Lean assessment questionnaire

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Commentary—Lean Assessment Questionnaire
This assessment helps to investigate, evaluate, and measure nine key areas of manufacturing. The result is a deeper understanding of key issues, problem areas, and potential solutions. These nine key areas are:

• Inventory
• The Team Approach
• Processes
• Maintenance
• Layout & Material Handling
• Suppliers
•Setup
• Quality
• Production Control & Scheduling

The Lean Manufacturing Assessment has a questionnaire with 3-6 questions for each area and multiple-choice answers. A scoring worksheet totals the score for each section and provides an overall Lean Index.

The nine areas are not equally important in determining overall manufacturing performance. Moreover, the relativeimportance of the areas varies with particular products, markets, processes, and other factors. The user must evaluate the relative strategic impact of each area. This weighting feature will also help establish priorities for implementation.

For example, a firm might score very low in the area of "Maintenance". For a highly automated factory with integral processes, a low maintenance scorewould be a critical deficiency. For an assembly operation using hand tools and manual methods, a low ranking on "Maintenance" would have little impact.

The questions also lead to metrics for your Lean Manufacturing journey. Managers traditionally rely on accounting metrics. These are inadequate for Lean Manufacturing. Managing a lean factory requires data that reflects what is happening allalong the value stream.

This format uses an Excel template to record information and score the results. It produces a "radar chart" that visually displays results. The assessment is available at the Strategos website, http://www.strategosinc.com/assessment.htm.

1.0 Inventory

Inventory is a recurring theme in Lean Manufacturing. Many authors and lecturers on LeanManufacturing say it is "evil". Yet, inventory can serve many purposes. It allows continuous delivery while manufacturing focuses on long runs. It prevents the vagaries of maintenance and quality from interrupting schedules. It accommodates the variation of incoming orders.

Excessive inventory is not a problem nor is it evil; it is only an effect. Just as obesity and fat are not problems, onlysymptoms of poor diet and insufficient exercise. The fundamental causes of high inventory, like the fundamental causes of obesity lie deeper. Some of the more common causes are shown below. Notice that the various remedies, taken together, constitute the core disciplines of Lean Manufacturing.

Inventory is probably one of the two biggest assets on your company's balance sheet. It is animportant determinant of Return On Assets (ROA) and other measures of financial performance. Carrying stock is expensive, usually 20%-40% of the average value per year. It devours capital-- capital the business may need for growth. It requires large warehouses and valuable floor space. It increases material handling. Large stocks require massive computer systems for tracking and control.

Weusually measure inventory in "turns.” Annual sales divided by average value on hand. This ratio allows comparison of larger and smaller firms. It accounts for changes in annual sales volume and seasonal fluctuation. (While there are many variations of this metric, they matter little as long as you are consistent.)

Notes:

1.1 When management is unaware of inventory turnover, it israrely a good thing. To answer this question, simply ask ten or so managers, selected at random. Wildly erroneous answers count as a negative response. Blank stares also count as negative.

1.2 Inventory turnover varies widely by industry but this question provides an overall benchmark.

1.3 This question compensates for industry variation by comparing turnover to an industry...
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