Lean Manufacturing & Waste Reduction: Key Terms & Concepts

Lean

The elimination of waste, representing a significant opportunity for improvement in high-performance enterprises.

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5-Whys

A principle for determining the root cause of a problem by asking 'why' repeatedly to delve deeper into the issue.

7 Wastes

Overproduction, Time on hand (waiting), Transportation, Processing itself (overprocessing), Stock on hand (inventory), Movement, Making defective product.

Eighth Waste

Waste of human potential or underutilized people, often added to the original seven wastes.

D.O.W.N.T.I.M.E.

An acronym representing Defects, Overproductions, Waiting, Non-utilized Talents of Employees, Transportation, Inventory, Motion, Excess Processing.

Andon

A Japanese word meaning 'light' or 'lantern'; it refers to a light triggered by an abnormal condition or machine breakdown, indicating that human intervention is required.

Andon board

A visual control device in a production area that indicates the current status of the production system and alerts team members to emerging problems.

A3

International sized paper (11 × 17 inches) used for visual, concise descriptions or reports in problem solving, following the Plan-Do-Check-Act methodology.

Autonomation (jidoka)

Combining human intelligence with automation so that equipment can detect defects, alert personnel, and immediately stop production.

Balanced line

Refers to line balancing in production processes.

Batch-and-queue

Producing more than one piece and moving them to the next operation before they are needed, opposite of single-piece flow.

Bottleneck

Any resource whose capacity is less than the demand placed on it.

Cell

The layout of machines of different types for performing different operations in a tight sequence, typically in a U-shaped pattern, allowing for single-piece flow and line balancing.

Change agent

The catalytic champion who transitions firms and value streams from batch-and-queue manufacturing to flow manufacturing.

Changeover

Assigning a production device to perform a different operation or setting up a machine to make a different part number than the previous part.

Changeover time

The time required to modify a system or workstation, usually includes both teardown time for the existing condition and setup time for the new condition.

Constraint

Anything that limits a system from achieving higher performance, or throughput.

Continuous flow

A production system in which products flow continuously rather than being separated into lots or batches.

Continuous improvement

A philosophy of making frequent and small changes to processes, the cumulative results of which lead to high levels of quality, cost, and efficiency.

Countermeasure

Corrective action taken to address abnormalities or problems that cannot be eliminated immediately.

Cycle

(1) A sequence of operations repeated regularly. (2) The time necessary for one sequence of operations to occur.

Cycle time

(1) The time required to complete one cycle of an operation. (2) The time elapsing between a particular point in one cycle and the same point in the next cycle.

Equipment availability

The percentage of time a process (or equipment) is available to run.

Error detection

A hybrid form of error-proofing that means a bad part can be made, but it will be caught immediately and corrective action will be taken.

Error-proofing

The implementation of simple, low-cost devices or innovations that can either detect abnormal situations before they occur in a process or, if they do occur, stop the operation or equipment and prevent the production of defective units.

External setup

Procedures that can be performed while a machine is running.

FIFO

"First-in, first-out" meaning that material produced by one process is consumed in the same order by the next process.

First pass yield (FPY)

The percentage of units that complete a process and meet quality guidelines without being scrapped, rerun, retested, reworked, returned, or diverted into an off-line repair area. It is calculated by subtracting the defective units from the units entering the process and dividing by the total number of units entering the process.

Flow/Flow Production

The accomplishment of steps within a value stream so that a product or service proceeds from the beginning of the value stream to the customer without waste.

Gemba

A Japanese term that translates to 'real place' as in where the action is; in lean it is where value-adding occurs. It has been adapted to mean the workplace, or the shop floor in manufacturing.

Gemba walk

A learning and coaching moment between a lean sensei and a student to look for abnormal conditions, waste, or opportunities for improvement.

Hansei

A Japanese term that means one's honest reflection, as in reviewing an event to capture lessons learned and see how to improve.

