Case 68 of Industrial Engineering ONLINE Course
Art Byrne joined Wiremold as CEO in September 1991. He found a classic batch and queue system in production, sales order taking and scheduling process and product development. The cycle time of products was four to six weeks. Order taking process was a week. Product development took two and half to three years from concept to launch.
In this company Art Byrne announced an early retirement package to the aging workforce. Almost all of the eligible hourly workers took the retirement offer, but only small fraction of office staff took the offer. So, he has given to some of the office staff also a forced severance. (Is is right? This is the typical American way, which is in practice even today).
But when the planned manpower reduction has occurred, Byrne called a meeting of the entire workforce and announced to them that there will an improvement exercise in the company but nobody will lose job because of process and productivity improvements. The union did not believe it and went through the promise very carefully. But in the end they concluded that Byrne would honor his word and he has the plan and capability to do it.
But managers were sceptical. Byrne explained to them, while he expects good things to happen, if some expected fall in sales takes place there are tools to manage the downturn. Overtime can be reduced, surplus workforce can be employed in improvement projects, some outsourced components can be manufactured inside, work week can be reduced and new product line can be developed. We are going to make the operators more skilled and management will not be interested to lose highly skilled operators.
Art Byrne led the first training session in the company himself. Byrne implemented lean in his earlier companies. Based on a manual that he developed, he conducted a two day program for 150 people and followed it with a three day improvement exercise to provide opportunity to them to practice what they learnt. He took them around the plant himself and showed them muda (excess resources being used every where). Then he told them that they are going to convert all activities into continuous flow activities that are activated through pull. He promised them the support of top Japanese consultants and trainers.
Soon hundreds of weeklong kaizen activities were started and improvements were made visible. The company was reorganised into six product families. Each team was given its own punch presses, rolling mills and assembly equipment.
A score board was setup which showed productivity of the team expressed as sales per employee, customer service as on time delivery, inventory turns and quality as rework inside and returns from outside.
The expectation per each time is 50 per cent reduction in defects, 20 per cent increase in productivity, 100 per cent ontime delivery, and inventory turns of 20 per year.
To help the teams to improve continuously, the JIT Promotion Office (JPO) was started. The product team leader and the JPO jointly evaluate the value stream(Order, production and delivery process) to determine kaikaku (reengineering a major portion of the process) and kaizen (local operation improvements) activities to be performed. JPO is given the major responsibility to get the projects implemented. The JPO also conducts training sessions and teaches every employee the principles of lean thinking (identifying value to be delivered to the customer, charting the value stream, flow and pull principles and continuous improvement for perfection.). The principles are to be reinforced in the organization periodically to stop people from reverting to the old habits.
The product development process was reengineered next. Order taking process was made lean. Employees were given a share in profits.
Supplier improvement was done converting them into lean suppliers.
Lot of cash was released from the system due to reduction of inventory and was used buy some companies, which were converted into lean companies.
The benefits realized include doubling of sales per employee in five years, throughput time of one or two days, and increase in operating profit of 600%.
Source: Lean Thinking
James Womack and Dan Jones
Simon & Schuster, 2003
2007 - Discussion between Mark Graban and Bob Emiliani regarding replacement of Lean by Mass Production System at Wiremold by the acquiring firm Legrand.
https://www.leanblog.org/2018/02/lean-can-fragile-especially-executive-changes/
Updated 22 July 2020
23 Feb 2014
The waste elimination and productivity improvement that made Toyota the most productive automobile plant in the world (with production being twice that of US plants per worker and at lower cost and at a higher quality) was made possible by further creative application of industrial engineering and scientific management. Both persons who improved Toyota Motors to world class production level have clearly stated this fact in their books (Taiichi Ohno & Shigeo Shingo).
While Japanese called their system, JIT, MIT researchers gave the name "lean" signifying smaller batch quantities and small work-in-process inventories. All engineers and managers have to recognize the productivity, cost reduction and continuous improvement orientation and practice of industrial engineering.
Articles explaining the relation between industrial engineering and lean manufacturing.
