Company Ltd., p. 41 The Ford Motor Company seems, however, to have forgotten its own principles: "One co-worker swore at Mr. [Tony] Tallarita when he tried to consolidate two trunk hinge assembly stations into a single station and save the other employee some 2,000 unnecessary steps each shift. 'Don't bother,' the man said. 'I like walking.'" Shirouzu, Norihiko. 2001. "Job One: Ford Has Big Problem Beyond Tire Mess: Making Quality Cars," Wall Street Journal , 5/25/2001, A1 and A6.
  • 1-3 The worker takes two steps to her left and picks up the material 4-6 The worker returns to the table with the material and folds it. 7-9 (next page) The worker takes two steps to her right to deposit the folded piece on the "finished" pile. 10-11 The worker needs two steps to return to the starting position. Therefore, the folding of each piece requires the worker to take a total of eight steps. Henry Ford said that pedestrianism is not a highly-paid line of work. This slide and the next were created with Poser 4, and the eleven steps were converted into an animated sequence. In practice, it is often useful to videotape an operation so workers can see how they do the job. They will quickly recognize wasted motions that require effort but add no value to the product or service.
  • Taylor's Principles of Scientific Management (1911) on standardization, using surgery as an example: the surgeon uses "…standard implements and methods which represent the best knowledge of the world up to date, [but] he is able to use his own originality and ingenuity to make real additions to the world's knowledge, instead of reinventing things which are old . In a similar way the workman who is cooperating with his many teachers under scientific management has an opportunity to develop which is at least as good as and generally better than that which he had when the whole problem was 'up to him' and he did his work entirely unaided." Principles of Scientific Management on worker initiative (contrary to the "leave your brain at the factory gate" stereotype) and best practice deployment:"It is true that with scientific management the workman is not allowed to use whatever implements and methods he sees fit in the daily practise [sic] of his work. Every encouragement, however, should be given him to suggest improvements, both in methods and in implements. And whenever a workman proposes an improvement, it should be the policy of the management to make a careful analysis of the new method, and if necessary conduct a series of experiments to determine accurately the relative merit of the new suggestion and of the old standard. And whenever the new method is found to be markedly superior to the old, it should be adopted as the standard for the whole establishment . The workman should be given the full credit for the improvement, and should be paid a cash premium as a reward for his ingenuity. In this way the true initiative of the workman is better attained under scientific management than under the old individual plan
  • Henry Ford's My Life and Work (1922), Today and Tomorrow (1926), and Moving Forward (1930) described all these lean enterprise principles very explicitly. Continuous improvement (kaizen) Standardization and best practice deployment Low-inventory single-unit processing Suppression of variation in processing times allowed Ford to do the "impossible:" run a balanced production line at close to 100% capacity. Elimination of all forms of waste (muda) from every aspect of the business Sophisticated freight management system (FMS) Design for manufacture (DFM) Error-proofing (poka-yoke) Self-check systems Cleaning and preventive maintenance aspects of 5S-CANDO Supplier development Benchmarking Statistical process control (SPC) and design of experiments (DOE) are about the only modern tools that Ford didn't mention. Industrial statistics began to develop only during the 1920s, under the auspices of Walter Shewhart and others.
  • This information should help sell lean enterprise to upper management in "the language of money."
  • This also is a key point to raise when selling lean enterprise to upper management. Any system that can make money in defiance of the economic climate of 1920-1921 (or, by implication, that of 2000-2003) should have a lot of appeal. Lean enterprise is more comprehensive and global in outlook than Six Sigma. Lean enterprise's goal is to root out all forms of waste. Remember, however, that lean actually incorporates aspects of Six Sigma, so the two systems are compatible.
  • A parallel may be drawn with the Russian field marshal Aleksandr Suvorov (1729-1800), who may well have been the greatest commander who ever lived. Consider some famous books that have become popular in the business community, like Sun Tzu's The Art of War , Carl von Clausewitz' On War , and Machiavelli's The Prince . Their intended audiences are the "management caste." Sun Tzu used his Art of Wa r to gain an audience, and employment as a general, with Ho Lu , the King of Wu. Machiavelli gave his book to a prince of a Renaissance Italian city-state. Suvorov's The Science of Victory ( Nauka Pobezhadt ) was "…the first known written record on the art of war intended not only for officers but for every serving man" (Longworth, Philip. 1966. The Art of Victory , p. 220). This was like writing a business management book to be understandable by factory workers. Henry Ford's My Life and Work (1922), Today and Tomorrow (1926), and Moving Forward (1930) are understandable and usable by every member of a modern workforce.
