Honda North America Purchasing
Working together to achieve Global Competitiveness, Locally
Honda Overview
Purchasing in NA
Supplier Development
Stability Improvements
Production Characteristics
Lean Partnership
Honda North America Purchasing
Working together to achieve Global Competitiveness, Locally
Honda Overview
Purchasing in NA
Supplier Development
Stability Improvements
Production Characteristics
Lean Partnership
Global Operations
Over 150 Facilities Worldwide
LEGEND
Regional Headquarters
Sales
Production (parts included)
Research and Development
Global Operations
Six Operating Regions
North America
Regional Operations
China Regional
Operations
Europe/
Middle East/
Africa Operations
South America
Regional Operations
Japan Regional
Sales Operations
Asia/Oceania
Operations
North American Production
Honda North America Purchasing
Working together to achieve Global Competitiveness, Locally
Honda Overview
Purchasing in NA
Supplier Development
Stability Improvements
Production Characteristics
Lean Partnership
North America Purchasing Vision
We will develop and manage a competitive and stable supply base
to support all of Honda’s North American Manufacturing facilities
with world class Quality, Cost, Delivery, and Development.
Develop
Developsupplier
suppliercapabilities
capabilitiesto
tomeet
meetQCDD
QCDD
(Quality,
(Quality,Cost,
Cost,Delivery
Delivery&&Development)
Development)requirements
requirements
Develop and manage material flow to meet plant requirements with
optimum inventory levels at competitive logistics cost.
Manage purchased parts cost to achieve globally competitive costs and
support Honda Motors’ competitiveness.
Understand future direction of the industry and develop strategies and
systems to enable Honda Motors and our suppliers to adapt to
changes and gain competitive advantage.
Build a world class purchasing organization through development of
associates and business practices
Honda Suppliers in North America
Number of Suppliers
••600+
600+ OEM
OEMSuppliers
Suppliers
supplying
supplyingour
ourN.A.
N.A.
Mfg
facilities
($16
Mfg facilities ($16Bil)
Bil)
••5,000
5,000 MRO
MRO
Suppliers
Suppliersfor
forN.A.
N.A.
OEM
OEM
Locations of Suppliers
•United
•UnitedStates:
States:
Suppliers
Supplierslocated
locatedin
in
34
34States
States
Honda OEM Suppliers
•Canada:
•Canada: Suppliers
Suppliers
located
in
located in 22
Provinces
Provinces
Honda North America Purchasing
Working together to achieve Global Competitiveness, Locally
Honda Overview
Purchasing in NA
Supplier Development
Stability Improvements
Production Characteristics
Lean Partnership
Supplier Support Model - Stability
High Level Purpose:
Methodology:
Stable Suppliers
Level and type of support varies
according to supplier capability.
Not a one size fits all approach.
Move entire supply base toward
self-directed improvement
capability.
Best Suppliers Self
Benchmark Suppliers
Motivated
Stability Concerns
Production
Characteristics
Activity
Stability
Projects
Stability
Projects
R
E
A
C
T
I
V
E
Training
Teaching
Problem Solving
Hands On Doing
Lean Network
Lean
Network
Production
Characteristics
P
R
O
A
C
T
I
V
E
Training
Teaching
Facilitating
Strategic Partnering
N
E
X
T
L
E
V
E
L
Training
Teaching
Networking/Showcase
Benchmarking
Honda Involvement
‘Hands-on’ Assistance
Facilitation
Self-Directing
Stability Improvement Process
OE Survey
Stability
Suppliers
1.
2.
