A Century of Lean Thinking

Transcription

1 A Century of Lean Thinking A Presentation by James P. Womack For Lean Manufacturing Conference Dearborn, MI May 11, 2004

2 What s Lean Thinking Looking at manufacturing as three primary processes that create value for consumers: product development, order to delivery, service through the product s life cycle. Asking what value really is from the standpoint of the customer. (The purpose of the process.) Asking how the process currently performs and how it could perform better. Asking what people and business processes are needed to support the value creating processes. Aligning purpose, process, and people in search of the perfect process.

3 In Search of the Perfect Process One that creates the desired value. In which every process step is: Valuable Capable Available Adequate Flexible

4 In Search of the Perfect Process And the steps are linked so that they: Flow smoothly and quickly from one to the next. At the pull of the downstream customer. With leveled demand.

5 Was Henry Ford the First Lean Thinker? Venetians understood flow production by 1400s! Adam Smith understood the division of labor by 1776! French Army Ordinance understood the advantages of interchangeable parts before 1789! Marc Brunel was making completely standardized parts with special purpose machines arrayed in process sequence for the British Navy by 1807! Thomas Blanchard introduced a production cell with progressive manufacture on automatically cycling machines at the Springfield Arsenal in 1818! Meatpackers understood the moving (dis)assembly line by the 1880s.

6 Was Ford the First Lean Thinker? Ford saw a total system when others saw parts. By 1914 at Highland Park the full system of flow production was largely in place: A comprehensive gauging system to prevent more than one bad part from being made poka yoke. A widespread practice of taking the process to the product to create fabrication activities resembling cells. Continuous flow in most assembly activities, made possible by interchangeable parts & standard work. A crude system of preventing over/under production.

7 Was Ford the First Lean Thinker? Of the three key elements in a lean production system purpose, process, and people Ford had the middle part well on the way and his own answer to the purpose and people elements with Flow Production. So Yes! And it s fair to say that we are now a century into Lean Thinking. Lean Thinking also includes an approach to product development, supply management, customer relations, and strategic direction, but at this Manufacturing Conference let s stick to manufacturing.

8 What Came Next? Ford s Mass Production at the Rouge. Highland Park made a completely standardized product in a de integrated system with suppliers in close geographic proximity (Ford s Toyota City). The Rouge was a highly integrated attempt to make a wide variety of products for world markets at one site. Highland Park initially conducted the great majority of Ford s assembly but the Rouge never accounted for more than a small fraction. Instead, the Rouge made standardized parts for whole vehicles in massive quantities and shipped them to as many as 50 assembly plants around the world.

9 What Came Next? One problem with the Rouge was high set up times, big batches, and workers tied to machines, meaning large buffers and lower productivity whenever variety was required. (And variety was increasingly required.) A second problem was the increasingly complex centralized control of information needed to coordinate the process, as pull became push. A third problem was that the social basis of production the people and management dimension was not in sync with the process. The Rouge was completed and Ford began to decline at the same time.

10 What Came After Ford? Toyota City! An enormous Highland Park on one floor or a deintegrated Rouge, where most parts production & practically all assembly at Toyota were conducted between 1937 and 1984! This was the real perfection of the Toyota System (by the late 1970s) as evidenced by remarkable turns of > 80. The problem was that Toyota City s success created the next challenge for Lean Thinking as production progressively moved off shore.

11 What Comes After Toyota City? It s up to us and we have no final answer! Here are some possibilities: A continuation of spaghetti world to serve global markets, except moving even faster with individual process steps for products spread across the globe. Creation of little Highland Park and little Toyota City where parts fabrication is co located or near located to serve a final assembly site for a wide variety of products. (Ford Amazon, Ford Chicago, and Ford DTP are initial steps in this direction.)

12 Spaghetti World Move each step in the processes culminating in a completed product to its lowest cost point. Perfect logistics to minimize logistics costs and coordination problems at many remote sites. Prepare to keep moving as factor costs change (e.g., Poland is now getting expensive, so how about the Ukraine? Coastal China will start to get expensive within a few years, so how about the interior? All parts fabrication ends up in Kyrgyzstan?!) Has the benefit of rapidly spreading industrial culture uniformly across the earth, but is it truly lowest cost?

13 Value Stream Compression World Tools are right sized, operating methods are perfected, and product designs are modified so that suppliers can support assembly operations with a very high level of product content in short trucking distance within the market of sale. (E.g., carrying Amazon, Chicago and DTP to their logical limit.) Build to order slot systems are perfected so that a substantial fraction of vehicles are built to customer order within the region of sale with very short delivery promise dates.

14 The Likely Trajectory We continue a bit further with spaghetti world. Gradually we shift to value stream compression world. Changing customer expectations about the product and converging wage rates help the transition. Someday we reach the happy condition of a high fraction of motor vehicles being built in the region of sale with very short response times. (A truly lean world!)

15 In the Mean Time The first century of Lean Thinking began in this town! The current focus in Detroit museums is on products, isolated machines, and empty buildings. The really distinctive contribution of Detroit to the world was an integrated, flowing process! Why can t we work together on a process museum and a formal history of lean thinking that brings all the pieces together and re claims the rightful place of Detroit in industrial history? Ford itself can t afford to do much. Who else could help? Let s keep talking within the Lean Community!