Course Agenda
Course AgendaLean office overview
Definition of waste
Orientation to YESCO Hawaii
Round one of simulation
Value Stream Mapping (current state)
Implementing lean tools
Round two of simulation
Value Stream Mapping (future state)
Round three final simulation
Final Evaluation
1IntroductionsWho are you?Where are you from?What do you want to
learn today??s
2What is Lean Office?Lean Office is a systematic approach
applied to the value chain with an aim to streamline the business
processes by:Eliminating wasteUtilizing lean techniquesResulting
in: Lead time reduction and Productivity improvement
3Why Lean Office?In America today we have good people working in
poor processes. What we want is good people working in great
processes Michael Hammer
4Why Lean Office? Toyota Production System will not work unless
it is used as an overall management system. TPS is not something
that can only be used on the Production floor.
Taiichi Ohno
5Lean Office$LEAD TIME REDUCTION
66Time equals moneyLean SystemsBusiness as
UsualCustomerDeliveryCustomerContactLead-TimeWasteCustomerDelivery
CustomerContactLead-Time(Shorter)Waste EliminationEliminate
Non-Value Added Activities77Processes have evolved over the years
but may never have been mapped and recalibrated toward no
wasteValue Added vs. Non-Value Added ActivitiesValue Added (VA)The
customer is willing to pay for itPhysically transforms the product
(or document or information)Is done right the first time
Non-value Added (NVA)Consumes resources, but does not add value
to the product or service
Necessary Non-value Added (N-NVA)Does not add value to the
product or service but are CURRENTLY NECESSARYCustomer Contract or
specification QS 9000 or customer standardGovernment
regulationCurrent state-of-the-art work method or technology
8Why Lean Office?Only 30% of the total costs are directly
manufacturing
Where is the rest of the money being spent?
9Lean Organization A streamlined flow of goods or services
through an organization in concert with customer demand and
requirements CustomerDelightBusiness Operations1) Identify, manage
or break the constraints
2) Eliminate waste and non value added work
3) Synchronize all activities toward customer delight
4) Apply an employee based cross functional continuous
improvement planStreamline, Synchronize, and IntegrateProcess
ViewWe can begin to reduce the complexity of an organization by
implementing Lean Tools and Techniques in support processes. We can
gain a competitive advantage by streamlining the organization,
focusing on these four areas1010We can begin to reduce the
complexity of an organization by implementing the Lean tools and
techniques in the support processes. We can gain a competitive
advantage by streamlining the organization by focusing on these
four areas. Where are the constraints?Where is the waste in the
processes?Are all processes focused on the customer?Do the
employees have an understanding of the overall business?
Business Activities1111Two points:Look at how producing the
parts (perform manufacturing operations) is just a small part of
the big picture and is most of the value added activityLook at all
the support activities and how the Lean Champion must navigate
through all the functional silosSites of WastePolicies
Organizational structureManagement policies and methodsMacroscopic
wastes Supply chainOffice layoutMajor wastes Process and cell
levelMicroscopic wastes Operator and computer level
1212DefectsOverproductionWaitingNon-utilized
talentTransportationInventoryMotionExtra processing
Typically 95% of Total Lead Time is Non-Value Added!!!Value
AddedLean = Eliminating the Waste2006 MMTC1313Waste of DefectsMoney
and time wasted to find and fix mistakesLack of process
controlsPoor work instructionsInadequate trainingData entry
errorMissing informationMissed specificationsPricing error
1414What defects do you see in your company?Ask for examples
Waste of Overproduction
Making multiple schedules due to system
incompatibilitiesE-mails/memos to everyonePrinting extra documents
just-in-caseMore information than the process requiresMore
information than the customer needsCreating reports no one
reads1515Ask what they see in their company. Waste of WaitingTime
lost when people and resources are waiting: Unbalanced
workloadEquipment break downsBatch processingWaiting for
informationWaiting for copiers/faxesWaiting for customer
responseWaiting for an internal response