Analysis
Specified Action Plan
System
Mgmt
Process
OEE
Systems
Process
Scrap
Identify supplier with
Q&D concerns
Supplier Selection
Assessment
Identify the gaps,
set baseline &
targets
Situation Analysis (SA)
Problem Solving Strategy
Training Plan
Implementation Plan
Plan (P)
Monthly Progress
Mid Project Check
Final Report
Implement Plan
Do (D)
Management Check
Check (C)
Adjust plan if necessary
Standardize improvements
Implement on 2nd line
Act (A)
Stability Improvement Example
OEE Trend
3rd
1st
2nd
Target
80%
73%
72%
70%
63%
62%
62%
59%
60%
57%
57%
65%
63%
55%
54%
50%
48% 48%
47%
50%
64%
61%
55% 55%
55%
54%
56%
55%
52%
52%
49%
44%
40%
70%
66%
63%
59%
59%
70%
69%
67%
45%
44%
47%
45%
43%
41%
40%
38%
32%
32%
35%
35%
33%
37%
31%
30%
25%
20%
SAT
SAT
SAT/SUN
SAT/SUN
SAT
SAT
20%
20%
SAT/SUN
SAT/SUN
10%
0%
0%
0%
0%
0%0% 0% 0% 0% 0% 0%
0%
0%
0%
0%
0% 0% 0% 0% 0% 0% 0%
0% 0% 0% 0% 0% 0% 0%
0%
0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
8/
1,
M
8/ on
2,
8/ Tue
3,
W
8/ ed
4,
Th
8/ u
5,
F
8/ ri
6,
S
8/ at
7,
S
8/ un
8,
M
8/ on
9,
8/ Tu
10 e
,W
8/ ed
11
,T
8/ hu
12
8/ , Fr
13 i
8/ , Sa
14 t
,
8/ Su
15 n
,M
8/
o
16 n
,
8/ Tu
17 e
,W
8/ ed
18
,T
8/ hu
19
8/ , Fr
20 i
8/ , Sa
21 t
,
8/ Su
22 n
,M
8/
o
23 n
,
8/ Tu
24 e
,W
8/ e
25 d
,T
8/ hu
26
8/ , Fr
27 i
8/ , Sa
28 t
,
8/ Su
29 n
,
8/ Mo
30 n
8/ , Tu
31 e
,W
ed
0%
Supplier was working working most weekends to meet Customer Demand
which negatively impacted workforce stability and the QCD performance
of the Supplier, Honda and most importantly the final Customer
Odyssey HU Main Line 2-Shifts
Creform
DTC
Scanner
Scanner
Scanner
Scanner
Scanner
Unit
IPK
Unit
IPK
Unit
IPK
Unit
IPK
Unit
IPK
Unit
IPK
Scanner
Unit
IPK
JIG
FCB
IPK
Unit
IPK
Scanner
Scanner
JIG
JIG
JIG
PQI
PQI
PQI
PQI
2'x2'
2'x2'
2'x2'
2'x2'
QI
QI
QI
QI
QI
QI
QI
JIG
PQI
PQI
2'x2'
2'x2'
QI
QI
QI
Unit
IPK
Knob
Unit
IPK
Hub
IPK
HR345x54
Room
3'4.5"x5'4"
3'4.5"x5'4"
Hearing
JIG
Scanner
HR345x54
Room
JIG
Scanner
3'
11.5x17x4.5
Knob
HRoom
Computer
CQG
Computer
2'x2'
CQG
QI
Computer
CQG
Hub
IPK
C63x12
Hub
IPK
Creform Computer
Computer
Stand
Stand
5'1"x1'9"
2'4"x1'6"
CCS51x19
PQI
CS24x16
1-24
1-25
Belt Conv
C63x12
6'3"x1'2"
C63x12
6'3"x1'2"
Creform
w b67x211
Work Bench
6'3"x1'2"
Creform
6'7"x2'11"
C63x12
6'3"x1'2"
Creform
6'7"x2'11"
Unit
IPK
Hub
IPK
PT
Scanner
18JIG
Work Bench
Unit
IPK
HR345x54
Room
C63x12
Scanner
17
P QI
2'x2'
Hearing
QI
C63x12
Scanner
PQI
2'x2'
CQG
CQG
Computer
HR345x54
Scanner
Unit
IPK
PQI
2'x2'
CQG
CQG
Computer
3'4.5"x5'4"
Scanner
Unit
IPK
P QI
2'x2'
3'
JIG
Scanner
PQI
2'x2'
HRoom
Computer
Scanner
Unit
IPK
PQI
Bar
Code
Printer
wb67x211
6'3"x1'2"
Room
Scanner
Unit
IPK
6'7"x2'11"
Creform
C63x12
Scanner
Computer
Work Bench
HR345x54
Unit
IPK
w b67x211
6'3"x1'2"
3'4.5"x5'4"
Unit
IPK
6'7"x2'11"
Creform
2'x2'
QI
Work Bench
Hearing
wb67x211
JIG
6'7"x2'11"
Scanner
Work Bench
Hearing
w b67x211
Room
6'7"x2'11"
3'4.5"x5'4"
Work Bench
C63x12
FCA
IPK
Unit
IPK
w b67x211
6'3"x1'2"
C63x12
Unit
IPK
