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Hoshin Planning: The Future Of Strategic Management

Since the 1960s, Japan’s leading automotive manufacturer Toyota has been using Hoshin planning to drive their business from one year to another. This goal setting and management tool was just recently adopted by companies around the world and the interest seems to be only growing. Even if the interest has increased, the adoption rate is relatively slow due to several reasons. Many companies do not have the right internal structure that could support the Hoshin model. The early adopters managed to stay ahead of their competition and the number of companies that started to adjust their management system to embrace the Hoshin model increases constantly. In current use, the model focuses on several aspects of a business.

The top management team needs to assess the state of the business and define a multi-year strategy based on a vision and a plan. During this thought process, the annual objective needs to be defined. With the aid of careful planning, the target needs to be monitored each year and develop new strategies to achieve it whenever the performance falls off behind. Metrics will play an important role. Setting the annual objectives needs to be followed up by monthly reports and performance charts that will track the progress. At the end of the year, all the data needs to be compiled into a single report that will provide vision over the progress of the past year and if the goal targets have been achieved. With each passing year, the goals and metrics will provide enough data to help managers continuously improve the processes and increase the goals. It is also a good opportunity to monitor employee skills in relationship with performance and plan trainings to increase productivity. Hoshin planning offers a better overall picture of the state of the business especially for the management team. It becomes even more efficient when combined with regular meetings that focus on developing action plans in correlation with the performance metrics.

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The Ideas Behind The DMAIC Model

The DMAIC model is one of the most representative tools that has been incorporated into Lean trainings. It focuses on a systematic analysis and assessment of processes and workflows within an organization using five simple steps. Looking at the model as a whole made of multiple parts, the DMAIC steps cannot be rearranged. It all starts with the definition of the goal, the problem and resources. The second step is the measurement. It requires an in depth analysis of the current performance using charts and spreadsheets that will serve later on as a comparison.

With the data at hand it is time to analyze the results and find the root cause of the problem. To do this, several tools are available but it is an accepted practice to use more basic tools depending on the nature of the problem. The next step is to develop improvements. With all the information and measurements available it is time to take action. Sometimes it might be required to organize meetings and rely on group-think in order to find the best solution to a problem. Testing is also a part of the improvement process and should not be left out or delayed. The fifth and last step focuses on control. It requires new measurements to be recorded starting from the moment the improvement has been implemented. Once enough data has been collected it is time to compare it with the initial results so ensure that the improvement was successful. When the numbers manage to prove that the change was beneficial to the organization, the only thing that is left is to update documents, organize trainings to ensure knowledge transfer and continue monitoring the performance charts. For some, all these actions seem a bit straight forward but when put on paper and applied strictly as they were designed and described, the DMAIC model proves to be a powerful tool that is able to drive an entire business from the point of breaking to growth, expansion and profitability increase.

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History of lean manufacturing

The popularity of lean manufacturing has crossed all barriers in these days and a huge number of companies have been utilizing this method with great amount of success. What about the history of lean manufacturing? The basic concept of lean manufacturing can be traced in the ideas developed by Henry Ford. He made use of the concept known as 'continuous flow' for his Model T automobile and his focus was on the standard of production to make the process of manufacturing really tight. His intention was to make different stages of production complement each other to ensure better efficiency and quality. The elimination of waste became a reality with this method of approach.

Things started changing after a certain period of time and various assembly lines started producing the same thing because of the lack of flexibility in his method. The end product remained the same (Model T) and changes or modifications became a distant reality. It was a business oriented approach than a customer oriented approach and waste began to increase over a period of time. This business model by Ford became a failure and it resulted in the wastage of huge amount of money.

  In the initial stages, a good number of people applied the methods advocated by Ford in their businesses and at a later stage; they realized that it was not flexible enough to solve their problems. TaiichiOhno of Toyota came up with a new method known as Toyota Production System (TPS) and in order to improve efficiency, he made use of a lot of Just In Time methods. Toyota became one of the leading companies in the world by using this process with great amount of discipline and commitment and they set good example for other companies to emulate. That is what exactly happened and a huge number of companies have making use of this system to improve overall efficiency. With the evolution of time, lean manufacturing has became a full- fledged philosophy for all business organizations.

