Lean Kaizen Glossary

A visual management tool that highlights the status of operations in an area at a single glance and that signals whenever an abnormality occurs. An andon can also be used to display the status of production in terms of the number of units planned versus actual output.

The location of processing steps for a product immediately adjacent to each other so that parts, documents, etc., can be processed in very nearly continuous flow, either one at a time or in small batch sizes that are maintained through the complete sequence of processing steps. A U shape cell is common because it minimises walking distance and allows different combinations of work tasks for operators. This is an important consideration in lean production because the number of operators in a cell will change with changes in demand.

Continuous Flow
Producing and moving one item at a time (or a small and consistent batch of items) through a series of processing steps as continuously as possible, with each step making just what is requested by the next step. It also is called one-piece flow, single-piece flow, and make one, move one.

A facility that sorts and recombines a variety of inbound items from many suppliers for outbound shipment to many customers, such as assembly plants, distributors, or retailers. A cross-dock is not a warehouse because it does not store goods. Instead, goods are usually unloaded from inbound vehicles and moved to shipping lanes for outbound vehicles in one step.

Cycle Time
The time required to produce a part or complete a process, as timed by actual measurement.

Effective Machine Cycle Time
Machine cycle time plus load and unload time, plus the result of dividing changeover time by the number of pieces between change- overs. For example, if a machine has a cycle time of 20 seconds, plus a combined load and unload time of 30 seconds, and a changeover time of 30 seconds divided by a minimum batch size of 30, the Effective Machine Cycle Time is 20+30+(30/30) or 1 = 51 seconds.

Order Lead Time
Production lead time plus time expended downstream in getting the product to the customer, including delays for processing orders and entering them into production and delays when customer orders exceed production capacity. In other words, the time the customer must wait for the product.

Order-to-Cash Time
The amount of time that elapses from the receipt of a customer order until the producer receives cash payment from the customer. This can be more or less than order lead-time, depending on whether a producer is in a build-to-order or a ship-from-stock mode, on terms of payment etc.

Processing Time
The time a product actually is being worked on in design or production and the time an order actually is being processed. Typically, processing time is a small fraction of production lead-time.

Production Lead Time (also Throughput Time and Total Product Cycle Time)
The time required for a product to move all the way through a process or a value stream from start to finish. At the plant level this often is termed door-to-door time. The concept also can be applied to the time required for a design to progress from start to finish in product development or for a product to proceed from raw materials all the way to the customer.

Every Product Every Interval (EPEx)
The frequency with which different part numbers are produced in a production process or system. If a machine is changed over in a sequence so that every part number assigned to it is produced every three days, then EPEx
is three days.

First In, First Out (FIFO)
The principle and practice of maintaining precise production and conveyance sequence by ensuring that the first part to enter a process or storage location is also the first part to exit. (This ensures that stored parts do not become obsolete and that quality problems are not buried in inventory). FIFO is a necessary condition for pull system implementation.

Five Ss
Five related terms, beginning with an S sound, describing workplace practices conducive to visual control and lean production.

  • Sort: Separate needed from unneeded items—tools, parts, materials, paperwork—and discard the unneeded.

  • Straighten: Neatly arrange what is left—a place for everything and everything in its place.

  • Shine: Clean and wash.

  • Standardise: Cleanliness resulting from regular performance 
of the first three Ss.

  • Sustain: Discipline, to perform the first four Ss.

Some lean practitioners add a sixth S for Safety: Establish and practice safety procedures in the workshop and office.

The Japanese term for “actual place,” often used for the shop floor or any place where value-creating work actually occurs. The term often is used to stress that real improvement requires a shop-floor focus based on direct observation of current conditions where work is done.

The continuous improvement practice of looking back and thinking about how a process or personal shortcoming can be improved; the Japanese term for “self-reflection.”
Hansei or reflection meetings typically are held at key milestones and at the end of a project to identify problems, develop countermeasures, and communicate the improvements to the rest of the organisation so mistakes aren’t repeated. Thus, Hansei is a critical part of organisational learning along with kaizen and standardised work. It sometimes is compared to “check” in the plan-do-check-act improvement cycle.

Levelling the type and quantity of production over a fixed period of time. This enables production to efficiently meet customer demands while avoiding batching and results in minimum inventories, capital costs, manpower, and production lead-time through the whole value stream.

Materials (and information) present along a value stream between processing steps. Physical inventories usually are categorised by position in the value stream and by purpose. Raw materials, work-in-process, and finished goods are terms used to describe the position of the inventory within the production process. Buffer stocks, safety stocks, and shipping stocks are terms used to describe the purpose of the inventory.