Heijunka

A method of leveling production for mix and volume.

Hoshin Kanri

A strategic decision-making tool for the selection of initiatives, projects, and tasks to achieve breakthrough goals. This method aligns and designates people and resources for completion, and establishes metrics to track progress and verify sustainment. Also called 'policy deployment'.

Information flow

The task of disseminating information for taking a specific product from order entry through scheduling to delivery.

Inspection

Comparing product or component against specifications to determine whether the product or component meets requirements.

Internal setup

Procedures that must be performed while the machine is stopped.

Inventory

The money the firm has invested in purchasing things it intends to sell (raw materials, buffer stock, work-in-process, safety stock, and finished goods).

Jidoka

A device that stops production and/or equipment when an abnormal or defective condition arises. Any necessary improvements can be made by directing attention to the stopped equipment and the worker who stopped the operation. Also called 'autonomation'.

Just-In-Time (JIT)

A philosophy that has the elimination of waste as its ultimate objective. To achieve this goal, each operation must be synchronized with subsequent operations. The concept refers to the manufacturing and conveyance of only what is needed, when it is needed, and in the amount needed.

Kaikaku

Typically translated as 'innovation' is also described as 'radical improvement', 'major process redesign', and 'reformation'. ____ changes may include major redesigns of product, part manufacture, or facility layout or business processes.

Kaizen

A Japanese term meaning 'change for the better' or 'continuous improvement'; it involves continuous, incremental improvement of an activity to create more value with less waste.

Kaizen event

A short, focused team-based improvement project that achieves breakthrough results; also called 'kaizen blitz', 'rapid kaizen', 'quick kaizen', and 'kaikaku'.

Kanban

Meaning 'sign board'; a communication tool that ensures that every operation produces only the amount that will be used in the next step of the process.

Leader standard work

Work that provides a structure and routine for process management, specifically for core tasks and routines of leaders and management.

Lead time

(1) The time required for one piece to move all the way through a system of processes, from start to finish. (2) The time from when the order is taken until the item is shipped.

Lean Champion

Subject matter expert in the tools of lean typically chosen to lead lean training, lean projects, and the lean transformation.

Lean enterprise

Any organization that continually strives to eliminate waste, reduce costs, and improve quality, on-time delivery, and service levels.

Lean production

The opposite of mass production.

Line balancing

A process in which work elements are evenly distributed and staffing is balanced to meet takt time.

Load leveling

A technique for balancing product mix and volume to capacity available.

Manufacturing resource planning (MRP II)

Uses the elements of material requirements planning plus capacity planning and a finance interface to translate operations planning into financial terms.

Mass production

Large-scale manufacturing with high-volume production and output; implies traditional methods with departmentalized operation and reliance on 'economies of scale' to achieve low per-unit costs.

Material requirements planning (MRP)

A computerized system typically used to determine the quantity and timing requirements for production and delivery of items.

Milk run

The routing of supply and/or delivery vehicles to make multiple pickups and/or deliveries at multiple locations to reduce transportation waste.

Mistake-proofing

The implementation of simple, low-cost devices or innovations that can either detect abnormal situations before they occur in a process or, if they do occur, stop the operation or equipment and prevent the production of defective units.

Muda

A Japanese term translated as 'waste'; elements that do not add value to the product or service.

Mura

A Japanese term meaning "irregularity" or "variability" or "unevenness".

Muri

A Japanese term meaning "strain" either physical or mental, or "overburden".

Non-value-added

Activities or actions taken that add no real value to the product or service, making such activities or actions a form of waste.

One-piece flow

One work piece flows from process to process in order to minimize muda in a just-in-time production system.

Overall equipment effectiveness (OEE)

The product of a machine's operational availability, performance efficiency, and first pass yield.

Point-of-use storage (POUS)

Storing information, items, materials, parts, and tools near where they are used.

