Lean TPM

A Blueprint for Change

Dennis McCarthy, Nick Rich

• Publisher: Butterworth-Heinemann
• Year: 2015
• ISBN:
  9780081001103
• Edition: 2
• Topic: Business
• Subtopic: Industrial Management
• Index: Business

Lean TPM is an accessible, step-by-step guide designed to help you increase manufacturing efficiency through continuous improvement. Based on their experience of working with organizations that have successfully achieved outstanding performance, McCarthy and Rich provide the tools and techniquesrequiredto convert strategic vision into practical reality. Packed with real-life case studies and examples to highlight common pitfalls and proven approaches, the book focuses on the continuous improvement that can be achieved within any manufacturing environment by challenging wasteful working practices, releasing the potential of the workforce, and making processes work as planned. Lean TPM contains an integrated route map along withcomprehensive benchmark datato enableengineers, technicians and managers to fully explore this potent technique.

• Unites the concepts of world-class manufacturing, lean and TPM into a single change agenda for continuous efficiency improvement
• Includes real-life case studies, advice on planning and pitfalls, and valuable benchmarking data from leading organizations
• New chapter on TPM and management of the supply chain, along with information on advanced lean practices and more implementation examples

Chapter One

The Business of Survival and Growth

Abstract

This chapter sets the context and explores the need for an improvement programme that can deliver! An improvement programme that is based on knowledge and know-how as well as on a systematic approach to learning that results in a reliable, resilient and robust production system. The chapter highlights the importance of Lean TPM in enhancing cash flow performance and generating customer value. The chapter offers several insights into what generates success in terms of a future-focused vision and strategy and an improvement programme that delivers value to customers.

Keywords

Change; Improvement; Leadership; Lean; Learning and competition; TPM; Vision

Let us face facts – most manufacturing businesses are under pressure to compete and to extract greater profit from what they convert. The ability to do so is determined by good product design (that minimises materials and maximises operational efficiency through good design for manufacture/assembly) and waste-free production (where every second of every shift is used to produce perfect quality outputs).

At the heart of the competition is the need to survive, to grow, to capture the benchmark position for their industry and also to improve efficiency and effectiveness at a rate faster than the competition (wherever they may be located). Lean total productive manufacturing (TPM) provides the solid foundations for a world class production system by developing the 3Rs of reliable processes, robust value streams and resilient organisations that can survive and prosper in today’s marketplace. This may sound quite a Darwinian statement – and it is – only the fittest and fitting (fitting profitably with market requirements) will survive. A great product will never achieve its potential if the production system that delivers it is unreliable and a great production system can never turn a bad product into a good one! These are ‘certains’ in an uncertain world. Even the great quality guru Deming was heard, on many occasions, to state that ‘survival is optional!’

To thrive, businesses need the strategic foundations of good product flow, reduced variation and process flexibility to offer the quality, order fulfilment lead time and flexibility to compete in modern markets with the minimum of finished goods stock. Achieving this is not possible without the application of both Lean and TPM principles and techniques as equal partners.

If an organisation has the highest quality, the shortest ‘turnaround and delivery times’ for products and the smallest of stocks, one of the few events that can stop you from delivering a customer’s requirements is equipment or process failure. These conditions, of minimal customer stocks, and a desire for eight deliveries per day for the vehicle assembly factories of Toyota in Japan set the challenge and started the process that has led to the Lean TPM model.

Lean TPM is a major competitive weapon that supports low-cost production and a market advantage based on cost competitiveness and it also supports a strategy of product and service differentiation by generating an equipment capability where processes are reliable, changed over in minimal time and where it is possible to customise products to order. The power of a manufacturing process comes from a partnership between operational and sales staff. Sales staff do not always know best – in fact some sales staff know a lot about the product but very little about how it is made and many operational staff know a lot about how to manufacture the product but not its application or how customers derive value from it. A strategy therefore provides focus and allows these two vital and mutually dependent activities to come together – to sell solutions to customer requirements profitably. Such a strategy is well beyond the mere application of a few Lean tools and point improvements to limited areas of the business – it is all embracing and focused on providing value by transforming business performance.

