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ABSTRACT:
It is felt that, manufacturing industry in India is evolving rapidly and it is the interplay of infrastructure, technology and new types of service providers that will define whether the industry is able to help its customers reduce their manufacturing and Operating costs and provide effective services (which are also growing). Changing government policies on taxation and regulation of service providers are departing to play an important role in this process. Coordination across various government agencies requires approval from multiple ministries and is a road block for multi modal transport in India. At the firm level, the logistics focus is moving towards reducing cycle times in order to add value to their customers. Consequently, better tools and strategies Namely Six sigma and Lean sigma are being sought by manufacturing industries in order to augment the products quality, ultimately productivity. Against this background, there has been an all round eagerness in corporate India to adopt lean and six sigma methodologies in their undertakings. This study first of its kind on manufacturing industry, brings out interesting facts hitherto unexplored in the operation management profession.

INTRODUCTION:
Many manufacturing companies have found it tedious to maintain their cycle time, cost and quality systems in their production operations. They must re-interview employees and re-estimate resource usage by activities each time the system is updated. Many managers are also uncomfortable with the degree of subjectivity involved in estimating employees’ proportion of time spent on each activity. Recently, an alternative approach has been developed that both simplifies the estimation of a lean, enables it to be updated easily whenever changes occur in the structure of the model, and also explicitly incorporates the role of capacity.
This paper attempts to develop quantitative and analytical benchmark at the manufacturing industry level so as to evaluate the six sigma and lean sigma (speed and quality) performance from time to time.
In order to examine the effect of productivity on manufacturing sector, three production operation & management tools were used:
1. 5s
2. six sigma
3. lean sigma
A well designer and well implemented lean and six sigma pedagogy must contribute positively to the productivity or efficiency.
It is in this context, an attempt has been made to discuss and elucidate the above tools the interrelationship, impact of the manufacturing industries towards productivity and so forth.

NEED FOR SIX SIGMA AND LEAN SIGMA:
The study brings to limelight the need and importance of using the productivity tools for the manufacturing units. To investigate the relationship among lean, six sigma and 5s, cash flow from operating activities has been used as a proxy. It is .a healthier proxy since it is a better estimate of the quality of company earnings.
Six sigma was once reserved for the largest corporations in the world. During the last few years, six sigma has moved to mid-size and small organizations seeking a way to improve their business. Some of these companies employ a single six sigma black belt to produce project results. One major focus of six sigma is the reduction of variation. Six Sigma is most closely associated with defects and quality, Lean is linked to speed, efficiency, and waste. Lean provides tools to reduce lead-time of any process and eliminate non-value add cost.
Six Sigma does not contain any tools to control lead time (e.g., Pull systems), or tools specific to the reduction of lead time (e.g., setup reduction). Since companies must become more responsive to changing customer needs, faster lead times are essential in all endeavors.
Lean is an important complement to Six Sigma and fits well within the Six Sigma DMAIC process. Additionally, the Lean Kaizen approach is a great method that can be used to accelerate the rate of improvements. Industry need both Lean (speed) and Six Sigma (quality) principles and tools to drive improvements in ROI and to achieve the best competitive position.

IMPACT OF SIX SIGMA AND LEAN SIGMA ON PRODUCTIVITY:
The study under consideration essentially intends to evaluate the Lean and six sigma system in corporate sector. The performance outcomes obtained in this regard shall be analyzed with the help of secondary sources.

LEAN SIGMA:
Lean is a methodology that is used to accelerate the velocity and reduce the cost of any process (be it service or manufacturing) by removing waste. Lean is founded on a mathematical result known as Lytle’s Law:
Qty of Things in Process
Lead time of any process == ————————-
AverageCompletionRate/Unitof Time

The lead-time is the amount of time taken between the entry of work into a process (which may consist of many activities) to the time the work exits the process. In procurement the Things in Process are the number of requisitions, in product development the number of Projects In Process, and in manufacturing the amount of Work In Process. Lean contains a well-defined set of tools that are used to control and then reduce the number of Things in Process, thus eliminating the non-value add cost driven by those Things in Process. The Pull/Kanban system puts a cap on the number of things in process, thus putting a cap on the lead-time. Lean also contains tools to reduce the quantity of things in process including setup reduction, total productive maintenance, 5S, etc. For example, setup reduction allows the reduction of the time spent on producing a quantity of any given offering or product, reducing lead-time without reducing the completion rate. The Lean methodology has a bias for action, leveraging Kaizen to rapidly improve processes and drive results.
From the above concepts and their utility, it is clear that, there has been an all round eagerness in corporate India to adopt Lean sigma and six sigma besides 5s.