  • "I believe that the average farmer puts to a really useful purpose only about 5 per cent. of the energy he expends. … Not only is everything done by hand, but seldom is a thought given to a logical arrangement . [Time for a kaizen blitz?] A farmer doing his chores will walk up and down a rickety ladder a dozen times. He will carry water for years instead of putting in a few lengths of pipe . His whole idea, when there is extra work to do, is to hire extra men. He thinks of putting money into improvements as an expense . … It is waste motion— waste effort— that makes farm prices high and profits low." Henry Ford, 1922, My Life and Work "One day when Mr. Ford and I were together he spotted some rust in the slag that ballasted the right of way of the D. T. & I [railroad]. This slag had been dumped there from our own furnaces." "'You know,' Mr. Ford said to me, 'there's iron in that slag. You make the crane crews who put it out there sort it over, and take it back to the plant.'" —-Harry Bennett, 1951. Ford: We Never Called Him Henry (The factory later put in powerful electromagnets to remove iron particles from the slag before it left the blast furnace.)
  • Created with Corel Gallery Magic, Corel PhotoPaint
  • Emphasis is mine.
  • "We have found in buying materials that it is not worth while to buy for other than immediate needs. We buy only enough to fit into the plan of production, taking into consideration the state of transportation at the time. If transportation were perfect and an even flow of materials could be assured, it would not be necessary to carry any stock whatsoever. The carloads of raw materials would arrive on schedule and in the planned order and amounts, and go from the railway cars into production. That would save a great deal of money, for it would give a very rapid turnover and thus decrease the amount of money tied up in materials. With bad transportation one has to carry larger stocks" (Henry Ford, 1922, My Life and Work ).
  • Reference: My Life and Work , 1922
  • 5S = Seiri, Seitori, Seiso, Shitsuke, Seiketsu CANDO = Clearing up, Arranging, Neatness, Discipline, Ongoing improvement
  • Reference: Norwood, 1931, Ford: Men and Methods , p. 10 National Semiconductor on "minor stoppages," which have the following characteristics: They are very short. The workers can usually fix them, i.e. "work around" them. It is not necessary to use spare parts or actually repair anything. National Semiconductor's position is that even minor stoppages add up to major losses of production time . They also indicate underlying equipment problems that could affect the product. Gardner, Les, and Nappi, Frank. 2001. "The Total Impact of Minor Stoppages." The 6th Annual Lean Management and TPM Conference, sponsored by Productivity Inc. October 25-26, 2001, Dearborn, MI
  • Emphasis is mine. Charles Sorensen identified this supplier as the C. R. Wilson Body Company, of which Fred Fisher was then superintendent. Fisher and his brothers later went on to make "Bodies by Fisher."
  • Formation of rail cars into trains under the Ford system: The sequence of the cars allowed for subsequent detachment in the proper order for transfer to connecting lines. Waybills and bills of lading were done in parallel with loading and movement of the freight cars. Per Norwood (1931, Ford: Men and Methods , p. 32), this cut out the 24 hours that other railroads needed to do these activities sequentially.
  • Sinclair, Upton. 1937. The Flivver King . Second printing, 1987. Chicago: Charles H. Kerr Publishing Company, p. 61 Upton Sinclair is better known as the author of The Jungle . He was not exaggerating, because Ford recovered valuable chemicals from coal before burning the remaining coke. Instead of becoming smoke (and pollution), these materials were indeed made into saleable goods, which presumably included some automobile parts. "Black smoke is unconsumed carbon— nascent heat— lost energy— wasted coal. A smoking chimney registers money lost." The System Company. 1911. How to Get More Out of Your Factory . London: A. W. Shaw Company, Ltd., p. 28 Ford, Henry, and Crowther, Samuel. 1926. Today and Tomorrow . New York: Doubleday, Page & Company (Reprint available from Productivity Press, 1988)
  • "Ford is a leader in the use of recycled materials. Many products that once would have been thrown away now are recycled as new and replacement parts for our cars and trucks." Note that Ford. Sr. would have drawn rapid attention to anything that was being discarded. "Recycled soft drink bottles are used in our luggage compartment carpeting, grille reinforcements and door padding. Plastic computer and phone housings are made into grilles. Used tires become step-in plates. Plastic water bottles become headlamps, old bumpers become tail lamps, and battery housings turn into splash shields." Source:, 6/9/2000 The Ford Motor Company now seems to be rediscovering many of its founder's principles.
