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Welcome

to In house Training ProgramIn-house Training Program

On “Supply Chain Management for Global Competitiveness”“Supply Chain Management for Global Competitiveness”

AtAt Indian Institute of Corporate Affairs

Manesar, Gurgoan By

SANJAY DWIVEDI , Chief Executive Consultant

K.K. PAREEK, Consultant–ERP & IT Services

3 E MANAGEMENTCONSULTANTS www.3emc.net 1

20th year of value added Business to Business consultancy

CUSTOMER’S VIEW OF COMPANY’S CONTRIBUTION

A B CCUSTOMER PROCESS FOR SUPPLY CHAIN MANAGEMENT

COMPANY PROCESSES

A

COMPANY PROCESSES

Scope of Materials Management p g

3 E MANAGEMENTCONSULTANTS

TRADITIONAL VIEW OF COMPANY’S CONTRIBUTION

Four Factors for Product and Service Up-gradation

• QualityQuality • Cost• Delivery • Responsiveness


Three Factors For Sustainability of Upgradation / Improvement

Repeatability MeasurabilityMeasurabilityTractability


In Bound + In Process + Out Bound

Supply Chain Management


SUPPLY CHAIN MANAGEMENT

Value ChainValue ChainSupply side- raw materials, inbound logisticsand production processesand production processesDemand side- outbound logistics, marketing

d land sales.


WHAT IS SUPPLY CHAIN MANAGEMENT

" Is the strategic management of activities involved in the acquisition and conversion of materials to finished products delivered to the customers"

SupplierManagement

CustomerManagement

Material Flow

Information FlowInformation Flow

Schedule /Resources Conversion Stock

Deployment Delivery


Leads to Business Process Integration

Supply chain is the system by which organizationspp y y y gsource, make and deliver their products or servicesaccording to market demand.Supply chain management operations and decisions are ultimately triggered by demand signals at the ultimate

l lconsumer level. Supply chain as defined by experienced practitioners extends from suppliers’ suppliers to customers’extends from suppliers suppliers to customers customers.


SUPPLY CHAIN INCLUDESSUPPLY CHAIN INCLUDES

INFORMATION FLOWS

MATERIAL FLOWSMATERIAL FLOWS

FINANCIAL FLOWS


SUPPLY CHAIN MANAGEMENT IS FACILITATED BY

PROCESSES

STRUCTURESTRUCTURE

TECHNOLOGY


Supply Chain Management (Measure, Improve and Control) is L d Ti tLead Time management

The objective is reduce lead time from the present status to ZeroThe objective is reduce lead time from the present status to Zero Lead Time

Go for continual Improvement through P-D-C-A


Material Requirement Planning (MRP-1)

Types of Techniquesypes o ec ques

PUSH PULL

MRP1MRP2ERP

KANBANJITERPERP ERP


Material Requirement Planning (MRP-1)

Introduction of MRP-1in 1960’s by Dr. Joseph Orlicky.

Definition:MRP is a software based production, planning and inventory control system used to manage the manufacturing processmanufacturing process.It is a computer based system in which the given Master Schedule is exploded with Bills of MaterialMaster Schedule is exploded with Bills of Material, into the required amount of raw material, parts and subassemblies needed top produce the final products in each tome period of say a week or month (called as “Buckets”)


Key Elements Of MRP 1

Demand Forecasting:-Demand Forecasting:It is the quantity demanded per year or per unit time which indirectly helps in knowing quantity to be supplied.

Master Production Schedule (MPS):-MPS is a series of time phased quantities for each item that a company manufactures. It gives the details of the products to be manufactured over the given space of timeproducts to be manufactured over the given space of time.


Manufacturing Resource Planning (MRP II)

It is defined as a method for the effective planning of all resources of a manufacturing company. Ideally its g p y yaddresses operational planning in units, financial planning in dollars, and has a simulation capability to

“ h t if” ti d t i f l danswer “what-if” questions and extension of closed-loop MRP.


MRP-I• Manufacturing-Centric/Push Mgt.g g• Master production schedule• Final production schedule•Inventory managementInventory management• Bills of Materials•Gross Requirement Generation• Net Requirement Generation• Net Requirement Generation• Recorder point Calculation• Automatic Replenishment

MRP II• Capacity Requirement planning• Production Controloduct o Co t o• Marketing Interface• Accounting Interface• Financial InterfaceFinancial Interface• Personnel Interface• Supplier Interface• Customer Interface


• Customer Interface

Operating Environment

GovernmentGo e e t- Regulation- SafetySafety

Economy- Effects demandEffects demand- Shortage and surpluses

Competition is now globalCompetition is now global- Reduced costs of transportation- Communications reduced costs and increased- Communications, reduced costs and increased

speed


Operating Environment (Continued…)

