Protected by Danfoss copyright Canada-Denmark “Productivity” Seminar Productivity on the shop floor/social organization of work Ejner Kobberø: Market Support.

Protected by Danfoss copyright

Canada-Denmark “Productivity” Seminar

Productivity on the shop floor/social organization of work

Ejner Kobberø: Market Support Manager Danfoss A/S

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Automatic Controls Operations NordborgKey Figures

Financial Factory turnover 552 M DKK (96 M USD)

Output Units/year 6.400.000 pcs

Employees Blue collars 280

White collars 55

Space Production 11.200 m2

Administration 1.600 m2

Certificates ISO 9001, ISO 14001, OHSAS 18001

Systems TQM Standardized mgmt system

ERP SAP R3

SPC Q – das

Maintenance DVS

PMS Online system

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10 principles for all production factories in the Danfoss Group

Danfoss Productivity Program

This presentation is protected by Danfoss copyright and solely for the use of Danfoss personnel. No part of it may be circulated, quoted, or reproduced for distribution outside the Danfoss organization without prior written approval from Danfoss Business System. This material was used by Danfoss Productivity Program during an oral presentation; it is not a complete record of the discussion.

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10 principles for all production factories in the Danfoss Group

Our production culture will be characterised by:

Production according to customer orders – we base all production on the actual needs of customers, optimised production flow and a minimum of stock (in short: pull not push)

Production teams – we group production employees into teams, each with a team coordinator who will facilitate an optimal production flow

Standard Operating Procedures (SOPs) – we standardise all processes and document them in SOPs

Stretched targets – we always set stretched targets for improvement activities that are based on: ”What if everything goes right?”

Hourly follow-up on production – we detect deviations from planned production immediately and respond with corrective actions

Committed management – our leaders are visible and active in the production area and are ambassadors for the Danfoss Productivity Program

Follow-up on improvement activities – we ensure a maximum impact on the bottom line by calculating the improvements in total costs and following up via KPIs (Key Performance Indicators)

Respect for people – we involve and support our employees in the change process, in accordance with Danfoss’ values

Creating value – all activities must create value for our customers

Continuous improvements – we make continuous improvements by constantly optimising our way of working, systematically solving problems and building competences

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Creating value – all activities must create value for our customers

1. Overproduction

We create value by removing waste:

2. Waiting

3. Transport 4. Over-processing 5. Inventory 6. Scrap & Rework

7. Motion

8. Untapped human potential

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Production according to customer orders – we base all production on the actual needs of customers, optimised production flow and a minimum of stock (in short: pull not push)

Use Material and Information Flow Analysis as a tool to diagnose lack of flow and design improved flow

Ensure optimization across the value stream instead of local optimization

Pull system

• Benefits:

• Prevents overproduction

• Controls inventory

• Makes production system visual

• Drives improvement

• Synchronises processes with customer rhythm

Push system

• Bad symptoms:

• Production in advance and delayed production at the same time

• High level of WIP

Company CustomersSuppliers Dailyweeklymonthl

y

ORDERSweeklyconfirm

edorders

Weekly Demand:

2000 A1000 B4000 C

Weekly Demand:

500 pallets

Schau

blinAvailable time

manual cycle time

machine cycle time

machine reliability

changeover time

shared / dedicated

Saw&

DeburrAvailable time

manual cycle time

machine cycle time

machine reliability

changeover time

shared / dedicated

Weld&

De-carbAvailable time

manual cycle time

machine cycle time

machine reliability

changeover time

shared / dedicated

Rotajet

Available time

manual cycle time

machine cycle time

machine reliability

changeover time

shared / dedicated

Paint

Available time

manual cycle time

machine cycle time

machine reliability

changeover time

shared / dedicated

‘G’ Build, Test & Final Assy

Available time

manual cycle time

machine cycle time

machine reliability

changeover time

shared / dedicated

Despatch

Available time

manual cycle time

machine cycle time

machine reliability

changeover time

shared / dedicated

30001000013500600

100

2250028500

26000

Rawmaterials

FinishedGoods

MRP system

10 d

180s

13.5 d28.5 d

120s 250s 240s 250s

2 d

500s

22.5 d 0.6 d

Processing Lead time

Processing timeManufacturing Lead time

For longest component stream

=

1540s = 0.06%77.8 d

Material and Information Flow Analysis

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Production teams – we group production employees into teams, each with a team coordinator who will facilitate an optimal production flow

Supports organization around flows with team coordinators

Ensure respect of and adherence to standards

Allocate clear authority to change the standards

Establish necessary foundation for reaching targets

Simplify management by alignment around common targets

Establish motivational environment

Basis for capability building programmes

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Standard Operating Procedures (SOPs) – we standardise all processes and document them in SOPs

Eliminates uncertainty in the process

Provides degrees of freedom for shop floor to identify improvements

Establishes a natural contract between management and shop floor

Provides the right baseline to establish targets

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Continuous improvements – we make continuous improvements by constantly optimising our way of working, systematically solving problems and building competence

