TOCICO 2012 Conference
How to improve Toyota Production System flow
factory performance in 6 days by 60% increase
Presented By: Katsumi Ozeki & Goldratt consulting JAPAN team
Date:5th May 2012
© 2012TOCICO. All rights reserved.
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TOCICO 2012 Conference
Acknowledgement
First of all, let me express my gratitude to Eli, Yuji, and other GC
members for giving me a opportunity to learn TOC body of knowledge.
All process including new findings in this presentation are validated
by my GC Japan team in the implementation Gemba Thanks to them I
could have an honor to present this.
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© 2012 TOCICO. All rights reserved.
The anguish of the Toyota production system
introduction in Japan
TOCICO 2012 Conference
REALITY
Less profit
PDE
More
profit
Cost is
reduced
Improve
efficiency
Strenuously, do the
Kaizen every day.
More effort
for Kaizen
Assumption
Not enough
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effort in Gemba
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TPS is being
introduced
More effort for TPS
(with outside
consulting)
Assumption
We don’t know
Proper TPS
The anguish of Gemba in Japan
Closeout own
factory
REALITY
Less profit
KAIZEN is
slow down
Improve
efficiency
Assumption
Not enough
effort in Gemba
Own factory
produces less
volume
Efficiency doesn’t
increase
Cost is
reduced
More effort
for Kaizen
TOCICO 2012 Conference
Assume
own factory is
not competitive
PDE
More
profit
Strenuously, do the
Kaizen every day.
Try finding
outsourcing
Bad Multi Tasking occurs
at Gemba by Kaizen
TPS is being
introduced
More effort for TPS
(with outside
consulting)
Assumption
We don’t know
Proper TPS
Try finding
other solution
（Cell system, 6Σ…）
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New ASSUMPTION
TPS can be done
by only TOYOTA
Increase BMT
due to production
transfer
Well fine tuned TPS flow lines
TOCICO 2012 Conference
Identify CCR… But there is no piled-up WIP
anywhere…
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TOC challenge in Japanese company
TOCICO 2012 Conference
We must improve flow despite of flow lines are super
fine tuned by TPS
Also, there are 3500 workers in the factory
Eli demands us,
It is vital to ensure that each of the first substantial actions
will result in immediate substantial benefits
・・・・
K
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Mystery by result of Direct Time Study
TOCICO 2012 Conference
S EC
50
40
CCR=45sec
30
20
ＰＲ１ＰＲ２ＰＲ３ＰＲ４ＰＲ５ＰＲ６ＰＲ７ＰＲ８ＰＲ９
1. The result of DTS is showing working time
variability of each work station.
But, there are no piled up WIP in strong
interconnected flow line.
Where does these time variability disappear?
2. CCR is 45 second
Capacity = working time/day ÷45sec = 640/day
However, I was told planed capacity is 530/day
Why are they different?
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Check reality of TPS flow line
TOCICO 2012 Conference
1. Variability by mixed products in flow line
2．The uncertainty in work itself
3． Work is done by human.
4．Delivery due date is committed by managers
(people)
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© 2012 TOCICO. All rights reserved.
Insight of Toyota Production System
TOCICO 2012 Conference
Henry Ford
Flow production
High efficiency Mass production
with single SKU
Low-variety High-volume >> Space management
Taiichi Ohno
Mixed SKU production
High efficiency mass production with high variety
with JIT concept in single production line.
high-variety high-volume >> Inventory management
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© 2012 TOCICO. All rights reserved.
Working time variability by SKU &
work stations
Change
Over
TOCICO 2012 Conference
SKU-A
SKU-B
SKU-C
SKU-D
SKU-E
Time
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Insight of CCR in mixed production
TOCICO 2012 Conference
Process１
２
３
４
５
SKU-B
SKU-A
SKU-C
SKU-E
SKU-D
Measure the time of all processes by stop watch.
And variation of each WS`s are needed to balance thoroughly.
However, CCR moves around every SKU as shown.
It is difficult to complete balance under this environment.
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How can you determine production capacity?
MAX CAPA=
Cycle time→
TOCICO 2012 Conference
1 2
SKU-A
3
45
6
7
8
1 2
SKU-B
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© 2012 TOCICO. All rights reserved.
3
6
5
4
7
8
TOCICO 2012 Conference
Under mixed SKUs environment,
the speed of flow production line
is subordinated to the slowest
work station.
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© 2012 TOCICO. All rights reserved.
The uncertainty in work itself
TOCICO 2012 Conference
Defective
parts!
1st run
Assembly
error!
Machine
SKU-E
trouble!
2nd run
SKU-E
3rd run
SKU-E
Time measures more than one time and uses the average data.