1616Ask examples from them
Waiting Waste2006 MMTC1717Packages delivered and waiting. Where
should they go? Who do they belong to?Waste of Non-Utilized
TalentUnclear job descriptionsLack of trainingLack of synergy and
collaborationNo feedback loop for continuous improvementSuggestions
for improvements that are not investigated/utilized1818This creates
a lot of waste. Errors are made, questions need to be asked with no
one around who has the answers, folks working with blinders
on.Waste of Non-Utilized Talent
1919The subject matter expert is not asked for her input to
solve the problemWaste of TransportationPoor office layoutWalking
around to correct mistakes and find answersRetrieving or storing
filesCarrying documents to and from shared equipmentGoing to get
signaturesTaking files to another person
2020Ask for other examplesWaste of InventoryStoring of obsolete
prints and specsObsolete databases/files and foldersFiles pile up
between work desksOpen projects (WIP)Office suppliesE-mails waiting
to be readUnused records in a database2121Is this happening in your
company? Other examples
Inventory Waste2222Looks like too much toner on hand especially
since they just replaced the machine that uses itWaste of
MotionLooking for items because they are out of placeMis- or
unfiled papersSaving files everywhereHandling paperwork that could
be electronicExtra clicks or keystrokesWorking around other open
files on desk2323Ask for their examplesWaste of Extra
ProcessingDoing more than is required to meet customer
requirementsUnnecessary paperworkRedundant approvalsRepeated manual
entry of dataUse of outdated standard formsUse of inappropriate
softwareCreating hard copies of reports
2424What examples do they have?Above the Shop Floor
This pile represents over a dozen jobs. How many labor hours to
produce this paper?
Tell me about this photoWhat else do you see?Are there any
hidden images?Were you even going bother to look until I ask
you?Waste in the Office manisnt always 26Office SimulationLets
learn by doing!
2727Exercise: Break group into teams of 4-5 and spread the teams
out to different white boards. Have them draw the DOWNTIME acronym
and list 2 to 3 examples of each of the 8 wastes that exists in
their office.YESCO HawaiiA New Division2828YESCO Hawaii
OrientationYou are all employees of YESCO HawaiiPositions to be
filled:- Sales- Material Control- Business Office-
SchedulingEngineering- Production/InstallationProcess EngineerWe
will work in batches of 5 at Sales and 1 everywhere elseWe will
measure the following- # of orders shipped- # of invoices faxed- #
of quote drawings completed- Work in process
29YESCO Hawaii Company PoliciesWork shift is 10 minutesKeep busy
at all timesThe goal is to Install and invoice 14 orders and
complete 3 new business quotes
30YESCO HawaiiRound 1
3131Metrics Scorecard32
Select an extra person to fill out this chart32YESCO HawaiiRound
2
33Make some improvements!33Make your improvements and lets try
it againMetrics Scorecard34
Enter your data into your chart34 LETS GET LEANLearn the tools
to recreate your WORLD35
Its all about TimeDVD3636DVD is the Time DVD showing office
waste 18 mins.
Characteristics of a Lean ProcessPeople arranged in process
orderOne-piece flow processesErgonomically-correct work areasPull
system disciplineStandard operations defined and
implementedCross-functional, multi-process associatesProcess
intolerant of abnormalities3737Improves morale, safety, reduces
waste Ask how?7 Steps for Value Stream Mapping with Swim
LanesCreate a macro level flow of processSelect a functional area
to mapDetail the stepsIdentify NVA and N-NVA stepsAnalyze the
processDevelop a future mapDevelop and implement action plan38
Create Flow of ProcessHave someone sketch it up on the board392.
Select Functional Area or value stream Break up departments into
swim lanes2006 MMTCYESCO Hawaii Value Stream Map of business
processSchedulingMaterial ControlBusiness OfficeSales40Swim Lane
border (divides departments)40In this case we will look at the
whole business process3. Detail the Steps
41Process Mapping GuidelinesGather the information from the
actual process - go see where the work is being performedGet the
real data versus the theoretical way it should be done or the way
people think it is doneUse the experts (people doing the work) to
develop the mapsUse the maps as a microscope on the process to
allow you to see where to make improvements4242What are some
examples?