Systematic capture of problems and suggestions from employees

Continuous use of Root Cause Problem Solving to improve all processes

Eliminate the 8 waste

Continuous reaction and corrections (just

do it) by the production team

according to planned production

Proposals to problem tasks

are made by the production team

Reasons to problems are

removed and the team

performance is improved

Problem tasks are prioritized

and solved

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System and

Method

Attitudes and Competences

Organisation

1 2 3 4

1. Identifyproblem

3. Find and implement solution 2. Analyze and

find root cause

4. Evaluate result

4-Step method

1. Identifyproblem

3. Find and implement solution 2. Analyze and

find root cause

4. Evaluate result

4-Step method

1. Identifyproblem

2. Analyze problem

3. Find cause and solution

4. Implement solution

5. Evaluate solution

6. Standardize/formalize solution

The 6 Step Method

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Hourly follow-up on production – we detect deviations from planned production immediately and respond with corrective actions

Creates transparency for early identifying of abnormalities from standards and deviations from targets

Changes problem solving modus from reactive to proactive

Provides foundation for root cause elimination

Allows managers at all levels to justify development of operations

14:15 - 15:15

15:15 - 16:15

16:15 - 17:15

17:15 - 18:15

18:15 - 19:15

19:15 - 20:15

20:15 - 21:15

21:15 - 22:15

Bemanding

KommentarerAktueltPlan

Aktuelt

DifferenceAkk. aktuelt

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Tid:

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Akk. Plan

Ansvarlig:

168B9570

168B9570

50

60

70

80

148B7070 10

148B7070 8

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168B9570

168B9570

22

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148B7070 10

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Skift:

0

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Område: Dato:

027G5670 12

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Emne nr.

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Dato

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(90%

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Produktion

Mål

14 hours prod.time 10 hours pred. time

Defect marker Ready on Monday

morning ;)

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Stretched targets – we always set stretched targets for improvement activities that are based on: ”What if everything goes right?”

Based on a future state (stretched targets) - constantly set short term activity plans and targets to drive continuous Improvement

Future states to be challenged and reviewed as a standard process

Provides the guidelines for prioritization of work

Ensures focus and momentum of entire organization

Supports motivation

Limit analysis approach

Structural performance gain

Performance

Time

What if it allgoes right?

Limit

Current

Target

Gain

What can Iachieve ?

Gap

•Global vision•Extended scope of progress•Good perception of deviations from benchmark

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Follow-up on improvement activities – we ensure a maximum impact on the bottom line by calculating the improvements in total costs and following up via KPIs (Key Performance Indicators)

Creates linkage to performance management system

Ensures commitment

Capitalizes realized efforts

Relates impact to present value

Ensures long-term perspective

Activities prioritised against business case and impact

Total cost of all activities who support operations

Priorities and KPIs definition

Targets setting and actions plan

MonitoringCounter-measures

Define the priorities of actions relevant for the plant or the value stream and the corresponding Key Performance Indicators (KPIs)

Set the targets and theassociated action plans toachieve those argets

Implement the monitoring process of operations at all levels of the plant organization

Ensure a rigorous reactivityprocess to develop effectivecounter-measures in case ofdeviations

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Produktivitet Mål

Mål: Efter DPP rationaliseringer.

Realisedt 2004: 17,3 FV. per manhour.

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Committed management – our leaders are visible and active in production and are ambassadors for the Danfoss Productivity Program

Role model slide

Role modelling through “Management By Walking Around”

Visual checks of activities, plans and countermeasures

Management as mentors to build the train-the-trainer organisation

Standardised reviews of targets with focus on countermeasures not excuses

Ensure sense of urgency to always improve

Demands quick response from management

” If you’re looking for perfection, look in the mirror. If you find it there, expect it elsewhere”. Malcolm Forbes

“I have the skills to behave in the new

way”

“The systems reinforce the future state”

“I know what I need to change and want to do it”

“I see my leaders behaving differently”

“I will change my behaviour if…”

Capability building

Aligned systems & structures

Under-standing

& commitmentRole modelling

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Respect for people – we involve and support our employees in the change process, in accordance with Danfoss’ values

Acknowledgement of difficulty

Change management abilities in all managers

Support change by ensuring relevant communications, training and rewards

Support to help people understand their new roles

Support through role modelling

Change in accordance with Danfoss´ values

Danfoss Core values

Our business is trust

A very safe and reliable choice

Passionate about technology

Global culture, local representation

Environmentally and socially responsible

Threats coming from changes in the environment

A satisfied and smooth organization

A new and positive level

Wood of confusion and frustration

Point of satisfaction The new

point of satisfaction

Hill of disowns

Hill of renewal

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TU - preassembly

TR

Solder

Washing

TR - Preassy

T2

SolderT2 –

Preassy

Laser

T2 / TUA/TUB/TC

Final assy

TR / TUC

Final assy

Packing

CDC

CDC

CDC

Schematic flow overview – Small TXV

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Performance management in AC-BN

KPI’s

Performance cockpit

Weekly report

Follow up meetings (shift, day, week, month, ½ year)