In Part 1 and Part 2 of this series, we have been discussing the nothing-short-of-amazing results achieved by firms that move toward repetitive, flexible supply (RFS). The report we are discussing was written by Alan Richards and it is entitled The Magic of Levelled Scheduling. [Mitchell]
So far in the series we have addressed three outstanding benefits that accrue to firms moving toward RFS-style production. These have been:
- Stability and predictability supplant chaos and fire-fighting in the production environment
- Both inventory levels and stock-outs drop dramatically for all classes of inventory—finished goods, raw materials, and work-in-process (WIP)
- Production output increases and increased production capacity is unveiled
We will pick-up from where we left off.
Moving Away From Chaos and Consternation
In his report, Mitchell relays this anecdote:
“Before we introduced the green stream [see Part 1 for explanation of ‘green stream’], shift coordinators would spend the first three to four hours of each shift in the warehouse trying to locate all the materials for that schedule,” remembers Fred Boyd, Manufacturing Director for Kimberly-Clark. After introducing levelled [sic] scheduling, he asked one coordinator how his life had changed. “He told me, ‘I haven’t been out there [to the warehouse] for three months.’ He knows what he’s going to be making, and he knows that it will be there. So, now he is saying, ‘last week, what were the biggest issues that impacted the green stream?’… and he’s working on planning what to do differently, for instance—how to make that grade change better. He is proactively planning rather than reactively looking for materials. That’s three to four hours that was spent on fire-fighting now focused on improvement. That’s the really big effect. Now we can focus on what is really important for flow.”
Moving away from the formerly ineffective mass-production, big-batch, mentality and in synchronous manufacturing using fixed and repetitive production reduces the level of inventory (as we have previously stated). Formerly, the inventory functioned as a cushion—an ineffective cushion, in the long run; but a cushion nonetheless—to obscure the real problems in the stream of production.
Removing the inventory in the system is like lowering the level of water in a stream. If the stream bed is not smooth, then the turbulence of the water increases and the rocks in the stream are exposed for what they really are—disruptions to the flow.
In this way, production bottlenecks and obstacles become immediately—and sometimes, painfully—apparent. It becomes much easier to recognize what needs to change and to prioritize the changes that must occur to smooth out the stream.
“Whatever the problem—machine capacity, machine reliability, materials quality, supplier reliability, changeover times—it becomes clear what has to be fixed,” Mitchell states flatly from his experience. “So, the focus of improvement shifts to what really matters, now.”
The Effect of Focus (and the Absence of Chaos)
Fred Boyd of Kimberly-Clark highlights an incident in Mitchell’s report: “One of the real barriers in our green stream was a grade change that took five hours…. There were many possible changeovers on which to focus. But, we realized that this is the one! So, we just worked on that one and we reduced the time by 43 percent in five weeks. We created focus on the one issue that was really important.” [Emphasis added.]
Why Don’t Companies Improve?
I have had dozens of conversations with clients over the years. Not a single one has ever objected to the concept of ongoing improvement.
A great many, however, never actually institute a POOGI—a process of ongoing improvement.
Why?
Because these companies find themselves “too busy” to focus on improvement.
In fact, all of “their best people’s efforts are squandered on fire-fighting rather than improving,” as Mitchell noted.
But it gets worse than that.
Because high levels of inventory, bad assumptions and outmoded cost-accounting practices obscure the real causes of problems in production, even when improvement actions are undertaken, they are frequently not directed at the things that really matter.
Moving toward greater agility by applying RFS principles actually liberates people’s time to do what they do best: innovate, apply their intuition, and dig into the things that really need to change in order to bring about lasting improvement.
Not Only Better Financials
Mitchell’s report brings to our attention the fact that moving from a daily regime of chaos, consternation and fire-fighting brings benefits that transcend the immediately evident financial gains. The RFS flow work environment “creates a happier workplace.”
In theory, advanced MRP systems should bring huge benefits. Unfortunately, their manifest shortcomings actually create cultures of “finger-pointing” and “blaming.” This is because the MRP’s unrealistic “plans are never met,” so “there’s always somebody at fault. Planners blame operations, operations blame suppliers and so on, ad infinitum. Back-biting becomes the norm” within the company’s culture.
By stark contrast, “[a] stable, repetitive production cycle” produces a work environment where “failing to meet the plan is not the fault of any individual or group; it’s the fault of the system itself,” Mitchell points out.
While MRP systems set up people for failure on a routine basis, the whole MRP-driven system ends up demotivating people—frustrating them day after day.
“Fundamentally, people want to do a good job. But, if operators’ routines are repeatedly changed, they lose interest,” notes 3M’s Steve Ackroyd. And that’s what constant re-scheduling and repeated failure to meet schedules does.
With RFS or flow production in place, “it’s a much better life with much less frustration,” according to Fred Boyd of Kimberly-Clark. Jayne Kelly, Planning Director at Kimberly-Clark, concurs with Boyd. “Nowadays, people spend less time arguing [with] each other and more time solving core issues. Informal relationships have improved. People simply like working with each other more.”
It’s Hard, but It’s Worth It
I can readily think of three reasons more companies don’t move to RFS or flow production environments:
- “Our business is unique” – We hear this all the time, and executives usually sincerely believe this. The fact is, no company is so unique that it cannot benefit from moving in the direction of flow production
- “We don’t have time to make these changes” – And, of course, the reason these companies don’t have time to make these changes is because their present production environment is chock-full of chaos, consternation and fire-fighting.
- “We don’t know where to begin” – This, of course, is a real and legitimate reason; but it is not an insurmountable obstacle. There are people available to help you get started in the right direction.
We freely admit that making these kinds of dramatic changes is not easy.
But we are also fully convinced that it is well worth the effort.
What You Need to Get Started
It takes guts to take a stand against an entrenched mass-production, cost-world culture and thinking. It takes a willingness to not let cost-accounting rules—rules that have been thoroughly shown to be no longer valid for modern-day decision-making—stand in the way of real and lasting improvement.
Since there are so many obstacles standing before you when you begin, chances are you are going to need an executive sponsor to make any headway. Find one that is willing to learn and to think outside the box. In the beginning, all the executive sponsor needs to do is give permission for some experiments and small steps in the right direction.
If the executive sponsor is willing to do that, the results should soon start to speak for themselves.
We would like to hear what you think about this topic. Please leave your comments here, or contact us directly.
Mitchell, Alan. The Magic of Levelled Scheduling. Report. Accessed September 20, 2013. http://www.leanuk.org/downloads/general/the_magic_of_levelled_scheduling.pdf.
See also: Glenday, Ian, and Ricky L. Sather. Lean RFS (repetitive Flexible Supply): Putting the Pieces Together. Boca Raton: CRC, 2014. Print.
For more information about RFS, visit: http://www.RepetitiveFlexibleSupply.com
