Problem Solving Process (A3) – Clear Understanding of Our Systems – Visual Management – Drive and Dedication – Urgency and Accountability

“Process Stabilization Through A3 and the Daily Management Process”

Angelo Esposito Manager of Quality & Operational Excellence ODG (Ontario Drive and Gear) Welcome Who is ODG? • Started in 1962 • Two divisions – Gear and Vehicle • Brand names – ODG Gear and ARGO • Sales 2013 of nearly $60M • Total employees 230 1967 The first Argo amphibious all terrain vehicle was developed

Gears • High mix, low volume, high quality gear manufacturer – Over 1000 skews – Target 1 to 50,000 pieces – Manufacture up to 500 mm, AGMA 12

• Industries supplied – Industrial, off-highway, agricultural, construction, automotive, military, aerospace, natural resources and ATV Engineering Design Gear Technology Transmission Assembly Test GROWTH !

CHALLENGE !

11 On Time Delivery

100%

95% STABLE 90%

On Time + Partials + Late Sales Orders 85%

80% GOOD 75% 70% CHALLENGE ! 65%

60% Quality - % Cost of Sales

1.8%

1.6%

1.4% 50% Improvement

1.2%

1.0%

0.8%

0.6%

0.4%

0.2%

0.0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2012 2012 2012 2012 2013 2013 2013 2013 2014

Cost of Quality Defect as % of Sales What was needed… Stabilize Operations Process Using A3 and The Daily Management Process Focus on Foundational Elements…

Consistency in: • Machines • Manpower • Materials • Methods MASTER PLAN Planning & Deployment… Where are we? 1.CURRENT STATE Where do we Requires Creation of want to be? 2.VISION / FUTURE STATE

Requires OBJECTIVES

Determines METRICS

Necessitates STRATEGY

When ? Who ? How ? What ?

3. PLAN Facilitates

4. MONITORING, Requires How will we FREQUENT REVIEW, Is it working? get there? FEEDBACK 16

Where are we ? Where do we want to be..?

Future State Condition

Current State Condition Two main areas of focus..

• On Time Delivery  75% > 100% • Cost of Quality  1.6% > 0.8% Team agreed on the strategies, timing and duration of activities, champions of the activities, milestones and review timing, and the target measurables.

A roadmap toward the vision. …Protection

Managing Scoreboard

Learning Safety QA Cost & TechnologyGrowth Environment Quality Delivery  & Morale So…

WHERE DO WE BEGIN? Quick 5S/ Changeover Visual Kanban Management Lean TPM Work Overview Excellence Standardized

Operating System Operating Maintenance

Daily Management Process Solving Measurables Problem Error Proofing What is Lean?

Measurables Standardized 5S/ Work Visual Management

Lean Problem Overview Kanban Solving

Maintenance Quick Error Excellence Changeover Proofing TPM Training developed that defines principles and more importantly provides a clear understanding of Lean and the standardized tools necessary to execute Lean principles. – Formal Problem Solving process (A3) – Clear understanding of our Systems – Visual Management – Drive and dedication – Urgency and Accountability

Specify Understand and specify what adds value Value from the perspective of the customer

Integrate the Identify steps in the whole value Value Stream stream to highlight waste

Make the Create a continuous flow of Product Flow activities along the value stream

Only carry out activities in response At the Pull of to pull from the customer the Customer

Strive for perfection by continually creating In Pursuit of value and removing successive layers of waste Perfection Paradigms…

Old Paradigm: New Paradigm: You Can Have 2 of 3 Must Provide all 3

C C

Q D Q D “Cost”

The House… Fastest Processes CONTINUOUS IMPROVEMENT “Speed” HUMAN CENTERED JUST WORK BUILT IN IN TIME QUALITY

PROBLEM SOLVING STANDARDIZATION “Quality” • Operational Excellence • Maintenance Excellence • 5S & Workplace Organization • Employee Training & Involvement

“Building Our Future” The House… ContinuousFoundational Improvement Elements to our system • PDCA Human Centered Work • Kaizen and Quickand Lean Manufacturing emphasizing• Lean Culture a Change Over Fastest Processes • Communication • Elimination of Waste • Support for the Value-Adder sequencedCONTINUOUS application IMPROVEMENT of tools. • Measurables KPIs Lowest Cost HUMAN • Total Cost Without these foundationsCENTERED the house• Price – Cost = Profitis Just In Time WORK Built In Quality • Takt Time JUST unstable.BUILT • Quality Standards • Level Production IN IN • Error Proofing • Pull System, Kanban TIME QUALITY • Andon • Flow • MSAProblem Solving • Multi-skilled Operators • A3 Problem Solving PROBLEM SOLVING • Six Sigma Standardization • Reoccurrence Prevention • ETQ STANDARDIZATION Training • Standardized Work • Lean Camp, Basic • 5S & Workplace • Operational Excellence Training Organization • Specific Training • Visual Controls & Visual • Maintenance Excellence Management – 50 ft 15 secs. • 5S & Workplace Organization • Employee Training & Involvement 5S/Visual Management…

