Operational excellence

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Operational excellence

  1. 1. Achieving Operational Excellence In Automotive Industry
  2. 2. Operational Focus The best of the Car manufacturers.. <ul><li>Strive to understand the customer needs </li></ul><ul><li>Design Products and Processes that deliver value </li></ul><ul><li>Recognise the need to service external and internal customers </li></ul><ul><li>PUT QUALITY FIRST ! </li></ul><ul><li>Recognise that quality is defined by the customer </li></ul><ul><li>Quality is used as the driver for both product & process improvement </li></ul><ul><li>Build in quality at source (in both Product & Process) </li></ul><ul><li>Pass no defects forward </li></ul>
  3. 3. Operational Focus <ul><li>Service Level Agreements (SLA) between all internal customers and suppliers for </li></ul><ul><li>Expected Quality </li></ul><ul><li>Expected Quantity </li></ul><ul><li>Expected Delivery Rate </li></ul><ul><li>Expected Mix </li></ul><ul><li>Expected Location and Presentation </li></ul><ul><li>Expected Documentation </li></ul><ul><li>etc...…. </li></ul>
  4. 4. Operational Focus <ul><li>Key Performance Indicators which are cascaded down from corporate level to CX. </li></ul><ul><li>These metrics are arranged in the form QCDDMS where </li></ul><ul><li>Q = Quality (Dimension, surface finish, hardness, colour, completeness etc....) </li></ul><ul><li>C = Cost (e.g..... Man Hours / Car) </li></ul><ul><li>D = Delivery (Takt Time or frequency, quantity) </li></ul><ul><li>D = Design (of the manufacturing processes) </li></ul><ul><li>M = Management Systems (Training plans, Kaizen) </li></ul><ul><li>S = Safety </li></ul>
  5. 5. Working Practices The best manufacturers believe in the STANDARD OPERATION .. always doing the same task in exactly the same way to ensure consistent quality from person-to-person, shift-to-shift, and day-to-day <ul><li>The Standard Operation is defined as </li></ul><ul><ul><li>the most EFFICIENT </li></ul></ul><ul><ul><li>CURRENT method of </li></ul></ul><ul><ul><li>SAFELY meeting </li></ul></ul><ul><ul><li>QUALITY standards </li></ul></ul><ul><ul><li>and achieving QCDDMS </li></ul></ul>
  6. 6. Standard Operations <ul><li>They establish the methods for manual tasks with respect to </li></ul><ul><ul><li>Quality </li></ul></ul><ul><ul><li>Quantity </li></ul></ul><ul><ul><li>Cost </li></ul></ul><ul><ul><li>Timing </li></ul></ul><ul><ul><li>Safety </li></ul></ul><ul><ul><li>Productivity </li></ul></ul><ul><li>Standard Operations are </li></ul><ul><ul><li>described in detail using words and pictures on Standard Operations Sheets </li></ul></ul><ul><ul><li>the basis for all continuous improvements and the elimination of waste in all its guises </li></ul></ul><ul><ul><li>reviewed by the Team Leader at regular intervals </li></ul></ul><ul><ul><li>linked closely into workshop management techniques </li></ul></ul>
  7. 7. Workshop Management The best manufacturers emphasize the need for.. Organisation Neatness Cleanliness Standardisation Discipline other techniques include.. <ul><li>“ one step” (no action requiring more than one step away from the workplace) </li></ul><ul><li>“ ownership” of machines by individuals </li></ul>sometimes known (from their Japanese origins) as the “5 Ss”
  8. 8. Workshop Management The best manufacturers try to eliminate the “7 Wastes”.. <ul><li>Overproduction </li></ul><ul><li>Waiting </li></ul><ul><li>Conveyance </li></ul><ul><li>Over-processing </li></ul><ul><li>Excess Inventory </li></ul><ul><li>Motion </li></ul><ul><li>Correction of Defects </li></ul>
  9. 9. Team Working The best manufacturers organise the workforce into natural teams, called SDT’s . A team is typically 6-10 individuals under a team leader, who.. <ul><li>has experience of all of the processes </li></ul><ul><li>acts as a trainer </li></ul><ul><li>promotes welfare/harmony </li></ul><ul><li>reports production progress </li></ul><ul><li>drives improvements through standard operations </li></ul>
  10. 10. Supplier Relationships The best of the Car manufacturers.. <ul><li>Have a relatively small number of suppliers (<200) </li></ul><ul><li>Build long-term relationships with suppliers </li></ul><ul><li>Provide training for suppliers </li></ul><ul><li>Give design responsibility to suppliers </li></ul><ul><li>Single source model-specific parts (but will often choose different suppliers for different models to maintain competitiveness) </li></ul>
  11. 11. Order Scheduling The best of the Car assemblers.. <ul><li>Give a rolling forecast of requirements </li></ul><ul><li>Give a daily delivery schedule 4-10 days ahead of delivery, via EDI links </li></ul>the car manufacturer’s objective is to ensure that the right quantity of the right parts will be on site; the actual build sequence is defined on a daily basis to even-out the production flow, and the parts are pulled to the production line as required, using KANBANs