6'7"x2'11"
Hearing
Unit
IPK
Work Bench
Creform
Hub
IPK
C
wb67x211
6'3"x1'2"
HR345x54
6'7"x2'11"
Creform
PT
C63x12
ar e
od ter
n
Pri
Work Bench
Hearing
6'3"x1'2"
3'4.5"x5'4"
B
Bar
w b67x211
Code
Printer
6'7"x2'11"
Creform
Room
Work Bench
C63x32
C63x32
C63x32
wb67x211
6'3"x1'2"
Scanner
6'7"x2'11"
Creform
Computer
Work Bench
Scanner
Bar Code
Printer
C63x32
Bar Code
Printer
JIG
6'3x3'2"
6'3x3'2"
6'3x3'2"
JIG
BTC
Creform
DTC
BTC
BTC
BTC
BTC
Creform
DTC
6'3x3'2"
Computer
LINE 21
Creform
DTC
wb67x211
Work Bench
Creform
6'7"x2'11"
C63x32
wb67x211
Work Bench
6'7"x2'11"
C63x32
6'3x3'2"
Creform
Creform
wb67x211
C63x32
6'3x3'2"
6'3x3'2"
Creform
Creform
10'1"x3'9"
C101x39
Creform
DTC
MY
OEE
80.0%
Line #21
Target
70.0%
OEE Trend
Downtime Trend
Line #21
Downtime
/ Lost Time
MY
60.0%
RecordedDT Trend
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
55.3% 53.5% 52.4%
50.0%
45.0%
40.0%
35.0%
30.0%
MY
Scrap
1
Line #21
Scrap Trend (Pcs in %)
14.3%
7.0%
26.4%
Target
6.0%
9.0%
3.0%
2.0%
807
0%
.
60
0%
.
504
0%
.
30
0%
.
201
0%
.
0
0%
.Jun-
40.%5
30.%5
20.%5
7.0%
5.0%1
-ulJ
ug-SeA
-Octp
0.%ov-D
N
5.0%6
e-JunlcJan
ug-SepA4.0%ebMF
ct-NovDOrApa
ec-JanFMayr
-MarApb1Q
May-Q1MY2
2MYQQ3
Q34YQ4YTD
2.0%3
0.%1
25.0% 32.8%
Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb-5.0%Mar20.0%
32.7%
15.0%
4.0%
10.0%
18.2%
5.0%
0.0%
UnrecordedDT
1
6.2%
Target
3.9%
1
3.3%
1.0%
0.0%
Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar- Apr-
Detailed line performance analysis showed poor process balance
& poor OEE (high downtime, lost time and scrap)
Goals and Objectives
•
•
•
•
Measurables
Baseline Data
Target
Daily Production
Overtime Hours
Process Utilization
OEE
463 daily average
54.8 monthly
128%
50.8%
670 daily
0 (zero)
93%
70.3%
– Operating Rate
72.7%
– Performance Rate 73.2%
– Quality Rate
95.5%
•
Line Balance
66%
84.8%
84.2%
98.5%
82%
Advanced
Advanced Planning
Planning tools
tools
allow
allow various
various Scenarios
Scenarios to
to
be
be tested
tested to
to establish
establish
detailed
detailed performance
performance
targets
targets
Specified Action Plans (SAP)
Brown
2005
August
Goal
Objectives
Baseline
Targets
Actual
Action Items
Gap Closure
1.1.1 Outline process to be followed for improvement projects.
1.1.2 Provide necessary training for team members.
1.1
Conduct parallel
projects using BP
outline for activity.
Instruct and guide
team members to
achieve success
No standard
process for
continuous
improvement.
Develop standard
process for activities.
1.1.3 Coordinate and guide on parallel line activity L8
#VALUE!
1.1.4
1.1.5
1
Establish model line activity
on two lines utilizing lean
and BP techniques.
( line 21 Odyssey / line L8)
1.1.6
1.2.1 Instruct in the utilization of OEE charts and graphs
1.2
Enhance visual
management to
provide better
communication,
training, and
management of
performance.
Posted
information
includes basic
Add OEE graphs and
performance
Idea Tracking Charts to
measurables.
current displays.