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The importance of SMED and how it works

SMED also known as single minute exchange of die is a lean production method which is used to reduce waste during manufacturing. It is used to provide a fast and reliable way of changing a manufacturing process from the product being produced for the next one. It is used to improve on the general flow of production. SMED has proved very helpful for companies which make, prepares, process and package their products using a single line or machine. It makes it easy for changeovers to be done at the right time enabling the clients expectations to be met with precision. For you to be able to appreciate this method it is important to know how it works.

  Usually, once the process of manufacturing a product is through, the entire system is shut down. The line is cleaned and the tools that were in use removed and new ones installed for a new product to be produced. After all the preparations are finished it is only then that new production begins. Needless to say, this process takes long and is tedious; however, it can be reduced with the use of SMED. SMED effectively identifies and separates the change over process into vital operations. An external setup allows the operator to start making changes which can be done while the machine is still running in preparation for the change over. The internal ones can be done after the machine has been halted for the change over to be done. However, if you are not careful, there can be a waste in between the two operations. For you to be sure that you have no waste in terms of time of workmanship it is imperative to measure the time you spent making a change over. Having a clear picture about the time used during a start up process will help you to improve on it next time.

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Something to keep the production safe!

When a company is creating a system that can help it with the work that it needs to finish, this company needs to protect the information afterwards. There are certain systems that can help the company with this. TPM is such a system. TPM actually means trusted platform module. That means that this system is going to keep all the information that it is used in production safely so that it cannot be modified or that it cannot be robbed. This system also helps to maintain the production and a way to just find where the defaults are.

The TPM system needs a team of experts that will help it function properly and also some operators that can put to work. This is not a difficult job, but the ones that work with this need to have some kind of an experience. They need to have an understanding of how the system works and how it can help them find the faults and the other problems that come when the company is in production. This is a great system because this way the company will not spend so much time when it is producing.

The TPM system is an investment for the future. The company has only to win from this because it is something that it is going to keep its production default safe and also safe from other things that can occur during the process. The TPM system was developed in fact in Japan and so it is known that they have a great technology there and so they know how to take care of their line of production. The Japanese people know how to invest into their future and how to make everything work at a higher level than the other countries out there and their technology.

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What you have been missing in the absence of pokayoke

Any production manager will agree that however much they avoid errors in their workplace, there is always a mistake committed by a person unintentionally. This is because human beings get tired, distracted or confused and are bound to make mistakes. In most cases these errors are not deliberate but can be very costly in the long run. That is why those who have had the chance to try pokayoke have appreciated it. Pokayoke are two Japanese words which when translated mean avoiding inadvertent errors. It has been used in big companies to do away with any defective products and has proved to be really reliable.

Pokayoke is not a procedure but a concept which employees use to minimize or eliminate errors during production. There is no step by step guide on how to use it but the employees are allowed to identify the mistakes they wish to avoid. Using the poker devices they come up with a way of eliminating those specific errors. What happens once pokayoke has been implemented is that it stops people from making mistakes even if they wish to. The presentation of pokayoke devices on a machine will cause the machine to stop and alert the machine operator if there is something wrong. Unlike other devices pokayoke devices are easy to install and can be easily used by the workers without supervision. It works independently and does not need the operator to keep checking it; actually the operator hardly remembers about it until the machine stops. It works effectively by helping you to eliminate errors in your products thus reducing your operating costs. They are also affordable and when you calculate the errors it will help you to eliminate, you will realize they are very reasonably priced. Pokayoke is most excellent if it is able to not only identify mistakes but stops them altogether.

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Why Lean Logistics could be the Wings Your Business Needs

About 3000 years ago, Chinese war strategist Sun Tzu noted, “The line between order and disorder is logistics.” On the other hand, lean logistics has in the recent past been described as the lifeblood of global commerce and the line between a company’s survival and death. This is because lean transportation goes beyond giving out purchase orders to include offering compressed cyclic pick-up and delivery rotations to reduce logistical costs. Achieving lean logistics status can be a challenging task for any organization. This is because moving goods from one part of the globe to another calls for internal processes such as paper work and external processes such as processing documents in insurance firms and governments’ ports agencies. According to Jennifer Karlin, the author of Defining the lean logistics learning enterprise: examples from Toyota’s North America Supply Chain; lean management of logistics improves your company’s information flow. This means that you will be able to deliver at the right time and win your clients approval as the king of logistical speed.