We know the reason why that we need average data.
Because of working time are different every time
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TOCICO 2012 Conference
Realizing stable production
is difficult, even if it is under
single SKU production
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Work is done by human.
TOCICO 2012 Conference
Parkinson's law
Work expands so as to fill the time available
for its completion.
The human being has used up all given time.
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© 2012 TOCICO. All rights reserved.
How can we measure idle time properly ?
TOCICO 2012 Conference
Is it possible to measure
the working time of
each work station?
Idle time
(waiting)
Working
time
Process１
Process２・・・・
The human being can not run
away from the Parkinson's law.
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TOCICO 2012 Conference
Work expands so as to fill the time
available for its completion
Therefore,
identifying CCR is difficult.
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The anguish of the factory manager
TOCICO 2012 Conference
Variety of SKU
How Gemba
can factory manager
Uncertain
KAIZEN & Cost reduction are a supreme order
control GEMBA in such environment？
Delivery due date is strictly kept
Be excellent
Factory!
Commit
to plan
INJECTION
Productivity
Buffer
on
management
capacity
Maximize
Efficiency
Assumed
No
bufferproduction
achieve 100%
oncan`t
capacity
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© 2012 TOCICO. All rights reserved.
productivity
Insight of flow line tuned by TPS
TOCICO 2012 Conference
1. Variability by mixed products in flow line
The speed of flow production line is subordinated to the slowest
work station.
2．The uncertainty in work itself
Realizing stable production is difficult, even if it is under
single SKU production,
3． Work is done by human.
Work expands so as to fill the time available for its completion.
Therefore, identifying CCR is difficult.
4．Delivery due date is committed by managers (people)
Productivity target setting is due that management is assumed
production line won`t able to achieve 100% productivity.
In order to find production capacity…
=The correct time must be pursued.
＊Actually, it isn't possible to measure correct time
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It is necessary to admit that correct time
is impossible to measure.
TOCICO 2012 Conference
Correct time
it is impossible to measure
How can we identify CCR?
Gemba is living thing
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© 2012 TOCICO. All rights reserved.
The Five Steps of Focusing
TOCICO 2012 Conference
1. IDENTIFY the system’s constraint(s)
2. Decide how to EXPLOIT (make the most out of) the constraint(s)
3. SUBORDINATE everything to the above decisions
4. ELEVATE - Find/invest in additional capacity or alternatives
5. If at any time in a previous step a constraint has been broken go
back to Step 1.
Do not allow INERTIA to become the constraint!
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Step1 Place buffer in between processes
TOCICO 2012 Conference
＝CCR
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© 2012 TOCICO. All rights reserved.
Step1 Place buffer in between processes
TOCICO 2012 Conference
＝CCR
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© 2012 TOCICO. All rights reserved.
Identify CCR by cutting flow line
TOCICO 2012 Conference
CCR
CCR
CCR
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© 2012 TOCICO. All rights reserved.
Direct Flow Study
Correct time
It is impossible to measure
TOCICO 2012 Conference
How can we identify CCR?
Correct time is measurable  Correct time data
＊Analyze each work station
= Direct Time Study
Correct time is not measurable  Place buffer in line
＊Analyze holistic flow
= *Direct Flow Study
*I am recognizing and prefer to use DFS which Yuji san invented this naming during our discussion..
Remember?
Improving flow (or equivalently lead time)
is a primary objective of operations.
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© 2012 TOCICO. All rights reserved.
Experimental approach at
OMRON Healthcare factory in China
Day to day KAIZEN activity
TOCICO 2012 Conference
’86：TPS
’93：TPS
’98：TPS
’05：TPS
RTC start at factory in JPN
introduction in China factory (KANBAN/JIT)
Challenging shortening production LT = 1 week
Recognized best TPS and Lean production
The special feature article was
published in NIKKEI business
magazine as a case with the most
excellent TPS factory in 2005
The excellent TPS flow line factory!!
TPS = Toyota Production System
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© 2012 TOCICO. All rights reserved.
Let`s challenge in the factory!
TOCICO 2012 Conference
Step-1
Identify CCR
Step-2
Exploit CCR by placing
buffer before and after CCR
Production capacity increases
close to 640/day immediate after
STEP-2
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© 2012 TOCICO. All rights reserved.
How can we expand experiment?
TOCICO 2012 Conference
First challenge was that only one line
with 9 operator improved capacity. But
factory consists of 3500 employees.
The following week, another line
applied same action and get result.
Unavoidable effect is?
Another line manager
imitated
and
didmanager
the
Another
line
same thing.
imitated
and
did
the
Another line manager
same thing.
imitated
and
did
the
Another line manager
same thing.
imitated
and
did
the
Another line manager
same thing.
imitated
and
did
the
Another line manager
AIR
same
thing.