Data not lend
itself for effective
problem solving.
1.2.2 Develop idea tracking charts for production and project use.
1.2.3 Display of visual management line side.
#VALUE!
1.2.4
1.2.5
1.2.6
2.1.1 100% elimination of all overtime (daily and weekend) avg. for June/July 54.8hrs
2.1.2 Increase average daily production from 560 daily to 670 daily or 16.4%
2.1
Improve Operating
Rate through the
elimination of
largest recorded
downtime issues.
2.1.3 Decrease process utilization from 128% to 93% or 27.3%
72.70%
84.80%
2.1.4 Enhance current downtime tracking to better capture specifics on all concerns
2.1.5
2.1.6
2.2.1 Improve line balance by 16% (66% to 82%) Reduce work stations from 26 to 21
2
Improve line 21 OEE from
50.8% to 70.3%.
Eliminating 100% of
overtime.
2.2
Improve
Performance Rate
through better
documentation and
improved
awareness of
production targets.
2.2.2 Improve PPLH by 16.6%
69.90%
86.80%
#REF!
2.2.3
2.2.4
2.2.5
2.3.1 Enhance current rework tracking to better capture specifics on all concerns
2.3
Improve Quality
Rate by better
capture of repair
units being
removed and
introduced to
production line.
100.0%* Base line
data did not
capture product
that was removed
from line for
repairs. Loss was
captured in
Performance
measurements.
2.3.2 Modify system to identify location, time and type of failures in final assembly
2.3.3 Modify system to contain failures in L8 and SMT from being sent to final assembly
95.50%
2.3.4 Develop daily process for formal review of concerns
2.3.5
2.3.6
3.1.1 Review of Situation Analysis (SA) summary items
3.1.2 Use Decision Analysis process to determine best scenario
3
Improve PPLH by 16.6%
3.1
Improved
awareness of
expectations, using
Lean Manufacturing
tools to support
project.
3.1.3 Determine action plan and schedule to implement improvements
PPLH 10.6
PPLH 15.9
3.1.4
3.1.5
3.1.6
Who
1
September
2006
October
November
December
8 15 22 29 5 12 19 26 3 10 17 24 31 7 14 21 28 5 12 19 26 2
January
9 16 23 30
Results, with Associate Input
MY
OEE
Line #21
Downtime
Trend
MY
Scrap
OEE Trend
Line #21
Downtime
MY
RecordedDT Trend
90.0%
80.0%
Target
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%
55.3% 53.5% 52.4%
64.2% 67.8%
76.9% 77.0% 75.0%
30.0%
25.0%
1
20.0%
26.4%
4.0%
12.9%
7.8%
32.8%
25.0%
18.2%
9.0%
Target
6.9%
32.7%
15.0%
10.0%
5.0%
0.0%
Unrecorde
7.0%
5.0%
14.3%
40.0%
35.0%
60.0%
Scrap
6.0%
50.0%
45.0%
70.0%
Line #21
8.5%
3.0%
7.2%
2.0%
24.1%
15.7%
14.2%
16.7%
6.2%
Target
1
1.0%
3.9%
3.3%
1.9%
1.1%
1.0%
0.7%
1.1%
0.0%
Jun-A Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- MarJun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- MarJun- Jul- Aug- Sep- Oct- Nov- Dec- Jan
Implementation of detailed data collection and analysis systems and input
from the associates on the production floor yielded excellent results
Final Results
•
•
•
•
Measurables
Daily Production
Overtime Hours
Process Utilization
OEE
Baseline
463 daily avg
54.8 monthly
128%
50.8%
– Operating Rate
72.7%
– Performance Rate 73.2%
– Quality Rate
95.5%
• Line Balance
*.
Output:
Direct O/T
Indirect O/T
66%
Input:
-$2,365K
-$592K
-$2,957K
Goals
670 daily
0 (zero)
93%
70.3%
Final
730
0
84%
76.4%
84.8%
84.2%
98.5%
83.3%
92.8%
98.9%
82%
84%
Honda Labor
Honda Travel
Supplier Labor
$68K
$75K
$18K
$161K
18:1
Out/In
Supplier Support Model – Production Characteristics
High Level Purpose:
Methodology:
Stable Suppliers
Level and type of support varies
according to supplier capability.
