Material Handling and Process Improvement Using Lean Manufacturing Principles.1-4

International Journal of Industrial Engineering, 18(7), 357-368, 2011.
MATERIAL HANDLING AND PROCESS IMPROVEMENT USING LEAN

MANUFACTURING PRINCIPLES
Tushar K. Acharyaa
PG Scholar, Production Engineering Department, VJTI, Mumbai University
Global competition has prompted companies to compete on the basis of Quality, Flexibility, Cost and Timely Deliveries.
Lean manufacturing appears to hold considerable promise to address these competitive demands. Lean manufacturing was
initiated within automotive industry, with the publication of Book The Machine That Changed the World (Womak,
Jones, Roos,1990) lean manufacturing practices have found acceptance in many industries. In this paper we describe the
case where Lean Manufacturing was started. The objective was Process improvements using Lean Manufacturing
Principles. Value stream mapping was used to find the scope of improvement in Material Handling. Team also used other
lean tools such as 5S, Visual System, Process improvement (Continuous improvement) and Kanban. Results obtained were
cycle time, distance and manpower reduction for material handling. Some floor area was also saved. Similar cycle time for
certain assembly process was reduced. Andon system helped supervisors and group leader tackle the line problem
immediately as they occur. Average output increased from 3.5 to 5 in period of 9 months.
Key Words: Lean Manufacturing, Waste Reduction, Material Handling, VSM, 5S, Visual System
(Received 15 July 2009; Accepted in revised form 9 September 2010)
1. INTRODUCTION
Growth of Nations economy owes their success to their wealth creating sectors, of which manufacturing is a key sector.
Looking at manufacturing industry the average investment is three times high then non-process (service) industry, while net
value added per capital employed is almost half of non-process sector.[1]
Looking at current situation firms operating in market has to compete with the firm operating in same market. Firms
develop strategies to increase their competitiveness. In order to gain competitive advantage, firms try to reduce their costs,
as well as try to differentiate their service or products from their competitors.[2]
With the publication of Book The Machine That Changed the World lean manufacturing practices have found
acceptance in many industries. Lean manufacturing is one of the initiatives that many major businesses in the United States
have been trying to adopt in order to remain competitive in an increasingly global market[3].
The focus of the approach is on cost reduction by eliminating nonvalue added activities. The objective of this paper is to
use a case-study approach to demonstrate how lean manufacturing tools when used properly, can help to eliminate waste,
maintain better inventory, obtain better operational and financial control. One of the Global leading Electric Switchboard
manufacturer is used to illustrate approach followed. One of their establishment (Medium Voltage- 4kV to 36kV) in India
is taken into consideration.
2. OVERVIEW OF LEAN MANUFACTURING

