STUDY AND IMPLEMENTATION PROPOSAL

LEAN TECHNIQUES IMPLEMENTATION FOR WASTAGE REDUCTION

1. SCOPE OF THE STUDY

Journey towards the improving all these Techniques by initiating comprehensive Lean and
Operational excellence activities. Page | 1

Scope of Work
S. Project Name/ Methodology to Parameters/ Actions/ Process Gain to
No Description Implement/Parameters Gains Management/Company
1s Identification & 1. Every Material will be
1. Manpower cost reduction
rectification reachable within 30 seconds.
2. Search Free Count Free will
2s blueprinting - Racks, be implemented at 2. Inventory reduction/
storage places Gemba/stores/ Godowns/ Management
Everywhere Else
3s - CWC, CWM, CWCL, 3. Improved visualisation
Practical 6S for 3. WIP Reduction
1 HK Standards according to industrial standards
Entire Location
4. 5s Score achievement Up to
4s with Benchmarking and 4. Benchmark for other
90% and L3 Level
blueprinting industries
5. Safety Levels Benchmarking
5th S with Audit frequency 6. Training Tests for the entire 5. Visibility to the HTA
and NC system staff and management Areas
6. Assessment Orientation of
7. Training Classes after audits
Employees
1. Cell Signs 1.Date in the computer
2. Team Photos Synch.
Sharing Information
3. Company News 2. Label on storage container
4. Media Story 3. HR Programs
1. Value Stream Maps
1. CFT Project Dashboards
Work Standards and 2. Standard Work Charts
2. Performance Boards
Instructions 3. Visual Work
3.Company mission & vision
4. Instructions
1.Shadow Board
1.Kanban Cards
Visual Build standards into the 2. Tool drawer with cut outs
2 2. Kanban Squares
Management workplace for each tool
3. FIFO Lanes
3.Change over chart
1.Andon lights
1. Inspection process with a
2. Buzzers, whistles, bells
Alarms buzzer
3. Zebra Crossings to prevent
2. Forklift reverse Siren
danger/hazards
1.Standard containers sample 1.Inspection that stops the
Stopping Defects
products for comparison process Guard rail
1. Unique containers Redesign
Eliminating Defects 1.Clean room with access key
product for poke yoke
3 OPI- Overall 1. Increased Performance of 1. Increased Productivity
OPI -Training
Productive operators.
Improvement OPI- Pre & Post 2. Increased Availability and
(TPM) Qualification tests utility of the Machines
(Changeovers)
 3. Reduction in Quality
OPI - Hand Hold 2. Increased Capacity
Rejection & Rework
4. Optimal Use of designed
OPI - Team Building 3. WIP Reduction
Plant capacity
4. Employee Morale
OPI- Project Allocation 5. Increase in Effectiveness
Improvement Page | 2
6. Benchmark in Manufacturing 5. Optimal Quality Customer
OPI- Review System
Industry Satisfaction
7. Kick off of Implementation of
6. Quality Circles
2 (AM, PM) pillars in the
Achievement
industry
8. AM/PM Step up to 3rd Step
7. Preventive & Predictive
OPI- Sustenance Qualified Machines and
Maintenance
Manpower.
9. Digital tracking 8. increased PPP
9. Sustenance through
Digitization
Assembly/ Production Flow 1. Single Piece/ Batch flow 1. Lean Factory Systems
2. Visible Flow of each Line
Manpower Optimization 2. Line Balancing
With VM
Inventory Flow 3. Impact on OTIFEF 3. OTIF Benchmarking
Lean 4. Complete Comparison of
4
Implementation Layouts 4. Manpower Optimization
Targets Vs Actuals
5. Calculations of Per UOM
Throughput / Yield Rate 5. Target Setting cost
Improvement 6. Improved Labour rate 6. RBA- Result based
Appreciations
1. New Processes for entire 1. Work efficiency and
quality assurance- QA quality
2. Production planning & 2. Zero Tolerance of
1. Operations Management Control Dept.- PPC Unethical Working
Process Design-
2. Execution of each 3. New Process and Systems for
5 Operations 3. Proper Records
process/Order Quality Control- QC
PPC
3. Review System 4. Audit Processes- Entire
4. Database Industry
Location (All Dept.)
5. Penalty Processes
5. KPI designing
(Outsourcing)
1. Preventive Maintenance 1. Reduction in Machine
Schedules Downtime
2. Predictive Maintenance 2. Switching Maintenance
Schedules Activities to Operations
1. Machine Health 3. CBM, TBM- Manually 3. Increased Health of the
CLRI/ machines
2. Maintenance Stores
6 CLITA
Coordination 4. Reduction in Forced
/CLAIR 4. SOP For each activity
3. PM Schedules Deterioration of the machine
5. Fuguai /Abnormality Less
5. IOMQH Culture
Plant
6.MTBF Calculations 6.Increased MTBF
7. MTTR Calculations 7. Decreased MTTR
7 Inventory 1. RM 1. Inbound inventory 1. Visibility to the inventory
 lying in organization in
Management
standardized method
2. Probing to the location and
2. Retrievable Tracking
material in standardized time
processes
span
2. WIP 3. Indent system with when Page | 3
3. Optimized WIP - VSM
3. FG and how much to order
Management
4. Spare Parts 4. FG Inventory Control as per 4. MIN- MAX levels
5. PM TAKT time blueprinting
5. Spare part inventory control-
Every equipment 5. Increased Cash flow
6. SOP against Slow/Aged/fast
6. Kanban system
moving inventory
7. Mizusumashi concepts
1. Visibility in time of 1.END to end Lead time
generating an enquiry Visibility
2. Visibility of Time taken to
2.Improved Lead Time
convert the enquiry into SO
3. Reception of PO- Purchase
SORT- Sales 3. RCA at each level
END to END Tracking of order
8 Order Real
Every Order 4. PO to PO conversion - 4. Customer satisfaction-
Time Tracking
Production order OTIFEF
5. Production Time taken for
every SO
6. Stage wise Visibility of SO
7. Dispatch and OTIF
ADDITIONAL AREAS
1) Calculation of the M/c Time Utilization, OEE (Overall Equipment Efficiency)
2) DWM (Daily Works Management with Measurement)
3) In Quality, 7QC & 7M, LPA and SPC (Statistical Process Control)
4) Additionally, Training Programs for Technical Handholding.

