WarehouseSimulationGameWarehouseSimulationGame12/6/20232DuringtheWarehouseSimulationGametheprinciplesofLeanareshownandweaskyoutoapplythemonthespotThegamemakesyouthinkaboutwhatisvalueaddforthecustomer,whatistheemployee’sroleandvalueaddintheprocess,andtoletgooftraditionalrolesandseeminglyindependenttasksThegoalistomakeLeanmoreconcreteandeasiertoapplyItisaninteractivewaytogetyouacquaintedwiththeLeanprinciples.Tounderstandtheopportunitytoimprovequality,cost,anddeliveryperformanceintraditionalwarehousingTogainanawarenessofhowJITwarehousingdiffersfromtraditionalwarehousingTogainanappreciationofthefollowing'LEAN'terms:EighttypesofwasteContinuousflowprocessingTakttimeObjectives12/6/20233AgendaCaseintroductionPracticeroundRound1“Waste”Round2“Flow”Round3“Takt”Summary

12/6/20234Run(do)Redesign&Prepare(plan)Analyze(check)LEANtheory&examples(act)Structureofsimulationrounds“Setupnewround”“Designimprovedwarehousesystem”“Simulateoperation”“Measureperformanceandidentifyissues”12/6/20235AgendaCaseintroductionPracticeroundRound1“Waste”Round2“Flow”Round3“Takt”Summary

12/6/20236Context12/6/20237Youare6,12,18,or24employeesinawarehousethatproduceskitsfortheconsumerindustryThepackingfortheseproductsrequiresspecialtreatment,buthasasimilarsetupThecompanyiscurrentlyunabletodeliverthequality,cost,anddeliverypromisesmadetoitscustomersOperationEachorderismadefrom?sheetofA4,1photofilmtubeand2to12paperclipsEachoperatorhasaworkstationwith1workinstruction12/6/202381Receiveandcheckpacking2Cutpackingintoquartersheets3Preparebox,addpicklist4PickpackitemsrequiredfororderQCShip&5Checkquality,sealorder6MaterialhandlerUnitsGoalNumberofgoodordersdeliveredPercentwrongpicked/packeditemsfromtotalnumberofitemsGoodordersdelivered/numberofemployeesNumberof1/4papersheetsinproductionareaAveragethroughputtime(minutes)Indexedagainstround1(=100%)Trackingkeyperformanceindicators

KPIDescriptionCostorRevenue€Comment1.Quantity#ofcorrectordersdeliveredRevenue€1002.Latepenalty#oforderslateCost-€503.Qualitypenalty#ofincorrectordersdeliveredCost-€504.WIPNumberof1/4papersheetsinproductionareaCost-€105.Space#tablesusedCost-€1006.Personnel#employeesCost-€2007.OverheadCost-€300Fixed8.Productivity#ordersdelivered/#employees9.LeadTimeTimeittakestofinishfirstorder12/6/20239AgendaCaseintroductionPracticeroundRound1“Waste”Round2“Flow”Round3“Takt”Summary

12/6/202310AgendaCaseintroductionPracticeroundRound1“Waste”Round2“Flow”Round3“Takt”Summary

12/6/202311Round1:TraditionalmanufacturingEveryprocesshasabatchsizeof4Everybatchmustbepreparedtogetherandthematerialhandlermustberequestedtodeliverthecompletebatchtothenextprocess(materialhandlercanonlytakeonebatchatatime)Everyoperatorshouldworkasfastaspossible1.Receipt5.Inspect/ship4.Pickpacking3.Preparation2.CuttingLayoutisbyprocess2m6.Materialhandler12/6/202312Simulationround1Customersdemand:24ordersin10minutes12/6/202313Time12/6/202314UnitsGoalNumberofgoodordersdeliveredPercentwrongpicked/packeditemsfromtotalnumberofitemsGoodordersdelivered/numberofemployeesNumberof1/4papersheetsinproductionareaAveragethroughputtime(minutes)Indexedagainstround1(=100%)Round1analysis:

TrackingkeyperformanceindicatorsKPIDescriptionCostorRevenue€Comment1.Quantity#ofcorrectordersdeliveredRevenue€1002.Latepenalty#oforderslateCost-€503.Qualitypenalty#ofincorrectordersdeliveredCost-€504.WIPNumberof1/4papersheetsinproductionareaCost-€105.Space#tablesusedCost-€1006.Personnel#employeesCost-€2007.OverheadCost-€300Fixed8.Productivity#ordersdelivered/#employees9.LeadTimeTimeittakestofinishfirstorder12/6/202315Round1analysis:

LearningpointsWhatwentwell?Whatwerethemostsignificantproblems?WIPlevelsBottlenecksWaitingtimeWorkerstress/boredomTeaminteractionDefectrateWhatweretherootcausesoftheseproblems?Howcantheseberesolved?QualityFirstpassyieldCostProductivityInventoryDelivery%ontimetocustomerLeadtimePerformanceHowcanperformancebeimproved?12/6/202316InflexibilityWasteVariabilityReducingwaste(“muda”)meansloweringcosts,improvingqualityandachievingconsistentthroughput(servicelevel)CustomerdemandOutputCustomerdemandOutputReducinginflexibility(“mura”)meansbecomingabletodelivertotheclientwhatheasksattherighttimeintherightamount(servicelevel)Reducingvariability(“muri”)meansimprovingprocessreliabilityi.e.loweringcostandimprovingqualityThreeleanenemies'waste','inflexibility'and'variability'addressalloperationaltargets12/6/202317Typicallearningpoints12/6/202318Thelayoutispoor:DoesnotsupportthisproductPreventspeopleunderstandingthesystemHinderscommunicationOperatorsoftenhavenothingtodo:BatchmanufactureWaitingformaterialhandlerSystememptyatstartofshiftHighlevelsofinventorytieupcashandcreateaqualityriskDespitealotofactivity,thecustomerdemandhasnotbeenmetItisafrustratingsystemtoworkinModule:Waste

Module:OnePieceFlow

Module:Kanban

8typesofwasteOverproductionProducetoomuchortoofastOverprocessingMorestepsintheprocessesthanrequiredTalentNotfullyutilizingthetalentofallemployeesMotionEverymotionthatisnotaddingvalueDefects/ReworkRepairingbadqualityormistakesTransportationMovementsbetweenprocessesInventoryEverythingthatisin

excessoftheminimumrequiredtoperformthetasksWaitingWaitingforparts,untilsomeoneelsehascompleteshiscycleLeanIntroductionTraining2012/6/2023ContinuousFlowProcessingisoftenthefirststeptoremovingwasteThetraditionallayoutandconfigurationofprocessesanddepartmentscreateswasteContinuousflowprocessing12/6/202321LinedesignexamplesAINVBCDINVINVINVEINVFBatchProductionIsolatedABCDEFContinuousFlowLinear“U”-ShapedParallelABCDEFCBADEFMaximizedFlexibility&MotionEconomyFeedbackReducedInventoryReducedfloorspaceClearproductionstatus(short/full)ReducedfloorspaceIncreasedoperatorflexibilityacrossstepsReducedfloorspaceGoodforpair-productproduction12/6/2023221pieceflowandpullsystemFinalcustomerdictatessequenceandpace:pullsystemCustomer-supplierrelationateachprocessstep(e.g.process3iscustomerofprocess2andprocess3issupplierofprocess4)Thesystemisusinga1pieceflowhavingstandard1pieceWIPEachprocessmakestoreplenish"supermarket"downstream(Kanban)KanbanSupermarketisidentifiedastheplacetoput1singlepartbetweeneachprocess12/6/2023231.Receipt3.Setup2.Cut4.Pickpack5.QualityFinalcustomerAgendaCaseintroductionPracticeroundRound1“Waste”Round2“Flow”Round3“Takt”Summary

12/6/202324Round2:Summaryofdesignchanges12/6/202325Improvedlayout(tooptimizematerialflow)ContinuousflowprocessingBatchsizeof1(fromoperator3onwards)NoneedforinternalpackagingWorkispasseddirectlybetweenoperatorsMaterialhandlerfreeduptostudyperformancePullsystemimplementedtocontrolinventoryandtoallowcustomertosetpaceEachstationworksonlyifdemandexistsatthenextdownstreamDemandissignaledbyemptyKanbanspace(WIPstorage)Customerpulls1orderfromlastprocessevery25secondsSimulationround2Customersdemand:24ordersin10minutes12/6/202326Time12/6/202327UnitsGoalNumberofgoodordersdeliveredPercentwrongpicked/packeditemsfromtotalnumberofitemsGoodordersdelivered/numberofemployeesNumberof1/4papersheetsinproductionareaAveragethroughputtime(minutes)Indexedagainstround1(=100%)Round2analysis:

TrackingkeyperformanceindicatorsKPIDescriptionCostorRevenue€Comment1.Quantity#ofcorrectordersdeliveredRevenue€1002.Latepenalty#oforderslateCost-€503.Qualitypenalty#ofincorrectordersdeliveredCost-€504.WIPNumberof1/4papersheetsinproductionareaCost-€105.Space#tablesusedCost-€1006.Personnel#employeesCost-€2007.OverheadCost-€300Fixed8.Productivity#ordersdelivered/#employees9.LeadTimeTimeittakestofinishfirstorder12/6/202328Round2analysis:

LearningpointsWhatwentwell?Whatwerethemostsignificantproblems?WIPlevelsBottlenecksWaitingtimeWorkerstress/boredomTeaminteractionDefectrateWhatweretherootcausesoftheseproblems?Howcantheseberesolved?QualityFirstpassyieldCostProductivityInventoryDelivery%ontimetocustomerLeadtimePerformanceHowcanperformancebeimproved?12/6/202329Module:TaktTime

Module:WorkforceFlexibility

Module:PokaYoke

11)21)3456OperatorLineisclearlyimbalancedWhatshouldbedone?Howmuchworkshouldeachpersonhave?Assumetheseprocessesmustremainbatchoperation1312331030Analyzingtheproblemofwaiting

Timeperorder,Seconds12/6/202331Solvingtheproblemofwaiting

Timeperorder,SecondsThecorrectpaceofproduction

exactlyachievescustomerdemandintheproductiontimeavailableForabalancedlinewithminimalwaste,eachprocessmustcompleteoneoperationatthispace:thetakttimeTakttime=AvailabletimeCustomerdemand =10minutes*60seconds

24orders =25secondsperorderTakttime=25sAssumetheseprocessesmustremainbatchoperation11)21)3456Operator131233103012/6/202332Solvingtheproblemofwaiting

Timeperorder,Seconds-LineBalancingTakttime=25sAssumetheseprocessesmustremainbatchoperation11)21)3456Operator1312252325Auxiliarywasteduetoisolatedbatchprocesses1)WorkelementshavetoberedistributedtoensureeveryprocesswillproduceatcustomerdrivenpaceCrosstrainingwillbenecessaryProductivitywillbeimprovedNonvalueaddedtimefocusedatoneoperation:timemaybeusefullyfilleduntilfurtherproductivityimprovementsarepossible12/6/202333AgendaCaseintroductionPracticeroundRound1“Waste”Round2“Flow”Round3“Takt”Summary

12/6/202334Round3:SummaryofdesignchangesLinebalancedtotakttimeFlexibleworkforceIn-stationqualitychecks(PokaYoka)12/6/202335SimulationRound3Customersdemand:24ordersin10minutes12/6/202336Time12/6/202337UnitsGoalNumberofgoodordersdeliveredPercentwrongpicked/packeditemsfromtotalnumberofitemsGoodordersdelivered/numberofemployeesNumberof1/4papersheetsinproductionareaAveragethroughputtime(minutes)Indexedagainstround1(=100%)Round3analysis:

TrackingkeyperformanceindicatorsKPIDescriptionCostorRevenue€Comment1.Quantity#ofcorrectordersdeliveredRevenue€1002.Latepenalty#oforderslateCost-€503.Qualitypenalty#ofincorrectordersdeliveredCost-€504.WIPNumberof1/4papersheetsinproductionareaCost-€105.Space#tablesusedCost-€1006.Personnel#employeesCost-€2007.OverheadCost-€300Fixed8.Productivity#ordersdelivered/#employees9.LeadTimeTimeittakestofinishfirstorder12/6/202338Round3analysis:

LearningpointsWhatwentwell?Whatwerethemostsignificantproblems?WIPlevelsBottlenecksWaitingtimeWorkerstress/boredomTeaminteractionDefectrateWhatweretherootcausesoftheseproblems?Howcantheseberesolved?QualityFirstpassyieldCostProductivityInventoryDelivery%ontimetocustomerLeadtimePerformanceHowcanperformancebeimproved?12/6/202339Analyzingopportunityforgrowth

Timeperorder,SecondsCurrenttakttimeof25secondsAssumetheseprocessesmustremainbatchoperation11)21)3456Operator1312252325CompanynowhasimmediateopportunitytomeethigherdemandwithexistingtrainedworkforceBenefitsofflexiblel