Use the Experts43Explanation of Flow Diagram Symbols &
ColorsDWNTIMEDescribe the process stepIf the step is Non-Value
Added, which DOWNTIME waste(s) does it represent?How much time does
it take to complete the process step?OValue AddedNon-Value
AddedNecessary Non-Value Added What is the walk/travel
distance?Color in:44Explanation of Flow Diagram Symbols &
ColorsRepresents InventoryI45Explanation of Flow Diagram Symbols
& ColorsRepresents a Decision46Yes or No?Explanation of Flow
Diagram Symbols & ColorsConnects a process within a swim
lane47Explanation of Flow Diagram Symbols & ColorsConnects
steps that cross swim lanes48Explanation of Flow Diagram Symbols
& ColorsRepresents electronic work/data
transmission49Optional49Explanation of Flow Diagram Symbols &
ColorsRepresents document Reviews, Approvals or Inspections
(RAI)RAI50
4. Identify NVA & N-NVA Steps
NVAN-NVAVA51Examples of NVA ActivitiesTraveling (excess
transportation or motion of people or materials)Inspecting or
checking (review-approval-authorization cycles)Work reporting (done
right the first time rule)Redundant or unnecessary data
entrySupervisingCountingReformatting or creating duplicate
copiesFiling and file maintenance5252What are some examples?5.
Analyze the Value Stream Map1. Total each of the different process
events
StepsTime5353SLAM swim lane analysis matrixHandout copy have
them fill it outNOTE: Paste a bright green post-it near improvement
opportunities that you have identified from you current state value
stream map. Write a small description of the waste and how to fix
it.5. Analyze the Value Stream Map (using Starbursts)STARBURST
5. Analyze the Process Map2.Identify opportunities to combine
steps that occur between two or more peopleIn order to eliminate
handoffs or delays3.Identify opportunities to perform work
simultaneously instead of sequentiallyIn parallel instead of
serially. What is the earliest a particular work step can
occur?Identify opportunities where work (documents or information)
can be delivered to the next person or operation one piece at a
time instead of delivering work in a BatchIdentify opportunities to
build into the process signals or advanced notice to downstream
departments to prepare to receive or produce work5555What are some
examples?Parallel vs. Serial Processing
565. Analyze the Process Map4.Identify opportunities to
co-locate people doing work:To improve communicationTo reduce the
effects of handoffs and of transportation distances.5.Identify
opportunities to automate any of the workElectronically capture and
transmit documents (scan-mail)Replace manual handoff with an
electronic handoffElectronically capture and report process events
and work statusReplace hard copy forms, worksheets, or spreadsheets
with electronic versions, accessible from the networkElectronically
combine several documents into a single database
5757What are some examples?5. Analyze the Process Map6.Identify
problems which if solved will reduce time or error rate
7.Determine whether the entire process is a candidate for
reengineering5858What are some examples?6. Develop Future MapNow
that opportunities for improvement have been identified through the
analysis step, start a new map incorporating the improvements you
identified. Remember to take a picture of your before and after
states.