Lean logistics is a business acumen that should be embraced in all businesses because its techniques are applicable and affordable. You can for instance use technology to integrate information flow amongst all the parties involved in a logistical process. The parties should be able to tell the difference between the commodities on transit by collaborating with key suppliers to carry out an accurate documentation of facts and figures. As a result, you will be able to put together a factual report and get proper recommendations using other lean management techniques such as A3 thinking.Experiment with different modes of transportation and different sea routes to experience different port schedules such as transit times and port procedures. Document and analyze everything and learn the secret to the cheapest and most efficient ways to move goods across the world given your ability to operate lean logistically.

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World class manufacturing will give you satisfaction

World class manufacturing ensures that a company is able to quality products and services to their clients. This is done within the specified and expected time and at the lowest costs possible. It is aimed at adding value to the products in question and at unhindered speed and organization. In order for world class manufacturing to be termed as successful, there has to be a continuous culture of improvement. This is aimed at meeting the needs of the customers. A conscious involvement of the employees from the beginning to the end of the process is highly required.

One of the strategies used in world class manufacturing is the training of workers on all levels of the organization. The training should be of high caliber meaning it should be made according to international standards. That will automatically place the workers at a higher position and will help them to perform their duties efficiently. Qualified workers will increase production levels and quality. This in return will make your clients to trust your products leading to loyalty and continuous purchases. Another strategy is overall equipment effectiveness which means that the equipments being used are in good condition and able to perform their duties effectively. Proper maintenance is vital for any production to be done at the expected speed and according to clients' expectations. Once the speed is identified, the management is able to foresee the number of items to be dispatched at a go. This will in return make the company to produce what is required hence reducing chances of waste and errors. The best thing about world class manufacturing is that due to its effectiveness, the products are acceptable all over the world. It helps you to be above average and gives an edge over the competition. It is designed to help you come up only with products that are needed by clients at fair prices.

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The process of value stream mapping and its benefits

For any company to produce quality services, there has to be a well organized movement of materials and information from it to its intended clients. Value stream mapping is the technique used to ensure that this movement is carefully scrutinized and improved if necessary. It is a by product of lean manufacturing which is known for its effectiveness in identifying waste. It helps you to come up with detailed data on how information and materials flow from one area of operation to the next. This will be done efficiently if there is cooperation between the different heads of departments and managers heading those departments.

Growth

Once that information has been gathered, a chart is then done which makes the analyzing process probable. For value stream mapping to be a success, you have to include the quantities of items in the chart. That will make it easy for you to identify areas where there is waste or inconsistencies. For the process to be a success you have to involve lean manufacturing consultants who will work together with your staff to identify areas of concern. Once any waste or inconsistency is identified, ways of how to remove them are created. Value stream mapping helps you to know your business well by showing you what happens in various departments of your business. It opens your eyes to any hidden problems in the general structures of your establishment. Using it will help you to see in a single chart the flow of products from inception to your clients hands. This way you will know which areas of operation are more important than others. You will also easily identify waste and come up with ways to get rid of it. Value stream mapping is a process which will make you see the entire process of your business at a glance thereby making informed decisions.

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How JIT inventory System Helps to Reduce Inventory Costs

The JIT inventory system encourages reduced waste and enhanced efficiency in a business like manufacturing company. The method to inventory in this system needs the business to deal with the materials and supplies that are necessary to generate products for consumers. The JIT system is a lean technique which aims to enhance efficiency in all production aspects as well as material movement. Pull System The JIT system makes use of a pull system in moving material through the company. In an informal push technique to material movement, a single department or manufacturing area pushes the materials or goods forward regardless of any need. In the pull system, employees pull the materials into the cell or workplace if it is needed. When one workplace pulls the materials out from another workplace, it creates a need to pull more materials. This decreases excessive inventory as well as production if there is no consumer order or need.

Limits the Work in Process

If materials move only during an order, it limits accumulation and extreme inventory buildup. Organizations save expenses by manufacturing only the things that are required, which limits the possibility for a backlog of faulty parts or scrap. JIT system produces parts in accordance with customer orders. Cell Layout JIT systems streamline production cells layout to enhance efficiency. Minor changes in production cell layout for instance, bringing the workplaces closer together, will save precious minutes in the movement of materials and parts via the pipeline. Supplier and Vendors Relations An organization which selects a JIT system should build relationships with the suppliers as well as vendors. The vendor should be able to deliver parts continuously for production system to perform well. Manufacturing companies which have good relations with the vendors can work jointly on one worksite to keep steady movement of materials and parts. This will remove transportation costs and possible delays in manufacturing because of late deliveries.