  • Arnold, Horace Lucien, and Faurote, Fay Leone. 1915. Ford Methods and the Ford Shops . New York: The Engineering Magazine. Reprinted 1998, North Stratford, NH: Ayer Company Publishers, Inc. 211-212 Ford, Henry, and Crowther, Samuel. 1922. My Life and Work . New York: Doubleday, Page & Company, (101-102) cites a four-operation process that wasted 12 percent of the steel when making gears. "One of the workmen devised a very simple new method for making this gear in which the scrap was only one per cent."
  • Ford, Henry, and Crowther, Samuel. 1926. Today and Tomorrow . New York: Doubleday, Page & Company (Reprint available from Productivity Press, 1988) Dieter, George. 1983. Engineering Design: A Materials and Processing Approach . New York: McGraw-Hill. Dieter mentions: Precision forging Precision investment casting Powder-processing techniques Ford's procedure of forging or casting small parts and then assembling them (preferably by welding) into large ones offered several advantages: Less exposure to defects like blow holes that were common in large castings, at least during that era The smaller parts were often stronger and lighter, so the final unit also was often stronger and lighter than it would have been had it been cast. Less machining  less cutting fluid to deal with, both in terms of buying it and disposing of it safely.
  • Norwood, Edwin P. 1931. Ford: Men and Methods . Garden City, NY: Doubleday, Doran & Company Inc. Norwood's reference to the phrase "It worried the men" shows that sensitivity to waste was part of the Ford organizational culture at all levels. The question "what goes up the smokestack?" refers to wasted material as opposed to pollution. It's assumed that the plant is obeying environmental regulations by removing toxic pollutants like sulfur and nitrogen oxides. We saw previously, though, that Ford extracted and sold many coal chemicals that would otherwise (today) have had to be dealt with by scrubbers, cyclones, filters, and so on. Also remember that thermal combustion is inherently wasteful if fuel cell technology is available for the fuel in question.
  • Ford, Henry, and Crowther, Samuel. 1926. Today and Tomorrow . New York: Doubleday, Page & Company (Reprint available from Productivity Press, 1988)
  • Ford, Henry. 1922. My Life and Work . Norwood, Edwin. 1931. Ford: Men and Methods
  • Blanton Godfrey, 2000. "Managing Key Suppliers." Quality Digest , September, 2000, p. 20 The Automotive Industry Action Group shares this opinion. "In AIAG/ASQ 1997-98 supplier surveys, it is documented that QS-9000 provided up to a 3:1 return for all (internal and external) compliance-related costs and nearly 17:1 return for out-of-pocket certification costs." Source: "A Healthy Choice: New AIAG initiative helps bring ISO 9000 to healthcare, promising the auto industry significant quality gains and big savings in cost." Henry and Clara Ford Hospital The hospital's minimized walking (non-value-adding work) by nurses, thus allowing them to spend more time with patients. Several doctors reviewed each case independently, thus assuring a more accurate diagnosis. Temperature and humidity controls for patient rooms
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    1. 1. Lean Enterprise: William A. Levinson, P.E., MBA Levinson Productivity Systems, P.C. 570-824-1986 Made in the USA
    2. 2. License/ Conditions of Use <ul><li>Permission is given to download and present this material royalty-free for corporate in-house use, professional meetings, and similar activities, provided that: </li></ul><ul><ul><li>No changes are made in it </li></ul></ul><ul><ul><li>Attendees pay no fee for admission beyond those necessary to cover the cost of attendees' meals plus rental of the meeting facility (as is common for professional societies) but they may not include a profit. </li></ul></ul><ul><li>The notes pages may be photocopied and distributed royalty-free provided that no changes are made in them. </li></ul><ul><li>A lean enterprise presentation suitable for a one-day workshop can be purchased from Levinson Productivity Systems, P.C. </li></ul>
    3. 3. Overview <ul><li>It can be proven unequivocally that lean enterprise originated in the United States (not in Japan, as is commonly believed). </li></ul><ul><li>Change management benefits: </li></ul><ul><ul><li>Unquestionable bottom-line results: sell lean to upper management in &quot;the language of money.&quot; </li></ul></ul><ul><ul><li>American workers are more likely to buy into &quot;Made in the USA&quot; concepts than kaizen , poka-yoke , jidoka , etc. </li></ul></ul><ul><li>Technical benefits: </li></ul><ul><ul><li>Historical principles are still valid and they are now fundamental elements of what we call lean enterprise. </li></ul></ul>