5S SYSTEM:
It is widely used today in a very large percentage of manufacturing businesses. Many non-manufacturing companies also employ the discipline. is one of the most common lean manufacturing principles, and generally the first one applied during implementation. It is a workplace organization and housekeeping system. When applied correctly, the benefits are enormous in terms of productivity, quality, and morale.
The 5S’s are:
1. Sort
2. Set In Place
3. Shine
4. Standardize
5. Sustain
There are variations to some of the 5S’s as they were derived from 5 Japanese words beginning with “s”.Most organizations apply the 5S system in one area at a time rather than across and entire facility at once.

The first “S” is Sort. It is the process of removing all unnecessary items from the workplace area. This first step is crucial to gaining efficiency through workplace design. A common method called the “red tag method” is often utilized, where all items are tagged which aren’t necessary for the specific area. These unnecessary items tagged are then moved to a “hold” area for review and disposition.

The second “S” is Set in Place. This is the process of moving the necessary items into the correct position for use. It is the process of organizing the work area to be perfectly laid out for maximum efficiency through minimizing movement. All materials and items that will be used at the job site are to be positioned and kept closes to the point of use. For example, if a tool is only to be used at the end of a machine, it should be kept there.

A common method used is called “shadow boards”, where the exact dimension of the tool is painted onto the board depicting the spot in which to hang the tool. It becomes obvious where the tool belongs.

The third “S” is Shine. This is the method of deep cleaning a machine or area to put it back into the condition it was when it was purchased. The idea is that quality and efficiency will not suffer if the machine is not allowed to deteriorate over time.

Machines that are kept in new condition have less downtime and produce the same quality level as a new machine.

The fourth “S” is Standardize. This is the process of standardizing the entire system, which is often the most difficult. Most companies have conducted the first three S’s many times, only to watch the condition deteriorate over time. This cycle of cleaning up followed by gradual deterioration has been repeated over and over for years. The “Standardize” portion of the system corrects this problem. The best way to standardize the system is to determine exactly what needs done to maintain the system. It is the “who, what, when, where” of 5S. For example, if a specific portion of a machine needs cleaned daily, there should be a checklist and written instructions detailing who will do it, when it will be done, and methods and materials necessary.

The last “S” is Sustain. Sustaining the system is thought to be one of the most difficult, primarily because experience proved years of cleaning and organization were not maintained. However, if the system is standardized in the fourth S, then sustaining it is much easier. The best method of sustaining the system is to conduct audits. Care must be exercised so the audit system is not punitive. The 5S system relies on employee involvement and commitment at all levels, and a punitive audit system can destroy the system. One good way of auditing the system is with a rotating audit crew of peers. This might be the plant workers auditing the system of their co-workers. The results are provided to the employees in the audited area and time given to correct deficiencies.

A good 5S implementation has many benefits. The assets of the company are kept in top condition which keeps the value high. Quality is kept at the level when the asset or machine was first installed. Maintenance costs are reduced as deterioration is immediately apparent. Setup times go down from better organization and reduced movement. The best benefit is the morale improvement from an improved environment and culture. Most managers think employees will not sustain a perfectly clean manufacturing environment. Like most systems, management is the reason the system succeeds or fails. Given the chance, employees will implement and sustain the 5S system. Most employees will choose an organized and clean workplace with a continuous improvement culture over a dirty disorganized facility.

KAIZEN- LEAN MANUFACTURING CONTINUOUS IMPROVEMENT

One of the most popular buzzwords in business today is the word “kaizen”. It is a Japanese word meaning “incremental improvement”.

Kaizen was formalized by the Toyota Production System, which is now utilized throughout the US as lean manufacturing.

