remove waste

Investigating Root Cause … with Experimentation

I was involved in a workshop recently where the second half of it was investigating a problem on a manufacturing production line. To make a long story short, the process of profiling a product generated unusable portions (ends) of the product which had to be cut off and thrown away. The scrap rate of 10% was adding up to be in the tens of thousands of dollars per year on this line alone in material, labor and disposition costs.

Using the A3, 7-step process, the team brainstormed potential causes for this problem of generating unusable parts of the product. These were direct causes and not necessarily root causes at this point. Based on experience and available data, the team was able to reduce the list to a few causes.

At this point, the team went to the actual production line (aka Gemba) and conducted a few simple experiments using the refined list of causes (factors). The team observed, and took measurements with video clips, which were evaluated later in the meeting room. It wasn’t long before the direct cause of the problem was determined and, by using the 5-why process, the root cause was reached. The team simply followed the funnel diagram below.

Based on the root cause (equipment alignment issue), the team brainstormed ideas for a solution. A temporary solution was implemented to reduces the defects significantly while a permanent solution was being planned.

The takeaway from this improvement initiative is the importance of conducting root cause analysis using experiments right where the problem is occurring as opposed to doing so in a conference room. For management, it is important to allow time for experimentation on the production line and to let the team, including production workers, be creative in troubleshooting the issues and generating solutions.

Mustafa Shraim

The Waste Series: Overproduction

What does “overproduction” mean?

In Wikipedia it refers to the “excess of supply over demand of products being offered to the market.” In other words, producing more (product) than what the customer wants or needs.

Questions:
– What if a company is producing based on forecasts?
– What about service-based organizations? is there such a thing as “overproduction”?

To answer the first question, we need to evaluate the impact of overproduction. While overproduction keeps equipment and employees busy (to satisfy utilization metrics) on one hand, it generates other types of waste such as:

Inventory – If it’s not going to the customer, it has to sit somewhere!
Transport – There is more transport activities if the product has to be stored and retrieved
Correction – If a defect is detected, more product must be investigated and corrected to ensure conformance.

So even if it’s based on forecasts, it is still generating other types of waste with no firm orders from the customer!

What about internal customers (like producing components for the next process, etc)? Same answer. Check against the list above.

The second question can be answered by first defining modes of overproduction:

Generating more information than needed (we’re all familiar with this!): Sending emails to everyone unnecessarily, generating reports no one needs, unnecessary data collection, etc. – all of this results in tying up people’s time in wasteful activities, including meetings, to discuss them. Remember the question that we need to answer, Is there any value to the client or improvement to the process from doing this?
Building potential value streams or capacities no one will use: If management puts in place facilities for potential services that stay idle for any reason, this may result in waste of resources (human resources, maintenance, etc)

Lean Projects

As lean concepts find their way into project-based companies, it is worth reviewing the basics. The aim of lean project management (LPM) is to reduce the amount of time required to complete a project by identifying and eliminating non-value added tasks. This means that the client (customer) is interested in successful completion on time while the project managers are focused on staying within budget. The key here is that quality of work is not compromised and neither is customer satisfaction.

One of the most important steps in any lean initiative is to evaluate current performance (or putting together a current state value stream map). To do so, the following steps can be followed:

Review recently completed projects. This can be done by type of project picking a type with most opportunities.
Identify tasks, with time spent, as follows:
- Value-adding tasks (remember – client is only paying for these tasks)
- Tasks adding no value but still needed (e.g. administrative)
- Tasks adding no value and can be eliminated from future projects.Create metrics (ratios using cost or time are recommended) to track progress with future projects
Eliminate tasks adding no value
For those adding no value but still needed, opportunities for more efficient ways to complete should be sought
For value-adding tasks, investigate (using root cause analysis) all bottlenecks, sources of delays and rework (corrections)
Apply improvements.

As an example, let’s consider this typical construction project in which the following milestones are listed: Scope, Estimate, Design, Permits, Tender, Construction, and Closure. Under each milestone are a number of tasks / subtasks. For example, under “Tender”, we could have the following tasks and duration (days):

Tender Task List	Duration (Current State)	Duration (Future State)
Identify and qualify potential contractors	20	12
Issue tender documentation	5	5
Review tenders after receipt	5	3
Conduct interview with acceptable tenders	10	5
Total	40	25

Although the above tasks are considered non-value adding activities, they are still important for the completion of the project. However, it may still be possible to remove pure waste at the subtask level as we improve the process. For example, after analyzing the task of “identify and qualify potential contractors” for a number of completed projects, it was estimated that the team had four meetings (2-hour each meeting on average). With four employees on the team, this multiplies quickly. Based on such analysis, the team could estimate improved figures for “future state.”
Out of this task list, it is possible to remove pure waste and improve the process of “Tender” by streamlining and standardizing steps. Based on such analysis, “future state” figures for such tasks are estimated. In this case, there is a potential for reducing the duration for the “Tender” task list by 15 days (or 37.5%) in future projects. Other task lists can be investigated in a similar manner.

The vision (future state map) should be based on all possible improvements. Potential savings are estimated from hours / days that could be eliminated. As new projects are completed, they become “Current State” and actual improvements can be measured against estimated ones. Ideally, completed new projects should have no waste with regard to schedule and budget. In reality, however, there is always room for improvement. But without going back and analyzing completed projects, determining wasteful activities, and planning for process improvements, it wouldn’t be possible to establish current and future state value-stream maps.

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