    4. 4. Outline <ul><li>Background: military origins of quality and productivity concepts </li></ul><ul><li>Benjamin Franklin's lean enterprise concepts  influence on Henry Ford </li></ul><ul><li>Frank Gilbreth and motion efficiency </li></ul><ul><li>Frederick Winslow Taylor and scientific management </li></ul><ul><li>Henry Ford and the lean enterprise </li></ul><ul><ul><li>Ford's bottom line: sell lean to upper management in &quot;the language of money&quot; </li></ul></ul><ul><ul><li>Lean techniques at the original Ford Motor Company </li></ul></ul><ul><ul><li>Ford and supply chain management </li></ul></ul><ul><ul><li>Ford and ISO 14000 </li></ul></ul><ul><ul><li>Ford and solutions to today's health care crisis </li></ul></ul><ul><li>Conclusion </li></ul>
    5. 5. Military Origins of Productivity and Quality Techniques <ul><ul><li>&quot;The United States government has already spent millions and used many of the best of minds on the subject of motion study as applied to war; the motions of the sword, gun, and bayonet drill are wonderfully perfect from the standpoint of the requirements of their use. This same study should be applied to the arts of peace.&quot; Frank Gilbreth, 1911, Motion Study </li></ul></ul>
    6. 6. Muda (Waste) = von Clauzewitz's Friction <ul><li>General Carl von Clausewitz's On War (1831) defined friction as &quot;…the force that makes the apparently easy so difficult. … countless minor incidents— the kind you can never really foresee— combine to lower the general level of performance, so that one always falls short of the intended goal.&quot; </li></ul><ul><li>Henry Ford ( Moving Forward , 1930): &quot;It is the little things that are hard to see— the awkward little methods of doing things that have grown up and which no one notices. And since manufacturing is solely a matter of detail, these little things develop, when added together, into very big things.&quot; </li></ul>
    7. 7. Motion Efficiency and Setup Time Reduction <ul><li>The ability to shoot more quickly at someone who was shooting back was a powerful incentive for armies to develop these techniques. </li></ul><ul><ul><li>The musket cartridge, with its premeasured powder charge, externalized the setup operation (a key concept of SMED) of measuring out each charge of gunpowder. This was being done 400 or more years ago. </li></ul></ul><ul><ul><li>Loading drills prescribed the &quot;one best way,&quot; or standard, for loading muskets. Soldiers were (per von Steuben's drill manual of 1779) to count a second between each motion: a forerunner of takt time? </li></ul></ul>
    8. 8. More on Takt Time <ul><li>The concept of rhythmic timing, or getting everyone to work at the same pace, is very old. </li></ul><ul><ul><li>Drums  everyone marches at the same speed. (Synchronous flow manufacturing's drum-buffer rope) </li></ul></ul><ul><ul><li>Sailor's songs on wooden ships provided rhythm for group tasks. </li></ul></ul><ul><ul><li>Music coordinates some very complex performances: </li></ul></ul><ul><ul><ul><li>Ballet dancers perform different routines that must, however, keep pace with one another. </li></ul></ul></ul><ul><ul><ul><li>Marching bands can make very complex formations during, for example, football halftime performances. </li></ul></ul></ul>
    9. 9. Benjamin Franklin's Lean Enterprise Concepts <ul><li>&quot;Nothing has happened in our history to render out of date the business philosophy of Benjamin Franklin. Poor Richard's Almanac is still the best business compendium.&quot; </li></ul><ul><ul><li>— Henry Ford, 1922. Ford Ideals </li></ul></ul>
    10. 10. Franklin on Inventory <ul><li>Purchasing departments are sometimes measured on their ability to get &quot;good deals&quot; from suppliers. Franklin warned of what is likely to happen: </li></ul><ul><li>&quot;You call them goods; but, if you do not take care, they will prove evils to some of you. You expect they will be sold cheap, and, perhaps, they may [be bought] for less than they cost; but, if you have no occasion for them, they must be dear to you .&quot; </li></ul><ul><li>Readers of The Goal will appreciate this concept! </li></ul><ul><li>Principle adopted by Henry Ford </li></ul>
