Simulation Provides New Ways of Thinking about Processes and Process Improvement

By Joe Rizzo, Lead Project Manager, MassMEP, [email protected]

Many companies are accelerating their productivity growth by implementing Lean concepts as a way to streamline their businesses, thus increasing profits and the ability to compete. Since Lean, by definition, means CHANGE and requires a change in culture, training in Lean concepts is required for both management and the hourly workforce in order to produce an effect on a continuing basis.

Resistance to change, at least in manufacturing, is ingrained. Manufacturing has been taught through the years to do things in a repetitive fashion in order to achieve uniformity of quality and uniformity of product. This is a good philosophy if there is no competition. However, in today’s global economy the competition is fierce. In order to remain competitive, if not viable, a company must embark on a program of continuous improvement. For a continuous improvement program to be successful, the people within the company must look at and do things differently. This concept is commonly referred to as “stepping out of the box.” Today, Lean manufacturing concepts and principles are guiding new ways of thinking about processes and process performance.

While there are good training tools for management, and there are good training tools for the hourly workforce, there are few training tools that are applicable to both management and the hourly workforce. Also, there are few good training tools that demonstrate the power of a Lean transformation, thus providing an effective and relatively quick way to overcome resistance to change.

One such tool is the hands-on, one-day workshop, called TimeWise™.

The TimeWise workshop takes into consideration both financial and workforce constraints. It takes a mythical company, TimeWise, Inc., from its current state of traditional manufacturing operations to a dramatically improved future state, the Lean Enterprise.

Participants experience the power of Lean and the changes and benefits of moving from a traditional manufacturing process to a Lean manufacturing environment by participating in TimeWise, a simulation workshop. Attendees learn about the eight wastes in manufacturing and how to apply standardized work, workplace organization, visual controls, set-up reduction, batch size reduction, point-of-use storage, quality at the source, workforce practice, and pull systems to eliminate these wastes.

Four rounds of simulations are alternately presented with four rounds of presentations. Participants become employees of TimeWise, Inc., a manufacturer of premier clocks. Each participant has a role in the company. The first round simulates a traditional manufacturing company that manufactures two types of clocks. In a 15-minute shift, there is usually a lot of chaos, and the only products shipped are those which were in Finished Goods Inventory at the start of the simulation.

Successive rounds gradually introduce Lean concepts including, POUS, Poke a yoke, reduced batch sizes, TAKT time, load leveling, one piece flow, Kanban, and pull signals. In the fourth round a third type of clock is introduced. The fourth simulation round is usually highly successful as the participants meet the TAKT time throughout the entire shift and all clocks are delivered on time.

In addition, TimeWise demonstrates the value of implementing Lean concepts by preparing net income statements for each of the four rounds of simulation. Sales numbers are calculated for each of the three models of clocks. Manufacturing costs, including labor, materials, and cost of inventory, are calculated to compute a profit or loss for each simulation. The first round usually results in a loss. Financial results gradually improve in the second and third rounds. The fourth round usually produces significant profits, as sales increase, inventory is reduced, and cycle time is significantly reduced.

The TimeWise Workshop was developed by MEP Management Services Inc. (MEP MSI) of Augusta, Maine in 2001. MEP MSI manages Manufacturing Extension Partnership centers in six states: Maine, New Hampshire, Massachusetts, Arizona, New Mexico, and Florida. The TimeWise workshop has been the prime training tool for companies in all six states.

The Massachusetts Manufacturing Extension Partnership (MassMEP) has seen the benefits of TimeWise, and we are capitalizing on it by conducting TimeWise Workshops at over 200 companies in Massachusetts. The TimeWise workshop is the first step in a Lean implementation pilot program for each of our clients.

The company plans to use the space for value-added activities for their customers. By moving up the value chain, the company will realize increases in both revenue and profits. But more importantly, the company will insure their long term viability as an ongoing business, and will not only retain jobs, but will increase the level of employment at the plant.

Pressure on manufacturing jobs will continue as manufacturers continue to be limited in their ability to raise prices in a Global Marketplace. The only way to maintain profits is to reduce costs. Going Lean is the way to succeed.