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Management Strategies For A Successful Lean Transformation November 2012 Speaker – John Weist
CNH Saskatoon Plant
INTRODUCTION
- Born and raised in Southern SK - Industrial Systems Engineering Degree - 4 years as Manufacturing Engineer - 4 years as WCM Manager - 1 year as ME / WCM Manager
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WHY AM I SPEAKING WITH YOU TODAY?
2010
2011
2012
Annual Savings $5.7 M $5.6 M $5.9 M % Trans. Cost 10.3% 9.0% 60
9.2% saskatoon Plant #11
50
Plant #6 40
Plant #4 Plant #9
30
Plant #3 Plant #2
20
Plant #8 Plant #1
10
Plant #7 0
2008
2009
2010
2011
2012
Plant #5
3
AGENDA
• • • •
•
Plant Information Product Line World Class Manufacturing (WCM) Management Strategies 1.) Senior Management Involvement 2.) Importance of KPI 3.) Goal Alignment 4.) Involve Everyone 5.) Time and Budget Investment 6.) Rigorously Audit 7.) Reward and Recognize Plant Results 4
Plant Information
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SASKATOON FACILITY
PLANT
LAND
632,000 SQUARE FT
156 ACRES
58,700 SQUARE M
63 HECTARE 6
FLEXI-COIL COMPANY HISTORY
•
The previous company, Flexi-Coil Ltd., was established in 1952.
•
During the 1990s Flexi-Coil became Canada's largest farm manufacturer.
•
Air Seeding and Tillage industry leader in North America and Australia. (air carts, drills and coil packer)
•
New Holland purchased 35% of Flexi-Coil in 1997
•
1999 Merger of New Holland and CaseIH
•
The remaining shares of Flexi-Coil were acquired in January of 2000
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FULLY INTEGRATED FACILITY
FAB
WELD
PAINT
ASSEMBLY
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PLANT LAYOUT Planter, Header Assembly Lines East Powder Paint Line
Planter and Header Weld Stalls
Fabrication Equipment
West Powder Paint Line M66 Assembly
Tillage and Air Seeder Weld Stalls
Receiving / Warehouse
Air Seeder line Tillage Crating and Component Assembly
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HEADCOUNT
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PLANT SUMMARY – CUSTOMER DISTRIBUTION
Canada 21.9% CIS 1.8% China 2.6%
USA 70.6%
Africa 0.5%
S America 0.6%
Australia/NZ 2.0%
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Product Line
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PRODUCTS
Planters
Air Carts
(17 models, 1 brand)
(4 models, 3 brands)
Hoe/Disk Drills (4 models, 3 brands)
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PRODUCTS
Grain Heads (2 models, 1 brand)
Corn Heads (2 models, 2 brands)
Pickup Heads (2 models, 2 brands)
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SOME ASSEMBLY REQUIRED!!
This configuration requires ~175 hours of labor to setup
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2010- 2012 NEW PRODUCT LAUNCHES
1260 Planter
16R30/18R20 Corn Header
580 Bu Air Cart
February 2010
April 2010
November 2010
Pickup Header
Pull-Type Sprayer
M66
January 2011
Dec 2011
December 2012 29
World Class Manufacturing
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WHAT IS WCM
- Corporate continuous improvement program focused on 3 objectives; 1.) employee involvement 2.) improving plant standards 3.) reducing wastes and losses - 10 technical pillars and 10 managerial pillars - focuses on the concept of “zero” and the sharing of best practices - 168 Plants involved in 16 different countries - Fundamentally changed how the Plant is managed - WCM is not a project, it is how we do business 18
Management Strategies
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THE RESOURCE STRUGGLE
Everyone has full time jobs where we work through the day to day things that allow us to get paid
Resources
We as Managers want more time for our employees to do continuous improvement type activities
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IT STARTS WITH SENIOR MANAGEMENT (TOP DOWN)
Senior Management including Plant Manager conduct Gemba project reviews twice per week Reviews completed and planned action items for the week Reviews road blocks and takes actions as required A lack of activity cannot be hidden on the floor (we learned this the hard way) 21
UNDERSTAND AND SET KEY PERFORMANCE INDICATORS
- Set KPI’s / Lagging metrics (3-5 most critical metrics) Plant level followed by department specific - Set KAI’s / Leading metrics (30-50 supporting measures) Plant level followed by department specific **** Caution, several companies try to focus on everything, 10-20 KPI’s are too many **** **** KAI’s need to predict KPI success and must be able to be influenced by the group**** 22
UNDERSTAND AND SET KEY PERFORMANCE INDICATORS
- Set SMART metrics 1.) specific 2.) measurable 3.) attainable 4.) realistic 5.) timely - Set aggressive metrics 1.) 8% transformation cost savings per year 2.) zero breakdowns 3.) 90% reduction in cleaning times
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VISUALLY DISPLAY YOUR KPI’S / KAI’S (PLANT LEVEL)
•
Create a Scorecard • • • •
Simple Highly visible to all employees Have the right metrics Must be easy for everyone to know whether they are winning or losing 24
VISUALLY DISPLAY YOUR KPI’S / KAI’S (PLANT LEVEL) KPI's # of breakdowns after step 3 in the model area MTBF MTTR OEE by Step 5 B/C of each step 1 B/C of each step 2 B/C of each step 3
May. 18
May. 25
Jun. 1
Jun. 8
Jun. 15
Jun. 22
Jun. 29
Jul. 6
0 1000 200 85
0 999 207.5 80.1%
3 417 289 80.1%
0 417 289 80.1%
0 417 289 80.1%
1 417 289 80.1%
1 548 202 77.2%
1 517 151 77.2%
0 548 151 77.2%
>1 >3 >1
KAI's # of SMPs in model areas % EWOs closed (counter measures implemented) # of MP Info in model areas Breakdown Maintenance Hours vs Non Breakdown hrs in Maint.
