Square Peg In A Round Hole: Applying Lean Principals In Process Industries

By Herb Lichtenberg, Senior VP Practice Director, Strategic Asset ManagementThe evolution and development of Lean and Six Sigma has focused on improvements in discrete manufacturing -- but how do the concepts translate to process manufacturing?

 
The two most popular process improvement methodologies in use today, Lean Manufacturing and Six Sigma, originated at Toyota and Motorola, respectively. These pioneering companies are discrete manufacturers. 
 
Not surprisingly, the subsequent evolution and development of these two methodologies has focused mostly on improvements in discrete manufacturing.
 
But how do these concepts apply to process manufacturing considering its differences with discrete manufacturing?
 
Process manufacturing is fundamentally different from discrete manufacturing in the way material flows. Material flows in a continuous stream in process manufacturing, while parts move in discrete batches in discrete manufacturing. 
 
Since there has been so much work done in developing these methodologies in discrete manufacturing and very little in process, it might seem logical to apply them “as is” to process manufacturing industries.
 
However, this approach is like trying to fit square pegs into round holes.
 
The better approach is to adapt these techniques within a process improvement framework that identifies the various forms of waste in the process manufacturing value stream, and manages the wastes with the appropriate concepts and tools.
 
Lean manufacturing defines seven types of waste that make a production system inefficient and costly:
1. Over-production: Producing too much, too soon.
2. Inventory: Extra production required to buffer process variability.
3. Transportation: Movement of materials without adding value.
4. Waiting: Increasing production cycle time without adding value.
5. Movement: Movement of operators without adding value.
6. Defects: Product that does not conform to customer specifications.
7. Over-processing: Processing a material more than is necessary to meet customer specifications.
 
The first three types of wastes above relate to a lack of material flow. By the very nature of process manufacturing, material flows in a continuous stream from one process to the next, without periods of stopping and waiting in between (the possible exceptions being some batch processing in the chemical and steel industries). The Lean ideal of flow occurs by default. As a result, over-production, inventory, and transport are either non-issues or only minor issues in process manufacturing.
 
Movement waste is also less relevant to process manufacturing because operators typically monitor automated equipment.  Their movement usually does not have an adverse impact on the ability of the equipment to continue processing the material.
 
However the three types of waste -- waiting, defects and over-processing -- do exist in process manufacturing and are fertile ground for the application of Lean and Six Sigma methodologies.
  • Product changeovers, which in process manufacturing can sometimes take 18 hours or more, are an example of waiting waste.
  • Defects are the result of production of material that does not meet the specifications of the downstream internal/external customer.
  • Over-processing occurs when the material is processed to a greater extent than is required by the downstream customer.

All of these add to costs and can be reduced / eliminated through the use of these methodologies.

In the perfect value stream, products are produced reliably, efficiently, with good quality, and in sufficient quantity at the individual process level and throughout the entire value stream. A suboptimal condition with respect to any of these characteristics constitutes a type of waste.
 
Since no production value stream is perfect, all real-world process manufacturing value streams will contain one or more of these wastes. These are targets of opportunity for any process improvement effort.
 
While the causes of process manufacturing waste vary, a few occur regularly:
 
Equipment Condition
Equipment in poor mechanical condition has poor availability, produces poor-quality product in inadequate quantities, and operates inefficiently. A maintenance kaizen event is the appropriate process-improvement tool to return the machine to an optimum mechanical condition. To sustain the improvement, a long-term maintenance program such as Asset Health Care (AHC) or Total Productive Maintenance (TPM) must be installed.
 
Suboptimal Operation
Typically process manufacturing involves a combination of physical parameters. These could be a combination of temperature, pressure, density, flow rate, moisture level, and chemical concentration that are set at the machine to process the material. If these settings are suboptimal, then the process operates sub-optimally in terms of throughput, quality, and efficiency. These types of optimization problems are ideally solved using the Six Sigma methodology and tool set.
 
Design and Technology
In brown-field plants that have been in operation for many years, it's not uncommon to find equipment that is obsolete with regard to both design and technology.  Such equipment can operate wastefully in terms of availability, quality, throughput, and efficiency, much like those in poor mechanical condition. Improving / upgrading equipment design/technology is an engineering problem requiring technical analysis and designed experimentation.
 
Availability
Availability can also be adversely affected by product changeovers and by long setup times after a process has been taken down for maintenance. In this case, quick changeover techniques such as Single Minute Exchange of Die (SMED) may be applied to reduce setup times and improve availability.
 
There is, however, a word of caution before applying these methodologies and tools. In many companies, becoming Lean seems to be primarily concerned with implementing tools such as “one piece flow”, “value stream mapping”, “standardized work”, or “kaizen events”, but the expected results have not always followed. 
 
By contrast, Toyota has stayed focused on its principles and not the tools. At most Toyota plants, there are no dedicated change agents or black belts. Value stream maps are rare and only used in problem areas. There are no value stream managers and only small portions of the plants contain actual standardized work charts and many of the daily tracking systems are highly computerized.
 
The emphasis on process improvement to obtain results rather than the implementation of tools is the main reason why Toyota has continued to see success on so many dimensions, where others struggle.
 
Nonetheless, the use of Lean, Six Sigma and also Theory of Constraint tools in the right context can be very useful in process industries for improving, throughput, costs and customer service. The proper approach is to adapt the tools to the process after due consideration of the situation at hand. 
 
In other words, focus on the advice of Mr. Takashi Ohno, the founder of the TPS methodology at Toyota. “Ask what the greatest point of need for improvement is and start from there.”
 
Strategic Asset Management (SAMI) is a management consulting group for industrial organizations looking to gain leadership alignment, implement strategic asset management, develop advanced maintenance and production programs, and create dramatic financial results. We produce these results by introducing new processes and practices into an organization, through cross functional teams, accountability, and change management. For more information, visit http://www.samicorp.com/.
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