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1. ALFRA Consulting - Developing Partners
Lean Manufacturing Simulation
Company Case Example

2. ALFRA Consulting - Developing Partners
Lean Manufacturing Simulation - Workshop
SIMULATION SESSION PURPOSE
• Simulation aims to involve participants in a real scenario where they can experience first hand, the traditional
work systems, living day to day problems, about lead time, quality, customer & employees satisfaction,
inventory among others, to finally understand the benefits of the lean principles applied to the process,
delivering performance improvements in quality, delivery, inventory, among other indicators, giving to
participants a deep understanding of the “know why” of lean, identifying and applying by themselves the lean
principles based on process needs.
• We start running a manufacturing plant, with a family product of two car models (city and rally), if simulation have
more participants a third product can be added to aggregate more complexity features.
• Participants work in different roles such: manufacturing workers, material handlers, supervisors, process
engineers, general manager, quality engineers, customer service, among others.
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• Starting the operations (ramp up) with only the city model, after several production orders for city, rally assembly line
was deployed.
• Production planning was based in forecast, approach was to fully use the total capacity of resource (push system)
• Inventory levels were not controlled, replenishment of raw material was based under workers requests
• Work in Process (WIP) was only moved by material handlers
• There were several motion & transportation waste from moving WIP from one Workstation to another, lay out was not
organized according to process flow.
• Decision making was done only for the General manager
1st Simulation Run: Traditional Manufacturing
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Order # Model
Order Entry
Time
Committed
Delivery Time
Real Delivery
Time
Delivery Quality to Customer Comments
1 City 0 15 18 Delayed Defect Quality inspector not identified failure
2 City 15 25 - CANCELED Order canceled due to excess of delay
3 City 25 35 36 Delayed Internal reprocess internal reprocessing due to defect
4 City 35 45 40 On time Internal reprocess internal reprocessing due to defect
5 City 40 45 40 On time OK
6 City 45 50 46 On time OK
7 City 50 55 57 Delayed OK
8 Rally 60 80 89 Delayed Internal reprocess
9 City 80 85 80 On time OK
10 Rally 88 108 120 Delayed OK Inventory accumulated at workstation 3
11 City 101 106 101 On time OK
12 City 108 113 108 On time OK
13 Rally 113 118 - CANCELED Order canceled due to excess of delay
14 City 118 123 118 On time OK
• City product demand pace was 15 min at beginning and finishing the round at 3 min pace
• Rally product demand pace was 20 min at beginning and finishing the round at 5 min pace.
• Several quality issues appeared due to the lack of training of production team, also several delays and canceled orders due
to an excess of delay.
1st Simulation Run: Results
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In order to improve the performance the group make some adjustments
in order to improve it, lean principles stills not being used in depth.
• Quality Inspection station was added at the end of the line.
• Best operators were placed at more complex workstations
• Engineers start to make decisions. by themselves
• Production planning was revised to achieve more accuracy
• Changes to Layout Distribution, some small process changes were
done.
• 5S first steps were done to set in order tools and material
2nd Simulation Run: Traditional Improvements
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2nd Simulation Run: Results
Order # Model
Order Entry
Time
Committed
Delivery Time
Real Delivery
Time
Delivery Quality to Customer Comments
15 Rally 123 126 2 .:03 On time OK
16 Rally 126 131 2:.14 Delayed OK Inventory accumulated at workstation 3
17 City 131 134 131 On time OK
18 Rally 135 140 137 On time OK
19 City 140 143 141 On time OK
20 City 143 146 - Delayed Order canceled due to excess of delay
21 Rally 146 151 - Delayed Order canceled due to excess of delay
22 Rally 151 154 155 Delayed Internal reprocess
23 Rally 154 157 159 Delayed OK Ran out of raw material at workstation
24 Rally 157 160 157 Delayed OK Ran out of raw material at workstation
25 Rally 160 163 160 Delayed OK
26 City 163 166 164 On time OK
27 Rally 166 169 171 Delayed OK
Due to improvements in lead time customer demand pace increased: city product demand pace was 3 min for this round &
Rally Product demand pace was 5 min for this round and at the end 3 min like city
• City´s orders were mostly delivered on time and without problems due to the training and deep understanding of the
process team was able to achieve the demand rate, but the team kept struggling to deliver Rally orders on time, in this
round even when demand forecast per model is 50%/50% there was more inclination to Rally which became I an
overload to this processes, being unable to deliver until the cancellation of two orders, and running out of material due to
replenishment problems
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3rd Simulation Run: First Lean Approach
First Lean Improvements:
• Workload balance for operations to improve flow.