The term kaizen is often coupled with another word to create the phrase “kaizen events”. The kaizen event is the term given to a highly focused continuous improvement event consisting of a team working together for a brief time period to solve a business problem.

The kaizen event could focus on any business opportunity. It could be a line re-designs SMED (single minute exchange of die) setup reduction event, speed improvement, cycle time reduction, waste reduction, or any other issue. Kaizen events are also conducted in service industries such as hospitals, banks, and other non-manufacturing businesses.

A kaizen event is similar to a brainstorming exercise, at least in the beginning stages.

Kaizen teams normally consist of 4-7 individuals. The team normally spends 100% of their time for a few days until the business problem or issue is solved for improved. The team often consists of a cross functional group of individuals with either knowledge in the area of focus or working in a department which is impacted by the issue. For example, a kaizen event to improve lead time 50% might include individuals from sales, manufacturing, scheduling, and shipping. The idea is for the team to be able to consider all views of the problem. A cross functional team will be able to understand the impact of every decision on all other areas.

Kaizen events are normally conducted for significant improvement. The mission statement clearly states the expected results. For example, the mission statement might be to “reduce waste on line 4 from 8% to 4%”.
There is generally one piece of paper containing all pertinent information concerning the events, including:
1. Mission Statement with Objective
2. Team Members, Leader, and Management Sponsor
3. Current Problem Statement
4. Resources Required
5. Expected Completion Date
6. Results
7. Signoffs

The kaizen team generally meets first for instructions, brainstorming of ideas, and development of action plans. Kaizen’s usually following the Plan-Do-Check-Act (PDCA) methodology. As the PDCA model suggests, once the actions are planned, they are carried out, checked, and actions taken based on the results. The PDCA cycle is continued until the problem is sufficiently solved.

Kaizen teams should gather their own facts by observing the issues or problems for themselves. Observations show many issues that cannot be detected viewing reports and data.

Once the kaizen team has obtained improvement, most groups will give a presentation to management.

Kaizen’s often result in new ways of doing job tasks or conducting business. Procedures, tasks, duties, and sequences may be changed. It is usually necessary for the team to work with the affected positions until all jobs become standardized (another lean term). If the new process is not standardized, it is common for people to revert back to the old comfortable procedures. It often takes some time to obtain maximum improvement through practicing the new procedures.

Some kaizen events result in more work being done with less people. It is important in any lean manufacturing implementation to not put people out of work. Most successful lean manufacturing implementations move people to the “5S” or other work team until the company grows and needs them in other areas. As this process continues, a company will eventually produce much more product will the same amount of employees.

If a company reduces their headcount as a result of lean manufacturing and kaizen events, the improvement process will not be sustained. People simply will not work themselves out of a job, and certainly will not help a company eliminate their job.

It is important to celebrate and share success from kaizen events. Don’t forget to involve the people whose jobs have changed. They helped make the company better, and deserve to share in the celebration