Customers Demand- Lower Prices- Improved Quality- Reduced Lead Time- Improved pre-sale and after-sale service- Product and volume flexibilityProduct and volume flexibility


Quality

Order Qualifiers:O de Qua e s- Customer requirements for price, quality, delivery etcOrder Winners:- Those characteristics that persuade customer to pselect a product or service

“Today’s order winners are tomorrows order qualifiers”


Manufacturing Strategy

DESIGN PURCHASE MANUFACTURE ASSEMBLE SHIPENGINEER-TO-

Delivery Lead Time

ORDER

INVENTORY MANUFACTURE ASSEMBLE SHIP

Delivery Lead TimeMAKE-TO-INVENTORY MANUFACTURE ASSEMBLE SHIP

Delivery Lead Time

MAKE-TO-ORDER

MANUFACTURE INVENTORY ASSEMBLE SHIP

yASSEMBLE-TO-ORDER

MANUFACTURE ASSEMBLE INVENTORY SHIP

Delivery Lead TimeMAKE-TO-STOCKSTOCK

Figure 1.1 Manufacturing Strategy and Lead Time3 E MANAGEMENT

CONSULTANTS

g g gy

Engineer-to-Order

Manufacture does not start until the order is receivedCustom DesignUnique ProductsLong Lead TimeInventory purchased after order is received


Make-to-Order

Manufacture does not start until the order is receivedOften uses standard componentsOften uses standard componentsLittle design timeLead Time is reducedLead Time is reducedInventory held as raw materials


Assemble-to-Order

Manufacture Inventories standard componentsNo Design time requiredo es g t e equ edAssembly only requiredShorter Lead TimeShorter Lead TimeInventory held as standard components


Make-to-Stock

Manufacture produces the goods in anticipation of p g pcustomer demandLittle customer involvement with DesignAssembly only requiredShortest Lead TimeInventory held as finished goods


The Supply Chain ConceptSupply-production-distribution system pp y p y

SU

CUS

MANUFACTUREPPLI

DISTRIBUTIONSYSTEM

STOMI

ER

MER

PhysicalSupply

Manufacturing, Planning and C t l

Physical Distribution

Control

DOMINANT FLOW OF PRODUCTS AND SERVICESDOMINANT FLOW OF PRODUCTS AND SERVICES

DOMINANT FLOW OF DEMAND AND DESIGN INFORMATION


The Supply Chain Concept

Includes all activities and processes to supply a product or service to the customerLinks many companiesHas a number of supplier/customer relationshipsMay contain intermediaries such as: wholesalers, warehouses and retailers


Historical and Current Perspective

In the past there well defined and rigid boundaries between organizationsgJIT viewed suppliers as partners- mutual analysis for cost reductiony- mutual product design- greatly reduced inventorygreatly reduced inventory- improved communications (Internet, EDI)


Growth of Supply Chain Concept

Integrated systems (ERP) and the sharing of informationGlobal competition and supplyFlexible Designs – reduced product life cyclesg p yJIT approach to interorganizational relationsSubcontracting or outsourcing workSubcontracting or outsourcing work


Current Supply Chain Concept

Manage the flow of materialsShare information through the internetS a e o at o t oug t e te etTransfer funds electronicallyRecover, recycle or reuse materialsRecover, recycle or reuse materials


Conflicts in Traditional Systems

Company main objectives1 Best customer service1. Best customer service2. Lowest production costs3 Lowest inventory investment3. Lowest inventory investment4. Lowest distribution costs


Conflicts in Traditional SystemsFUNCTION OBJECTIVE IMPLICATIONFUNCTION OBJECTIVE IMPLICATIONMarketing High Revenues

High Product High CustomerS ig

Availability

Production Low Production

ServiceLow

Production Low ProductionCostHigh-Level

Many Disruptions to Production

FewProduction Long ProductionRuns

Few

Runs

Finance Low Investment Highand CostFewer Fixed CostLow Inventories

HighInventories

Low


Low Inventories

Conflicting Objectives

Manufacturing Planning and Control

Planning and Controlling the flow of materials through the manufacturing process through:g p g- Production Planning- Implementation and Controlp- Inventory Management


Process Specifications

Recorded on a Route SheetDescribe how the product is madeDescribe how the product is made- Operations required to make the product- Sequence of operationsSequence of operations- Equipment and accessories required- Standard time to perform each operation- Standard time to perform each operation



Production Part Approval Process


Genichi Taguchi

TAGUCHI’STAGUCHI’S QUALITY

LOSSLOSSFUNCTION

INTRODUCTION

Taguchi Methods is a statistical methods developed g plargely by GENICHI TAGUCHI to improve quality of manufactured goods.The philosophy of off-line quality control.Innovations in the design of experiments.