    11. 11. The Value of Time <ul><li>&quot;If time be of all things the most precious, wasting time must be,' as Poor Richard says, 'the greatest prodigality;' since,  'Lost time is never found again; and what we call time enough always proves little enough:'  </li></ul><ul><ul><li>Readers of Goldratt and Cox's The Goal will recognize this concept as, &quot;Time lost at the constraint is lost forever.&quot; </li></ul></ul><ul><ul><li>F.W. Taylor identified the false economy of maximizing tool life instead of cutting (production) rate. </li></ul></ul>
    12. 12. The Value of Time, contd. <ul><li>Henry Ford, 1922, My Life and Work : &quot;If a device would save in time just 10 per cent. or increase results 10 per cent., then its absence is always a 10 per cent. tax. </li></ul><ul><li>…Save ten steps a day for each of twelve thousand employees and you will have saved fifty miles of wasted motion and misspent energy.&quot; </li></ul>
    13. 13. Franklin on Friction <ul><li>For want of a nail a shoe was lost, </li></ul><ul><li>for want of a shoe a horse was lost, </li></ul><ul><li>for want of a horse a rider was lost, </li></ul><ul><li>for want of a rider an army was lost, </li></ul><ul><li>for want of an army a battle was lost, </li></ul><ul><li>for want of a battle the war was lost </li></ul><ul><li>for want of the war the kingdom was lost, </li></ul><ul><li>and all for the want of a little horseshoe nail. </li></ul><ul><li>A defective part that costs a few cents can make a final assembly nonconforming or, even worse, result in a field failure. The idea is the same. </li></ul><ul><li>Ford: snap gages, go/no-go gages rejected such parts automatically. </li></ul>
    14. 14. Frank Gilbreth and Motion Efficiency
    15. 15. A Friction Classic <ul><li>Most of us are familiar with the story about how under-achievers install a light bulb. One holds the bulb while three others turn the ladder. </li></ul><ul><li>It's funny because no one could be this stupid, right? </li></ul>
    16. 16. Bricklaying, through late Nineteenth Century <ul><li>The brick weighs about five pounds (2.3 kg). How much is the worker actually raising and lowering every time he bends over for another brick? </li></ul>
    17. 17. Bricklaying, through late Nineteenth Century <ul><li>The brick weighs about five pounds (2.3 kg). How much is the worker actually raising and lowering every time he bends over for another brick? </li></ul>
    18. 18. Bricklaying, after Frank Gilbreth <ul><li>The joke about the underachievers and the light bulb isn't so funny any more. </li></ul><ul><li>Lesson: waste can, by long habit (&quot;living with it,&quot; &quot;working around it&quot;) become built into a job. </li></ul>
    19. 19. Bricklaying, after Frank Gilbreth <ul><li>The joke about the underachievers and the light bulb isn't so funny any more. </li></ul><ul><li>Lesson: waste can, by long habit (&quot;living with it,&quot; &quot;working around it&quot;) become built into a job. </li></ul>
    20. 20. In case you think I made this up... <ul><li>Top: &quot;The usual method of providing the bricklayer with material&quot; (Gilbreth, Motion Study , 1911. The photo is dated 9/5/1906, believed to be in the public domain). </li></ul><ul><li>Bottom: &quot;Non‑stooping scaffold designed so that uprights are out of the bricklayer's way whenever reaching for brick and mortar at the same time&quot; </li></ul>
    21. 21. Animation of fabric folding operation Henry Ford principle: &quot;Pedestrianism is not a highly-paid line of work.&quot; This shows the value of videotaping real operations (e.g. for kaizen blitz, SMED).
    22. 22. Fabric Folding Operation This shows the value of videotaping real operations (e.g. for kaizen blitz, SMED). 1 2 3 4 5 6
    23. 23. Fabric folding, contd. 7 8 9 10 11
    24. 24. Frederick Winslow Taylor and Scientific Management Standardization and Best Practice Deployment
    25. 25. Standardization and Best Practice Deployment <ul><li>Standardization and best practice deployment are key features of Six Sigma. Both are also basic principles of scientific management. </li></ul><ul><ul><li>Standardization holds the gains from continuous improvement, thus avoiding the two-steps-forward-and-one-back problem. </li></ul></ul><ul><ul><ul><li>Taylor speculated that trade workers often improved their jobs, but the knowledge was lost when they died or retired. </li></ul></ul></ul><ul><ul><li>Best practice deployment applies improvements to all relevant operations in the business. </li></ul></ul>
    26. 26. Henry Ford and the Lean Enterprise Ford developed motion efficiency and scientific management into a comprehensive lean enterprise system that equals or surpasses anything that exists today.