Tentative Ranges of Tangible & Intangible Gains: Here we are sure that we are going to provide the Tangible &
Intangible gains to your organisation which are now tentative in % age but definitely are under the ranges mentioned.

Basis of the Deriving the above Scope derived from the following observations
i) The plant is not running at full capacity due to lack of client schedules /marketing efforts.
ii) Only some of the products are giving good VA and many products have low VA due to high RM cost.
iii) Conversion costs are high leading to low operations Profits.
iv) Manpower costs are high particularly due to good number of old skilled n unskilled employees
employed by the co. This is a situation generally seen in Indian cos.
v) Line cap utilization levels have a scope to improve.
vi) Manpower productivity improvement scope looks good.
vii) Energy & Quality costs have a scope to improve.
viii) Scope to reduce consumables n spares costs.
ix) Scope for introducing Kaizen culture
x) Scope for downsizing & improving Staff team
xi) Scope to reduce supply chain costs.
xii) There is good scope to optimise inventories & improve logistics costs.
 xiii) With introduction of TPM like activities, maintenance function can be improved to keep upkeep of
heavy n expensive plant & machinery.
xiv) Reworking, Poor-Quality costs can be reduced, thus improving product yields
xv) NPD, VE functions can be improved
xvi) Good scope for improving the existing marketing function for better mktg penetration & increasing the
sales revenue. Page | 4

2. ACTION PLAN AND APPROACH FOR IMPLEMENTATION

The Entire Journey will be divided into 3 PHASES

Phase-01 --- Assessment Phase

Phase-02 --- Implementation Phase
Phase-03 ---- Sustenance Phase - After Phase-01 & Phase-02

All these Phases will go through a Planned design for every process. for each Product Vertical
DETAILS OF THE PHASES FOR UNDERSTAND
PHASE-01 --- ASSESSMENT PHASE:
The entire location will be assessed in the first month and two streams will be extracted , one Tangible and
other is Intangible.