Taguchi Loss Function Definition

Taguchi defines Quality as “the loss imparted by the product to society from the time the product is shipped ”product to society from the time the product is shipped.LOSS = Cost to operate, Failure to function, maintenance and repair cost, customer satisfaction, poor design.p , , p gProduct to be produced “being within specification”


Taguchi’s Vs Traditional Approach

Taguch’s Traditional

When a product moves from its Target

There is Good or Bad Products only as per moves from its Target

will cause the loss even if the product

Products only as per Limits

plies or not within Limits


Taguchi’s Quadratic Quality Loss Function

Quality Loss Occurs when a product’sQuality Loss Occurs when a product s deviates from target or nominal value.D i ti G th L iDeviation Grows, then Loss increases.Taguchi’s U-shaped loss Function Curve.g p


Taguchi’s U-shaped loss Function Curve.

Taguchi loss Fn

Scrap or Rework Cost.

Loss

LTL NominalMeasured characteristic

UTL3 E MANAGEMENT

CONSULTANTS

LTL Nominal UTL

Formula to find Taguchi’s Loss FnTaguchi uses Quadratic Equation to determine loss Curve

L (x) = k (x-N)²Where L (x) = Loss Function,( ) ,k = C/d² = Constant of proportionality, where C – Loss

associated with specification limitpd-Deviation of specification From target value

x = Quality Features of selected product,x Quality Features of selected product,N = Nominal Value of the product and

(x-N) = Tolerance(x N) Tolerance


Problem

A t di i t l i ifi dA part dimension on a power tool is specified as 32.25±0.25.Company records show±0.25 exceeded & 75% of the returned fo replacement. Cost of replacement 5% o t e etu ed o ep ace e t Cost o ep ace e tis Rs.12,500.Determine k & QLF.

Solution : Expected Cost of repairC = 0.75(12500) = Rs 9,375k = C/d²= 9375/(90.25)² = Rs 1,50,000Q ( ) 0 00( )QLF =L (x) 1,50,00(x-N)


Ideal Supply Chain Management

What youthink it is

What it really is What itshould be

What itcould be

think it is

3 E MANAGEMENTCONSULTANTS 44www.3emc.net

Lead Time Improvement Tools and Techniques

MeasurementSupplier Rating and ImprovementSupplier Rating and Improvement Quality Plan Advance Production Quality Plan (APQP)Advance Production Quality Plan (APQP)Part Production Approval ProcessPl i t l ( B Ch t G t Ch t Mil StPlanning tool ( Bar Chart, Grant Chart, Mile Stone Chart)Critical Path MathCritical Path Math Performance/Project/Program Evaluation Review Techniques (PERT)Techniques (PERT)


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KAI ZENKAI ZEN

Change + good = improvement


KAIZEN INSTRUMENTS

5STOTAL PRODUCTIVE MAINTENANCETOTAL PRODUCTIVE MAINTENANCE KANBANVISIBLE MANAGEMENT ( Visual Control )VISIBLE MANAGEMENT ( Visual Control )PROCESS ORIENTED MANAGEMENTCROSS- FUNCTIONAL MANAGEMENT/ QUALITY CIRCLECROSS FUNCTIONAL MANAGEMENT/ QUALITY CIRCLE JUST –IN- TIME MANAGEMENTSTATISTICAL PROCESS CONTROLPDCA CYCLE


WORKPLACE MANAGEMENT SYSTEM

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OBJECTIVES

DESIGN A SYSTEM FOR ORGANIZING WORK PLACE IN ORDER TO RECOVER

LOSS OF INVENTORYLOSS OF MOVEMENT / ENERGYLOSS OF MOVEMENT / ENERGYLOSS OF TIMELOSS OF SPACELOSS OF SPACELOSS OF QUALITYLOSS OF SAFE CONDITIONLOSS OF PRODUCTION


WORK PLACE MANAGEMENT 5S

1S SEIRI ORGANIZATION

2S SEITON ORDERLINESS

3S SEISO CLEANLINESS

4S SEIKETSU STANDARDIZATION

5S SHITSUKE DISCIPLINE


Organizing(1-S)-Only necessary inventoriesClassification of ItemClassification of Item

ON THE BASIS OF PRIORITIES

NECESSARY ITEMS

UNNECESSARY ITEMS

NOT NEEDED ITEMS

ON THE BASIS OF UTILITYON THE BASIS OF UTILITY

MACHINES – CODE A

INVENTORY – CODE B

OPEN SPACE – CODE C


PAINTING STRATEGY

WALKING AREA ( WALK WAYS )

WORKING AREA ( OPERATION AREA )WORKING AREA ( OPERATION AREA )


CLEANLINESS ( 3-S) WORK -STATUS BASED

CONSTRUCTORY BASEDINTERNAL CLEANLINESSEXTERNAL CLENLINESS

CLEANLINESSCLEANLINESS

WHERE CLEANLINESS IS TO BE MAINTAINED?

