Finding ways to maximize use of assets always has been a big concern in business. This is as it should be. In some industries, the competitive use of facility space is a significant basis for competition when margins are razor thin.
The managers of a printing company in the Midwest were struggling to figure out where they were going to put a computer-to-plate operation and a new printing press. They were considering off-site warehousing and a brick and mortar add-on to the facility. Let’s examine their dilemma and find some answers.
There are many pieces of the lean toolkit that directly attack the space requirements of operating a business, whether that business is manufacturing or providing services. The key tools include:
We’ll look at five S, VSM, cells and flow production more closely and then expand on their application at the aforementioned printing company.
The technique of five S was developed by Hiroyuki Hirano and perfected by Toyota as part of the Toyota Production System (TPS). TPS is the forerunner to what we know as lean in the Western world. Essentially, this 5-point system forces you to sort, straighten, sweep, schedule and sustain housekeeping and organization to a customer-ready “24/7/365” state. This means there is a place for everything and everything is in its place.
The 30-day rule is a particularly effective part of this technique. The rule states that, if you have not used or will not use it in 30 days, it has no reason to be in the workplace. Things that are needed are stored in a space-efficient visual organization system in which anything can be found and put away with the 30 second rule (my personal favorite five S rule). This brutal process of eliminating unneeded items from the workspace collapses space requirements—sometimes by as much as 75 percent. Do this everywhere, and you will be amazed by how much space is available for consolidating the workplace into a smaller footprint.
One of the key deliverables of a VSM effort is the ability to clearly identify where inventory and resources are used in processes. Since materials in production operations usually represent a huge percentage of the space used, I focus a great deal of the team’s attention on why the inventory is there. Inventories of material or work in process (WIP) make up the vast percentage of the time something is in a system—sometimes up to 99 percent or more. By systematically asking “why” five or more times in searching for the root causes for inventories of materials or information, it is possible to identify the true causes for this inventory. The key reasons I usually find are:
It’s beyond the scope of this article to examine all the drivers of inventory waste. But, trust me on this one. The number-one thing that will reduce space requirements is attacking the reasons for system inventories. Your VSM helps to uncover where they are and hopefully some clues as to why.
Cells and flow production promote stockless value streams with a desired batch flow of one unit or one-piece flow as the ultimate desired state. By breaking functional layouts for 80 percent of the volume produced in a smaller space with minimum people, equipment and WIP, I have seen space reductions of 60 percent or more, as compared to the prior condition.
Back at the printing company, the challenge was to figure out how to make room for a new computer-to-plate operation and a new printing press within the existing facility. We will review the three key activities that helped them find the space.
One of the deliverables I like to get the leadership team to develop in the initial strategic planning process is what I call a “blue-sky layout.” This can be started after mapping out the current state of the enterprise and identifying the key equipment needed. Then we explore the possibilities of operating in cellular layouts with reduced WIP for the vital 80 percent of what they do. The blue sky part comes when we take a blank piece of paper and design a waste-free system without today’s monuments in the way. In the case of the printing company, we arrived at a shocking realization: 50 percent of the current space in use was being wasted.
After walking the four walls with clipboards in hand and asking some critical questions, it was obvious many items were adding little value to the core business. For example, just outside the main entry to the shop floor, there was a 40 x 60-foot space occupied by some outdated equipment and hard tooling that they had had since Grandpa started the company. By sorting this out and discarding the materials no longer needed, we were able to relocate it to a much smaller space in the back of the plant. Now, when you walk out this same door, the first thing you see is a beautiful state-of-the-art computer-to-plate making facility and the expanded information technology department.
A major piece of this printing company’s business is dedicated to finishing—formerly about 4,680 square feet of space. After challenging some paradigms and setting up a flow cell, this was cut to 1,680 square feet of space, a 62 percent reduction. While we were at it, we relocated the new finishing cell to be right next to the finished goods warehouse and shipping department. This eliminated miles of wasted walk time to move finished product.
Here is how we did it. The major finishing steps include jogging sheets to a perfectly square stack prior to cutting, cutting the printed sheets into labels, drilling the labels, shrink wrapping and finally labeling and palletizing them to store or ship. In the old process, we used a batch-and-queue scheduling technique to plan jobs across jogging, cutting and finally drill/wrap/label (which already was a flow line). Each of the three operations had a schedule. For each stock-keeping unit (SKU), operators would check the schedule, find the WIP and the paperwork and log in to the reporting system. They would then set up, run and move the stock to the next WIP location and then log out of the computer.
By thinking through the cycle times and setups, the team figured out how to meet my challenge on day one of the kaizen. They determined that, once you touch the paper to start jogging, it does not need to stop moving until it is in the warehouse, ready to ship. In the new layout, they introduced conveyors and slide tables that enabled them to flow jogged sheets from a single jogger to two different cutters. There is a small buffer between the two, enough to allow the jogger to switch from one SKU to another without starving the cutters.
Each cutter now has its own drill and wrapper directly downstream. Cut labels travel directly to the drill/wrap operation on a small roller conveyor with enough of a buffer to enable cutters to change over without starving the drills.
Now, there is no need to worry about scheduling three operations in finishing. All that is required is to schedule the sheets for jogging. After that, everything is in the warehouse in a few hours. The cellular layout eliminated the need for WIP to decouple the operations. Today, a paper that is touched in jogging literally does not stop moving as it goes through the finishing operations. Aside from the huge space reduction, the company has enjoyed nearly a 30 percent increase in finishing productivity and reduced finishing lead time from several days to a matter of hours. In addition, it recently added another major printing press in the space where we used to keep WIP for finishing.
Before you allow anyone to convince you that it’s time to invest in bricks and mortar, I suggest asking a few questions beginning with the word “why.” Until the steps outlined here have been taken, there certainly will be many opportunities to reduce, if not eliminate, the need for more space altogether.
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