Poka-yoke

The implementation of simple, low-cost devices or innovations that can either detect abnormal situations before they occur in a process or, if they do occur, stop the operation or equipment and prevent the production of defective units.

Product family

A group of related products or services that can be produced or performed using like and/or similar processes interchangeably.

Production (analysis) board

A board located at the job site on which hourly production targets are recorded along with the actual production achieved.

Production leveling

A technique for balancing product mix and volume to capacity
available

Production smoothing

A technique for balancing product mix and volume to capacity available.

Productivity

A measurement of output for a given amount of input(s). Increases in productivity are considered critical to raising living standards.

Pull

A system of cascading production and delivery instructions from downstream to upstream activities in which the upstream supplier does not produce until the downstream customer signals a need.

Push

A system of production in which the upstream supplier produces as much as it can without regard to the actual demand of the downstream processes.

Queue time

The amount of time a product or customer (in service) spends in line awaiting the next process step.

Quick changeover

The ability to change dies, tooling, and fixtures rapidly (usually in minutes) so that smaller batch sizes can be produced effectively.

Right-size

Matching tooling, manpower, and equipment to the job and space requirements of lean production.

Runner

A person on the production floor who paces the entire value stream from the pickup and delivery of materials to kanban utilization.

Shadow board

A board painted to indicate which tool belongs where and which tools are missing.

Single minute exchange of dies (SMED)

A series of techniques pioneered by Shigeo Shingo for changeovers of production machinery in less than 10 minutes.

Single-piece flow

Products proceed, one complete unit at a time, through various operations in design, order-taking, and production, without interruptions, backflows, or scrap.

Spaghetti diagram

A drawing that shows the layout and flow of materials, information, and people in a work area and is commonly used to uncover motion and transportation wastes.

Standardization

A system of using policies and common procedures to manage processes.

Standard work

A precise description of each work activity specifying cycle time, takt time, the work sequence of specific tasks, and the minimum inventory of parts on hand needed to conduct the activity.

Supermarket

The storage locations of the parts before they go on to the next operation, managed by predetermined maximum and minimum (or order point and order quantity) inventory levels.

Takt time

The available production time divided by the rate of customer demand, setting the pace of production to match the rate of customer demand.

Theory of constraints

A management philosophy that stresses removal of constraints to increase throughput while decreasing inventory and operating expenses.

Throughput

The rate the system generates money through sales (or the conversion rate of inventory into shipped product).

Total productive maintenance (TPM)

A system to ensure that every machine in a production process is able to perform its required tasks so that production is never interrupted.

Value

A capability provided to a customer at the right time at an appropriate price, as defined in each case by the customer.

Value-added

Activities or actions taken that add real value to the product or service.

Value stream

The set of actions required to take a specific product from raw material to finished good per customer demand, concentrating on information management and physical transformation tasks.

Value stream mapping

The process of creating a drawing of the value stream using icons that show the information flow and material flow of a process family in an organization.

Visual management

The placement in plain view of all tools, parts, production activities, and indicators of production system performance so that everyone involved can understand the status of the system at a glance.

Waste

Any activity that consumes resources but creates no value, using equipment, materials, parts, space, employee time, or other corporate resources beyond the minimum amount required for value-added operations.

Work-In-Process (WIP)

Incomplete products or services that are awaiting further processing prior to being forwarded to the customer as finished product or completed services.

Bottle neck

The operation or function with the lowest capacity, usually the operation with the longest cycle time per unit. The ___ sets the limit for the production pace and thus the capacity of the entire process.

Buffer Inventory between operations

Compensates for differences in cycle time (lack of synchronization) between operations.

Customer demand

The number of products that the customers are expected to buy or order during a certain time period.

Downstream

Parts of the production process or value stream (or operations) that occur after an arbitrary point or operation.

Downtime

Time when equipment is unavailable for production due to e.g. equipment breakdown or planned maintenance.

Heijunka box

Scheduling system to level out the production.