Page 297 - How To Implement Lean Manufacturing

274 Cha pte r Se v e ntee n

• Sell the recommendations consistent with their Lean initiative.
• Assist in the implementation.

Our constraints were many, but for the sake of brevity I will distill them to the
critical few.

• There was really no capital available to solve this
problem.
Point of Clarity When dis- • We could not increase inventories. (Miguel noted
cussing variation, the stand- that they were presently holding 30 units of safety
ard deviation has no meaning stock to handle the internal supply variations.
unless the data show stability. This volume was calculated to be three sigma of
inventory, but they were still missing deliveries.)

Some More Relevant Information
Of course, a little more information is necessary to appreciate this particular situation.
This plant was a Maquiladora and it had only a skeleton of technical personnel onsite,
with little or no design responsibilities. Like many Maquiladoras, which are the Mexi-
can half of the Twin Plant concept, taking advantage of low cost Mexican labor, their
task was to meet the production schedule at minimum costs. Purchasing was done
centrally, while planning was local. Four years earlier, the ABC Widgets Co. had
embarked on a Lean initiative, but most Lean-specific skills were centrally located at
the home office. Both the metrics of performance and the actual performance results of
the plant were much the same now as they were before the implementation of the Lean
initiative. They had made great strides in one area: inventories. Both raw materials
and finished goods inventories had been dramatically reduced. The entire plant took
great pride in this because they were among the leanest plants in the corporation by
this measure. Raw materials had been improved from 12 to 35 turns and finished
goods for this line improved from 24 to nearly 70 turns. No information was available
about WIP.
Another issue was influential in this problem. The reliability manager, Miguel,
was the son-in-law of the general manager of their North American manufacturing
division. Miguel had graduated three years earlier from an engineering university and
was hired 18 months before I arrived to assist in the Lean initiative. “Water cooler
rumors” of nepotism had arisen and several managers questioned his capabilities.
Since his arrival, machinery reliability had improved, and availability associated with
machinery reliability had risen over 7 percent. These gains were clearly seen in Overall
Equipment Effectiveness (OEE) on several production lines. To make things more
problematic, Miguel had apparently created a serious rift with the production personnel
when, earlier in the year, he had initiated autonomous maintenance as part of their
TPM efforts. It did not go well, and that effort was aborted after just a few months due
to the friction it caused. Obvious tension remained between the Reliability and Pro-
duction departments.

We Analyze the Data
Our efforts began with a look at the data associated with this line for the last 30 normal
production days. This is shown in Table 17-1.