    27. 27. Ford and Change Management Use the history of Henry Ford's lean enterprise system to gain buy-in from upper management and front-line workers
    28. 28. Ford's Bottom Line and the Language of Money <ul><li>The Ford Motor Company (and the industries that grew to support it) was directly responsible for making the United States the wealthiest and most powerful nation on earth . </li></ul><ul><ul><li>The U.S. surpassed the British Empire during the 1910s. </li></ul></ul><ul><ul><li>During the Model T's 19 years of production, it created more prosperity than the estimated wealth of 35 of the country's 48 states (Ford, 1930, Moving Forward ). </li></ul></ul><ul><ul><ul><li>This figure did not include railway workers, rubber workers, oil workers, and others for whom the Model T created jobs. </li></ul></ul></ul>
    29. 29. When the Going Got Tough… <ul><li>… the Ford lean enterprise system kept going. </li></ul><ul><li>The Ford Motor Company sold 1.25 million cars during the 1920-1921 depression that followed the First World War and the 1918 influenza epidemic: five times as many cars as the company sold during 1913-1914 . </li></ul><ul><li>How would this system have performed in comparison to others in 2000-2003? </li></ul>
    30. 30. Ford and the Front-Line Worker <ul><li>Henry Ford was not a professor, &quot;guru,&quot; or consultant. </li></ul><ul><ul><li>Ford was a self-taught mechanic and then an engineer at Detroit Edison before he began to make automobiles. </li></ul></ul><ul><ul><li>He spent considerable time on the shop floor with front-line workers. </li></ul></ul><ul><li>Ford wrote in a very practical and hands-on manner. </li></ul><ul><ul><li>His principles and workplace examples are easily understandable by anyone in a modern workforce — perhaps more so than many modern lean manufacturing books. </li></ul></ul>
    31. 31. Lean: Made in the USA or &quot;Who do you think taught Japan how to make cars?&quot; <ul><li>Taiichi Ohno, the father of the Toyota production system, said openly that he got the idea from Henry Ford's book and the American supermarket. </li></ul><ul><ul><li>Ford's Today and Tomorrow (1926) describes the benefits of just-in-time (JIT) manufacturing explicitly. </li></ul></ul><ul><ul><li>In a supermarket, replenishment of shelf stock is triggered by depletion; it is a &quot;pull&quot; system. </li></ul></ul><ul><li>Taylor influenced Shigeo Shingo </li></ul>
    32. 32. Lean Methods and Management at the Ford Motor Company The original Ford Motor Company had a comprehensive lean enterprise system that equals or surpasses anything that exists today.
    33. 33. Ford and Muda (Waste) <ul><li>Henry Ford's ability to recognize waste on sight, and to teach this skill to his organization, may have been his chief success secret. </li></ul><ul><ul><li>Culture at Ford's River Rouge plant, regarding waste: &quot;It worried the men.&quot; </li></ul></ul><ul><li>If it doesn't add value, it's waste. </li></ul><ul><ul><li>&quot;We will not put into our establishment anything that is useless. We will not put up elaborate buildings as monuments to our success. The interest on the investment and the cost of their upkeep only serve to add uselessly to the cost of what is produced— so these monuments of success are apt to end as tombs&quot; (Ford, 1922, My Life and Work ) </li></ul></ul>
    34. 34. The world's first &quot;monuments of success&quot; were actually tombs. The ancient Egyptians bypassed the phase of using these &quot;elaborate buildings&quot; to house living executives; they stocked them directly with dead ones.
    35. 35. Kaizen, Standardization, and Best Practice Deployment <ul><li>&quot;To standardize a method is to choose out of many methods the best one, and use it. … Today's best, which superseded yesterday's, will be superseded by tomorrow's best .&quot; </li></ul><ul><li>&quot;An operation in our plant at Barcelona has to be carried through exactly as in Detroit— the benefit of our experience cannot be thrown away . A man on the assembly line at Detroit ought to be able to step into the assembly line at Oklahoma City or São Paulo, Brazil.&quot; </li></ul><ul><li>— Henry Ford, 1926, Today and Tomorrow </li></ul>
    36. 36. Just-In-Time (JIT) <ul><li>Ford described the following principles explicitly: </li></ul><ul><li>Materials arrive exactly, and only, when the production line needs them. </li></ul><ul><li>Materials go, not from dock to stock, but from dock to factory floor. </li></ul><ul><li>JIT requires reliable transportation and a supporting logistics system. </li></ul><ul><ul><li>Bad transportation (e.g. lack of a good freight management system) requires the plant to keep more inventory. </li></ul></ul><ul><ul><li>Ford created a very impressive freight management system (FMS) to address this issue. </li></ul></ul><ul><li>Inventory reduction frees capital. </li></ul><ul><li>Cycle time reduction frees capital. </li></ul>