WHAT IS TO BE CLEANED?

WHO WILL CLEAN?

HOW TO CLEAN?

FREQUENCY OF CLEANINGFREQUENCY OF CLEANING

DURATION FOR CLEANING

TOOLS AND MATERIALS REQUIRED3 E MANAGEMENT

CONSULTANTS 54www.3emc.net

TOOLS AND MATERIALS REQUIRED

APPROACH BASED

INSTANT MAINTENANCE ( Routine )

REQUIRED MAINTENANCE( PreventiveREQUIRED MAINTENANCE( Preventive

Leading to TPM to be measured in OEE


PILLARS OF TPM


PILLERS OF TPM

PILLAR 1 - 5S PILLAR 2 - JISHU HOZEN ( Autonomous Maintenance ) PILLAR 3 - KAIZEN PILLAR 4 - PLANNED MAINTENANCE PILLAR 5 - QUALITY MAINTENANCE PILLAR 6 - TRAINING

O CPILLAR 7 - OFFICE TPM PILLAR 8 - SAFETY, HEALTH AND ENVIRONMENT


5S BASED MAINTENANCE

Cleanliness Maintenance

Discovery of abnormality or slight defectslight defect

Instant i

Requested iMaintenance Maintenance


TYPES OF MAINTENANCE

Maintenance PreventionDesigning or selecting equipment that will run with minimal maintenance and is easy to service when necessary. Predictive MaintenanceD t i i th lif t f hi tDetermining the life expectancy of machine parts or components in order to replace them at their optimum times. Corrective MaintenanceImproving the performance of existing equipment or alteringImproving the performance of existing equipment or altering equipment to changing manufacturing needs. Preventive MaintenanceScheduling and planning maintenance activities so that smoothScheduling and planning maintenance activities so that smooth operation of equipment may continue. Autonomous MaintenanceInvolving production employees in all aspects of the machine g p p y pmaintenance process.


CLEANLINESS ( 3-S)WORK -STATUS BASED

CONSTRUCTORY BASED

INTERNAL CLEANLINESS

EXTERNAL CLEANLINESS


PILLAR 2 - JISHU HOZEN ( Autonomous Maintenance )( Autonomous Maintenance )

To develop operators to take care of small maintenancetasks.tasks.To make free skilled maintenance people to spend time onmore value added activity and technical repairs.The operators are responsible for upkeep of theirequipment to prevent it from deteriorating.


GOALS OF TPM

Zero Unplanned Downtime Zero Defects Zero Speed Losses Zero Accidents A Long Healthy Machine Life Cycle With Mi i R i C tMinimum Repair Costs


LOSSES THAT IMPEDE EQUIPMENT EFFICIENCYF il l B kd lFailure losses - Breakdown loss Setup / adjustment losses Cutting blade lossCutting blade loss Start up loss Minor stoppage / Idling lossMinor stoppage / Idling loss. Speed loss - operating at low speeds. pDefect / rework loss Scheduled downtime loss

LOSES THAT IMPEDE EFFECTIVE USE OF PRODUCTION RESOURCES

Energy lossEnergy loss Die, jig and tool breakage loss Yield loss.


Kanban Systems

The first kanban system was applied by Taiichi Ohnoin Toyota around 1953 to:Toyota around 1953 to:Reduce inventory and production cycle timeI d ti itImprove productivity


Kanban Control System

• Kanban card indicates standard quantity of production

• Derived from two-bin inventory system• Derived from two-bin inventory system• Kanban maintains discipline of pull

production


Kanban Control System

Once implemented, a Kanban system acts a control system rather than a scheduling systemrather than a scheduling system

It implements a repetitive schedule embedded in the systemp p y

This schedule can be generated by a scheduling algorithm

Simulation can be used to determine the number of kanbans, queue size, etc.


Basic Preconditions for Kanban Systems

Repetitive production in small lots• Repetitive production in small lots• Balanced manufacturing system g y

(capacity balancing model)


Kanban provides a number of benefits.

Reduce inventory and product obsolescence.Reduces waste and scrapProvides flexibility in productionIncreases OutputpReduces Total Cost


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Synonyms for JIT

Continuous flow manufacturing Zero inventoryKeep moving material manufactureKeep moving material manufactureTime bases competitiveness pSynchronous manufacturing


JIT Stages

JIT techniques are classified into Two stages:

Stage 1: The stage 1 techniques are concerned with preparing the plant for flow, flexibility, short lead time and high quality. They may be said to be the prerequisites for JIT.

