Optimizing High-Mix Low-Volume Operations

1. Optimizing High-Mix Low-Volume Operations Shahrukh A. Irani Department of Integrated Systems EngineeringThe Ohio State UniversityColumbus, OH 43210 PHONE: (614) 688-4685 EMAIL: irani.4@osu.edu WEBSITE: http://ise.osu.edu/biosketch_SIrani.cfm

2. Agenda • Types of Manufacturing Systems • What type of manufacturing system do you manage? • What makes jobshops (high-mix, low-volume, MTO) different from any “Toyota-type” plant? • Limitations of the (Toyota)Lean tools • Examples of high-mix low-volume (HMLV) manufacturing systems • CASE STUDY: Optimization of the layout of an entire plant • CASE STUDY: Optimization of the setup on a press • A Toolbox for High-Mix Low-Volume Manufacturers

3. Spectrum of Manufacturing Systems QUANTITY (Volume) Assembly Lines or Transfer Lines Flexible Flowshops Manual Cells High Flexible Mfg.Cells Jobshops Low MIX (Variety) Low High

4. What is Your Manufacturing System? MIX (R) QUANTITY (Q,T) Outliers P RUNNERS REPEATERS In a Part Family STRANGERS LOW HIGH $ALES ($) PROTOTYPES

5. JobshopsAssembly Facilities High mix of products i.e. many different routings Part families may not be known Product mix segmentation must be done Setup times, cycle times, lot sizes, etc. vary significantly Wide variety of product designs and equipment types Typical facility has a Process Layout (= batch-and-queue) Different (and Difficult) Business Environment Demand is unstable Lot sizes change Customer loyalty and sanity are non-existent Production schedules are driven by due dates (notTakt Time) Shifting capacity constraints Due dates are different and subject to frequent changes Lean for Toyota Lean for Jobshops

6. Strategic Planning Top-Down Leadership Motivated Workforce 5S Total Productive Maintenance Setup Reduction Error-Proofing Quality at Source Visual Workplace Right-sized Equipment Standardization of Work Many Lean Tools are NOT Universal X Right-sized (= Inflexible) Machines X Kaizen Events (Mainly by Operators) X 20th (not 21st) Century Managers X Pencil-and-Paper Problem Solving X Value Stream Mapping X One-Piece Flow Cells X Product-specific Kanbans X FIFO Sequencing of Orders X Pacemaker Scheduling X Inventory Supermarkets X Scheduling using Takt Time X Heijunka/Load Leveling X Assembly Line Balancing

7. How to Recognize a High-Mix Low-Volume Manufacturing System?

8. Forge Shop (≈500 Routings)

9. MTO Industrial Scale Fabrication Facility

10. Flexible Machining Cell

11. Finish Grinding Department

12. Factory Layout Optimization at Ulven Forging

13. Current State

14. Future State

15. Actions Taken • An additional processing area was created in the Drop Hammer building where cleaning,finishing,packaging and shipping were consolidated. • The 158 ton Trim Press was replaced by a 440 ton press that was positioned next to the 5000# Hammer. This eliminated the transportation of large forgings to a distant 350 ton Trim press. Also, a 350 kW induction heater and conveyor were purchased and co-located with this press to form an Upset Forging cell. • A new 2.5” Upsetter was purchased and positioned next to the 3000# Hammer to form an Upset Forging cell.

16. Actions Taken (contd.) • The 1.5” Upsetter was replaced with a faster machine and positioned next to the 700 ton Press to form an Upset Forging cell. • A crane was installed over the 5000# Hammer to reduce piston change-out time, reduce die key tightening time and to facilitate product movement in the area. • A portable Marvel Hacksaw and 1.5” Bar Shear were acquired. • A CNC Mill was acquired and positioned next to the EDM machine to reduce vendor costs and lead times for die sinking.