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Ersfjordbotn reflections (by John A.Hemmingsen)

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How to Implement Six Sigma

Six Sigma is a type of business process that results better production. Businesses that implement this plan are aiming for an ideal quality control in the products. Six Sigma was initiated in 1980s by Motorola to put standards for the manner defects are taken into account. It is a business strategy as well as statistical measure. Six Sigma is used to achieve fewer defects for every million opportunities. This is done by educating internal leaders to use established techniques. This method has been implemented by all sizes of organizations.

  Here is a method of implementing Six Sigma. Be committed to the project. Ensure all the top management is involved and the resources are put in place. Set up policies and guiding principles and have training programs for workers. Define the scope of the project and objectives based on consumer feedback and needs. Motivation for Six Sigma projects may come from studies, existing projects and surveys. Set objectives for the entire organization or for a particular level of organization that requires improvement. Gauge the defects of the existing system and performance. Make use of statistical information and analysis. Examine the system to check defects and troubles. Identify probable causes of the problems. Look for possible solutions and evaluate their effect on your organization. Develop the system by applying new ways to carry out things quicker, cheaper and better. Make use of planning and management tools to set the improvement projects. Check the improvement using statistical data. Manage the new process through modifying systems as well as measuring processes to keep on achieving results. Use consumer opinion and statistical equipment. State things that were performed to enhance performance. Document ways to identify and solve problems in the future.

Once a Six Sigma management program to enhance processes and rationalize products defects are set, establish a governance committee which will assess its success rates. This will make sure that successful techniques are shared with other companies and less useful plans are revised or terminated.

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Lights… Camera… Toronto!

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Get all your staff members engaged using A3 problem solving

A3 problem solving is a method if well used will help you to know the problems in your company. It will help you to come up with goals and objectives to boost the performance of your company based on your findings. It also aids you to know facts about the areas of concern and how to counter the challenges. All this is done on a single A3 sized paper hence the name A3 problem solving. There are many advantages associated with this method and big multinational companies have benefited from it.

Answer

Top on the list of benefits is the fact that this method involves all the employees in your organization. Usually, a few members of staff are tasked to handle a certain problem and the whole burden left to them. However, A3 problem solving involves all your members of staff and offers them help on how to identify an issue of concern. It helps them to dig deep into the problem and find out its root cause. Once the cause is identified by the entire team, measures are put in place to rectify the situation. This act alone is able to cause staff members to bond and be imaginative in identifying issues of concern in the company. As they work through and see an improvement in their company, they will be motivated to work harder and solve other issues in the company. A3 problem solving will push your staff members to think critically, efficiently and independently. Because the method is open and clear to everyone, it helps them to see what is supposed to be done and has not been done yet. If the team comes up with intervention strategies, they will be able to follow up on the problem and see whether all has been done to solve the problem. This means that the company will improve on its day to day operations.

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What 5S is all about?

What is 5S? 5S represents 5 disciplines for maintaining workplace efficiency at its best and they include Sort, Set in Order, Shine, Standardize and Sustain. It can be described as a philosophy and methodology that will minimize any type of waste and the workplace will be organized to improve the overall efficiency. 5S will reduce set-up times and cycle times and the floor space will get increased as well. Accident rate will get diminished and this methodology will take care of the wasted labor as well. Equipment reliability will undergo tremendous amount of transformation as well.

  In order to answer the question, ' what is 5S', in the best manner people should be thoroughly familiar with all the disciplines. The first discipline known as Sort will clear the work area with great efficiency and unwanted items will be sorted out to make the area more functional. A good work area will contain only those items that ensure optimal performance and the first discipline takes care of this aspect. The second discipline known as Set in Order will keep various items in the most deserving place to increase efficiency and this process can be described as designating locations. The third discipline, Shine will make sure cleanliness and the appearance of the workplace will get enhanced with this process. Preventive housekeeping assumes great importance during this phase and the problem of work area getting dirty can be averted. The Standardize discipline will implement best practices and everyone should copy these best practices in the exact manner all the time. Storage techniques and work area layouts will be standardized at every right time as well. All these positive changes and practices will have to be maintained and the last discipline known as Sustain will take care of this cultural change in the best manner. All these aspects will clearly answer the question, 'what is 5S', with great clarity.

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Karpathos, Greece (by Patrick Giardina)