In Part 1 of this series, we began discussing the amazing results achieved by firms such as 3M, Kimberly-Clark and Wrigley (the chewing gum company) when they took steps to move toward repetitive, flexible supply (or RFS). The details are found in a report by Alan Mitchell entitled The Magic of Levelled Scheduling.” [Mitchell]
In Part 1, we covered the first two effects to emerge from moving toward leveled scheduling. They were:
- Stability and predictability begin to replace the prior staple of most production operations—namely, chaos and fire-fighting
- Simultaneously—and contrary to what one might think would happen—both stock-outs and inventory levels of finished goods, raw materials and work-in-process (WIP) begin to fall dramatically
We will pick up where we left off.
Production Output Increases
The third effect experienced by companies that move toward RFS (repetitive, flexible supply) is the dramatic unveiling of increased capacity. This increased productive capacity was previously masked by the misallocation of resources under the old “mass production” and “efficiency” mindset.
Cost accounting, as we have discussed elsewhere in other articles, is the chief enemy of increasing Throughput. The mistaken principles of cost accounting and "efficiency" measure hamper a firm's ability to achieve greater production.
This unfortunate relationship between cost accounting and real productivity is why H. Thomas Johnson, of Portland State University’s School of Business Administration, reports that “the Toyota accounting system treats daily plant operations essentially as a "black box" that it does not enter. Accountants, of course, record everything that goes into the plant, and all the products that come out. But within the plant they don't track the flow from incoming resources to outgoing finished product. Everything one needs to know about the transformation that takes place inside the plant is inherent in the flow of the work itself. In the Toyota Production System, the work provides all the information needed to control its state.” [Emphasis added.]
Alan Richards, production director at Wrigley, reported his firm’s result from moving toward RFS this way: “Out bottleneck in production of pellets was being able to coat…. We had nine big machines running 24 hours a day, five days a week, and they were so busy we had to run overtime every weekend and [even] send volume to another factory to help us out. After going to flow through fixed frequent repetitive cycles, we only needed to run eight of [the nine] machines; we had no overtime; and we didn’t have to send any volume to another factory.”
This was all accomplished, Richards states, simply by changing the way they organized and schedule production in the RFS method.
The Obstacle of Set-ups
Mitchell writes, “One common obstacle to improved output is changeovers,” sometimes referred to as set-ups between runs of different products. Setups that take a long time are a major hurdle to be overcome if smaller batches are to be run more frequently as RFS requires.
Part of the problem with the big-batch mentality and operations is that the number of setups is intentionally minimized. As a result, no one focuses on the inefficiencies in performing the changeovers themselves.
Once RFS becomes the order of the day, “everyone has to focus” on the time and expense involved in setups and changeovers. Increasing the frequency of changeovers begins to force improvements in the changeover methods immediately.
Just how much improvement might be achieved by focusing on changeover methods?
Taichii Ohno, Toyota’s leading industrial engineer, worked tirelessly focusing on the time it took to changeover die-stamping machines in the automotive industry. At a time when it was still taking Detroit-based auto manufacturers upwards of a full day to changeover these machines in their plants, Ohno managed to get the time down to an amazing three minutes! And, he did so while also eliminating the need for changeover “specialists” in Toyota plants. The line workers themselves were fully capable of making a timely and accurate changeover. [Womack, p. 53]
“At 3M,” Mitchell tells us, “one of the most important changeovers took over five hours. By focusing on it, [3M’s] team [has] already reduced it by 50 percent, freeing up one [whole] day’s worth of machine time [every] month. At Wrigley, the average changeover time was 100 minutes. Now, it is down to seven, and Richards believes that is just the beginning. He thinks he can see ways of getting it down to one minute.”
Think About This
Under your present system of scheduling and production, what do you have your very best people doing a large share of the time?
Chances are, your best people are spending a lot of their time putting out fires!
But the best your firm will ever be able to achieve with the best of “fire-fighters” is to restore normality.
Fighting-fires does not produce improvement.
Improvement comes from focus.
Where your best people are focusing their energy makes all the difference in the world—in lots of ways. In part three, you will see just how much a difference this matter of focus can make.
Please leave your comments here, or contact us directly. We would be delighted to hear from you on this (or any) topic.
Mitchell, Alan. The Magic of Levelled Scheduling. Report. Accessed September 20, 2013. http://www.leanuk.org/downloads/general/the_magic_of_levelled_scheduling.pdf.
Womack, James P., Daniel T. Jones, and Daniel Roos. The Machine That Changed the World - The Story of Lean Production: How Japan's Secret Weapon in the Global Auto Wars Will Revolutionize Western Industry. New York, NY: HarperPerennial, 1991. Print.