LEAN MANUFACTURING:
Most large corporations are in various stages of implementation. Many companies are currently applying the principles and building a lean foundation. Others are sustaining the implementation and continuously improving on the foundation. There are also many corporations wondering what went wrong or why they haven’t obtained the results they hoped for.
The primary key for success with lean is to understand that it is a journey. There is no “silver bullet” in any manufacturing or service industry. If there were, it would be sold and every company would have it.
Lean begins with the top management of the enterprise. Top management must have the vision to understand both the requirements and expected results, and commit the resources to achieving them. If the expected requirements and resources do not match the results, any system such as lean manufacturing will fail.
The requirements depend on the business. If the business has 5000 employees spread across 15 facilities in 20 different states, the requirements will be large. A small facility with 100 employees will require less.
Management needs to understand that lean manufacturing is a journey. It is a system of applied principles that leads the enterprise to a state of “lean”. If management is expecting to achieve “headcount reduction”, they are choosing the wrong system. Any headcount reduction should take place prior to implementing lean manufacturing.
Lean systems involve everyone in the enterprise to work diligently to remove all muda (waste) in the system. There are eight common types of waste defined in lean manufacturing. These wastes are so pervasive in organizations that everyone must pursue and eliminate them. People simply are not going to work themselves out of a job, and therefore everyone must be supportive of the journey.
Lean also involves continuous improvement through “kaizen”. Kaizen in Japanese means “small incremental improvement”. Kaizens involve employees from all functions to work together to eliminate waste, improve productivity, and improve the business in all aspects. Again, management must have employees empowered to improve the operation.
One piece flow is another system utilized in lean manufacturing. Therefore SMED (single minute exchange of die) systems to reduce changeover times must be employed.
Other lean concepts utilized in the journey include “pull systems”, “cellular manufacturing”, “kanban”, OEE (overall equipment effectiveness), TPM (total productive maintenance), error proofing, root cause elimination, and many others.
All of these systems require the effort of a large mass of employees to be successful. Therefore, employees must not be fearful of losing a job or lean manufacturing will not succeed.
Once employees feel they can trust management, the lean journey can begin. The journey begins with training and it never stops.
Lean manufacturing is not a system that can be administered or implemented by a few individuals. It can be led by a few individuals, but the implementation will involve everyone.
Every person in the organization should first know why the company is implementing lean manufacturing. Is it to have a competitive advantage? Is it to stay in business?
Since employees have always thought of management as “cost cutters”, it should be explained that costs are expected to come down in the long run. It should be explained why that is necessary, and what it will mean for the business. Lower costs enable the company to sell product or service. It might preserve existing jobs and lead to more hiring.
Once the overall goals of the company are explained, training should begin with the basics. This will include an overview of lean manufacturing, 5S, 8 wastes (muda), problem solving techniques, and simple value Stream mapping.
After that, individual concepts should be explained which apply to the company. For example, companies with machinery will be implement SMED kanban, OEE, and TPM. Companies carrying inventory will want all employees to understand the waste involved in it.
Almost every company will begin with some type of “review” process. This review process will provide the “gap” analysis between where the company is in terms of lean versus where it wants to be. For example, setup times might average 12 minutes but need to be done in 3. Or cycle time might be 18 hours and it should be 6.
Once the analysis is completed, the training and implementation begins. Most companies begin training with 5S (workplace organization). Most implementations also begin with 5S while value stream mapping is often done simultaneously. As with all lean concepts, 5S, value stream mapping, and the review process never end.
Once these are implemented, the journey begins. Lean concepts are the arsenal to move the company to a state of lean. The lean leader utilizes the tools necessary to improve each part of the organization. Most often, many of the tools are utilized in every area.
When implemented correctly, lean is contagious. People in all functions from the plant or office floor to the executive suite are constantly looking for waste and non value adding activities. When they find them, they do everything possible to eliminate it forever.

ROLE OF LEAN SIGMA IN MANUFACTURING SECTOR:
It is well recognized that, Lean manufacturing is a management philosophy focusing on reduction of waste through over production, waiting time, process time, transportation, inventory, motion and scrap in any business. By eliminating waste, quality is improved and production time and costs are reduced. The processes of all companies and organizations must:
1. Become faster and more responsive to customers
2. Achieve Six Sigma capability
3. Operate at world class cost
Only the combination of Six Sigma and Lean can fulfill all three goals. In any process, Lean Six Sigma creates a value stream map of the process identifying value add and non-value add costs, and captures the Voice of the customer to define the customer Critical To Quality issues. Projects within the process are then prioritized based on the delay time they inject. This prioritization process inevitably pinpoints activities with high defect rates (Six Sigma tools) or long setups, downtime (Lean tools). In manufacturing, a further benefit results from a reduction in working capital and capital expenditure. We have found over the last 15 years that these methods apply in virtually every kind of process from healthcare to financial services to energy to manufacturing. Lean will add another dimension of improvement in process speed and reduction of non-value added cost. Further, by accelerating process speed, Lean provides faster feedback and more cycles of learning enhancing the power of Six Sigma tools. For example, an L18 Design of Experiment might require about 100 separate runs to optimize parameters and minimize variation. Reducing the lead time by 80% will allow the fractional factorial design to be completed five times faster. In addition, the Lean Kaizen approach allows Black Belts to implement rapid improvements whenever possible.

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