Not a one size fits all approach.
Move entire supply base toward
self-directed improvement
capability.
Best Suppliers Self
Benchmark Suppliers
Motivated
Stability Concerns
Production
Characteristics
Activity
Stability
Projects
Stability
Projects
R
E
A
C
T
I
V
E
Training
Teaching
Problem Solving
Hands On Doing
Lean Network
Lean
Network
Production
Characteristics
P
R
O
A
C
T
I
V
E
Training
Teaching
Facilitating
Strategic Partnering
N
E
X
T
L
E
V
E
L
Training
Teaching
Networking/Showcase
Benchmarking
Honda Involvement
‘Hands-on’ Assistance
Facilitation
Self-Directing
Production Characteristic Example
Improving Production Characteristics…….
in Mass Production & New Model
• Value Stream Mapping
• 3P: Production Preparation Process
• Summary of Results
Value Stream Mapping
7-14-26 Wk
Forecast
Suppliers
Milark
Honda Trading
Daily
Order
Berwick
Penntecq
Increase delivery
frequency to
1/Day.
7-14-26 Wk
Forecast
Production
Control
Customer
Daily
Order
Demand ~ 1380
Takt ~ 60 sec
Setup
kanban.
1 / Day HDM
Pillar Cover Repack
Milark
3 / Wk
Eliminate deliveries3 /to
Wk Warehouse. Milark
deliver to Cairns plant.
2500 sets
Warehouse
2500 sets
Setup kanban to
supplier.
Rollform
Berwick
1 / Day
1 day
C/T
C/O
Assoc.
OEE
2.3
5 min
1
85%
Setup
kanban.
2500 sets
Center Hemming
C/T
C/O
Assoc.
OEE
32
60 min
4
88%
C/T
C/O
Assoc.
OEE
N/A
N/A
7 / Day MAP
Milark
N/A reduce batch
sizes.
N/APack in smaller
containers.
Shipping
Setup
kanban.
1540 sets
Warehouse
HDM deliveries
direct from Cairns
plant.
1 / Day W/H
Setup kanban to
supplier.
Bending
Penntecq
1 / Day
1500 sets
C/T
C/O
Assoc.
OEE
32
0 min
3
87%
Setup
kanban.
1800 sets
Van Sheet
Berwick
Honda Trading
Setup
kanban.
1 / Wk
5 days
400 Ton Blanking
C/T
C/O
Assoc.
OEE
1.5
30 min
2
61%
Setup
kanban.
13000 sets
Laser Weld
C/T
C/O
Assoc.
OEE
13.8
50 min
2
83%
Setup
kanban.
5000 sets
Twin Press
C/T
C/O
Assoc.
OEE
5
45 min
6
61%
Setup
kanban.
6000 sets
Inner Pierce
C/T
C/O
Assoc.
OEE
32
0 min
1
91%
Improve Twin
Press quality.
240 sets
Comp Line
C/T
C/O
Assoc.
OEE
33
0 min
5
91%
1200
sets
•VSM: Shows Production & Information flow from Customer Æ Raw Materials
8.9 Days
12.5 Days
35.8 sec
6.6 Days
45.8 sec
4.3 Days
5 sec
0.2 Days
32 sec
0.9 Days
33 sec
Lead Time
Process Time
33.4 Days
151.6 Seconds
VSM: Shows Production & Information flow from the Customer to Raw Material
- Identifies sources of waste and provides a common language
3P – Production Preparation Process
The purpose of 3P is to design out waste and simulate the process with a cross functional
team to achieve a higher level of safety, quality, productivity and delivery at start-up.
Applications:
Objectives:
- New Products
- Design Changes
- Changes In Demand
- Relocation Of Process
- Mass Production Improvements
3P Methodology:
- Use Minimal Resources to
Meet Customer Takt Time
- Eliminate Waste Prior to
Production Start
- Clear Objectives (MP Eff. WIP, Flr Space)
- Cross-functional Team (prod, quality, ms, maint,)
- Creativity Before Capital
- Quick and Crude vs. Slow and Elegant
- Tight Focus On Time (1 week)
1 Week
Schedule:
Traditional Method:
Low Associate Involvement
Excessive Capital Investment
Copy of Existing Process
No Simulation
Parts Presentation Afterthought
3P Method:
Cross-functional Involvement
Lower Capital Investment
Process Innovation
Cycle Time Simulation
Planned Parts Presentation
AM
Monday
PM
3P / Lean Training
Tuesday
Situation Appraisal
Create 7 Alternatives
Wednesday
Evaluate Alternatives
Full Scale Mock-up
Thursday
Simulate / Kaizen
Documentation
Friday
Results Presentation
3P – Eliminating waste prior to New Model
supply
supply
INV.
