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Achieving and Maintaining Lean and Six Sigma
CreateASoft, Inc.
The Process Improvement Company
Introduction
  • About CreateASoft, Inc.
    -- In business since 1992
    -- Provides software, and simulation consulting services.
  • Simcad Pro
    --  Process Modeling and Simulation tool that’s been successfully applied to multiple industries.

Overview
  • Refresher on lean and Six Sigma.
  • Using simulation to achieve a lean environment.
  • Using simulation to achieve Six Sigma.
  • The role of simulation in maintaining and fine tuning the attained goals.
 
What is Lean?
  • Set of methods and concepts used to
    -- Reduce waste.
    -- Decrease WIP.
    -- Provide a streamline flow.
  • Lean concepts are not industry specific.
    -- Can benefit both the service and manufacturing environment.
 
Key Stages of Lean application

Demand -> Flow -> Leveling -> Lean System

  • Demand identified by
    -- Takt time, buffer inventory,safety inventory,…
  • The Flow
    -- Continuous flow, work cells, Kanban system, FIFO lanes, …
  • Leveling
    -- Paced withdrawal, Heijunka (load leveling)…
 
Goals of Lean systems
  • Stabilize your processes.
    -- Review capabilities, labor, and material flow.
  • Standardize processes and flow.
  • Simplify, through Kaizan principals.
Key Lean concepts
  • Takt time
    -- Available production time/total quantity desired.
  • Cycle Time
    -- Time that elapses from the beginning of the operation until completion, also known as processing time.
  • Value added time.
  • Non value added time.
  • Process efficiency
    -- Value Added Time / Total time.
Kanban System
  • One of the most widely used terms in lean implementation2
  • Implements a pull system.
    -- Only produce what’s needed downstream.
    -- Create production orders to upstream processes through signals or bins.
 
What is Six Sigma?
  • System of management to achieve lasting business leadership and performance to benefit the business, its customers, shareholders, …
  • A measure to define the capability of any process.
  • A goal for improvement that reaches
Six Sigma and Quality
  • Six Sigma represents the capability of a core business process as measured in defects per million opportunities.
Sigma Level Defects per Million Yield
6 3.4 99.997%
5 233 99.977%
4 6,210 99.379%
3 66,807 93.32%
2 308,537 69.2%
1 690,000 31%
 
Benefits of Lean and Six Sigma.
  • Projects that are lean pay off in inventory and manufacturing cost reduction.
  • Six Sigma projects working on improving quality (reduce defects) provide improved production rate and customer satisfaction.
 
The role of simulation
  • Simulation provides a tool to analyze, visualize, and experiment.
  • Improvement ideas are tested and analyzed before implementation.
  • Migration scenarios can be tested.
  • Forecasting and scheduling.
 
Where to start?
  • Identify the Goal.
    -- Simulating without a defined goal does not generate results.
  • Identify the processes involved in the environment.
  • Define and collect metrics from existing line.
Simulation - First Step
  • Start with a process map.
  • Define the process flow.
  • Assign scrap rates, product specific flows, resources, …
  • Simulate and validate of the model.
Simulation – Step 2
  • Convert flow to a value stream map.
  • Identify the processes contributing to value added time.
    -- The remaining processes contribute waste to the overall flow.
  • Identify the process efficiency rating.
    -- Process efficiency = VAT / total time.
    -- Identify the “worst performers” in the current flow.
 
A Value Stream Map
Download this presentation
 
Things to watch for:
  • Queue wait time can be misleading.
    -- Main objective: Reduce WIP.
  • Large production batches lead to large WIP values and a deviation from Lean principals.
Achieving Lean – Step 1
  • From the VSM determine the processes contributing to 80% of the waste.
  • Determine the non-value added time in the flow.
  • Simplify – determine processes that can be split to avoid long processing times.
Achieving Lean – Step 2
  • Can the Kanban system be used?
    -- A set of parts waiting to be assembled at a process (Large WIP Values) may indicate a problem at the assembly process, while the actual problem is at the feeding process.
  • Determine the Kanban size:
    -- There should be enough work on every process to allow it to operate while the next bin is being produced.
    -- How? Kanban size can be determined based on the cycle time of the upstream processes.
   
Achieving Lean – Step 3
  • Define the worst case scenario.
    -- Document the differences between runs (save the logs).
    -- Compare results to determine which scenario produces the best outcome.
  • Based on the goal, determine how close you are to the projected takt time.
  • Simulate multiple product mixes.
Achieving Lean – Step 4
  • Define the worst case scenario.
    -- If more than one is possible, then run all possibilities.
  • Define the best case scenario.
    -- A lean flow should operate flawlessly.
  • Goal
    -- A combination of the process changes that provide a lean environment in 80% of the cases.
    -- Provide a solution for high demand scenarios.
   
Applying Six Sigma Changes
  • Six Sigma changes may include
    -- Changes in the process flow.
    -- Changes in resource allocation.
    -- Changes in product mixes.
    -- Changes in the number of items in the flow.
  • Use the simulation model to apply the changes.
    -- Is our lean solution still intact?
Quality effect on the line
  • By reducing scrap, there is more demand on upstream processes to produce items.
    -- Potential problem: down stream processes may starve, or utilization may drop.
  • Is a reduced utilization a problem?
    -- The goal is to produce products based on a preset customer demand (takt time).
    -- If takt time is achieved with a lower utilization, the process can be expanded in the future without impacting the operation.
   
Maintaining progress
  • Current business models require constant monitoring of the operation.
  • After desired improvements are achieved, the flow will lose efficiency through time if proper monitoring is not performed.
    -- A large percentage of companies that achieve lean and Six Sigma fail to maintain improvement through time.
Maintaining improvement with simulation
  • Simulation models can play a major role in maintaining progress and help in constant improvement.
    -- Time was invested in building a model that resembles the production line.
    -- Constantly apply changes on the line to model and perform analysis before implementation.
  • Always maintain an updated model.
   
The role of forecasting
  • By preloading the model with existing WIP, and forecasted orders, …
  • Schedules generated…
  • Help the production line while maintaining model state.
  • Proactive role … predict problems before they affect your line.
 
SimCAD Pro approach
  • Support Value Stream Map and process map.
    -- Computation of VAT, Process Efficiency, takt time deviation, and many others.
  • Forecasting and scheduling.
    -- Load existing WIP, forecasted orders, and generate the best production schedule.
  • Ease of model creation.
    -- Quick solution turnaround.
 
CreateASoft, Inc.
The Process Improvement Company

Achieving and maintaining Lean and Six Sigma with simulation

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Contact information:
Hosni Adra
(630) 428-2850 x205
hadra@createasoft.com

 
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