- European Regions for Innovative Productivity
Applying Lean Practices in SMEs:
A ”Bitesize” Methodology
Daryl Powell
Newcastle University Business School
24th November 2011
1
The transnational network
• Participants from 6 countries in the North-Sea region:
UK, Norway, Sweden, Germany, Netherlands, Belgium
• Dissemination to Baltic-Sea region
2
Exemplar
Company
Regional
Development
Agency
Exemplar
Company
Academic
Partners
IPC UK
Regional
Development
Agency
Regional
Development
Agency
SME
Delivery
Partners
SME
SME
SME
SME
SME
SME
SME
SME
SME
Exemplar
Company
SME
Exemplar
Company
IPC Germany
Academic
Partners
Regional
Development
Agency
Exemplar
Company
Academic
Partners
IPC Holland
Delivery
Partners
Regional
Development
Agency
SME
Delivery
Partners
SME
SME
SME
Academic
Partners
IPC Belgium
Delivery
Partners
SME
Academic
Partners
IPC Sweden
Delivery
Partners
SME
SME
Academic
Partners
IPC Norway
Delivery
Partners
Regional
Development
Agency
Exemplar
Company
SME
SME
SME
SME
SME
SME
ERIP Transnational Network
3
Why SMEs?
Although SMEs are the backbone of the EU economy, few are
fulfilling their potential in terms of productivity and
innovation:
• No widespread successful adoption of lean manufacturing
• Limited understanding of lean practices at every level within
the organisation, resulting in a failure to embed the concept.
The ERIP Methodology
S1
Pre-Diagnostic
S3
Workshop
S2
Diagnostic
S4
M1
Measurement
Cc1t/m
t/mCc6
Cc6
Cc1
Cc1
t/m
Cc6
Cc1
t/m Cc6
Improvement
Improvement
Improvement
1) Not RightImprovement
First Time
cycles
cycles
cycles
2) Stock Turns cycles
Diagnose:
Yearly action
- Focus areas & problems
plan
- PNA
3) Value added per Person
- VSM
4) Lead time
- Organise improvement team
Problem
identification
5)Cc1:
Schedule
achievement
- Management
&
team
expectations
- Goals from S2: diagnose
a 6)Cc2:
LeanEquipment
basics
Overall
Effectiveness
M2
S6in
-Lean Production
Workshop
-M3
Assessment
of
necessary
Lean
knowledge
&
timetable for 1-1,5 year
Cc3: Diagnostic
Final
Final
-LeanHalfway
Management training
current
status
- 2-3 improvement cycles
Cc4: Workshop
Measure
Measure
presentation
- 1-3 months per event
Cc5: Follow up
Cc6: Review
M2 : Measurement
The ERIP “Showcase”
Methodology
The “Showcase” Methodology essentially consists of 3 stages:
Pre-Diagnostic
Diagnostic
Workshop
The ”Showcase” Methodology
The Original ERIP ”Showcase” Methodology identified 3 stages:
• 1-day Pre-diagnostic
• 3-day Diagnostic Event
• 5-day Workshop
In Norway, this was problematic during recruitment of SMEs, as
it was ”impossible” for the SME to free up resources for the
3-day and 5-day blocks.