L/R Rear Sash Final Weld Cell
s u p p ly
80
NVA
VA
70
60
50
supply
INV.
s u p p ly
supply
L/R Front Sash Final Weld Cell
40
INV.
30
s u p p ly
3P Proposal
20
10
F/ I
L oad
Se ale
r
Con v
eyor
T/ T
Con v
eyor
• Total M/P = 22 for two shifts all 4 parts.
Pierc
e
Con v
eyor
• VA time = 50.9
0
NVA
VA
35
30
AFTER 3P
25
20
$AVINGS % IMP AFTER BEFORE
supply
INV.
supply
s u p p ly
PPLH
WIP
FL/SP
32.7
N/A
9100
45
N/A
4820
37.6%
N/A
47%
$450K
N/A
$300K
15
10
5
F/I
Hem
Spot
MIG
2
Unlo
ad T
/T
• Total M/P = 16 for two shifts all 4 parts.
MIG
1
• VA time = 66.9.
Load
0
One Time Savings = $300K
Annual Savings
= $450K
1st Yr Savings
= $750K
Production Characteristics Results
Supplier New Model 3P Results
PPLH
#
Supplier
Title
1
2
3
4
5
6
7
8
9
10
11
12
13
14
A
B
C
D
E
F
G
H
I
J
K
L
M
N
Rail Sub-Assy
Door Liner Assembly
Tire Cover Assembly
Visor Assembly
Tire Mount & Rear Fork Assy
Under Cover Injection Molding
Rear Knuckle Casting
Throttle Body Assy
Brake Hose Bracket Weld
Sash Weld
Rear Tray Injection Molding
Rear Knuckle Machining
Trailing Arm Assembly
Front Knuckle Sub-Assembly
Average % Improvement
Baseline
11.3
2.4
19.1
19.0
No Change
28.0
25.7
19.4
146.0
32.7
15.5
49.8
14.5
51.3
3P Result
18.8
3.2
31.9
31.0
55.0
34.3
20.8
211.0
45.0
26.3
53.8
14.5
102.5
PPLH:
Floorspace
WIP
% Improve
66.7%
33.3%
67.0%
63.2%
96.4%
33.5%
7.2%
44.5%
37.6%
69.7%
8.0%
0.0%
99.8%
48.2%
Baseline
50 parts
36 parts
3.8 days
3.8 days
1.75 days
No Change
560 parts
No Change
No Change
No Change
5 parts
No change
1.7 days
3.0 days
3P Result
5 parts
16 parts
0.8 days
3.2 days
1.01 days
% Improve
Baseline
3P Result % Improve
90.0%
740
396
46.0%
57.0%
4990
2040
59.0%
79.0%
4800
620
87.1%
16.0%
1672
379
77.0%
42.3%
No Change
512
360
29.7%
180 parts
68.0%
2434
1767
27.0%
855
714
17.0%
No Change
2275
1138
47.0%
3 parts
40.0%
242
196
19.0%
2112
1848
12.5%
1.0 days
41.0%
1029
1029
0.0%
1.2 days
60.0%
1240
1204
3.0%
54.8%
Floorspace:
35.4%
WIP:
Supplier Mass Production 3P Results
PPLH
#
Supplier
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
Floorspace
WIP
Title
Baseline
ATV Frame Weld
24.0
5.9
Door Mirror Assembly
Cat Con Weld
6.3
9.1
Rail Assembly
14.4
Door Mirror Assembly
No Change
Seat Sub-Assembly
5.7
Radio Assembly
8.6
Cable Assembly
3.5
Differential Case Assembly
8.9
Door Liner Assembly
5.5
Door Liner Assembly
5.3
Module Assembly
11.8
Pillar Garnish Assembly
1.7
RES Assembly
17.7
Blower Assembly
Brake Pedal Weld
39.9
14.8
Blower Assembly
Exhaust Pipe Weld
20.0
100.9
ELD Assembly
31.0
Cable Assembly
Rear Tray Injection Molding
13.1
Blower Assembly
10.3
Average % Improvement
3P Result
33.7
8.2
7.9
13.7
20.8
% Improve
40.4%
39.9%
25.4%
49.9%
44.0%
Baseline
1.6 days
3245 parts
1600 parts
No Change
