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1、The Goal,A Process of Ongoing ImprovementEliyahu M.Goldratt and Jeff Cox,The Goal,Back to the story:Q.Where does Alex and company find the bottleneck?They find two bottlenecks,NCX-10 and Heat TreatQ.What is thier first approach to improving the flow through the bottlenecks and ultimately improving p
2、roductivity.1.Move QC in front of bottlenecks.2.Make a list of all late jobs and what components from those jobs flow through the bottleneck machines.They then create a schedule/list in due date order and instruct the bottleneck operators to only work on those jobs in that order.,The Goal,Back to th
3、e story:Q.Does this scheduling system work(e.g.get late jobs completed while always keeping bottleneck running)?A.No,because the late job components are not always waiting in front of the bottleneck machines.Q.What do they do to rectify this?A.Create a red tag(parts that travel through the bottlenec
4、k)/green tag system for all jobs throughout the plant such that any job with a red tag which arrives at a machine is given priority.If they are in the middle of a run,then if the run takes longer than 30 minutes to complete,stop that job and start the red tag job.If no red tags,then ok to process gr
5、een tag jobs.If more than one red(or green tag),then process job with lower number on tag.,The Goal,Back to the story:Q.What do they do next to further off-load the Herbies/bust the bottleneck?Gold tags placed on parts that have traveled through the bottleneck everyone extra careful not to damage.De
6、dicate personnel at NCX-10 and Heat Treat even though they are idle much of the time,just dont let machine idle.Send out some portion of heat treat parts to vendor in town.Found old equipment(that is less efficient)to run in parallel to NCX-10.Fully load furnace when possible(e.g.mix batches).Reduce
7、 setup time with new fixtures.Were able to process some parts differently so heat treat wasnt required.,The Goal,Back to the story:Q.What were the results of these bottleneck busting tactics?New monthly shipping record from old record of 2 million to new record of 3 million.57 customer orders shippe
8、d versus old record of 31.WIP Inventories reduced 12%.,The Goal,What happens next?The bottlenecks are apparently expanding material is backing up at the milling machines,and non-bottleneck parts(green tags)are not reaching assembly even though all bottleneck parts(red tags)are available at assembly.
9、,The Goal,What happens next?Jonah revisits plant and discusses relationship between bottleneck(X)and non-bottleneck(Y)machines.Y X 3)Y A 4)Y Product AX Y X S X Product B S E M B L Y,The Goal,Jonah believes the“new bottlenecks”are not real bottlenecks,but self-created bottlenecks.Why?Material is bein
10、g“released”to the plant just to keep the non-bottleneck machines busy.This improves these machines efficiency measures,but does not help the goal.Jonah:“A system of local optimums is not an optimum system at all;it is a very inefficient system”.Lesson:Do not try to make non-bottlenecks work all the
11、time.They should be idle some of the time!,The Goal,So how do you go about fixing the problem of keeping the non-bottleneck machines working at the same rate as the bottleneck?Recall the boy scout hike:Herbie is in the middle of the line and cannot be moved,so how do you keep the kid in the front wa
12、lking at the same pace as Herbie?Alexs kids:use a rope and a drum.Rope:Attach a rope from Herbie(bottleneck machine)to the kid at the front(assembly).The length of rope represents inventory.Drum:Herbie tells the kid at the front to slow down or speed up(beats the drum).Need some kind of signaling or
13、 communication between assembly and the bottleneck.,The Goal,How is the rope and drum concept implemented in the plant?Identified it takes about 2 weeks from when parts are released to the floor until they get to bottleneck.Setup system that monitors when inventory is processed at the bottleneck.Mat
14、erial required 2 weeks later is then released to the floor.Non-bottleneck parts are released according using the same principle but tied to assembly.,Bottleneck,Material Release,2 weeks lead time,Communicate release,The Goal,What is the result of this new release system?WIP is down.Revenues are up.E
15、fficiencies dropped initially,but have come back up.The backlog of orders is completely gone(satisfied customers).How does management respond?HappySomewhat skeptical success will lastWants 15%more revenue next month!,The Goal,In order to improve by another 15%what does Jonah suggest as the“next logi
16、cal step”?Cut batch sizes for non-bottleneck parts in half.What is the impact of reducing these batch sizes?WIP for non-bottleneck parts reduced by half.Significantly reduce time parts spend in plant.Leads to increased responsiveness(from 6-8 weeks to 3-4 weeks).What about the time to handle increas
17、ed number of setup?Doesnt matter if occurs on non-bottleneck operations.,Process Time,Setup Time,Queue Time,Wait for Assembly Time,Time parts spend in the plant,The Goal,Also to help get the 15%,Alex calls the marketing/sales manager and bets him he can reduce lead time to fill orders.What does Alex
18、 expect to gain by reducing lead times to ship from what used to be 4 months to 4 weeks?Increased sales!The bottleneck had moved to customer demand.Quick response on promised due dates should translate to a competitive advantage.,The Goal,Everything is going good now except it looks like part costs
19、are going up.However,in reality all costs have gone down.How can this be?The accounting rules:Cost per part=raw material+direct labor+burden costBurden cost is all the indirect labor costs.Burden=direct labor x burden factorCost per part has risen because more setups are occurring because of smaller
20、 batch sizes.However,workers were idle,so the increased number of setups didnt really increase costs.,The Goal,What other performance measure made them not look as good as they actually were.Answer:InventoryInventory is counted as an asset on the balance sheet.When the plant worked hard to reduce in
21、ventories to improve their throughput and responsiveness,it looked as if their assets had fallen.,The Goal,Sacred Cows Slaughtered:Worker efficiencyOptimal batch sizeReleasing work to the floor to keep people busyAccounting rules,The Goal,Why Alexs plant was successful:Change in Focusfrom the“cost w
22、orld”to the“throughput world”,Cost,Throughput,Inventory,Throughput,Inventory,Cost,The Goal,What process did they use to shift their focus to the“throughput world”?The Theory of ConstraintsStep 1:Identify the systems constraints(NCX10 and oven)Step 2:Decide how to exploit the systems constraint(dont
23、take lunch break on bottleneck machines)Step 3:Subordinate everything else to the above decision(red tags and green tags)Step 4:Elevate the systems constraint(bring back old Zmegma machine,outsource heat treat)Step 5:Warning!If in a previous step,a bottleneck has been broken,go back to step 1(materi
24、al release system,marketing),but do not allow inertia to cause a systems constraint(red and green tags eventually caused problems).,The Goal,Final words from Alex on“how to be an effective manager”:Help people to identify:“what to change?”“what to change to?”“how to cause the change?”,The Goal,Final
25、ly some Philosophy:What approach did Jonah use to help Alex and the plant succeed?Find the answers/solutions by asking questions,the Socratic approach.Let others convince themselves of the answers,dont just give it to them.Also used a“common sense”approach which went against“common practice”.In other words,think!,