597. Develop & Implement Action Plan Create a list of
actions Prioritize the list Impact-Difficulty Grid Assign
responsibility Define due dates
6060What are some examples?Impact/Difficulty
MatrixEasyHardHighLowDifficultyImpact6161What are some
examples?Sustaining ImprovementsRecognize that several follow-up
activities may be necessary:Implementing and refining a measurement
or performance monitoring systemInitiating additional improvements
or corrections based on the measured results of the improved
processReconvene Team representatives until the projected levels of
improvement have been achieved and sustained for at least three
months6262What are some examples?Exercise
Exercise Map the process!6363What are some examples?Symbols
& Colors for Process MappingProcess StepSame Person StepBetween
Process StepIInventoryDecisionRAIReview, Approve Inspect64Lean
Tools
Fill up your Tool Box!65Establishing Takt TimeTakt Time is the
pace needed to meet customer demand.If you have a Takt Time of two
minutes, that means every two minutes the process is completed
once.Every two hours, two days or two weeks, whatever your sell
rate (customer demand) is your Takt Time. Takt Time =Your Operating
Time per ShiftCustomer Requirement per Shift27,600 sec (7.67
hours)460 orders= 60 secGOAL: Produce to Demand!665S & Visual
ManagementA proven method used to systematically organize, clean,
and standardize the workplace
If you cant do 5S, you cant do Lean!
675S & Visual Management
Seiri Saiton Seiso Seiketsu Shitsuke SortSet-In-Order
ShineStandardizeSustain Clear outConfigureCleanConformityCustom
68Elements of a 5S ProgramSort - what is not needed, sort
through, then sort out; When in doubt, throw it out!Set-in-order -
what must be kept; make visible and self-explanatory so everyone
knows where everything goesShine - everything that remains. Clean
equipment, tools and workplaceStandardize - implement best
practices to keep the workplace clean and organizeSustain - making
a habit of properly maintaining correct procedures5S69What is
Standardized Work?Standardized Work is a method enabling employees
to improve their control of operations and measure their
performance against documented standards
Performance is optimized by reducing variation and waste in
operations by the efficient arrangement of people, products, and
machines, thus improving product quality
70Cellular / Flow ProcessingArrange people and workspace to
achieve one-piece flowMinimizes wastes of: Defects Overproduction
Waiting Non-utilized Talent
Transportation Inventory Motion Extra ProcessingSingle piece
flowPull process controlReduced wasteImproved floor space71One
Piece Flow
Consider these conditions for flow in the office setting:One
piece processing versus batchPeople in process
sequenceMulti-process work sequenceMulti-process skilled
peopleSynchronization of operations (work balance)
72Poka-Yoke / Mistake-ProofingPoka-Yoke is the removal of all
potential causes of error either through design, process, or
mistake-proofing devices, to ensure consistent process
resultsPoka-Yoke helps build quality into processes to achieve Zero
Defects
73KaizenKai = ChangeZen = Good (for the better)Kaizen =
Continuous Improvement
Kaizen has a bias for action!
74Yesco HawaiiRound 375Remember to think outside the box!75What
are some examples?Metrics Scorecard76
Enter your data into your chart76Customer Service Request IT
ProviderPurchasingquotes orderOrder processingReceives andSigns
offService Repdefines orderMgr verifiesorderCustomer
ServicePrepares formAdmin inputsTo data baseQuoteNeeded?Mgr
approvesquoteQuote above $8,000?MgrapprovalMgt BoardapprovalAccount
VPapprovalPurchasing fillsorderDefineorderNoNoYesYesOld Process
Average 50 daysNew Process - Average 7 days Waste
removedCustomerService RepMgr approvesquoteAdmin inputsto data
basePurchasing fillsorderOrder processingReceives andSigns
offCustomerAdmin sendsApproval notice7777The lead time to fulfill a
customer service request was dramatically reduced by mapping the
process and focusing on non value added work.. YESCO Las Vegas
Success StoryThe business office has reduced Node 5 (last day of
labor to date of invoice) from an average of 15 to 20 days to 5 to
12 days for the Exteriors Branch. The same concepts are being used
to streamline the billing process for Interiors eliminating several
hand offs and reducing Node 5 as well.
7878 YESCO Electronics Success Story7979Lending Process
Financial Institution 10/15% 10/20% 5%60/75%90% 5%
5%Adm/clerical-filing-typing-mailing-gathering dataGeneral
phoneInquiries frommembersFill in forOther staffLoan
ProcessingPhone inquiriesLoans onlyFill in forOther staffLoan
ProcessingTime spent by Loan Processor Old ProcessNew Lean Process
after Kaizen Event8080In the banking industry revenue is generated
mainly by interest received from loans. The shorter the lead time
for the lending process allows more loans to be generated. This
increases revenue for the bank.