  • Buffer Stock: Goods held, usually at the downstream end of a facility or process, to protect the customer from starvation in the event of an abrupt increase in short-term demand that exceeds short-term production capacity.

  • Safety Stock: Goods held at any point (raw materials, WIP, or finished goods) to prevent downstream customers from being starved by upstream process capability issues. Also called emergency stock.

  • Finished Goods: Items a facility has completed that await shipment.

  • Raw Materials: Goods in a facility that have not yet been processed.

  • Shipping Stock: Goods in shipping lanes at the downstream end of a facility that are being built up for the next shipment. (These generally are proportional to shipping batch sizes and frequencies.) Also called cycle stock.

Work-in-Process (WIP)
Items between processing steps within a facility. In lean systems, standardised work-in-process is the minimum number of parts (including units in machines) needed to keep a cell or process flowing smoothly.

Inventory Turns
A measure of how quickly materials are moving through a facility or through an entire value stream, calculated by dividing some measure of cost of goods by the amount of inventory on hand.
The most common method of calculating inventory turns is to use the annual cost of goods sold (before adding overhead for selling and administrative costs) as the numerator divided by the average inventories on hand during the year.

Inventory turns = Average cost of good sold / Average value of Inventories

Providing machines and operators the ability to detect when
 an abnormal condition has occurred and immediately stop work. This enables operations to build in quality at each process and to separate men and machines for more efficient work.
Jidoka highlights the causes of problems because work stops immediately when a problem first occurs. This leads to improvements in the processes that build in quality by eliminating the root causes of defects.

Just-in-Time (JIT) Production
A system of production that makes and delivers just what is needed, just when it is needed, and just in the amount needed.
JIT is comprised of three operating elements: the pull system, takt time, and continuous flow. JIT aims for the total elimination of all waste to achieve the best possible quality, lowest possible cost and use of resources, and the shortest possible production and delivery lead times.

Continuous improvement of an entire value stream or an individual process to create more value with less waste. There are two levels of kaizen:

  • System or flow kaizen focusing on the overall value stream. This is kaizen for management.

  • Process kaizen focusing on individual processes. This is kaizen for work teams and team leaders.

Value-stream mapping is an excellent tool for identifying an entire value stream and determining where flow and process kaizen are appropriate.

Kaizen Workshop
A group kaizen activity, commonly lasting five days, in which a team identifies and implements a significant improvement in a process.

A kanban is a signalling device that gives authorisation and instructions for the production or withdrawal (conveyance) of items in a pull system. Kanban have two functions in a production operation: They instruct processes to make products and they instruct material handlers to move products. The former use is called production kanban (or make kanban); the latter use is termed withdrawal kanban (or move kanban). Production and withdrawal kanban must work together to create
 a pull system.

There are six rules for using kanban effectively:

  • Customer processes order goods in the precise amounts specified on the kanban.

  • Supplier processes produce goods in the precise amounts and sequence specified by the kanban.

  • No items are made or moved without a kanban.

  • All parts and materials always have a kanban attached.

  • Defective parts and incorrect amounts are never sent to the next process.

  • The number of kanban is reduced carefully to lower inventories and reveal problems.

Material Flow
The movement of physical items through the entire value stream. I
n lean production, the process steps for different product families are moved together, whenever possible, into tight process sequence so small amounts of product can flow directly from step to step at the pull of the next downstream process and of the end customer.

Milk Run
A method to speed the flow of materials between facilities by routing vehicles to make multiple pick-ups and drop-offs at many facilities. By making frequent pick-ups and drop-offs with milk-run vehicles connecting a number of facilities rather than waiting to accumulate a truckload for direct shipment between two facilities, it is possible to reduce inventories and response times along a value stream. Milk runs between facilities are similar in concept to material handling routes within facilities.

Any activity that consumes resources without creating value for the customer.
Most activities are waste—muda—and fall into one of two types. Type one muda creates no value but is unavoidable with current technologies and production assets. An example would be inspecting welds to ensure they are safe.
Type two muda creates no value and can be eliminated immediately. An example is a process with disconnected steps in process villages that can be quickly reconfigured into a cell where wasteful materials movements and inventories no longer are required.

Overall Equipment Effectiveness (OEE)
A total productive maintenance (TPM) measure of how effectively equipment is being used. OEE is calculated from three elements: The availability rate measures downtime losses from equipment failures and adjustments as a percentage of scheduled time.
The performance rate measures operating speed losses—running at speeds lower than design speed and stoppages lasting a few seconds.
The quality rate expresses losses due to scrap and re-work as a percentage of total parts run.