17. Benefits • Approximately 5% cost savings on annual sales of $ 6 million • WIP reductions were significant • Lead times quoted to customers were reduced • Throughput ($ales) increased Since this company is a defense supplier, they were reluctant to release financial and delivery performance data that could be seen by their customers (Defense Logistics Agency and Department Of Defense)

18. Press Setup Optimization at Hirschvogel

19. Observe and Document the Press Setup

20. Work Locations around the Press

21. Sequence of Tasks in Press Setup

22. Operator Motion Traffic around the Press

23. New Workstation Layout for the Press

24. Operator Motion in Previous Layout

25. Operator Motion in New Layout

26. Press Setup Time: Before vs. After

27. Estimation of Increased Production Potential Increase in Production = [EPT – (# of Setups * Time/Setup)] / Cycle Time per Part

28. Estimation of Increased $ales Potential Increase in Revenue = [EPT – (# of Setups * Time/Setup) / Cycle Time per Part]* $/Part

29. Benefits Savings in Setup Time Potential Increase in Revenue

30. Parallel Task Scheduling for Press Setup Op #1 Op #2 • 1 Operator 113.02 min (Current State) • 2 Operators 60.86 min (Parallel Execution of Activities) • 3 Operators 60.86 min (Unnecessary, 2 operators are OK) Gantt Chart for Optimized 2-Person Setup Process

31. Optimization could Enhance Every Lean Tool

32. Value Stream Mapping Demand Forecasting Multi-Period Slotting of Orders Work Order Release Current Project at Pompano Beach Warehouse Design Cell Design Scheduling Supplier Deliveries Work Center Scheduling WIP Inventory Control Scheduling Material Handlers

33. A Toolbox for HMLV Manufacturers MORE…. UNIVERSITY PARTNERSHIPS • Co-Curricular • Projects • Co-ops • Internships • Faculty R&D • Executives on • Loan • Factories as • “Test Beds” COMPETING THROUGH INNOVATION • Value Network • Mapping • M3Facilities • Flexible Focus • (GT) • Product Mix • Segmentation • ERP+FCS+MES • IT-enabled JIT • Communications • Virtual Cells and • Distributed Teams • Water Striders • Real-time Order • Tracking • PLM+CAPP • Agile Suppliers “4H” LEADERSHIP • Walks the Gemba • Knowledgeable • Beyond TLSS • Competitive • Respects Employees • Efficient Fire • Fighters (Risk • Managers) • Change Managers • Invested in Talent • and Technology LEARNING ENTERPRISE • Cafeteria Chats • E-newsletter • Wikis • Kaizens • Online Chat • Groups • Idea Boards • Annual • Conference • Resource Center • - E-books • - Case Studies • - Videos • - Online Apps • - etc. INDUSTRIAL ENGINEERING • Work Measurements • Facility Layout • Ergonomics • Scheduling • Variety Control • Value Analysis/Value • Engineering • DFMA • Flexible Mfg. Cells • Product/Process • Standardization • Product Mix • Rationalization • etc. CURRENT STATE FUTURE STATE ENGAGED WORKFORCE • Lean Thinkers • “Factory of • One” Problem • Solvers • Empowered • Multi-skilled • Team-oriented • IT Savvy • Collaborative

34. Acknowledgements The PRO-FAST Program is enabled by the dedicated team of professionals representing the Defense Logistics Agency, Department of Defense and industry. These team mates are determined to ensure the Nation’s forging industry is positioned for the challenges of the 21st Century. Key team members include: R&D Enterprise Team (DLA J339), Logistics Research and Development Branch (DLA – DSCP), and the Forging Industry Association (FIA).

35. Acknowledgements Project Champion: Kevin Shaw Project Engineer:Greg Muniak Project Champion: Craig Kaminski Project Engineer:Haydn Garrett Project Champion:John Wilbur Project Engineers: Thomas Slauta Project Champion:Dick Johnston Project Engineer: Todd Sheppard Jon Tirpak Russell Beard Vicky McKenzie Project Champion: Joe Kracheck Project Engineer: John Lucas Project Champion:Andrew Ulven Project Engineer: Jim Huiras Dan Gearing Project Champion: Thomas Stys Project Engineer:Jorge Alvarez PFAST Development Team Dr. Rajiv Ramnath Dr. Rajiv Shivpuri

36. Questions?