Page 103 - How To Implement Lean Manufacturing

82 Cha pte r F i v e

How Did the Shortened Lead Times Positively Affect Those Concerns Stated Earlier?
First, for labor efficiency, they had rather liberal estimates for the needed work; and
then both planned and performed poorly compared to the estimates. Labor efficiency
on this lot was 118 percent compared to the 56 percent they had been achieving. Labor
efficiency more than doubled—and at no cost! For them, that meant we could do the
work with less than half the manpower. I would call that a huge gain!
Regarding their quality problems, it is clear they had huge problems with rework.
The shorter lead time model allowed them to correct the problems. For example, with
the quality problem on the CNC punch press, we were able to catch the problem after the
production of only 40 units; 150 minutes into the run. We were able to promptly feed-
back the quality problem and fix the problem with the changeover procedure and this
also led to reworking a much smaller volume. In the large lot production situation, a
review of the schedule shows that the CNC punch press would finish the entire lot after
460 minutes and probably be on another job when the problem was found in assembly
after 620 minutes. In this case, there is no possibility to correct the problem and our only
choice is to manually rework all 100 units. Whatever the quality problem, whether it is
scrap or rework, the long lead-time model only exacerbates the magnitude of the prob-
lems. Again, the shortened lead time allowed us to correct the problems because they
could be found in a timely fashion and reduced the labor to rework the problems. That
was a huge gain for this company since you will recall that it is common to perform
rework two or three times, on each job!
As for the scheduling concerns, this by now should be obvious. It is very difficult to
plan your way out of problems that you have managed your way into. A review of past
production for this model showed that in no case were they able to start and complete
this product in the same calendar week! Even with their large lot approach, this job
should be done in less than three shifts. It is easy to see that with the large lot production
model, quality problems and the delays associated with correcting them were bound to
be large and very punishing in terms of lead time. Yet in the reduced lot size we were
able to produce the lot in less than 11 hours. It was done the same day! We reduced the
theoretical time to produce from 22 to 11 hours, and we reduced the actual time to pro-
duce from over seven days to less than one day. I would also call that a huge gain!

How Well Did We Implement the Lean Concepts in This Batch Operation?
Let me give you a word of both caution and encouragement. We were not able to get the
essence of Lean incorporated into this production process since we could not really set
up pull systems, operate at takt, and flow one piece
at a time—and we may never be able to, considering
Point of Clarity Do not let their business.
the things you can not do pre- However, in the end we were Leaner than when
vent you from doing the things we started because we were able to produce the same
you can! product using less labor, less space, and do so with a
much shorter lead time.

Regarding the Applicability of Lean at Excalibur
So although this is not a textbook example of the application of the principles of the TPS,
Excalibur Manufacturing clearly was able to reduce the waste in their process and pro-
duce a superior product in a more flexible and more responsive manufacturing system.
They were able to apply the Lean principles and produce their products with less waste.
I call that a huge success! What do you think?