The
MBA program in Supply Chain Management
at NC State University is unique among business
schools. With the support of the Supply Chain
Resource Consortium, an industry/university
partnership, the program brings the industry into
the classroom, involving students, faculty and supply
chain professionals in finding solutions to the
real industry problems. This project-based approach
to education reflects the new model for business
schools described by Peter Drucker.
For
more information...
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Peter
Drucker...
"Management is a practice, like medicine;
and the model should have been the medical school,
where the bulk of the teaching, especially the most
important teaching of the M.D. in his or her residency,
is performed by practitioners. Unlike medicine,
where you can bring sick patients into the classroom,
business education does not allow you to bring an
organization into the classroom. You can, however,
bring experience in through your faculty and students.
Business educators should be out as practitioners
where the problems and results are."
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4/27/04
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Lean
Implementation Is Tough!
by Rob Handfield |
Lean
Business Solutions publishes free e-newsletter
discussing applications of lean thinking in the
workplace. Recently a reader by the name of Marty
Laurent who has a lot of experience in lean manufacturing
related a process capability story from his manufacturing
leadership experience. His experience in implementing
a pull system at Lordstown Metal Center identifies
some key challenges in implementing lean supply
chain solutions.
He notes that change management is particularly
difficult: “When something goes wrong and you
take on the blame yourself, you also put yourself
in the position to solve the problem. Creating a
lean cell in a traditional plant is bound to fail,
no matter who is willing to take the blame. There
is a natural reaction to change - something appears
funny and we revert to what we know. This is normal
and a good thing, really; it is part of our survival
mechanism. The only way to overcome this reaction
is for management to 'burn the boats', so that retreat
is not possible..."
...Let
me explain by explaining Lordstown and the underbody
process. We provided completed underbodies to
Lordstown assembly. We built the underbodies
one at a time in response to use at the assembly
plant. Our process started with building the
rails for the engine compartment, then building
up the compartment, the floor pan, and the rear
pan. The three parts were married, tacked together,
and sent down a respot line for final assembly.
There were more than 30 steps in series - and
no buffers. In addition, the engineers who designed
our process designed it to have an out put of
80 per hour (to feed an assembly plant rated
at 75 per hour). The engineers who designed
the assembly plant process, however, had the
process which accepted underbodies and started
framing designed for 100 per hour.
Chaos reigned! When they went through start
up problems, our buffer (there was a buffer
of finished underbodies on the conveyor between
the plants) filled quickly and we stopped and
waited. Or as was more frequently the case,
we didn't quite fill the buffer, their downstream
problem was solved and they started pulling
at 100 per hour, ran us dry, quit early, and
went home. These are just the problems that
started on their side of the trestle (the name
of the conveyor between the plants) that caused
shut down. If any of our cells went down, and
they all did, we starved the system, since there
were no buffers.
The solution to this was simple, add buffers.
It took nearly 18 months, but, when they were
added the system finally ran. Being lean should
not be confused with being brave or being stupid.
Having a buffer that is less than the variation
that is going to come from the process you have
is fool hardy. It resulted in our building fewer
J cars than we could have sold for a year and
a half.
Now, to our pull system. We did not change a
cell, we changed the whole plant. We did this
over a fairly short transition time, but, we
did have a transition. It happened like this.
One day I put the shipping department in charge
of the production meeting. This made the scheduling
department extremely angry, but, they had to
learn to live with it. We started talking daily
about what they needed to ship, not what we
thought we needed to build. At that time our
shipping performance was lousy. Within a short
period, maybe two or three weeks, our shipping
performance was very good and people were becoming
accustomed to looking at the shipping dock to
see what we needed to build.
The plant had been well organized and no matter
what part of the plant you worked in, you could
see from the stacks of finished goods you built
what you were going to be building during that
shift. We made some minor changes to our finished
goods buffer during this time, but, although
we still had a schedule which told us what to
do, more and more, day by day we over rode what
the schedule said and did what the buffers said.
Our shipping performance became perfect. The
violent changes caused by the schedule (which
allowed overproduction) stopped. People quit
carrying a schedule; they never used it. The
scheduler became my most zealous teacher of
lean. One day someone noted that we were not
using the schedule anymore, why were we printing
it. We stopped. In truth, we still had a couple
of people involved with the schedule, they would
talk to people about some plant taking a down
week, so we would know, but, it really didn't
make any difference.
We were able to do with the pull system what
we were not able to do with the underbody. We
ran it with the schedule, so that our security
blanket was there (I laugh as I write that,
the plant had operated for 20 years when I arrived,
the Fisher Body scheduling system had never
kept them on schedule, despite huge buffers,
it didn't work, couldn't work, and wasn't going
to work - but it was what we knew, so we liked
it). During our transition period, we knew we
had buffers that would sustain us. We knew the
new system would work and we switched.
A big part of the success was due to something
I had not considered when I started the change.
Putting shipping in charge of production changed
the informal power structure and communication
channels in the plant. Prior to the change when
the plan we established in the production meeting
went to hell for some reason, people would call
the scheduler to see what to do - they would
get an answer. After the change they called
the shipper and got a different answer. The
shipper was new to receiving these calls and
so he communicated with many people to find
the best answer, our response to problems became
more coordinated (for instance, if he had to
load a truck that afternoon, he called enough
people to get maintenance to fix the problem
so, that we could make the truck - the scheduler
would have given production the next hot job
and we would have missed the truck). |
This
improved communication came from the fact that all
of these people wanted to do a good job, but, they
needed a new model to be able to do that good job.
They were stuck in the old paradigm and used to
blaming each other for bad performance. Lean gave
them a way to be successful together.
Sincerely,
Rob Handfield
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