•
Target
Target May. 18 May. 25 Jun. 1 Jun. 8 Jun. 15 Jun. 22 Jun. 29 Jul. 6 240 367 367 367 367 367 398 398 398 100% 90.00% 91.60% 91.60% 91.60% 91.60% 91.30% 91.40% 92.80% 24 16 16 16 16 16 16 16 16 30% vs. 70% 12% vs 88% 11% vs 89% 11% vs 89% 11% vs 89% 11% vs 89% 11% vs 89% 11% vs 89% 11% vs 89%
Each pillar updates their specific KPIs every week • •
Displayed in Center of Excellence Quick visual for Senior Management to see overall progress and question KPI’s which are not being met
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VISUALLY DISPLAY YOUR KPI’S / KAI’S (DEPARTMENT SPECIFIC)
• Standardized supervisor communication boards (hourly staff)
• Process Monitor Boards for department specific metrics (salaried staff)
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VISUALLY DISPLAY YOUR KPI’S / KAI’S
Front Entrance Safety
Activity Boards
Kaizen Tracking Board
KPI Display Boards
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KPI / GOAL ALIGNMENT Objectives managed through central Performance Management System (EHRMS System)
Plant
Functional Area
Salaried Employee
Hourly Employee
Example of Goal Alignment from Plant Manager to the Hourly Employees: Plant Manager’s Goals provide the foundation for all other objectives. For 2012 they are: -Cost (Productivity & Spending) -Safety Area Manager’s Goals are derived from the Plant -Quality Manager’s goals. For 2012 they are: -Delivery & Inventory -Cost (Productivity & Spending) -WCM Production Supervisor’s Goals are derived from -Safety the Area Manager’s Goals and linked with their -Quality employee’s Goals: -HR -Spending -WCM Hourly Employee’s Goals are derived from the -Productivity Success Share Targets set across all plants: -Safety -Spending -Quality -Productivity -HR -Safety -WCM -Quality -WCM
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INVOLVE EVERYONE
- Our WCM Pillar Leaders are Managers, no questions asked, other Plants are not this way - All salaried staff are mandated to participate on a Pillar, its part of our “letter of offer” now
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INVOLVE EVERYONE (MAKE IT A PRIORITY)
•
All pillars meet weekly (Using a kaizen journal)
WCM Weekly Meeting Times 7:00
Monday
Tuesday
Management Meeting
Management Meeting
Wednesday Management Meeting
Thursday
Friday
Management Meeting
Management Meeting
GEMBA Walk (8:00 – 9:00)
8:00
PM (7:30-8:30)
Pillar Leads, Plant Manager, Ops Manager
9:00
Focused Improvement Corporate (9:00-10:00)
Room F Logistics 9:00-10:00 Floor
10:00 Autonomous Activity 11:00
12:00
Room F (10:30-11:30)
WO (11:00-12:00) Corporate WCM Information Session 11:3012:30 MTC
WCM new-hire presentation EPM Room B 12:30-1:30
1:00
2:00 Quality Control Room A (2:30-3:30) 3:00
4:00
FI (1:00-2:00)
EEM Room B 1:00-2:00
Floor project reviews
PM (1:00-2:00)
Room B
Room F
CD East Plant
People
EEM (2:00-3:00)
Environment
Development
Room B (10:00-11:00)
Room F
Room B CD Fabrication
(2:00-4:00)
CD Pillar
Floor project reviews
Floor project reviews
Pillar Lead Meeting Corporate (2:00-3:00) Safety Room F 3:00-4:00 Floor project reviews
5:00
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INVOLVE EVERYONE (MAKE IT A PRIORITY)
Introduction of WCM into daily production meetings (2 Pillars present each day) - Tying WCM into everyday management - Support from production for roadblocks, brainstorming and countermeasures
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TIME AND BUDGET INVESTMENT (LAST 5 MONTHS) Quality Gate Central Team Conference Racine EEM / CD – Wichita