These elements are multiplied to obtain OEE:
Availability Rate x Performance Rate x Quality Rate = OEE
If Availability is 90%, Performance is 95%, and Quality is 99% then
0.90 x 0.95 x 0.99 = 84.6% OEE

OEE typically focuses on what are termed the six major losses— failures, adjustments, minor stoppages, reduced operating speeds, scrap, and rework—but some companies add other measures judged important to their business.

Producing more, sooner or faster than is required by the next process. Overproduction is considered to be the most grievous form of waste because it generates and hides other wastes, such as inventories, defects, and excess transport.

Pacemaker Process
Any process along a value stream that sets the pace for the entire stream. The pacemaker process usually is near the customer end of the value stream, often the final assembly cell. However, if products flow from an upstream process to the end of the stream in a FIFO sequence, the pacemaker may be at this upstream process.

The amount of time needed in a production area to make one container of products.

Pitch = takt time x pack-out quantity

For example, if takt time (available production time per day divided by customer demand per day) is one minute and the pack-out quantity is 20, then: 1 minute x 20 pieces = pitch of 20 minutes

Plan, Do, Check, Act (PDCA)
An improvement cycle based on the scientific method of proposing
a change in a process, implementing the change, measuring the results, and taking appropriate action. It also is known as the Deming Cycle or Deming Wheel.

The PDCA cycle has four stages:

  • Plan: Determine goals for a process and needed changes to achieve them.

  • Do: Implement the changes.

  • Check: Evaluate the results in terms of performance.

  • Act: Standardise and stabilise the change or begin the cycle again, depending on the results.

Plan For Every Part (PFEP)
A detailed plan for each part used in a production process, showing everything relevant to managing the process with no errors or waste. A plan will include the part number, its dimensions, the amount used daily, the precise location of use, the precise location of storage, order frequency, the supplier, pack-out quantity, transit time from the supplier, container size and weight, and any other relevant information. The point is to precisely specify every aspect of the handling and use of every part.

Preventive Maintenance
An equipment servicing approach considered a precursor to Total Productive Maintenance that is based on regularly scheduled checking and overhauling by maintenance personnel to decrease breakdowns and increase equipment life.
In lean manufacturing, hourly workers have daily responsibilities for performing basic preventive maintenance tasks like checking lubrication levels, the condition of filters, and the tightness of nuts and bolts.

Pull Production
A method of production control in which downstream activities signal their needs to upstream activities. Pull production strives to eliminate overproduction and is one of the three major components of a complete just-in-time production system.
In pull production, a downstream operation, whether within the same facility or in a separate facility, provides information to the upstream operation, often via a kanban card, about what part or material is needed, the quantity needed, and when and where it
 is needed.

Supermarket Pull System
The most basic and widespread type, also known as a fill-up or replenishment or a-type pull system. In a supermarket pull system each process has a store—a supermarket—that holds an amount of each product it produces. Each process simply produces to replenish what is withdrawn from its supermarket. Each process is responsible for the replenishment of its supermarket, so daily management of the worksite is relatively simple and kaizen opportunities are relatively easy to see.

Sequential Pull System
A sequential pull system—also known as a b-type pull system—may be used when there are too many part numbers to hold inventory of each in a supermarket. Products are essentially “made-to-order” while overall system inventory is minimised.
In a sequential system, the scheduling department must set the right mix and quantity of products to be produced. A sequential system creates pressure to maintain short and predictable lead times. In order for this system to work effectively, the pattern of customer orders must be well understood. If orders are hard to predict, production lead-time must either be very short (less than order lead time) or an adequate store of finished goods must be held.

Mixed Supermarket and Sequential Pull System
Supermarket and sequential pull systems may be used together in a mixed system—also known as a c-type pull system. A mixed system may be appropriate when an 80/20 rule applies, with a small percentage of part numbers (perhaps 20%) accounting for the majority (perhaps 80%) of daily production volume. Such a mixed system enables both supermarket and sequential systems to be applied selectively and the benefits of each are obtained.

Push Production
Processing large batches of items at a maximum rate, based on forecasted demand, then moving them to the next downstream process or into storage, regardless of the actual pace of work in the next process. Such a system makes it virtually impossible to establish the smooth flow of work from one process to the next that is the hallmark of lean production.

The Japanese term for “teacher.” Used by Lean Thinkers to denote a master of lean knowledge as a result of years of experience in transforming the gemba (the place where work actually is done). The sensei also must be an easily understood and inspiring teacher.