Stage 2: The stage 2 set of techniques generally build on stageStage 2: The stage 2 set of techniques generally build on stage 1 set, and comprise those techniques allows operations to run in JIT manner, that is with short (Zero?) lead time and little (Z ?) t(Zero?) waste.


JIT Stage 1:

Maintenance Quality (TQM)

Maintenance (TPM)Design

Focus

Prepare the plant for flexibility, Low Cost, Short ,Lead Time and High Quality

People Preparation

Setup Time Red tion

Layout and

Small Machines PreparationReductionand

GTMachines


JIT Stage 2

Enforced Process DataTotal People

ImprovementProcess Data Collection

VisibilityTotal People Involvement

Produce with zero lead time

dand no waste

Supplier and Customer Partnerships

Buffer and Lot Size Reduction

Inventory Control

Flow Scheduling

Partnerships


JIT Stage 1: Design

Effect Causes Sub CauseEase of manufacturing with control quality speed

Parts Reduction 1. GT Data Base2. Modular Specs.control quality speed 2. Modular Specs.3. Value Eng

Communication 1. Design as operators2. Location of design office2. Location of design office3. Feedback meetings

Option Reduction 1. Pareto2. Value Eng.

Design for manufacturing 1. Manufacture Vs. The customer2. EMI3. Option AS Late AS POSS4 Capability awareness4. Capability awareness5. Concurrent Engineering

Supplier Involvement 1. Open Specification2. Early consulting2. Early consulting3. Trust4. Supplier as experts5. Inter shop floor visits


JIT Stage 1: MaintenanceEffect Causes Sub CauseEffect Causes Sub Cause

Maintenance tool, Equipment available

People 1. Operator Responsibility: cleanliness aircraft style checkEquipment available

when needed with Low cost

cleanliness aircraft style check use of senses simple tasks

2. Maintenance staff: standard procedure improvement operator p p ptraining more complex task

Data 1. Visible charts : on machine, on shop floorshop floor

2. MIS: Inventory history, maintenance cycles

Support 1 Condition monitoring: failure typeSupport 1. Condition monitoring: failure type awareness

2. Fast response MTTR: Lights, sound tool location trolleyssound tool location, trolleys response time monitoring

3. Maintenance shifts: Bottleneck awareness “8-4-8-4” cycle


awareness 8 4 8 4 cycle

JIT Stage 1: Total QualityEffect Causes Sub CauseEffect Causes Sub Cause

Defect free product and component

People 1. No fears2. Education3 Teams: SGIA circles3. Teams: SGIA circles4. Training: 7 tools & FMEA5. Responsibility

Support 1. Design involvementpp g2. Supplier involvement3. Maintenance of tools & Gauge etc4. Under cap schedule5. Communication: Procedures customer costs

standards 85/15 principle

Detection 1. POKA YOKA2. Operators: as inspectors use of all senses3 Process chart analysis3. Process chart analysis4. Visibility: lights chart5. Internal customer feedback6. Line stop

Prevention 1. SPC2. Capability3. Housekeeping4. At source principle


JIT Stage 1: Small Machine

Effect Causes Sub Cause

Flexibility cost Self 1 Simplify: mat hand processFlexibility cost,layout, cash flow, latest tech

Self development machine

1. Simplify: mat hand process2. At ITS worst when new: poka yoka

devices, Quality capable, low cost automation combined operationsautomation, combined operations

Small Machine 1. Demand speed2. Flexible layout: move machine, move

l b thpeople, move both3. Permanently set up: non bottlenecks,

idleness no problem4 Suck cost principle4. Suck cost principle

Old Machine 1. Permanently set up: non bottlenecks, idleness no problem

2 S k t i i l2. Suck cost principle


JIT Stage 1: LayoutEffect Causes Sub CauseEffect Causes Sub CauseFlow Facilitation with minimum waste

Housekeeping 1. Time allowed2. Operator ownership3. Incentives, bonus, awards4. Cleanliness5. Orderliness6. Tidiness

Support 1 Machine n wheelsSupport 1. Machine n wheels2. Human movable containers3. Gravity feeds4. Line side delivery5 Multi access points5. Multi access points6. Small machine

Improvement 1. Flow length monitoring2. Process chart analysis3 W h k h3. Waste check sheets4. Dynamic Layouts

Shape 1. U shape communication pfa2. Cells & GT: shojinka close by quality2. Cells & GT: shojinka close by quality

Place 1. Quality of life at work place: lighting, carpets, noise, ergonomics

2. Autonomous work place3 Operators Participation


3. Operators Participation

JIT Stage 1: Set Up Reduction


Minimize time taken to Administration 1 Record keepingMinimize time taken to change from one batch to another

Administration 1. Record keeping2. Incentives3. Regular practice4. Clear priorities5 Form team5. Form team