ACTION
doesn’t
imitated
and
did
therequire
Another line manager
Production managements
AIR
technical
skill require
same
thing.
ACTION
doesn’t
imitated
and
didmanager
the
evaluate
with performance
Another
line
Production
managements
AIR
technical
skill require
same
thing.
ACTION
doesn’t
imitated
and
did
the
evaluate
with
performance
Production managements
AIR
technical
skill require
same
thing.
ACTION doesn’t
evaluate
with
performance
Production managements
AIR
technical
skill require
ACTION doesn’t
evaluate
with performance
Production
Capacity
managements
up
is well
AIR
technical
skill require
ACTION doesn’t
evaluate
appreciated
with performance
Production
Capacity
managements
up
is well
AIR
technical
skill require
ACTION doesn’t
evaluate
appreciated
with performance
Production
Capacity
managements
up
is well
AIR
technical
skill require
ACTION doesn’t
evaluate
appreciated
with performance
Production
Capacity
managements
up is well
technical skill
evaluateCapacity
with performance
appreciated
Drastic capacity
increase
up is well
in short
periodappreciated
Drastic
capacity
increaseup is well
Capacity
in short
periodappreciated
Drastic
capacity
increaseup is well
Capacity
in
short
periodappreciated
Drastic capacity
increaseup is well
Capacity
in short
periodappreciated
Drastic
capacity
increase
in short
periodincrease
Drastic
capacity
in short
periodincrease
Drastic
capacity
in
short
periodincrease
Drastic capacity
in short period
Another line manager
imitated and did the
same thing.
AIR
Production managements
evaluate by productivity
ACTION doesn’t
require technical skill
Capacity up is well
appreciated
Drastic capacity
increase in short period
ACTION
Identify CCR by placing
buffer in production line
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© 2012 TOCICO. All rights reserved.
ACTION
Exploit CCR by placing
buffer before and after CCR
For further capacity increase…
50
45
40
35
S EC
S EC
TOCICO 2012 Conference
30
20
25
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ＰＲ１ＰＲ２ＰＲ３ＰＲ４ＰＲ５ＰＲ６ＰＲ７ＰＲ８ＰＲ９
ＰＲ１ＰＲ２ＰＲ３ＰＲ４ＰＲ５ＰＲ４’ＰＲ５’ ＰＲ６ＰＲ７ＰＲ８ＰＲ９ＰＲ１０ＰＲ１１
Capacity 530/day by 9 worker
Add (4) worker in process for avoid jumping
CCR. Capacity increases to 830sets/8h when
CCR is controlled to 34sec.
Capacity 640/day by 9 worker
by focusing CCR
Assembly
Line layout (~ July/ 23rd)
Adjustment
Packing
Inspection
Set LCD
Set LCD
Line layout(July / 30th ~)
Assembly
Adjustment
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© 2012 TOCICO. All rights reserved.
Inspection
Packing
Capacity increase under MTA environment
increases TP
TOCICO 2012 Conference
Capacity up
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increase sales
Higher priority
Red = below
target inventory
utilize
resource
Stop produce
reduce inventory
Lower priority
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© 2012 TOCICO. All rights reserved.
Blue = above
target inventory
The bright future of the manufacturing
that TPS had being introduced
TOCICO 2012 Conference
In TPS flow line gemba, TOC can deliver results
more surely with shorter time
Production management
compete TOC introduction
The result comes
out to the short time
AIR entity
Production managements
evaluate by productivity
High skill GEMBA
Focus all
effort on CCR
Strenuously, do the
Kaizen every day
TPS is being
introduced
It is vital to ensure
that each of the
first substantial
actions will result
in immediate
substantial
benefits
INJECTION
Introduce TOC
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© 2012 TOCICO. All rights reserved.
TOCICO 2012 Conference
Let`s realize on manufacturing GEMBA all
over the world！
Let`s deliver immediate substantial results
in Japan and world!
with TOC
armed TPS
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© 2012 TOCICO. All rights reserved.
About Katsumi Ozeki
TOCICO 2012 Conference
Katsumi Ozeki, Project Director of Goldratt Consulting . In 1998, he was appointed to
Sony manufacturing UK and told closing factory. He counter proposed recovering
factory competitiveness by realizing RTC within local market.
6 month later, factory got President award as best performance factory. His local boss
arranged special present to him. He was invited to the guest house of her majesty Anne
and staying 3 nights together with young leaders in UK for debating UK future vision.
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© 2012 TOCICO. All rights reserved.
TOCICO 2012 Conference
End of presentation
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© 2012 TOCICO. All rights reserved.