Seven Wastes
Seven major wastes typically found in mass production are:

  • Overproduction: Producing ahead of what’s actually needed by the next process or customer. The worst form of waste because it contributes to the other six.

  • Waiting: Operators standing idle as machines cycle, equipment fails, needed parts fail to arrive, etc.

  • Conveyance: Moving parts and products unnecessarily, such as from a processing step to a warehouse to a subsequent processing step when the second step instead could be located immediately adjacent to the first step.

  • Processing: Performing unnecessary or incorrect processing, typically from poor tool or product design.

  • Inventory: Having more than the minimum stocks necessary for a precisely controlled pull system.

  • Motion: Operators making movements that are straining or unnecessary, such as looking for parts, tools, documents, etc.

  • Correction: Inspection, rework, and scrap.

Single Minute Exchange of Die (SMED)
A process for changing over production equipment from one part number to another in as little time as possible. SMED refers to the target of reducing changeover times to a single digit, or less than 10 minutes.

Six Sigma
A quality standard of just 3.4 defects per one million opportunities; 99.9996% perfect.
Six sigma methodologies emphasise mathematical and statistical tools to improve the quality of processes that are already under control. Application follows a five-step process of define, measure, analyse, improve, and control often referred to as DMAIC.

Spaghetti Chart
A diagram of the path taken by a product as it travels through the steps along a value stream. So called because in a mass production organisation the product’s route often looks like a plate of spaghetti.

Standardised Work
Establishing precise procedures for each operator’s work in a production process, based on three elements:

  • Takt time, which is the rate at which products must be made in a process to meet customer demand.

  • The precise work sequence in which an operator performs tasks within takt time.

  • The standard inventory, including units in machines, required to keep the process operating smoothly.

The benefits of standardised work include documentation of the current process for all shifts, reductions in variability, easier training of new operators, reductions in injuries and strain, and a baseline for improvement activities.

Strategy Deployment
A management process that aligns—both vertically and horizontally —an organisation’s functions and activities with its strategic objectives. A specific plan—typically annual—is developed with precise goals, actions, timelines, responsibilities, and measures.
Strategy deployment, also known by the Japanese term hoshin kanri, may start as a top-down process when an organisation launches a lean conversion. However, once the major goals are set, it should become a top-down and bottom-up process involving a dialogue between senior managers and project teams about the resources and time both available and needed to achieve the targets. This dialogue often is called catchball as ideas are tossed back and forth like a ball.

The location where a predetermined standard inventory is kept to supply downstream processes. Supermarkets ordinarily are located near the supplying process 
to help that process see customer usage and requirements. Each item in a supermarket has a specific location from which a material handler withdraws products in the precise amounts needed by a downstream process. As an item is removed, a signal to make more (such as a kanban card or an empty bin) is taken by the material handler to the supplying process.

Takt Time
The available production time divided by customer demand. The purpose of takt time is to precisely match production with demand. It provides the heartbeat of a lean production system.

Total Productive Maintenance (TPM)
A set of technique to ensure that every machine in a production process always is able to perform its required tasks. The approach is termed total in three senses.

  • It requires the total participation of all employees, not only maintenance personnel but line managers, manufacturing engineers, quality experts, and operators.

  • It seeks total productivity of equipment by focusing on all of the six major losses that plague equipment: downtime, changeover time, minor stops, speed losses, scrap, and rework.

  • It addresses the total life cycle of equipment to revise maintenance practices, activities, and improvements in relation to where equipment is in its life cycle.

Toyota Production System (TPS)
The production system developed by Toyota Motor Corporation to provide best quality, lowest cost, and shortest lead time through the elimination of waste. TPS is comprised of two pillars, just-in-time and jidoka, and often is illustrated with the “house” shown at right. TPS is maintained and improved through iterations of standardised work and kaizen, following PDCA, or the scientific method.

Value Stream
All of the actions, both value-creating and non value-creating, required to bring a product from concept to launch (also known as the development value stream) and from order to delivery (also known as the operational value stream). These include actions to process information from the customer and actions to transform the product on its way to the customer.

Value-Stream Mapping (VSM)
A simple diagram of every step involved in the material and information flows needed to bring a product from order to delivery.
Value-stream maps can be drawn for different points in time as a way to raise consciousness of opportunities for improvement. A current-state map follows a product’s path from order to delivery to determine the current conditions. A future-state map deploys the opportunities for improvement identified in the current-state map to achieve a higher level of performance at some future point.

Visual Management
The placement in plain view of all tools, parts, production activities, and indicators of production system performance, so the status of the system can be understood at a glance by everyone involved.