TKF has implemented the lean six sigma (LSS) philosophy within its company. To understand the implications of this philosophy it is important to address the theory and ideology behind it. From the business point of view LSS is best described as: a business strategy used to improve business profitability, to improve the effectiveness and efficiency of all operations to meet or exceed customer’s needs and expectations (Antony & Banuelas, 2001). LSS reaches these results by reducing lead-times within the value-chain which improves cash flow, eliminates waste, reduces inventory, and increase on-time deliveries (Markarian, 2004). LSS is a combination of two business improvement methods, namely lean manufacturing and six sigma. The combination of these two results in higher benefits than each of these can yield when carried out separately (GoLeanSixSigma, 2014). The strength of LSS is that it is not just an improvement methodology, it is a philosophy, and it is integrated within the company on all levels.
- 23 - Lean manufacturing is the first method we discuss. Lean manufacturing aims to streamline a process by removing all types of waste. Classical process improvement approaches target the value adding activities of a process and aims to maximise these processes. On the contrary, LSS focusses on the non-value adding processes and aims to minimise these processes. We identify identifies 7 types of waste that are applicable to a manufacturing environment as proposed by Brook (2010):
Defects – Defects are the most obvious waste. Products that are broken need to be fixed or replaced resulting in extra processing time and (material) costs.
Overproduction – Producing more products than the customer has ordered results in higher WIP and lead times.
Waiting – Waiting in queues increases the lead time without adding value to the product. Transportation – Unnecessary transporting results in the use of time, money and resources
without adding value to the product.
Unnecessary inventory – Holding inventory that is not required increases the holding and handling cost.
Unnecessary motion – Non-optimal facility layout or misplaced items result in extra motion. Unnecessary processing – Adding more value to a product than a customer is willing to pay
for is a waste of resources.
After removing all the wastes it is critical to quickly solve problems that disturb the process. Six sigma is a method to assist with problem solving, and is the second aspect of this process improvement approach. Six sigma provides a structured approach called DMAIC, that stands for define, measure, analyse, improve and control to tackle problems. The power of this approach is its simplicity and clarity (Brook, 2010). Each stage has plain objectives and corresponding actions.
2.4.1 Heijunka
The definition of Heijunka, or production levelling, is: ‘the distribution of production volume and mix evenly over time’’ (Dennis, 2002). Clustering production orders by itself can reduce setup and fine- tune times, but usually increases lead and idle times and causes excess inventory as well. The objective of production levelling is to balance production quantity as well as production mix which will reduces variation in form of peaks and gaps in the production scheduling. Every product every cycle (EPEC) is one of the principles of Heijunka and is achieved by reducing the production volume until every product returns every cycle. The result is a cyclical schedule as proposed by Glenday and Sather (2006) who state that Heijunka is required to realise a pull production system with continuous flow.
Heijunka is predominantly utilised in large scale production and rarely applied in a low volume high variety environment. However, by forming product families based on manufacturing similarities and scheduling families it is applicable (Bohnen et al., 2013). The first important characteristic of a product family is that product types can be produced in an arbitrary sequence without increasing the time and material losses due to setups and fine-tuning significantly. Second, the production sequence of product types within a family has to be identical (Bohnen et al., 2013).
After product families are defined, it is important to classify these families as runners, runners / strangers or strangers. Runners are products that have high customer demand, high order frequency and a low variation in demand. The other extreme are strangers which have low customer demand,
- 24 - low order frequency and a high variation in demand. Regarding the cyclical schedule, runners and stranger / runners are products that mainly return each cycle while strangers are covered with a certain production slack, reserved for uncommon products.
2.4.2 One Piece Flow
An approach to achieve Heijunka and a continuous flow in a job shop environment is the one piece flow manufacturing principle. One piece can refer to a single product or a small batch, depending on the product. One piece flow manufacturing means that pieces move from operation to operation with as minimal work in process in between operations. A continuous flow means that parts, pieces, or batches move through the production process with minimal stagnation. One piece flow manufacturing aims to reduce the wastes caused by waiting times, transportation, overproduction, inventory, and defects. By dividing production orders in smaller pieces, only that piece requires rework in case a defect is detected resulting in smaller amounts of waste. The cycle time will reduce since pieces are processed at a machine and directly moved and processed at the next machine. One piece flow also improves the flexibility of the job shop because the machines are occupied for a shorter period of time because the processing times per production order decreases. Obviously, in the end the machine still needs to process all pieces, but changes in the production schedule can be realised quickly. A continuous one piece flow also results in lower working capital. The downside of one piece flow manufacturing is that it results in more changeovers at machines. One piece flow manufacturing works best in combination with other lean techniques such as the principles of 5-s or a pull manufacturing system.
To implement one piece flow manufacturing, the production facility must meet certain prerequisites. First, the production processes must be able to produce good products. If too many defects are detected, one piece flow is not possible. Second, the processing times must be consistent, or at least a small variation. Third, machines must be able to process most of the time meaning breakdowns are allowed but the frequency and duration must be low. Fourth, the time required for changeovers must be significant smaller than the processing time of a piece and finally, the layout of the manufacturing environment should be designed such that machines are in flow with the process.