5S Provides Competitive Lean Foundation

Estimated reading time: 7 minutes

Product margins are continually shrinking, which ultimately drives the need for reduction in product manufacturing cost.

By Jim Lanigan

In some cases, component substitution or a redesign for cost reduction can meet an organization's annualized cost reduction target. But in many more, unit quantities or the complexity of new design qualification means redesign is not cost-effective. However, every manufacturing process has hidden costs, which are rarely uncovered at first glance. Just as Six Sigma philosophy drives higher quality by increasing organizational focus on all aspects of product quality, lean philosophies tap knowledge at all levels of the organization to keep the product moving, getting everyone involved in reducing waste, and taking control of what is controllable.

The lean philosophy gives organizations the power to take control of processes, reduce costs and create competitive advantages. Unfortunately, in many cases, the industry's basic understanding of a lean philosophy solely is to get individuals from all levels working together through kaizen events to cut costs (Figure 1).

Figure 1. Kaizen flowchart.

In kaizen events, a cross-functional team comprises representatives from all applicable areas of the factory. The team first focuses on how things are really being done, analyzes the steps of a process, determines where non-value added activities occur, and then redesigns the process to eliminate them. Typical events result in reductions in items such as setups, product travel, equipment downtime, redundant activities, work-in-process inventory, and material replenishment cycles. Improvements also include increases in plant capacity by freeing up floor space, shorter cycle times through increased product velocity and fewer defects by shortening feedback loops. The team documents the savings, celebrates their improvements, disbands, and goes back to their everyday activities.

Many companies perform kaizen events and therefore believe they are following a lean philosophy. However, the true lean model is more than that. As effective as kaizen events can be, they are only momentary gains that evaporate over time if a company does not create a system to support continued improvement. It is in the systemic culture that a company truly becomes lean.

No matter how talented a company's people are, a poor, unstructured system will keep them from achieving sustainable momentum in the quest for continuous waste reduction. If a company has an inefficient system in place, the individuals within it will be inefficient. For this reason, developing a strong foundation to be truly lean and create a competitive differentiator is critical.

The most effective method to create this foundation is by implementing a good visual factory through 5S, also known as the 5 Pillars. The 5S concept was created by Hiroyuki Hirano. Many industry experts view this as the most important step for productivity improvement. The physical environment is critical to allow individuals the ability to work at their maximum potential. The 5Ss often are referred to as the foundation blocks, or pillars, upon which a company can build its lean initiative.

During the first 12 months of the 5S program at one EMS provider*, the following sustained improvements occurred:

• Work-in-process reduced by 60 percent
• Cycle time reduced by 70 percent
• Changeover times reduced by 40 percent
• SMT output improved by 42 percent
• Output per employee improved by 11 percent
• Schedule adherence improved by 60 percent
• Freed up 4,000 sq. ft of manufacturing floor space for future customers or projects.

Figure 2. In the 5S environment, workstations are arranged to store tools near their point of use. Each specific tool has a designated place, and it is easy to see when it is not in place.

The 5S concept lays a framework for individuals at all levels of the company to embed lean activities into the corporate culture. The EMS provider trained both direct labor and salaried individuals over a six-month period. The training sessions lasted 15 hours over five days. The classes spent the first hour of each session in the classroom, while the last two hours were consumed with implementing the subject matter on the factory floor. The 5S pillars taught to all individuals are:

• Sort — Refers to eliminating unneeded materials, tools, equipment and furniture from the workplace. Recommended parameters for analyzing workplace and office items should be based on frequency of use. A key principle when analyzing inventory (production materials) is whether the item is likely to remain "resting in place" or "moving." The objective is to keep inventory consistently moving as work-in-process. Performing this step results in freed floor space, better product flow and improved communication between associates. More than 800 unused items were removed from the manufacturing floor at the EMS provider during the initial Sort process.
• Set in Order — Recommends a goal in the arrangement, placement and sequence of items left after the Sort process. Some work cells (flow lines) are highly organized; however, more work is required to fine-tune the arrangement of materials and tools used to perform operations. Set in Order also is concerned with the amount of materials in the workplace and uses various methods to implement visual orderliness. Performing this step results in elimination of numerous types of waste, improved quality and reduction of inventory levels on the factory floor (Figure 2).
• Shine — This principle refers to keeping the workplace clean, including floors, storage shelves, tools, equipment and products themselves. This is best accomplished by identifying tasks to be performed, tools required to perform the task, and the assignment of who will do the task. Implementing Shine requires the development of a 5S Job Cycle Chart. This chart lists the 5S task, which pillar it represents, and the frequency the task is to be performed. This step increases individual pride in the work area, creates a safer workplace, and reduces product defects and equipment downtime. At the EMS provider, employees' newfound ownership of keeping the factory clean instills confidence to the customer that their product is in good hands.
• Standardized Cleanup — This refers to the standardization of the process of maintaining Sort, Set in Order and Shine. Main strategies include:
  1. Dedicating five minutes at the end of each shift every day for a 5S cleanup (Figure 4). Cleanup tasks should be part of the 5S Job Cycle Chart.
  2. Implementing measures that prevent excess inventory and unwanted items in the workplace.
  3. Establishing a work environment and practice that incorporates in-process cleaning, avoiding cleaning as a separate activity.
  4. Team leads or manufacturing managers having 5S discussions with their groups at least once a week.
  The EMS provider found that not only was the five minutes each day a good time to clean up, but also a means to ensure that operators were keeping current with all critical activities such as ESD logs, daily PMs, input to SPC data and pre-control operations.
• Sustain — Refers to the follow-up appraisal of the system. One of the best methods for sustaining the 5S principles in the work environment is a site audit. The 5S Point Standardized Checklist includes a ranking and scoring system to judge the effectiveness of the program. Each area should perform an audit on a weekly or biweekly basis.

Figure 4. Standardized cleanup is maintained during a dedicated five-minute period each shift.

Another method to sustain the program involves establishing the 5S Patrol. Each production area elects a group of three individuals who, in conjunction with the Team Lead, visit other areas on the production floor (once a month or quarter) to audit the 5S checklists. At the EMS provider, the 5S Patrols brought the best ideas from each area and carried them throughout the facility. The competitiveness of each area literally took the lean program to a new level (Figure 3).

Figure 3. Daily production schedules are visible in each work area. At the start of each shift, supervisors review project scheduling and general work flow.

Once the lean program is implemented, the teams in each area perpetuate the improvements daily. Management's responsibility is to understand and recognize common resistances to the program and find ways to overcome them. They must encourage people to use their training to take action and to communicate to everyone "what's in it for them" (i.e., reduced costs, better competitiveness, happier customers and greater job security) to get their buy-in. Company management also must maintain an environment where people can to take risks and fail, which promotes learning, while mitigating cost impact.

Conclusion

One-time kaizen events alone would not have yielded these results. The 5S concepts have created a corporate culture where individuals are encouraged and rewarded for continually identifying and eliminating waste. This culture has enabled the EMS provider to provide significant value to customers through cost reductions and process improvements without redesigning the product. Most importantly, cost reduction becomes a natural output of the process, rather than an artificial target set once a year.

*Preco Electronics, Morton, Ill.

Jim Lanigan, director of operations and engineering, may be contacted at Preco Electronics Inc. (Morton Division), 1651 N. Main St., Morton, IL 61550; (309) 263-7788; Fax (309) 266-2380; E-mail: jlanigan@preco-morton.com.