Facilitators 1. Video2 S i2. Sequencing3. Regularity4. Maintenance5. Trolleys6 Ad i6. Advance warning

Classify Activities 1. Internal: jig design, tool design, quick design, roll through platforms, simultaneous activities

2. External: maximum preparation location of tools, dies, pre heating, pre checking


JIT Stage 1: People PreparationEffect Causes Sub CausePeople fit for JIT Reward, Incentives 1. Bonus system: group based anti over production,

anti-defects, pro- improvement

The production technician

1. Capacity through people2. QWL: Sets up, check quality, carries out

maintenance, produce where needed, make suggestions

Training 1. Multiple Tasks2. Multiple functions3. Job Rotation3. Job Rotation4. Creativity5. Full use of time

Policy 1. Job security2 Taylor 3&42. Taylor 3&43. SOCIO Tech. 4. MIN SPECS.5. Line & Staff equality6 Fewer categories6. Fewer categories7. Participation8. Info. Sharing9. Hire the whole person: skill, brain, sense,

potential


potential

JIT Stage 2:

1. People Involvement2 Visibility2. Visibility3. Process data collection4. Improvementp5. Flow scheduling6. Lot size and buffer reduction7. Inventory Control8. Suppliers


JIT Stage 2: People Involvement

Effect Causes Sub CauseInvolve all in improved Education 1. Operators visits: Supplier, Customer, other JIT performance companies

2. Area: design, quality, maintenance, marketing, purchasing

Beliefs OperatorsBeliefs Operators1. Opinions valuable2. Are good problem solver3. Can be trusted

D i 1 Ti t li t d li t i killDevices 1. Time to listen: and listening skills2. Teams: circles, SGIAs3. U not H4. Manager access5 S ti ith Q i k f db k5. Suggestions: with Quick feedback

Opportunity 1. Under capacity schedule2. Autonomous groups and super teams3. Operators ownershipp p4. Give operators the chance


JIT Stage 2: Visibility

Effect Causes Sub CauseMake progress and Quality 1. Light & soundproblem clear 2. Defect display: by operators, by type

3. Problem Pareto & Fishbone4. SPC Charts

Schedule 1 Painter stock locationsSchedule 1. Painter stock locations2. KANBAN3. Electronic counts4. Bottleneck Tags

Oth A 1 C fOther Area 1. Company performance2. ANDON Boards3. Delay Clocks4. Visible skill chart5 O t t ib ti di l5. Operator contribution display6. Daily Communication7. Office Locations


JIT Stage 2:Process Data Collection

Effect Causes Sub CauseCollect and use data Inventory & 1. BAR codingCollect and use data as it happens

Inventory & Scheduling

1. BAR coding2. Delay Clocks3. Automatic counting

Machine 1. Automatic Condition monitoring2 R H di2. Run Hour recording3. Status Display: tools, Strokes

Quality 1. Operator performance: acknowledge and unacknowledged defectsunacknowledged defects

2. POKA YOKA: automatic stop warning3. ON shop floor SPC


JIT Stage 2: Improvement

Effect Causes Sub CauseContinuously reduce Management 1. Process Visibilitywaste 2. Audio Visual warning

3. Failure cost apportionment4. Rewards

Material 1 Line stop: Shortage quality maintenanceMaterial 1. Line stop: Shortage, quality, maintenance2. Deliberate inventory withdrawal

Machines 1. On going capability studiesMachines 1. On going capability studies5 WHYS7 Wastes

Methods 1 Process / Method auditingMethods 1. Process / Method auditing2. Creative participation3. Line side recording: Pareto based action4. Non Value adding analysis


JIT Stage 2: Flow Scheduling

Effect Causes Sub CauseKeep inventory moving Pull System 1 KANBAN: internal external square card priorityKeep inventory moving at rates of demand

Pull System 1. KANBAN: internal, external, square card, priority, electronic ping pong

Regularity 1. Same time every day2. Linearity

Schedule D l t

1. Mixed model2 U d it h d lDevelopment 2. Under capacity schedule3. INPUT/OUTPUT control4. Constant sequence5. Bottleneck capacity control6 F d i ibilit6. Forward visibility7. Some every day8. Schedule stability9. ADD value late


JIT Stage 2: Lot size & Buffer reduction


Minimize lot size and buffers

Buffers 1. Holding cost awareness2. Schedule accuracy, feedback loop3. Non bottleneck, buffer elimination4. Awareness of linkage: with maintenance, quality,

supplier variability, lead times & multi locations

Lot size 1 Linkage with setup times: graphed recalculatedLot size 1. Linkage with setup times: graphed, recalculated run times