Lean ( a term coined by IMVP researcher John Krafcik) production is lean because it uses less of everything compared with
mass production half the human effort in the factory, half the manufacturing space, half the investment in tools, half the
engineering hours to develop a new product in half the time. Also it requires keeping far less than half the needed inventory
on site, results in many fewer defects, and produces a greater and ever-growing variety of products. [4]
Lean manufacturing is a set of operating principles which a manufacturing company may apply to optimize its provision of
value to customers. This involves the elimination of waste and the improvement of material flow.[5]
2.1 The rise of lean production
Toyota is credited with being the birthplace of lean production, and their manufacturing philosophy has been evolved from
ideas developed in the end of the thirties [4]. After the Second World War Toyota and other Japanese organizations suffered
from the effects of the war. The resources were straitened and Japan needed to rebuild its manufacturing industry [6]. Many
of the Japanese companies turned to the western industries to gain ideas and inspiration on how to build up their industry. In
the United States, the call was for mass production to satisfy the needs of a large populace. The Japanese market on the other
hand was much smaller and investment capital was scarce. With smaller production volumes per part and limited resources,
ISSN 1943-670X
INTERNATIONAL JOURNAL OF INDUSTRIAL ENGINEERING
Acharya
there was a need for developing a manufacturing system that was flexible and uses less resource [6]. The solution was to
develop a lean production system, and the production genius Taiichi Ohno at Toyota is said to be the man behind the
development of lean production.
2.2 Main Principles of Lean
2.4.1. Specify Value : What does and what does not create value from the customers perspective.
2.4.2. Identify all the steps necessary to design, order and produce the product across whole Value Stream to highlight
non value adding waste.
2.4.3. Make those action that create value flow without interruption, waiting or scrap.
2.4.4. Only make what is pulled by the customer.
2.4.5. Strive for perfection by continually removing successive layers of waste as they are uncovered
2.3 Value creation and waste
In Lean Manufacturing, the value of a product is defined solely based on what the customer actually requires and is willing
to pay for. Production operations can be grouped into following three types of activities:
Value-added activities are activities which transform the materials into the exact product that the customer requires.
Non value-added activities are activities which arent required for transforming the materials into the product that the
customer wants. Anything which is non-value-added may be defined as waste.
Necessary non value-added activities are activities that dont add value from the perspective of the customer but are
necessary to produce the product unless the existing supply or production process is radically changed.
Research at the Lean Enterprise Research Centre (LERC) in the United Kingdom indicated that for a typical manufacturing
company the ratio of activities could be broken down as follows:
Muda (or nonvalue-added work): Muda is discovered after the
process is in place and is dealt with reactively.
Muri (or overburden): It is focused on the preparation and planning
of the process, or what work can be avoided by design. Muri can be
avoided through standardized work. Muri is pushing a machine or
person beyond natural limits.[6]
Figure 1. Activity break up
Mura (or unevenness): It focuses on implementation and the

elimination of fluctuation at the scheduling or operations level, such
as quality and volume. Mura is avoided through the Just in Time
Systems. It is based on little or no inventory, by supplying the
production process with the right part, at the right time, in the right
amount, and first-in, first out (FIFO) component flow. Muda is
result of Mura.
2.4 Seven types of waste (Muda)

1. Overproduction
2. Inventory
3. Defects
4. Over processing
5. Waiting
6. Motion
7. Transportation
8. Underutilized People (8th waste included later by Toyota. For detail information of these waste please refer, The
Toyota Way, by Jeffrey Liker).
Lean Material Handling

2.5 Lean Manufacturing Tools
5s: Focuses on effective work place organization and standardized work procedures. 6th S included is Safety and
ergonomics.[8]
Cellular Manufacturing: Organizes entire process for a particular product or similar products into a group including all
necessary m/cs, equipments.
JIT: Pulling all requirements just when they are required.
Kanban: A signaling system for implementing JIT production
Total Preventive Maintenance: Workers carry out regular equipment maintenance to detect abnormalities focus is
changed from fixing breakdowns to preventing breakdown.
Setup time reduction: Continuous improvement to reduce setup time on machines.
Total Quality Management: System of continuous improvement employing participative management centered on needs
of customers.
Visual Management:
Standard Processes: Standard Process clearly state the content, sequence, timing and outcome of all actions by workers.
This eliminates variation in the way that workers perform their tasks. [3][9]
3. CASE STUDY: SWITCH BOARD MANUFACTURER , REAL LIFE EXAMPLE

The firm assembles Medium Voltage Switchboard as well Circuit Breaker for the same, also RMU is assembled. The focus
of this study is on one of its Standard Med. Voltage Switchboard assembled in-house.
3.1 Problem Definition
Previously the manufacturing system adopted by the firm was Batch type production. The constraint with current
manufacturing system was that to meet future projected growth the space and manpower requirements will be as shown in
Table 1.
Table 1. Requirements for increased demand
FY 2007-08
FY 2011-12
Remarks
Total output ( IN + APS)
10000
21000
IN= Panels assembled in house