In this example Loan Processor time was spent on non value added
work. Reassignment of the clerical work and a new process for
taking phone calls dramatically improve the time for Lending
money.Keys to SuccessCreate a sense of urgencyHave a vision,
communicate it continuouslyFocus on key process driversRemove all
obstacles to achieve the visionCreate short term victoriesDont
declare victory too soonSpeak with dataDont assumeAnalyze data
doubt itMake decisions with dataTake action based on dataCheck
results
8181The ideal first project is clearly and unambiguously
measurable. This is not always possible for administrative
Kaizens.satisfies a widely-perceived need. is a repeatable process.
is self-contained, not subject to uncontrollable external
influence.
8282Administrative Process ImprovementAdministrative Kaizens are
often discontinuous mini-Kaizens.The team meets first to understand
the nature of the project and decide what they will need to know.
The current state is described. A process map may be developed. Any
information unavailable at the first meeting is provided prior to
the second meeting.The second meeting is generally one day. The
project is analyzed and a complete action plan is developed. The
plan is implemented and the outcomes are monitored. If necessary, a
follow up meeting is held. 8383.The Kaizen Project TeamTeam members
are selected on a project-by-project basis.There is a team leader
chosen to facilitate and coordinate. The leader is not in charge in
the traditional sense.The team can be comprised of:
Subject matter experts in the target area. Others in the same
segment of the organization. Individuals from other areas of the
organization. This includes technical staff. Individuals from
outside the organization.8484The Kaizen Project TeamAn open,
egalitarian structure is important.When Kaizen project work is
underway, organizational position is irrelevant and disregarded.
All team members are considered equal within the team.8585Key
Kaizen TenetsAn open atmosphere is critical. Free thinking and
contribution are necessary. Everything is open to question. No
assumptions are made. A Kaizen event is not developing a list of
ideas or recommendations to be studied. The outcome is implemented.
8686Now Recreate that WorldMap it with the expertsStudy your
mapImplement changesCelebrateStudy and implement more
changesCelebrateRepeat, Repeat, Repeat
87Questions?
8888Sheet1Goal: 14 Orders/3 QuotesRound 1Round 2Round
3MeasuresTeam 1Team 2Team 1Team 2Team 1Team 2Lead
TimeWork-In-ProcessOrders Shipped/InstalledDrawings QuotedInvoiced
$s$0Material Costs$0Labor Costs$0Overhead Fixed Costs
($5,000)$0Total Cost$0$0$0$0$0$0Total Revenue$0$0$0$0$0$0Profit /
Loss Totals$0$0$0$0$0$0
Sheet2
Sheet3
Sheet1Goal: 14 Orders/3 QuotesRound 1Round 2Round 3MeasuresTeam
1Team 2Team 1Team 2Team 1Team 2Lead TimeWork-In-ProcessOrders
Shipped/InstalledDrawings QuotedInvoiced $s$0Material Costs$0Labor
Costs$0Overhead Fixed Costs ($5,000)$0Total Cost$0$0$0$0$0$0Total
Revenue$0$0$0$0$0$0Profit / Loss Totals$0$0$0$0$0$0
Sheet2
Sheet3
Sheet1Goal: 14 Orders/3 QuotesRound 1Round 2Round 3MeasuresTeam
1Team 2Team 1Team 2Team 1Team 2Lead TimeWork-In-ProcessOrders
Shipped/InstalledDrawings QuotedInvoiced $s$0Material Costs$0Labor
Costs$0Overhead Fixed Costs ($5,000)$0Total Cost$0$0$0$0$0$0Total
Revenue$0$0$0$0$0$0Profit / Loss Totals$0$0$0$0$0$0
Sheet2
Sheet3