In the tangible stream we will identify the projects which will give direct savings to the organization and in the
intangible stream improvements will be done, which are not monetary in nature but are essential part of
manufacturing.

PHASE-02 IMPLEMENTATION PHASE:

The time period for this phase is totally dependent over the identified 2 streams. But in general, it requires at
least 10 to 12 months of time period.

The entire road map will be based on points mentioned below. And we are going to cover SIPOC of the
company which means everything.

VERY HIGH PRIORITY: (Management Kaizen Approach)- Through Time & Motion Studies
1. Underutilised Manpower --- (Extreme Priority) -----> Manpower Optimization
2. Machine Efficiencies OEE --- (Extreme Priority)
3. High Over times ---- (Big Loss)
4. Condition of Machines (TPM)--- (Must Needed)
5. Process Bottlenecks ---- (Must Needed)
6. Rejection & Rework -----(Big Loss)
7. High Inventories (RM Store + Shop Floor)-----(Major Pain Area)
8. High WIP levels at each stage (Work In Process)-----(Major Pain Area)
9. Interrupted In & Out Material Flows----- (Big Loss)
10. Higher Lead times.----- (Major focus)
11. R&R System---- > RBA ( Result Based Appreciations)
12. Safety----(100% Major Focus)
13. SMED
14. VSM
15. PPP----- Productivity Per Person
16. SOP of Each and Every Operation

High Priority: (Managers /Leaders Kaizen Approach)

1. 6S of the entire location-----(Required Industrial Standards Upto Level -III)
2. Visual Management--------(At Controlling Levels)
3. KPI Matrix---------------------(PMS)
4. Customer Complaints------(IQC, PDI)
5. Search Free Count Free Systems
6. Space Utilization Page | 5
7. Daily Work Management (Culture Building)
8. CFT Culture

Though your teams could be doing most of the things mentioned above, but the depth of the actual
presence needs to be checked and furnished.

4. PROCESS
The Entire Project will be done from two perspectives -
1. Operations
2. End to End Supply chain

1. OPERATIONS----> A) Gemba Level: Gemba part will be Addressed on-----> a) Efficiencies b) 5M's c)
Flow d) Quality
e) Manpower Optimisation
f) Planned Maintenances g) I-OMQH

a) Efficiencies:-------> 1) Current OEE Levels 2) Line/ Process Capabilities 3) Process NVA's 4) Capacity
Utilization 5) MTTR & MTBF
b) 5M's:----------> Errors related to Man, Material, Machine, Method & Measurements will be assessed for
each and every product.
c) Flow: Product flow will be assessed starting from RM Issuance to FG storage and the entire SIPOC will be
studied.
d) Quality: Rejections & reworks will be studied & attacked along with focus on yield losses.
e) Manpower Optimisation: Manpower Efficiency will be studied with a extra focus to get the exact
optimization of the resources along with Overtime Study
f) Planned Maintenance: Entire machines will have PM schedules as per the required efficiencies and OEE's.
g) I-OMQH: I operate, Maintain, i give Quality & I will Housekeep my place concept will be implemented
through TPM

2. SUPPLY CHAIN: How we Will Assess the Supply chain is mentioned below :
Project No -01 -----------> Process Mapping--- Also part of Gemba assessment.
Entire Production Line (All type of products) ------> a) RM Intake Flow Process Study b) RM
Issuance Flow Study c) Material Movement in the production area d) Manufacturing of the product -Output
monitoring e) Blueprinting of cycle and process time f) OEE's g) Documentation

