AUnifiedApproachtoLeanTransformationDiagnosti

AUnifiedApproachtoLeanTransformationDiagnosticsThisreportissolelyfortheuseofclientpersonnel.Nopartofitmaybecirculated,quoted,orreproducedfordistributionoutsidetheclientorganisationwithoutpriorwrittenapprovalfromMcKinsey&Company.ThismaterialwasusedbyMcKinsey&Companyduringanoralpresentation;itisnotacompleterecordofthediscussion.April2002Copyright2002Version1.0McKinseyManufacturingPractiseandProductionSystemsDesignCentre1Engagement/ClientDirector’sSummary•Adiagnosticshouldidentifytheperformancegapinavaluestream/streamsandeducateaclienthowtocloseit•Afulldiagnosticshouldformpartofastructuredchangeprogramandleadtoaclient-ownedTacticalImplementationPlan•20daysshouldbeplannedforatypicalMMP/PSDCdiagnostic(thismayvaryaccordingtothetypesofquestion/problem)•AtleastoneMMP/PSDCspecialistshouldbeusedinperformingadiagnostic•ReasonableresourcingshouldbesecuredthroughMMP/PSDCstaffing•Thefocusofthediagnosticmustbeclearfromtheoutset•Avarietyoftoolsexistfordiagnosticspurposes,ofwhichtheMIFAisthemostpowerful2OBJECTIVES•Integrateexistingdiagnostictoolsintoasingleunifiedandeffectivediagnosticsframework•Combinebestpractisediagnosticapproachestoallowyoutogettotheheartofyourclientsproblemsquickly•HighlightexistingdiagnosticstoolsandhowbesttoapplythemThispackaimsto……..3DOCUMENTCONTEXT•Aunifieddiagnosticframework•Gettingthemostfromtheframework•Diagnostictools&techniques4Whatisadiagnostic?DefinitionAdiagnosticisastructuredsetofactivitiesandtoolsthatareusedtosystematicallymeasuretheperformancegapinclients’valuestreamsandtodevelopappropriateplansoflogicalimprovementstoclosethatgap5Anassessment(diagnostic)helps…•identifypotentialforimprovement•demonstratethatanengagementwilldeliverimprovement•SupporttheLOPacceptanceOVERALLENGAGEMENTAPPROACHThediagnosticoccursatapostengagementstageinaclientrelationship,butcanbeusedtobuildclientdevelopment.ItssuccesscanbecrucialtotheoveralloutcomeofanLOPorengagementLetterofproposalPre-diagnosticdiscussionDiagnosticImplem-entationRoll-OffUmbilicalsupportAdiagnostichelpsaclient….•Togettotherealheartofhisbusinessproblems•Toidentifyresourcesandtimescalesrequiredtoclosetheperformancegap•Toremainfocusedoncriticalsolutionsandresources•TosetdirectionInitialclientdiscussions6•Diagnosticsarecarriedoutinverydifferentways•Varioustoolsareapplied•EDandclientexpectationsofdiagnosticsvaryenormouslyfromstudytostudy•Diagnosticsoftenhighlightthesizeofpotentialleanbenefitsbutrarelythetaskrequiredtosecurethem•THERESULTSVARYHUGELYWeneedtochangeourdiagnosticsapproachtoensurethatcustomerandengagementexpectationsaremetWeneedastandardbutflexibleprocessthatintegratesthekeytoolstoallowrapideffectiveclientdiagnosticsSource:McKinsey&CompanyTHECHALLENGECurrentsituation•Accuratediagnoses•Structuredprocessandappropriateselectionoftools•ThatdeliveraconsistenthighqualitydiagnosticproductDesiredsituation7Adjustmentsintheapproachareneededaccordingtothetypeofactivity•Powergeneration•Trains•Planes•Boats•Construction•Automotive•Medicaldevices•Consumerproducts•Packaging•Electronics•Sheetmetalmanufacturer•Controlsystempanels•Aluminiummanufacturers•Metalsandmining•Luxurygoods•Pulpandpaper•PostalserviceNumberofunitsFewManyFewManyNumberofprocessstepsSource:McKinseyLeversforeachsegment1.Few/Few•Productionplanning•Manufacturingorganisation(Flow,pullandlayout)•Performancemanagement(actualtoplanattainment)•Flexiblemanning•Knowledgeandworkskills2.Few/Many•Productionplanning•Standardwork•PerformancemanagementtoTakttime•Layout3.Many/Many•Standardwork•Performancemanagement•Processdesign•BuildinQuality4.Many/Few•Productionplanning•Standardwork•Performancemanagement•VariabilityreductionincontrolparametersSEGMENTATIONBYPROCESS&PRODUCTS23418SimplesegmentationindicatestwodistinctviewsCapitalEmployedHIGH(Assetbasedoperations)LOW(Humanbasedoperations)Assetbased•Variabilityreduction•EquipmentOEE–Breakdowns–Changeovers–Minorstops–SpeedLosses–Scrap•StrategicMaintenanceFramework–FocusedEquipmentImprovement–AutonomousMaintenance–EquipmentMaintenanceStrategy–SparePartsManagement–EarlyEquipmentManagement•PatternProductionHumanbased•Wasteelimination–Waiting–Inventory–Motion–Over-production–Transportation–Over-processing–Rework•Labourproductivity•Standardisedwork•FlexibleManpowerSystems•ContinuousFlowProcessing•PerformanceManagement•CapabilityBuilding•TakttimeLeversSEGMENTATIONBYCAPITALEMPLOYED9Source:McKinseyProductionSystemsDesignCentre•Toestablishwhatthekeybusinessissueisforbothshareholdersandcustomers•Toidentifypotential‘rootcauses’ofthebusinessproblem.Thetoolstoremoveorminimisetheproblemscanthenbeidentified•TodefinethefuturestateandspecifytheperformancegapintermsofTechnicalSolution,ManagementSystems&ChangeManagement•ToagreeasequentialplantoachieveaLeanTransformationPurpose•Tomaximisevalueaddedtimeduringthediagnosticprocessbyensuringthatallknowledge,resourceandmaterialsareinplacepriortoarrivingattheclientsite•TogaincommitmentandownershipfortheplanandresourcesrequiredPreparationIdentifykeybusinessissueIdentifykeyleversCreatevisionDevelopplanSecureclientownershipOff-SiteAtt