APS = Assembled Panel Structure ( Outsourced)
IN panels
4000
8400
@ 40% of total output.
Average working days in a year
280
280
Avg. output per day
13.8
29
Target per Line
10
Assembly TAKT time (minutes)
60
42
No. of Lines required/ (operated)
2/(3) $$
3/(3 or 4)
Total operators for panel line.
63/63
74/(45)
Area (Sq. Meter). (Approximately)
15000
21200
IN panels / No of days
$$ Two shift operated per day. Two lines in one shift and one
line in second shift making total 3 lines.
74- Actual requirement, 45- Manpower available
Looking at the table above there are three major constraints to be overcome to achieve the target. These are:
1) Area availability
2) Manpower requirement and availability.
3) TAKT time and panel output.
Analyses of these three constraints were carried out and analysis of table was an eye opener. Even if current Area and
Manpower for future growth is sufficient and Takt time is of 42 minutes is achieved, still we wont be able to achieve the
359
Acharya
set target, reason being at present we are unable to reach the set target with sufficient resources. To carry out further
analysis we gathered data for Line stoppage and summary of same is as follows.
Problem with current system:
1.
Material unavailability and missing. (Waiting time)
2.
Wrong material delivery to line.
3.
Faulty material delivered to line.
4.
Non standard material kitting system.
5.
Multiple storage of material.
6.
Multiple handling of materials.
7.
Long distance of material movement.
8.
Unsafe handling and assembly process.
9.
Lack of visual system (Andon and Kanban) etc.
To make improvement Firm wanted to implement Lean Manufacturing Principle to meet projected market growth till
2012. After initial training in Lean Principles, Lean Manufacturing team was formed. Team consisted employees from all
functional departments. One of the group from Planning and Process Engineering (P&PE) was given task of Material
Handling and Process Improvements. We will study the work done by this group using Lean Manufacturing Principle.
3.2 Scope of the project
Reduce the overall handling time, manpower and Distance of Material Handling in Switchboard factory ensuring One piece
flow of material
3.3 Objective of Project
1) Pull Production type assembly layout.
2) Creating Supermarket area near assembly shop.
3) Layout for material storage in supermarket area.
4) Material delivery system (One Piece Flow- FIFO).
5) Visual System ( Visual replenishment system, Andon)
6) Manpower reduction for material handling (By 40%)
7) Material handling system (Reducing handling time by 40%)
8) Reducing material handling distance.
9) 5S implementation and maintaining the same. Elimination of nonvalue adding task: reduce transport time no
walking, searching, waiting
3.4 Data Collection
Team first wanted to know scope of developing material handling system so they first gathered Output and Cycle time data.
After starting lean cell the estimated SMH/panel is 7 hours. So in each shift approx. 7 panels should be assembled, but
actual average output per shift was 3.41, and average cycle time for three lines is 9.1 hours.
Team further gathered data for line losses as shown in figure 2. Main reason was material unavailability with 43%. For
further analysis data for material unavailability was gathered and summary is as shown in Fig.3.
Figure 2. Reason for loss pie chart
Figure 3. Material unavailability pie chart

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International Journal of Industrial Engineering, 18(7), 357-368, 2011.

MATERIAL HANDLING AND PROCESS IMPROVEMENT USING LEAN

2. OVERVIEW OF LEAN MANUFACTURING

INTERNATIONAL JOURNAL OF INDUSTRIAL ENGINEERING

Figure 1. Activity break up

Mura (or unevenness): It focuses on implementation and the

2.4 Seven types of waste (Muda)

Lean Material Handling

3. CASE STUDY: SWITCH BOARD MANUFACTURER , REAL LIFE EXAMPLE

Total output ( IN + APS)

IN= Panels assembled in house

@ 40% of total output.

Average working days in a year

Avg. output per day

Target per Line

Assembly TAKT time (minutes)

No. of Lines required/ (operated)

Total operators for panel line.

Area (Sq. Meter). (Approximately)

Figure 2. Reason for loss pie chart

Figure 3. Material unavailability pie chart

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