A ”Bitesize” approach was required…
Pre-diagnostic
• A semi structured “Productivity Needs Analysis” interview of
the management team yields an assessment of the
operational excellence of the SME
• Management expectations are considered (if there are any
immediately important areas for focus)
0,5 days
Diagnostic
• Aims to achieve buy-in and involvement from the SME core
team who will be working on the improvement cycles
• Teaching points focus on indentifying 7 wastes and Value
added and non-value added activities
• Considers 6 core ERIP measures
• Creation of Current-state VSM
• Poorest results will become the focus for the workshop
0,5 days
1 day
1 day
Workshop
• Uses Plan-Do-Check-Act (PDCA) cycle to focus on improving the
poorest of the measures / problem area from VSM
• Creation of future-state VSM
• Teach points focus on lean tools to identify the areas for
improvement and to countermeasure the problems
0,5
day
1 day
1 day
1 day
1 day
1 day
++
Norwegian
IPC structure
SINTEF
NTNU
SMEs
IPC
Norway
Norwegian
Networks
Exemplar
companies
IPCs in
other
countries
11
Norwegian
IPC structure
Hagen
Norplasta
SINTEF
CTM
Lyng
NTNU
SMEs
Noca
IPC
Norway
Norwegian
Networks
SMARTLOG
Exemplar
companies
IPCs in
other
countries
NCEI
Teeness
Benteler
12
Based in
Trondheim, Norway
Our distinctive character
• The SINTEF Group is Scandinavia's largest independent research institution, with
international top level expertise in several areas of research. SINTEF has over 2000
employees from 68 countries
•
SINTEF cooperate closely with industry, universities and authorities, and have a
combined research and business culture.
Our vision
• “Technology for a better society”
Our role
• Create value through research and innovation, and offer concrete solutions for
sustainable development
•
SINTEF creates value through knowledge, research and innovation, and develop
concrete solutions for sustainable development
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Related project activities in SINTEF:
NCEI Lean
•
Collaboration project between 4 companies (Kongsberg Maritime, Noca,
Roxar and Fugro Oceanor and 2 competence partners (SINTEF, HiST)
Goal:
”To increase the competitiveness of the partners by more efficient production
through employing tailored techniques from lean manufacturing and positive
change in company culture towards continuous improvement”
14
-
Number of employees: 2,600
Number of students enrolled: approximately 20,000
Department of Production and Quality Engineering (IPK)
-
Works on the point of intersection between technology and
management, with issues tied to operations, industrialization
and production, along with quality and safety.
-
Three primary research groups covering Production Systems;
Production Management; and Reliability, Availability,
Maintainability and Safety (RAMS).
-
Relevant further education programme in Lean Manufacturing
15
Hagen
Exemplar
companies
Norplasta
SINTEF
CTM
Lyng
NTNU
SMEs
Noca
IPC
Norway
Norwegian
Networks
SMARTLOG
Exemplar
companies
IPCs in
other
countries
NCEI
Teeness
Benteler
16
Exemplar company: Teeness
 Produce Machining Tools
 Not ”The Factory” – but ”The School”
 Own Philosophy: 5M
1. Man
2. Machine
3. Methods
4. Material
5. Milieu (environment)
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Exemplar company: Benteler Automotive
-
Turnover (2010), - MNOK
460 employees
producer of aluminium bumper beams and crash protection systems
- Production Scheduling
- Supplier development
Tools /
Techniques
- Team organisation
- Coaching and leadership
- HES
- 5S and workplace organisation
- Value Stream Mapping
- Standardised work
- H2C
- HAPS Roadmap
- Self Assessment
- Benchmarking
Current state
Need for change
Motivation
Alignment
Vision
Team organisation
Waste reduction
Safe healthy
workplace
Visual factory
- TPM
- SMED
- Mistake proofing
- Continiuous
improvement
- Just in Time production
Just in Time Production
Reduced costs
Increased Profit
Continiuous flow
Flexibility
Process stability
Increased capacity
Continiuous
improvements
Company wide quality
Goals
18
Methodology
and SME test
companies
Hagen
Norplasta
SINTEF
CTM
Lyng
NTNU
SMEs
Noca
IPC
Norway
Norwegian
Networks
SMARTLOG
Exemplar
companies
IPCs in
other
countries
NCEI
Teeness
Benteler
19
SME test company: Noca
-
Turnover (2010), Approx 90 MNOK
50 employees
Producer of printed circuit boards and electronic products
What we did:
• Value Stream mapping
• 5S activity
• SMED Workshop
Results
• Lean steering group created with an identified lean champion and 5 change agents
on the shopfloor
• Improvement in visual management due to 5S activity – toolboards etc.