But from a production system design perspective lean now became an alternative system. The earlier basic alternatives were job shop, batch production shop, mass production flow shop, group technology cell or cellular manufacturing cell. The two additional production systems are fixed layout production and continuous flow production. Lean production system having mixed model assembly, supplied through a component supermarket in which replenishment of parts occur based on the consumption during the previous period (may be hour, or day or multiples of day) has emerged as an alternative production system that can be installed right at the starting of the production of new product. This is the natural progression of industrial engineering improvement. Improvements done by industrial engineers are communicated to designers and product designers and process designers capture these improvements in the subsequent designs.
The improvements done using industrial engineering in Toyota Motors are now captured by production system designers and production managers as lean production system or lean manufacturing system.
1991 - The Story Begins
Art Byrne joined Wiremold as CEO in September 1991. He found a classic batch and queue system in production, sales order taking and scheduling process and product development. The cycle time of products was four to six weeks. Order taking process was a week. Product development took two and half to three years from concept to launch.
In this company Art Byrne announced an early retirement package to the aging workforce. Almost all of the eligible hourly workers took the retirement offer, but only small fraction of office staff took the offer. So, he has given to some of the office staff also a forced severance. (Is is right? This is the typical American way, which is in practice even today).
But when the planned manpower reduction has occurred, Byrne called a meeting of the entire workforce and announced to them that there will an improvement exercise in the company but nobody will lose job because of process and productivity improvements. The union did not believe it and went through the promise very carefully. But in the end they concluded that Byrne would honor his word and he has the plan and capability to do it.
But managers were sceptical. Byrne explained to them, while he expects good things to happen, if some expected fall in sales takes place there are tools to manage the downturn. Overtime can be reduced, surplus workforce can be employed in improvement projects, some outsourced components can be manufactured inside, work week can be reduced and new product line can be developed. We are going to make the operators more skilled and management will not be interested to lose highly skilled operators.
Art Byrne led the first training session in the company himself. Byrne implemented lean in his earlier companies. Based on a manual that he developed, he conducted a two day program for 150 people and followed it with a three day improvement exercise to provide opportunity to them to practice what they learnt. He took them around the plant himself and showed them muda (excess resources being used every where). Then he told them that they are going to convert all activities into continuous flow activities that are activated through pull. He promised them the support of top Japanese consultants and trainers.
Soon hundreds of weeklong kaizen activities were started and improvements were made visible. The company was reorganised into six product families. Each team was given its own punch presses, rolling mills and assembly equipment.
A score board was setup which showed productivity of the team expressed as sales per employee, customer service as on time delivery, inventory turns and quality as rework inside and returns from outside.
The expectation per each time is 50 per cent reduction in defects, 20 per cent increase in productivity, 100 per cent ontime delivery, and inventory turns of 20 per year.
To help the teams to improve continuously, the JIT Promotion Office (JPO) was started. The product team leader and the JPO jointly evaluate the value stream(Order, production and delivery process) to determine kaikaku (reengineering a major portion of the process) and kaizen (local operation improvements) activities to be performed. JPO is given the major responsibility to get the projects implemented. The JPO also conducts training sessions and teaches every employee the principles of lean thinking (identifying value to be delivered to the customer, charting the value stream, flow and pull principles and continuous improvement for perfection.). The principles are to be reinforced in the organization periodically to stop people from reverting to the old habits.
The product development process was reengineered next. Order taking process was made lean. Employees were given a share in profits.
Supplier improvement was done converting them into lean suppliers.
Lot of cash was released from the system due to reduction of inventory and was used buy some companies, which were converted into lean companies.
The benefits realized include doubling of sales per employee in five years, throughput time of one or two days, and increase in operating profit of 600%.
Source: Lean Thinking
James Womack and Dan Jones
Simon & Schuster, 2003
2007 - Discussion between Mark Graban and Bob Emiliani regarding replacement of Lean by Mass Production System at Wiremold by the acquiring firm Legrand.
https://www.leanblog.org/2018/02/lean-can-fragile-especially-executive-changes/
Updated 22 July 2020
23 Feb 2014
The Back Story – Better Thinking, Better Results by Bob Emiliani
ReplyDeleteSeptember 23, 2013
The book was written between late December 2001 to early March 2002, and then underwent four months of reviews. The book was completed in fall 2002 and published in January 2003.The book won a Shingo Research Award in 2003, and remains the premier book on the topics of Lean leadership and Lean transformation. The second edition of Better Thinking, Better Results was published in 2007 covers the story of wiremold moving away from Lean.
https://bobemiliani.com/back-story-better-thinking-better-results/