3P Result
1.6 days
110 parts
870 parts
% Improve
0.0%
97.0%
45.6%
Baseline
4463
2191
3500
609
2228
605
169
1116
1409
1833
2574
50
744
1160
656
2343
543
431
1207
848
1140
3444
3P Result % Improve
3802
14.8%
1080
50.7%
3370
3.7%
187
69.0%
1568
30.0%
328
46.0%
101
40.2%
1116
0.0%
1057
25.0%
1718
6.3%
2310
10.3%
5
90.0%
866
-16.4%
638
45.0%
399
39.2%
1053
62.0%
216
60.2%
310
28.0%
978
19.0%
324
61.8%
396
65.3%
492
85.7%
Floorspace:
38.0%
Average 3P Improvement: PPLH: 45.1%, WIP: 58.9%, Floor Space: 36.6%
6.9
9.4
7.3
10.7
9.0
6.6
18.4
2.1
22.4
52.7
18.1
46.0
134.6
47.0
19.6
14.0
PPLH:
21.1%
9.3%
108.3%
20.2%
63.6%
24.5%
55.9%
23.5%
26.6%
32.1%
22.0%
130.0%
33.4%
51.6%
49.6%
35.9%
43.2%
240 parts
72 parts
70.0%
35 parts
No Change
No Change
No Change
874
12 parts
66.0%
820
6.0%
56 pcs
1800 pcs
56 parts
18.0
38 pcs
1339 pcs
No Change
2 pcs
23.0
18 pcs
1800 pcs
6 parts
1.0
1 pc
259 pcs
68.0%
0.0%
91.0%
94.4%
97.0%
80.6%
0 pcs
10.0
WIP:
100.0%
56.5%
62.3%
In-house (MMP) 3P Results
Associate Walking Distance
#
Plant
Title
1
2
3
4
5
MMP
MMP
MMP
MMP
MMP
Final Repair Area
AF Sub-Assy Area Layout
Tank & Rear Fender Assembly
Engine Assy
Paint - PWC Move (L1 to L3)
Average % Improvement
Baseline
3P Result % Improve
96820
62298
35.7%
32306
10442
67.7%
747
585
21.6%
46.3
22.3
51.9%
2037
1158
43.2%
Assoc Walking:
44.0%
WIP
Baseline
No Change
No Change
38
94
884
3P Result
20
55
402
WIP:
Floorspace
% Improve
47.4%
41.5%
54.5%
47.8%
Baseline
8626
5032
508
2934
3976
3P Result % Improve
6122
29.0%
4381
12.9%
371
27.0%
2416
17.7%
1557
60.8%
Floorspace:
29.5%
Supplier Support Model – Lean Network
High Level Purpose:
Methodology:
Stable Suppliers
Level and type of support varies
according to supplier capability.
Not a one size fits all approach.
Move entire supply base toward
self-directed improvement
capability.
Best Suppliers Self
Benchmark Suppliers
Motivated
Stability Concerns
Production
Characteristics
Activity
Stability
Projects
Stability
Projects
R
E
A
C
T
I
V
E
Training
Teaching
Problem Solving
Hands On Doing
Lean Network
Lean
Network
Production
Characteristics
P
R
O
A
C
T
I
V
E
Training
Teaching
Facilitating
Strategic Partnering
N
E
X
T
L
E
V
E
L
Training
Teaching
Networking/Showcase
Benchmarking
Honda Involvement
‘Hands-on’ Assistance
Facilitation
Self-Directing
Supplier Lean Network
Supplier Challenges:
• Outstanding Quality
• Global Competition
• Flexibility
• Global Sourcing
Lean Manufacturing Methods are
the keys to meeting these challenges
Value added
5%
Non-value
added
1. Overproduction
2. Excess inventory
3. Defects
4. Non-value added
processing
5. Waiting
6. Excess motion
7. Transportation
8. Underutilized people
Typically 95% of Total Lead Time
is Non-Value Added!!!