5S / Measurables Standardized Work Visual Management

Lean Overview Problem Kanban Solving

Maintenance Quick Lean Excellence Changeover Culture TPM 5S Activities 5S Activities 5S Activities 5S Activities

Total Productive Maintenance and Maintenance Excellence…

Measurables Standardized 5S / Work Visual Factory

Lean Mfg. Problem Overview Kanban Solving

Lean Maintenance Quick Culture Excellence Changeover TPM The House…

Continuous Improvement Human Centered Work • PDCA • Lean Culture • Kaizen and Quick Fastest Processes • Communication Change Over • Support for the Value-Adder CONTINUOUS IMPROVEMENT • Elimination of WasteMaintenance Excellence - anotherLowest Cost • Measurables KPIs HUMAN • Total Cost Just In Timefoundational elementCENTERED to our System• Price – Cost = Profitand • Takt Time WORK JUST BUILT • Level ProductionLean Manufacturing emphasizingBuilt In Qualitya Zero • Pull System, Kanban IN IN • Quality Standards • Flow Tolerance,TIME Zero MileageQUALITY condition.• Error Proofing • Multi-skilled Operators • Andon PROBLEM SOLVING • MSA Standardization Problem Solving • ETQ STANDARDIZATION • A3 Problem Solving • Standardized Work • Six Sigma • Reoccurrence Prevention • 5S & Workplace • Operational Excellence Organization • Visual Controls & Visual • Maintenance Excellence Training Management – 50 ft 15 secs. • 5S & Workplace Organization • Lean Camp, Basic • Employee Training & Involvement Training • Specific Training TPM Objectives… The concept of “Zero Mileage Equipment” How Do We Measure Maintenance & TPM?

• OEE (Overall Equipment Effectiveness) • % Planned vs. Unplanned maintenance • Repeat failures • MTBF (Mean Time Between Failure) • MTTR (Mean Time To Repair) Visual OEE

STANDARDIZATION

Measurables Standardized 5S/ Work Visual Management

Lean Problem Manufacturing Kanban Solving Overview

Maintenance Lean Excellence Quick Culture TPM Changeover The House…

Continuous Improvement Human Centered Work • PDCA • Lean Culture • Kaizen and Quick Fastest Processes • Communication Change Over • Support for the Value-Adder CONTINUOUS IMPROVEMENT • Elimination of Waste Lowest Cost • Measurables KPIs HUMAN • Total Cost Just In Time CENTERED • Price – Cost = Profit • Takt Time WORK • Level Production JUST BUILT Built In Quality • Pull System, Kanban IN IN • Quality Standards • Flow TIME QUALITY • Error Proofing • Multi-skilled Operators • Andon PROBLEM SOLVING • MSA Standardization Problem Solving • ETQ STANDARDIZATION • A3 Problem Solving • Standardized Work • Six Sigma • 5S & Workplace • Operational Excellence • Reoccurrence Prevention Organization • Maintenance Excellence Training • Visual Controls & Visual • 5S & Workplace Organization Management – 50 ft 15 secs. • Lean Camp, Basic • Employee Training & Involvement Training • Specific Training ContinuousThe House… Improvement Human Centered Work • PDCA Standardization - another foundational• Lean Culture • Kaizen and Quick Fastest Processes • Communication Change Over • Support for the Value-Adder elementCONTINUOUS of our IMPROVEMENTLean Manufacturing • Elimination of Waste Lowest Cost • Measurables KPIs System emphasizingHUMAN a consistent• Total Cost Just In Time CENTERED • Price – Cost = Profit • Takt Time WORK • Level Productionresult, makingJUST the abnormalBUILT standBuilt In Quality out • Pull System, Kanban IN IN • Quality Standards • Flow TIMEfrom the normalQUALITY • Error Proofing • Multi-skilled Operators • Andon PROBLEM SOLVING • MSA Standardization Problem Solving • ETQ STANDARDIZATION • A3 Problem Solving • Standardized Work • Six Sigma • 5S & Workplace • Reoccurrence Prevention Organization • Operational Excellence • Visual Controls & Visual • Maintenance Excellence Training Management – 50 ft 15 secs. • 5S & Workplace Organization • Lean Camp, Basic • Employee Training & Involvement Training • Specific Training What Does It Look Like? Traditional Work: Standardized Work:

• Manage symptoms • Eliminate root cause • React to fires • Prevent problems • Search for things • Find things easily • Engineers design • Processes designed by processes operator consensus • Use a variety of individual • Follow and improve the methods standard tool • Inconsistent results • Consistent results PLAN DO