However, historical studies show that many manufacturers have fundamental weaknesses in their competitive weaponry. Some businesses do not have a formal business strategy or a manufacturing strategy that outlines how manufacturing will allow marketing staff to win orders and many businesses struggle to focus and manage change effectively (Brown, 1996). These processes are further complicated because markets and competitors do not stand still and what used to win orders last year is considered just the basic level of performance needed to begin to negotiate with a customer – a qualifier to do business if you like (Hill, 1985). Market requirements are constantly changing and adding more uncertainty and confusion for managers. Those who do nothing and simply react to markets will have an uncertain future. They will be in crisis management and try to sell anything to anyone. Competition is an inevitable part of manufacturing today and the ability of a firm to compete is the final arbiter of the longevity of any business. A great product, a good brand name and capable employees are not enough to guarantee survival – the management of good thinking, good people, good products and outstanding processes is the answer. Management means the approach to leading change, the methods used to engage with the workforce’s creativity and a system of systematic change to deploy the right techniques to constantly improve. We will return to this theme of policy deployment later in the book and the role of TPM as a solid foundation upon which to make quality and delivery promises to customers that maximise cash flow and customer service.

1.1. The New Competitive Conditions

The modern competitive conditions have generated a new ‘set of rules’ for manufacturers and the transparency of the Internet means customers really do hold the power in any relationship. The new customer/consumer rules include the provision of the highest level of customer service, the delivery of quality products in shorter lead times and product proliferation to offer variety to customers (Brown, 1996). If you take a few minutes to consider what life was like 10 years ago and compare it to now, your business has probably moved on substantially. In the past, businesses recorded product quality in terms of percentage defects produced during manufacturing but this measure changed quickly to that of ‘parts per million’ levels; businesses typically offer more products and service combinations than before and will have halved their lead times for new and existing products. Taking a few more minutes, you may like to contemplate the future and guess what? These performance indicators are likely to get tougher and tougher. The new rules of competition demand the effective management of the rate of change within the business and the elimination of all unnecessary waste or costs in order to provide the ultimate levels of customer service throughout the firm.

Reliable processes are mandatory in today’s competitive world. In business-to-business relations, it is typical to find minimal levels of stock and frequent deliveries – this is not possible without TPM. Good-quality systems and a very fast logistics system cannot overcome catastrophic and frequent equipment and process failures. It can be no surprise that suppliers to Toyota developed the TPM system to overcome the challenge of a just-in-time logistics system which demanded eight deliveries per day to resupply only 2 h of stock which was held at the line side of the vehicle assembler (and not in a big warehouse close by). Personalisation and a great brand reputation for products and services can only be achieved with a very flexible process – another objective of TPM. Indeed today we often regard Dell as the benchmark – and a business that turned an industry on its head through the disruptive power of a very flexible and customer-focused production facility and supporting supply chain.

Whilst many businesses were content to build large batches of stock and sell it from warehouses, Dell assembled customised laptops to order in very short lead times so that Internet-based customers get the exact product they want, pay at the time they configure their computer and then receive it within a matter of hours. Such a high-performance production system did not come about by chance – it was the result of a customer-driven strategy that ignored the conventional way of thinking and just applying a few management techniques here and there. The Dell operating model truly reset customer expectations and provided a benchmark for the industry.

Lean TPM is a vehicle to deliver sustained ‘world class’ performance because the feedback generated from progress through TPM master plan milestones combined with the Lean operations model provides a road map to the next generation of products, services and equipment. Robust, reliable and resilient systems result from Lean TPM and they offer the certainty that management decisions (to reduce stocks or to work to a customer pull) will be realised. Without Lean TPM, a production and service system is incomplete. If quality improvement programmes and great product designs determine the quality of the product and process and the delivery of a system is determined by the use of Lean flow and pull systems then the cost of operating the system (without high and unnecessary stocks, without large production batches and without inflexible processes) is determined by the quality teams and the Lean flow teams (ideally, this is one team that has matured rather than different groups) and the critical knowledge they gain from TPM. TPM effectively hardwires a system. Without TPM, great and effective customer service is a temporary phenomenon. It will not last. TPM, often misrepresented as operator maintenance, will not last unless its master plan road map is aligned with the Lean principles of enhancing customer value and seeking perfection.

External pressures

The race to compete and to survive is a difficult one. Markets are full of press...