Establish a Lean Network
• Comprised of 40+ Supplier Partners
• Lead by Steering Committee
• 9 Supplier & 2 Honda members
• Facilitated by Honda
• Coordinate meetings &
communicate to members
• Arrange Benchmarking visits
• Share Best Practices
• Coordinate Lean Workshops &
Lean Training
• Stabilize Network & position for
growth
• Showcase Lean Implementations at
annual Lean Network Conference
Supplier Lean Network
Lean Supplier Network Mission Statement
Through a diversified network of suppliers, guide the development,
implementation, and measurement of Lean manufacturing practices by
information sharing, best practices, and active participation
Lean Principles & Best Practices To Improve QCD
Selection of Suppliers
•Benchmarking
•Benchmarking
Stable Suppliers
Nonstable
Suppliers
Initial Focus
Benchmark
•Project
•Project Support
Support
Network
Provides
•Workshops
•Workshops (VSM,
(VSM, Kanban,
Kanban, 5S)
5S)
•Training
•Training (Mat’l
(Mat’l Flow,
Flow, TPM,
TPM, Ergo)
Ergo)
•Quarterly
•Quarterly meetings
meetings
•Monthly
•Monthly Steering
Steering Cmte
Cmte Meetings
Meetings
Team atmosphere for mutual learning, assistance &
improvement within the Supplier base (networking)
Lean Network Workshop History
Workshops
Workshops provided
provided by
by Network
Network members
members
•• VSM
VSM (Value
(Value Stream
Stream Mapping
Mapping
•• Set
Set Up
Up Reduction
Reduction
•• Pull
Pull // Kanban
Kanban Systems
Systems
•• Cellular
Cellular Mfg
Mfg
•• Yokoten
Yokoten –– Maintenance
Maintenance
•• TPM
TPM
•• Quick
Quick Changeover
Changeover
•• Material
Material Flow
Flow
•• Ergonomics
Ergonomics &
& Safety
Safety
•• MOST
MOST &
& Standardized
Standardized Work
Work
•• OEE
OEE
•• Labeling
Labeling &
& Traceability
Traceability
•• 5S
5S
•• Energy
Energy Cost
Cost Reduction
Reduction
•• Safety
Safety
•• Suggestion
Suggestion Systems
Systems
Attendance
Attendance since
since 80Ki
80Ki == 719
719 Supp
Supp Assoc
Assoc
Training
Training provided
provided by
by Honda
Honda
•• Lean
Lean Overview
Overview
•• VSM
VSM (Value
(Value Stream
Stream Mapping)
Mapping)
•• Lean
Lean Simulation
Simulation
•• Pull
Pull // Kanban
Kanban Systems
Systems
•• 5S
5S
•• Visual
Visual Workplace
Workplace Mgmt
Mgmt
•• OEE
OEE
•• 3P
3P (Prod.
(Prod. Prep.
Prep. Process
Process
Ki
Classes
Attendees
FY 04
28
448
FY 05
38
997
FY 06
42
683
108
1,828
Totals
Over 2,500 Supplier Associates trained by
Honda and Network Members since FY 04
Expectations & Results
•
•
•
•
Must have top management support.
No layoffs as a result of improvement activity.
Methods learned are applied at your facility.
Results of Projects are showcased for the benefit of the
network.
– At Quarterly Meetings
– At Fall Lean Network Conference
Lean Network Results
Manpower
Manpower
Efficiency
Efficiency
--Sq.
Sq.Feet
Feet
Inventory
Inventory
Reduction
Reduction
Total
TotalSavings
Savings
+8.1%
+8.1%
-447,000
-447,000
-$30.7M
-$30.7M
-$97.1M
-$97.1M
North America Purchasing Vision
We will develop and manage a competitive and stable supply base
to support all of Honda’s North American Manufacturing facilities
with world class Quality, Cost, Delivery, and Development.
Develop supplier capabilities to meet QCDD
(Quality, Cost, Delivery & Development) requirements
Develop and manage material flow to meet plant requirements with
optimum inventory levels at competitive logistics cost.
Manage purchased parts cost to achieve globally competitive costs and
support Honda Motors’ competitiveness.
Understand future direction of the industry and develop strategies and
systems to enable Honda Motors and our suppliers to adapt to
changes and gain competitive advantage.
Build a world class purchasing organization through development of
associates and business practices