  12. 12. Supply Logistics Deliveries to the best of the Car assemblers.. <ul><li>are weekly for small high-volume commodity items </li></ul><ul><li>are daily for most items (either by the supplier or by a Logistics Partner who collects the parts from the smaller suppliers on a “milk-round” journey) </li></ul><ul><li>are just-in-time, direct to the line, for large order-specific items such as seats (for e.g., a truck-load every 40 minutes) </li></ul>the objective is to minimise the stock held, particularly of high-value, large-size and variety-dependent items
  13. 13. Just-in-time supply The best of the Car assemblers arrange for customer-specific items to be built to order. e.g..... for seats.. <ul><li>the supplier will receive an order by EDI, two-and-a-half hours before the seats are to be fitted into the car </li></ul><ul><li>after making the seat set, the supplier will consolidate it into a sequenced load which is delivered to the car manufacturer. The seats are unloaded onto a conveyor feeding the production line in the correct order for fitting to the cars coming along the line </li></ul>
  14. 14. Human Resource Management The best manufacturers.. <ul><li>recruit people willing to work in a high-commitment, constantly-changing work environment, and with a “can-do” attitude </li></ul><ul><li>provide single-status facilities </li></ul><ul><li>operate reward systems based on appraisals and individualised salary progressions through merit </li></ul><ul><li>organise people into natural teams </li></ul><ul><li>multi-skill all production staff </li></ul><ul><li>focus on the production areas </li></ul>
  15. 15. Multi-skilling Multi-skilling is regarded as essential.. <ul><li>for maintaining the quality </li></ul><ul><li>the line is resilient against absenteeism </li></ul><ul><li>many staff can contribute to problem-solving </li></ul><ul><li>for flexibility in production (if the output rate of vehicles is changed up or down, each line associate will be doing fewer or more tasks per vehicle) </li></ul><ul><li>for maintaining employee enthusiasm and interest </li></ul>
  16. 16. Communication The best manufacturers communicate objectives and performance visually at the workplace.. <ul><li>output/quality </li></ul><ul><li>individual skills </li></ul><ul><li>team performance </li></ul><ul><li>results of quality improvement activities </li></ul>
  17. 17. World Class Manufacturing - What is it ? <ul><li>Understand, document, measure and target for improvement all their business processes </li></ul><ul><li>Constantly work with the best suppliers to reduce the total cost of doing business and to improve the supply chain responsiveness </li></ul><ul><li>Seek to gain the maximum from the capabilities of their people in delivering the business objectives </li></ul>As per a study, World class manufacturers across the globe :
  18. 18. World Class Practices Processes Tightly integrated Closely controlled <ul><li>Tight Process Control NOT Inspection and Rework </li></ul><ul><li>Complexity does not preclude Productivity </li></ul><ul><li>Flexibility and Adaptability </li></ul>
  19. 19. Processes Tightly integrated Closely controlled Supply Chain High quality throughout <ul><li>Tight Process Control NOT Inspection and Rework </li></ul><ul><li>Complexity does not preclude Productivity </li></ul><ul><li>Flexibility and Adaptability </li></ul><ul><li>Low Inventories throughout </li></ul><ul><li>Short time horizons </li></ul><ul><li>Stable Supplier/Customer Schedules </li></ul><ul><li>Information exchange and learning </li></ul>World Class Practices
  20. 20. Processes Tightly integrated Closely controlled Supply Chain High quality throughout People Advanced Management Practices <ul><li>Tight Process Control NOT Inspection and Rework </li></ul><ul><li>Complexity does not preclude Productivity </li></ul><ul><li>Flexibility and Adaptability </li></ul><ul><li>Low Inventories throughout </li></ul><ul><li>Short time horizons </li></ul><ul><li>Stable Supplier/Customer Schedules </li></ul><ul><li>Information exchange and learning </li></ul><ul><li>Greater Team Leader responsibility for quality, maintenance and training </li></ul><ul><li>Operators focus on production </li></ul><ul><li>Suggestion Schemes and Problem Solving </li></ul>World Class Practices
  21. 21. World Class Practices - Summary Processes Tightly integrated Closely controlled Supply Chain High quality throughout People Advanced Management Practices <ul><li>Tight Process Control NOT Inspection and Rework </li></ul><ul><li>Complexity does not preclude Productivity </li></ul><ul><li>Flexibility and Adaptability </li></ul><ul><li>Low Inventories throughout </li></ul><ul><li>Short time horizons </li></ul><ul><li>Stable Supplier/Customer Schedules </li></ul><ul><li>Information exchange and learning </li></ul><ul><li>Greater Team Leader responsibility for quality, maintenance and training </li></ul><ul><li>Operators focus on production </li></ul><ul><li>Suggestion Schemes and Problem Solving </li></ul>
  22. 22. THANK YOU

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