• Visual management will continue with creation of performance dashboards.
• SMED activity planned for 2nd quarter 2011.
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SME test company: Hagen
-
Turnover approx 100 MNOK (2010), 98 employees
Producer of staircases
90% to professional house builders, 5% export (mainly to Sweden)
What we did:
• Automating the production by use of modern technology: CNCmachine, Robot, Internal transport, RFID, Shop floor system
• Started the process of planning for 5S implementation projects in
2011
Results
• Building the technological foundation for Lean production
• Fully implementing the invested production line in Q1 2011
• Further testing of Lean techniques
21
SME test company: ASTI
-
Turnover (2009), Approx 56 MNOK
50 employees
Producer of printed circuit boards
and electronic products
What we did:
• Diagnostic activity
• 6 ERIP Measures
• Value Stream mapping
Results
• ASTI are currently designing future-state VSM and collecting data Re. 6 measures
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SME test company: Norplasta
-
Turnover (2010), 88 MNOK, 68 employees (average age = 49 years old)
Producer of moulded plastic boxes, trays, and food packaging (50% to food industry)
Injection moulding, and branding with hot stamp or inmould labelling (IML)
Experience with Lean
• 5S started as a project mid-August 2010, will be implemented by May 2011
ERIP
• Selected a focus area: Factory 2, Machine 132
• Analysis of data shows that machine downtime is an
area for improvement
• Downtime due to Repair of tooling was the focus area
• Tool 3003 became the priority tool
• Detailed description of tooling issues will be recorded
throughout the next two months
23
SME test company: CTM Lyng
-
Turnover approx 58 Mill NOK (2009),
45 employees
Producer of electronic circut boards for Smart House Control Systems
What we did:
• Pre-diagnostic
• Walking the process
• Lean philosophy
Further work
• Analyse value streams
• Implementing 5 S in selected sections
of the production lines
Alvin Berg CEO, Ståle Sund, production manager and
Daryl Powell, NTNU & SINTEF
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Some results…
Experiences and concluding remarks
•
Collaborate with others – other people have similar issues.
– Sharing experiences, challenges and solutions with other companies have
proved useful – different industries, but similar challenges
• Use sufficient time for the staring up the process
– As the groups have gotten to know each other: trust among participants have
increased, better discussions
• Have some form of external pressure for
internal improvement programmes
– If not, it is harder to maintain steam and
momentum in the process
• Learn it, don’t buy it
– Build the competence of you staff. If not,
it is harder to sustain a Lean organisation
with continuous improvements
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Exemplar
Company
Regional
Development
Agency
Exemplar
Company
Academic
Partners
IPC UK
Regional
Development
Agency
Regional
Development
Agency
SME
Delivery
Partners
SME
SME
SME
SME
SME
SME
SME
SME
SME
Exemplar
Company
SME
Exemplar
Company
IPC Germany
Academic
Partners
Regional
Development
Agency
Exemplar
Company
Academic
Partners
IPC Holland
Delivery
Partners
Regional
Development
Agency
SME
Delivery
Partners
SME
SME
SME
Academic
Partners
IPC Belgium
Delivery
Partners
SME
Academic
Partners
IPC Sweden
Delivery
Partners
SME
SME
Academic
Partners
IPC Norway
Delivery
Partners
Regional
Development
Agency
Exemplar
Company
SME
SME
SME
SME
SME
SME
ERIP Transnational Network
29
PhD Research Project: ERP Support for
lean production
• Exploratory Case studies
• Action Research (Norway)
– Simultaneous implementation of ERP
and lean principles
• Multiple Case Study (Netherlands)
– ERP support for pull production in SMEs
Questions or comments?
Daryl Powell (Research Associate & PhD Candidate),
ERIP Project Coordinator, Norway
E-mail: daryl.j.powell@ntnu.no
Phone: +47 73 59 39 83
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