    37. 37. Ford on Design for Manufacture (DFM) <ul><li>&quot;Start with an article that suits and then study to find some way of eliminating the entirely useless parts. This applies to everything— a shoe, a dress, a house, a piece of machinery, a railroad, a steamship, an airplane. As we cut out useless parts and simplify necessary ones, we also cut down the cost of making.&quot; </li></ul><ul><li>&quot;But also it is to be remembered that all the parts are designed so that they can be most easily made.&quot; </li></ul>
    38. 38. 5S-CANDO at Ford <ul><li>Ford, Today and Tomorrow (1926) on a new mine: &quot;The first job was to clean up— that is always the first thing to do in order to find out what you are about. … We cannot afford to have dirt around— it is too expensive. … everything is painted and kept painted a light color, so the least bit of dirt will show. We do not paint to cover up dirt— we paint white or light gray in order that cleanliness may be the order of things and not the exception.&quot; </li></ul><ul><li>Norwood's Ford: Men and Methods (1931) shows how the River Rouge plant anticipated Disney theme parks (which provide convenient waste containers everywhere) by providing waste containers within six steps of any position on the shop floor . </li></ul>
    39. 39. Stopping the Line <ul><li>Workers at the River Rouge plant were authorized to stop the line (a practice later adopted by the Japanese) if there was a problem. </li></ul><ul><ul><li>This lit an alarm light in a control booth. If the light stayed on for more than two minutes, the attention of a &quot;trouble mechanic&quot; was required. </li></ul></ul><ul><ul><li>Even if the workers on the line could fix the stoppage in less time, the cause was still recorded for future action . </li></ul></ul><ul><ul><ul><li>Closed-loop corrective action </li></ul></ul></ul><ul><ul><ul><li>Tie-in with computerized maintenance management system concept </li></ul></ul></ul>
    40. 40. Ford and Supply Chain Management Supply chain management recognizes the dependence of a lean manufacturer on its own suppliers and distribution systems.
    41. 41. Ford on Supplier Development <ul><li>&quot;The man finally consented to try to manufacture at exactly one half his former price. Then, for the first time in his life, he began to learn how to do business. …he found he could make cost reductions here, there, and everywhere, and the upshot of it was that he made more money out of the low price than he had ever made out of the high price, and his workmen have received a higher wage &quot; (Henry Ford, 1926, Today and Tomorrow ). </li></ul><ul><li>The supplier had wanted $152 per body. Ford's Charles Sorensen built a model for $50 in labor and materials. The supplier then agreed to accept $72 per body. </li></ul>
    42. 42. Ford's Freight Management System (FMS) <ul><li>Norwood's Ford: Men and Methods (1931, 20-24) gives an outstanding summary of what a good FMS does. </li></ul><ul><ul><li>The Ford logistics system was a &quot;continent-spanning conveyor.&quot; </li></ul></ul><ul><ul><li>Deliveries were coordinated, scheduled precisely, and apparently just-in-time. </li></ul></ul><ul><ul><li>Supply was never to exceed or fall short of requirements . </li></ul></ul><ul><ul><li>&quot;Using that multitude of additional links offered by rail, highway, water, and air, it has butt-welded them with their own time-tables and picketed them with telegraphic checkings as watchful as the straw bosses who supervise progression along the conveyor lines of the shop.&quot; </li></ul></ul><ul><ul><li>Per Ford, the location of any rail car could be determined to within an hour . </li></ul></ul>
    43. 43. Ford and ISO 14000 ISO 14000 is, if used properly, a moneymaker as opposed to a costly and time-consuming annoyance
    44. 44. The Basic Concept <ul><li>&quot;He perfected new processes— the very smoke which had once poured from his chimneys was now made into automobile parts&quot; (Sinclair). </li></ul><ul><li>&quot;It is not possible long to continue to get something for nothing, but it is possible to get something from what was once considered nothing&quot; (Ford, 1926). </li></ul>
    45. 45. Meat Packer's Principle: &quot;Use Everything but the Squeal&quot;