• JIT replenishment system was developed to assure raw
material at point of use.
• Standard work was deployed to eliminate waste and combine
tasks.
• Layout was redesigned to eliminate motion and transportation
• Visual controls for material and WIP were developed
• All the workers can provide ideas to take decisions
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• City and Rally demand pace was 3 min at the beginning and finishing the round at 1 min per order which is the
objective pace (takt time)
• Internal quality is consistent, and delivery time improves, only few delay for rally due to some overloads on demand
when rally is required more often than city (firsts 4 orders)
• Flow and inventory management now is the biggest challenge for the team.
3rd Simulation Run: Results
Order # Model
Order Entry
Time
Committed
Delivery Time
Real Delivery
Time
Delivery Quality to Customer Comments
28 Rally 169 171 170 On time OK
29 Rally 171 173 171 On time OK
30 Rally 173 175 176 Delayed OK
31 Rally 175 177 179 Delayed OK
32 City 177 179 178 On time OK
33 City 179 180 179 On time OK
34 Rally 180 181 182 Delayed Internal reprocess Delay due to small rework
35 City 181 182 183 Delayed OK
36 City 182 183 183 On time OK
37 Rally 183 184 183 On time OK
38 Rally 184 185 185 On time OK
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Working in a Lean System
• One Piece Flow between workstations was established
• Kanban Signals were developed to trigger the pull system in
every process step, eliminating forecast production.
• Just in time Raw Material Replenishment routes (Milk Run) were
developed with material supermarkets at workstation
• 5S and Visual controls enhanced
What could be improved yet?
• Reduce Raw Material Supermarkets (Inventory levels)
• Improve warehouse management and lead time
• Operators Multiability for more flexibility
4th Simulation Run: Lean Manufacturing System
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• City and Rally orders were delivered on time and with good quality every time, achieving the objective time of 1
min/product.
• Pull system avoids overproduction and provide focus only in customer needs.
4th Simulation Run: Results
Order # Model
Order Entry
Time
Committed
Delivery Time
Real Delivery
Time
Delivery Quality to Customer Comments
39 Rally 185 186 185 On time OK
40 Rally 186 187 186 On time OK
41 City 187 188 187 On time OK
42 City 188 189 188 On time OK
43 Rally 189 190 189 On time OK
44 City 190 191 190 On time OK
45 Rally 191 192 191 On time OK
46 City 192 193 192 On time OK
47 City 193 194 193 On time OK
48 Rally 194 195 194 On time OK
49 Rally 195 196 195 On time OK
50 City 196 197 196 On time OK
51 Rally 197 198 197 On time OK
52 City 198 199 198 On time OK
53 Rally 199 200 199 On time OK
54 City 200 201 200 On time OK
55 City 201 202 201 On time OK
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Depending on the simulation scope, length and number of participants (from 8 to 35) different Lean
Principles and tools can be applied, an example list is shown below:
Systems & Tools Application in Simulation Session
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➔ 5S, Visual Control
➔ Standard Work
➔ Yamazumi Chart
➔ Value Stream Mapping
➔ Line balancing
➔ Quality at the source system
➔ Just in time replenishment (milk run)
➔ One piece flow
➔ Supermarket Pull system and Kanban
➔ Cross Training
➔ SMED (Change over time)
➔ Heijunka (EPEI calculations)
➔ P&L Management

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Hansei: Participants Reflections
WHAT I LIKED?
➔ The team work development and
everybody’s participation
➔ It was a very dynamic and fun
workshop
➔ The good performance we got based
on the improvement efforts.
➔ Achieve the targets & results at the end
of the session
WHAT I DIDN'T LIKE?
➔ We ended the day very tired
➔ Some team members did not cooperate
enough
WHAT HAVE WE LEARNED?
➔ To apply the theoretical concepts in a real
scenario
➔ Now its easier to understand what We can
do in our factory
➔ The difference between work in a chaos
(as we normally work) and in a lean
system, and why is better for everybody.
➔ The value added approach and waste
elimination
➔ To identify problems and use the lean
principles to solve them
➔ How to work on continuous improvement
cycles
➔ To listen & work with others in complex
situations making consensus & decisions.
➔ That we can do it if we propose it as a
value stream team
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13. ALFRA Consulting - Developing Partners
Contact Information:
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