AM – Goodfield PD – Fargo / Wichita
PM – North America Pillar Leads
PD – Chrysler Academy
PD – WCM Audit Toledo
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TIME AND BUDGET INVESTMENT (SENIOR MANAGEMENT) BENCHMARKING Pillar Teams
CD
CNH - Zedelgem
CNH – San Mauro
CNH - Jesi
CNH – Grand Island
FI
FIAT - Cassino, Sevel
FIAT - Mirafiori
Iveco - Brescia
Iveco - Suzzara
FIAT - Mirafiori
Iveco - Brescia
Iveco - Suzzara
FIAT - Mirafiori
Iveco - Brescia
Iveco - Suzzara
AM
CNH - Fargo
WO
FIAT - Cassino, Sevel
PM
CNH - Fargo
QC
CNH – Grand Island
EEM/EPM
Vizient
PD
FIAT - Cassino, Sevel
Senior Management Benchmarking SEVEL Cassino Suzzara Brescia Mirafiori Auto Mirafiori FPT AM, PM, Minimum Material Handling, QGates, Bulky Items, Golden Zone, Kitting
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WCM AUDIT PROCESS AND RESULTS • Audit Process Split between shop floor projects and management presentations 10 technical pillars scored 0 – 5 10 managerial pillars scored 0 – 5 Total score is out of 100
Yamashina Audit April 2009 14 Points 2008 2009
WCM Starts Mar. 2008
Materazzo Audit Aug. 2010 35 Points 2010
Yamashina Audit Oct. 2010 37 Points
Mr. Emo Audit May 2011 41 Points 2011
Mr. Pino Audit Dec 2011 44 Points
Mr. Risi Audit May 2012 48 Points 2012
Bronze Audit Oct 2012
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REWARD AND RECOGNITION
Senior Management rewards 4 employees per week with small monetary reward for top kaizens
Employees presented their Kaizens and Suggestions to the Senior Management and attendees
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Plant Results
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RESULTS Employee Suggestion Program YTD Target: 9.0/person YTD Actual: 9.0/person
6,579 Suggestions YTD
14
12
10
8 Actual Target
6
4
2
0 2009
2010
2011
Projected 2012
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RESULTS (WCM INVOLVEMENT) 2011
ESP
Kaizen
Pillar Team
Project Team
1
1
1
1
2012
ESP
Kaizen
Pillar Team
Project Team
3
3
1
1
2013
Actual
ESP
Kaizen
Pillar Team
Project Team
6
4
1
1
Target
100% 80% 60% 40% 20% 0%
2009
2010
2011
2012
2013 38
RESULTS (SAFETY) KPI - Lost Time Injury Frequency
Frequency
LTIFI 2.1 1.8 1.5 1.2 0.9 0.6 0.3 0
96% Decrease in LTI Frequency since 2008
2008
2009
2010 LTI
2011
2012 YTD
Target
KPI – First Aid Injury Frequency
75% Decrease in First Aid Frequency since 2008
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RESULTS Plant Shipping – Customer Service Delivery
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VARIABLE COST PER HOUR
Variable CPH 58.00 56.00 54.00 52.00 50.00 48.00 46.00
2008
2009
2010
2011
2012
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COMPARISON TO OTHER PLANTS 60
50 saskatoon Plant #11
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BRONZE LEVEL Plant #6 Certification last week Plant #4 1st Plant in CNH Plant NA #9 Plant #3 3rd Plant CNH WW
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Plant #2 Plant #8
20
Plant #1 Plant #7 Plant #5
10
0
2008
2009
2010
2011
2012
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WHY WCM IS IMPORTANT TO SASKATOON
Considerable improvements to Plant KPI’s (Safety, Quality, Productivity, Shipping) Continue to empower employees (ESP, Employee Observation Form, Quick Kaizen, Plant Wide Data Collection) Staying competitive globally requires constant growth and improvement
43
QUESTIONS
44