    46. 46. Waste to Profit <ul><li>Henry Ford: </li></ul><ul><ul><li>A wood distillation plant turned scrap wood into methyl alcohol, charcoal, tar, and fuel gas. </li></ul></ul><ul><ul><ul><li>$12000/day could pay 2000 workers @$6/day (Ford's relatively high minimum wage) in 1926. </li></ul></ul></ul><ul><ul><li>Charcoal briquettes from sawmill chips (Kingsford charcoal) </li></ul></ul><ul><ul><li>Blast furnace slag  cement and paving material </li></ul></ul><ul><ul><li>A paper plant converted waste paper into binder board and cardboard. </li></ul></ul><ul><ul><li>Fumes from a coating operation were recovered by adsorption in charcoal and reused. </li></ul></ul>
    47. 47. Make Parts, Not Machining Chips <ul><li>&quot;The machine shop produces about 14,000 [piston] rings per day  say 1240 pounds of finished rings from 13,000 pounds of ring stock, 11,760 pounds of stock, worth $294 wasted for the pleasure of cutting it into chips and using snap-ring piston packing&quot; (Arnold and Faroute, 1915, Ford Methods and the Ford Shops ). </li></ul><ul><ul><li>Ford was well aware of this problem, and he changed processes and designs to eliminate it. </li></ul></ul><ul><ul><li>Less machining  less cutting fluid to purchase and dispose of. </li></ul></ul>
    48. 48. The Solution <ul><li>&quot;Our objective is always to minimize the subsequent machining&quot; (Ford, 1926, 69). </li></ul><ul><ul><li>Dieter (1983) points out the virtues of &quot;chipless machining.&quot; The idea is to make the part as close to its final shape as possible, to minimize subsequent machining. </li></ul></ul><ul><ul><li>Ford pointed out that cast parts require considerable (on the order of 30%) machining. </li></ul></ul><ul><ul><ul><li>Forge or cast small parts and then assemble them into the desired large one. </li></ul></ul></ul><ul><ul><li>Tie-in with Design for Manufacture </li></ul></ul>
    49. 49. Keep Your Eye on the Doughnut's Hole <ul><li>Doughnut = the product </li></ul><ul><li>Hole = whatever is thrown away </li></ul><ul><ul><li>Example: metal sheet with six stamped holes (product) </li></ul></ul>Workers ask, &quot; What was in those holes? &quot; Most people saw scrap for remelting and reuse. Ford's workers saw radiator caps. Pressing two disks made a very strong radiator cap.
    50. 50. The Doughnut's Hole, continued <ul><li>This concept cannot be overemphasized. </li></ul><ul><ul><li>Culture at Ford's River Rouge plant, regarding waste: &quot;It worried the men.&quot; </li></ul></ul><ul><li>Workers should pay close attention to &quot;holes&quot; and ask questions. </li></ul><ul><ul><li>&quot;Where did the metal go that was in those cutout sections of the part?&quot; </li></ul></ul><ul><ul><li>&quot;What becomes of cutting fluids, solvents, and lubricants?&quot; </li></ul></ul><ul><ul><li>&quot;What goes up the smokestack?&quot; </li></ul></ul><ul><ul><li>Metal chips or sawdust should always invite attention! </li></ul></ul>
    51. 51. Reuse Packaging <ul><li>&quot;Why should a crate or a packing box once used be considered only as so much waste to be smashed and burned?&quot; (Ford, 1926, 125) </li></ul><ul><ul><li>Ford allegedly asked a supplier to package shipments in boxes whose boards had to be specific sizes. The latter became Model T floorboards. </li></ul></ul><ul><ul><li>Ford's River Rouge plant often knocked down containers and sent them back &quot;for another load.&quot; </li></ul></ul><ul><ul><li>Cardboard boxes can be folded flat and sent back for the same purpose. </li></ul></ul>
    52. 52. Ford and Health Care The same kind of management which permits a factory to give the fullest service will permit a hospital to give the fullest service, and at a price so low as to be within the reach of everyone. (1) It is simply a matter of transferring those precision methods, so well established in the Ford shops, into hospital work. (2)
    53. 53. Solving the Health Care Crisis <ul><li>Industrial quality and productivity techniques have the potential to reduce health care costs by 30 to 50 percent while improving its quality. </li></ul><ul><ul><li>Blanton Godfrey, former CEO of the Juran Institute: &quot;Health care providers' cost of poor quality is estimated to be as high as 30-50 percent of the total paid for health care. For some companies the cost of employee health insurance is now higher than profits.&quot; </li></ul></ul><ul><ul><li>AIAG supports the use of ISO 9000 in hospitals. </li></ul></ul>
    54. 54. Conclusion <ul><li>Lean enterprise is an American innovation. </li></ul><ul><ul><li>Use Henry Ford's bottom line to sell lean to upper management in the language of money. </li></ul></ul><ul><ul><li>Use Ford's down-to-earth and hands-on approach, along with lean's &quot;Made in USA&quot; label to sell lean to front-line workers. </li></ul></ul><ul><li>Ford showed how to make money through ISO 14000 (before ISO 14000 existed) </li></ul><ul><li>Industrial methods can reduce health care costs significantly. </li></ul>