2. Non bottleneck transfer lot size3. Bottleneck constraints: greater throughput


JIT Stage 2: Inventory control

Effect Causes Sub CauseControl inventory for Flow preparation 1. Cycle countingControl inventory for flow

Flow preparation 1. Cycle counting2. Record accuracy3. Bottleneck links4. Visibility5. Window deliveries5. Window deliveries6. MRP7. Reduction BOM levels8. Standardized container

Fl it i & 1 I t/ t t t lFlow monitoring & Control

1. Input/output control2. Buffer monitoring3. Four wall inventory4. Back flushing5 Bottleneck throughput5. Bottleneck throughput


JIT Stage 2: SuppliersEffect Causes Sub CausePartnership on cost, quality, reliability and long term profit

Cost Reduction 1. Open specs.2. Cooperation on future design3. Fewer suppliersp pp4. Supplier Pareto5. Cutting lead times

Delivery 1. Periodic reconciliation2. Less checking standard containers3. Delivery time window4. KANBAN5. Line side delivery

Quality 1. Site visits2 E2. Easy access3. Joint team4. Supplier responsibility5. Product identification

Reliability 1 Longer term contractsReliability 1. Longer term contracts2. Sole suppliers3. Blanket orders4. Schedule stability5. Cut buffers

Information 1. EDI2. 2 way problem notification3. Schedule visibility4. 2 way visits5 C b d


5. Common bar code

Elements of JIT

Pull production conceptFlexible resourcesFlexible resourcesCellular manufacturingKanban production controlSmall-lot productionQuick setupsHigh qualityHigh qualitySupplier networks


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Six sigma

Six Sigma is a Management technique that aims to develop and deliver near perfect products and servicesdevelop and deliver near perfect products and services.Six Sigma is a quality system based on measurements of how well an organization meets customer requirements.g q

Six Sigma is a Measure for QualitySix Sigma is a Measure for Quality

-- Process For Continuous ImprovementProcess For Continuous Improvement

-- Enabler for Culture ChangeEnabler for Culture Change

3 E MANAGEMENTCONSULTANTS 92

How Six Sigma works?

Traditional approach towards Problem solving:A h th bl di tlApproach the problem directlyTry to identify a solution

Six Sigma:Root Cause analysis to identify the factors impacting the problemValidating them using statistical tools Finding solutions for the significant causesFinding solutions for the significant causes


D-M-A-I-C

1. Define: Customer expectations of the process?2. Measure : What is the frequency of defects?3. Analyze: Why, when, and where do defects occur?4. Improve: How can we fix the process?5. Control: How can we make the process stay fixed?


Characteristics of Six Sigma Approach

The extensive focus on customer requirements.

The direct link to business strategy and financial results.

Th i d it t f t l d hi f tThe required commitment of top leadership up-front.

Each project delivers bottom line results in a short time.

The disciplined improvement methodology based on

measurement and analysis.measurement and analysis.


Statistical Measure of Six Sigmadpmo (Number of defects discovered/ Opportunities for error) * 1 000 000

σ (Sigma) rating Defect rate On-time at-quality

dpmo = (Number of defects discovered/ Opportunities for error) * 1,000,000

( g ) g q yrate

0 93.32% 6.68%

1 69.15% 30.85%

2 30.85% 69.15%

3 6.68% 93.32%

4 62% 99 38% 4 .62% 99.38%

5 .23% 99.77%

% % 6 .034% 99.966%


Basic definition

Process: this refers to some unique combination of machine, tools methods materials and people engaged in productiontools, methods, materials and people engaged in production

Capability: this word is used in the sense of an ability, based on tested performance, to achieve measurable results

Inherent capability: this refers to the product uniformityInherent capability: this refers to the product uniformity resulting from a process which is in a state of statistical control, i.e., in the absence of time-to-time drift or other assignable

f i ti I t t d ibilit icauses of variation. Instantaneous reproducibility is a synonym.


Process capability index and product outside specification limit

Process capability index (Cp)

Total product outside two sided specification limits

0.5 13.36%

0.67 4.55%

1.00 0.3%

1.33 64 PPM

1.63 1 PPM

2.00 02.00 0


System Approach for Sustainable Upgradation/ Improvement


Implications of Advancing for Continuous ImprovementA) PROCESS )

Level1 Level 2 Level 3 Level 4 Level 5F t bl P I t t d P PFew stable processes Exist or areused.

Processes are Documented ,Repeated

Integrated management is used to standardized the process across the

Processes areQuantitatively understood and stabilized

Processes arecontinuously and systematically p

organization to have consistency .

predictable.y y

improved optimize .

“Just do it” P oblems a e P oblems a e So ces of Common“Just do it” Problems arerecognized and orrectedas they

Problems areanticipated and prevented , or their impacts

Sources of individual problems are understood

CommonSources of Problems are Understood y

occur.p

are minimized. and eliminated.

and eliminated.