Project No -02 -----------> Inventory Control

A) Raw Material Inventory ---------> a) Min Max Levels b) Stores Places Decision c) Material
Movement (End to end)
B) WIP Inventory --------> a) Level Controlling b) Interfaces Design c) Storage Places d) Movement e)
Blueprinting
C) FG Inventory ----------> a) Level Controlling b) Interfaces Design c) Storage Places d) Movement e)
Blueprinting f) Invoicing club

Project No -03 -----------> RM Unloading & Dispatch Logistics System

A) TAT of each vehicle-------> a) End to End Balancing of unloading b) End to End Balancing of loading

Project No -04 ------> Most Important Project -----> (SORT) - Sales Order Real Time Tracking
A) Deep Study of the marketing process from enquiry to PO Generation.
B) RM Procurement Cycles and TAT
C) Supplier TAT Page | 6
D) Production Start Processes
E) Stage Level Studies.
F) Output flow till FG storage
G) Delivery Flow Status.

Automation in current processes

Automation available best in the industry will be studied and will be implemented accordingly.

New Technology
New Technology Available best in the industry will be studied and will be implemented accordingly.

Project No -5 -----------> After projects or parallel to projects 1-4 ----> Supplier Chain Optimisation

1. We will be assessing and making an cluster with all the vendors/Suppliers to work upon ----->
A) Current Inventory Levels
B) Quality Rejections
C) Machine Health
D) Productivity Improvement---> Cellular manufacturing implementation (Where Ever Applicable)
E) Manpower Optimization.

5. STUDY AND IMPLEMENTATION TEAM AND TIMELINES

Study Team and Duration
Dr. Ashok Puri as Advisor and Dilip Kumar Gayen as Principal Consultant will be engaged for the Total
Duration this Project and one/ two Project Associate/ Engineer may be engaged as Executive in the Plant during
the study period.
Note: For the same One consultant will be deployed over the site. Consultant will be there on site for a
minimum 03 days per week. The consultant may work in night shifts of the plant as well according to the need
of the project.
Dr. Ashok Puri shall visit the site once a fortnight.
Full Satisfaction of sustenance will be delivered in this project.

Study Duration: One Year (12 to 15 Months)

TERMS AND CONDITIONS:

1) One Coordinator from the plant will be given to the consultants for the said tenure to coordinate for the
entire requirements.
2) Asked Data must be given on priority basis to the consultants, if data is not available then one person from
the plant will be assigned to make that data.
3) Seating Space with internet connection to be provided to the consultants
4) Client has to take care of the accommodations, Travel & food part for the consultants, along with travel
expenses.
5) Payment to be released within 7 days from invoice date.
6) PO to be released before starting the project.

COMMERCIALS FOR LEAN PROJECT:

For the above efforts we shall charge a fee @ Rs lacs + 18% GST per month Only. This fee is not for just
onsite plant visits but also for offline, back-office working including transfer of know-how on various
fronts from time to time including training costs.
In addition, for some special projects on cost reduction a variable bonus @5 % of the annualized savings
achieved shall be paid to us.
In Return We will be giving at least 3x as cumulative savings over a period of 1 year. Page | 7

These Savings will come from the following

1. Increased productivity from the current levels
2. Reduced Rejection or rework from the current levels
3. Reduced Manpower
4. Optimization of Manpower
5. Dead Inventory Stock Clearance (Interest + Holding costs)
6. Reduction in holding cost
7. Increase of Inventory Turnover Ratio
8. Reduced break-downs on machines/ processes

Seeking a positive response from your side.

Review with management will happen once every 30 days or as per need.

Best Regards

Dr Ashok Puri
Managing Director
Lean India Consulting Group ,
A unit of JCE Management Services Pvt Ltd
5, Kanishka Complex, K-Block, Kalkaji, New Delhi – 110019 , India
Mob:+919810030260 | Offiice ..91 11 41629387 | fax: +91 11 26225095 |
apuri@leanindia.com ; |www.leanindia.com | www.kaizenguru.in