Implications of Advancing for Continuous ImprovementB) People) p

Level1 Level 2 Level 3 Level 4 Level 5Level1 Level 2 Level 3 Level 4 Level 5Successdepends onindividualheroics.

Successdepends onindividuals;management

Area groupswork together,perhaps as an integrated

Strong sense of teamwork exists within each project.

Strong sense ofteamworkexists acrosstheheroics. management

systemsupports.

integratedproduct team

each project. theorganization.

“Fire fighting” is a way of life.

Commitmentsare under-

Training is planned and

Everyone is involved ina way of life. are under

stood and managed

planned and provided according to roles.

involved in processimprovement.

Relationships People areRelationships between department are uncoordinated, perhaps even

People are trained in coordination, interpersonal relation ship.perhaps even

adversarial .relation ship.


Implications of Advancing for Continuous Improvementc)Technology) gy

Introduction

of new

Technology

Supports

New technologies

are

New

technologies

New

technologiesof new

technology is

risky.

Supports

Established ,

stable

are

evaluated

on a

technologies

are evaluated

on a

technologies

are

proactively

activities. qualitative basis. quantitative

basis.

pursued and

deployed.


Implications of Advancing for Continuous ImprovementD) Measurement

Data collection

Planning andmanagement

Data arecollected and

Data definition and collection

Data are used to evaluate and co ect o

andanalysis aread hoc.

a age e tdata used byindividuals.

co ected a dused in alldefined processes.

a d co ect oare standardized across the o gani ation

to e a uate a dselect process improvements.

organization.

Data are systematicallyshared across

Data are used to understandthe understandshared across

projects.the understandquantitativelystabilized


International Standard for Operating System

First Version ISO 9001:1987ISO 9002:1987ISO 9003:1987ISO 9004:1987

Second Version ISO 9001:1994ISO 9002:1994ISO 9003:1994ISO 9003:1994ISO 9004:1994

Third Version ISO 9001:2000ISO 9004:2005

Fourth Version ISO 9001:2008ISO 9004:2007

Fifth Version ISO 9001:2015ISO 9004: 2017


ISO 9004: 2017

www.3emc.net 104

Top 10 countries for ISO 9001 certificates (2010)[31]

Rank Country No. of certificates

1 China 297,037

2 Italy 138,892

3 Russian Federation 62,265

4 Spain 59,854

5 Japan 59,287

6 Germany 50,583

7 United Kingdom 44,849

8 India 33,250

9 United States 25,101

10 Korea, Republic of 24,778


Session VII: Strategic Role of Technology-ERP

What is ERP?S it f i t t d li tiSuite of integrated applicationsAddresses most of functions in an OrganizationData redundancy – Enter onceData redundancy Enter onceBest of breed business practicesBuilt in controls


ERP Vs non ERP Solutions

Tier 1 / Tier 2 ERPs cover most SCM functionsI d S ifi SCM l iIndustry Specific SCM solutionsChoice depends on specificsMay start with ERP if no specific reasons forpoint solutionI t ti i dIntegrations required


What to look for

Supply SideSourcing, Procurement, Inbound Logistics

Warehousing, Inventory ManagementConversion (Manufacturing)Demand SideDemand Side

CRM, Sales, Outbound Logistics,Transportation managementp g


What to look for

Planning & SchedulingManufacturing SchedulingCapacity PlanningDistribution PlanningMRPMPS


TOP ERP Vendors

Top 101 SAP 6 Lawson2 Oracle 7 QADQ3 Microsoft 8 SAGE4 Infor 9 IFS5 Epicor 10 Consona Corp.

Top 100 Microsoft Excel Worksheet


Top 15 SCM Vendors

Following is report showing top 15 SCMli i d d fapplication vendors and features

provided

Adobe Acrobat Document

No wonder they are mostly top ERP vendorsNo wonder they are mostly top ERP vendorsCourtesy : Business-software.com


Some core SCM Modules in Oracle EBS








Sample Data Sheet of Oracle Inventory in EBS

This slide includes the datasheet of OracleInventory This briefly describes the moduleInventory. This briefly describes the modulefunctionalities.

Adobe Acrobat Document


On -Line Off the Session SupportQueries are invited atQueries are invited at

[email protected] www.3emc.netwww.3emc.net

3E MANAGEMENT CONSULTANTS SF-36 , ANSALS FORTUNE ARCADE

Sector 18 , Noida .Ph- 0120- 4320978

ThanksThanks for

participative session p p


Documents

In-house Training Programhouse Training Programiica.in/images/3EMC-IICA-SCM.pdf · In-house Training Programhouse Training Program On ... Consultant–ERP & IT Services ... MRP1 MRP2