ACT CHECK

Standardize Continuous Improvement Benefits of Standardization…

• Quicker identification of problems • Provides baseline from which to improve The House… ContinuousFoundational Improvement Elements to our system • PDCA Human Centered Work • Kaizen and Quickand Lean Manufacturing emphasizing• Lean Culture a Change Over Fastest Processes • Communication • Elimination of Waste • Support for the Value-Adder sequencedCONTINUOUS application IMPROVEMENT of tools. • Measurables KPIs Lowest Cost HUMAN • Total Cost Without these foundationsCENTERED the house• Price – Cost = Profitis Just In Time WORK Built In Quality • Takt Time JUST unstable.BUILT • Quality Standards • Level Production IN IN • Error Proofing • Pull System, Kanban TIME QUALITY • Andon • Flow • MSAProblem Solving • Multi-skilled Operators • A3 Problem Solving PROBLEM SOLVING • Six Sigma Standardization • Reoccurrence Prevention • ETQ STANDARDIZATION Training • Standardized Work • Lean Camp, Basic • 5S & Workplace • Operational Excellence Training Organization • Specific Training • Visual Controls & Visual • Maintenance Excellence Management – 50 ft 15 secs. • 5S & Workplace Organization • Employee Training & Involvement House… Human Centered Work The tools… • Lean Culture • Communication Continuous Improvement Fastest Processes • Support for the Value-Adder • PDCA CONTINUOUS IMPROVEMENT Lowest Cost • Kaizen and Quick • Total Cost HUMAN Change Over • Price – Cost = Profit • Elimination of Waste CENTERED • Measurables KPIs WORK Built In Quality JUST BUILT Just In Time • Quality Standards IN IN • Error Proofing • Takt Time TIME • Level Production QUALITY • Andon • Pull System, Kanban • MSA • Flow PROBLEM SOLVING Problem Solving • Multi-skilled Operators • A3 Problem Solving Standardization STANDARDIZATION • Six Sigma • Reoccurrence Prevention • ETQ • Standardized Work • Operational Excellence Training • 5S & Workplace • Maintenance Excellence • Lean Camp, Basic Training Organization • 5S & Workplace Organization • Specific Training • Visual Controls & Visual Management • Employee Training & Involvement “Building Our Future” PROBLEM SOLVING

Measurables Standardized 5S/ Work Visual Management

Lean Problem Overview Kanban Solving

Maintenance Quick Lean Excellence Changeover Culture TPM Problem Solving…

The key to elimination of firefighting! Defining a Problem… Problems: – Are abnormalities that vary from the desired or expected condition – Are OPPORTUNITIES

We must utilize a structured method to determine the quickest, most cost effective way to ensure the root cause of a problem is: – Identified – Addressed – Permanently eliminated A3 PROBLEM SOLVING – Formal Problem Solving process – Drive and dedication – Urgency and Accountability – The classification of problems / opportunities – The 8 steps of problem solving The House… Continuous Improvement Human Centered Work • PDCA • Lean Culture • Kaizen and Quick Fastest Processes • Communication Change Over • Support for the Value-Adder CONTINUOUS IMPROVEMENT • Elimination of Waste Lowest Cost • Measurables KPIs HUMAN • Total Cost Just In Time CENTERED • Price – Cost = Profit • Takt Time WORK • Level Production JUST BUILT Built In Quality • Pull System, Kanban IN IN • Quality Standards • Flow TIME QUALITY • Error Proofing • Multi-skilled Operators • Andon PROBLEM SOLVING • MSA Standardization Problem Solving • ETQ STANDARDIZATION • A3 Problem Solving • Standardized Work • Six Sigma • 5S & Workplace • Operational Excellence • Reoccurrence Prevention Organization • Maintenance Excellence Training • Visual Controls & Visual • 5S & Workplace Organization Management – 50 ft 15 secs. • Lean Camp, Basic • Employee Training & Involvement Training • Specific Training The House…

Continuous Improvement Human Centered Work • PDCAProblem Solving - another foundational• Lean Culture • Kaizen and Quick Fastest Processes • Communication Change Over • Support for the Value-Adder elementCONTINUOUS to our IMPROVEMENT System and Lean • Elimination of Waste Lowest Cost • Measurables KPIs ManufacturingHUMAN emphasizing• Total Costa Just In Time CENTERED • Price – Cost = Profit • Takt Timesystematic eliminationWORK of problems and • Level Production JUST BUILT Built In Quality • Pull System, Kanban IN IN • Quality Standards • Flow TIMEabnormalitiesQUALITY • Error Proofing • Multi-skilled Operators • Andon PROBLEM SOLVING • MSA Standardization Problem Solving • ETQ STANDARDIZATION • A3 Problem Solving • Standardized Work • Six Sigma • 5S & Workplace • Reoccurrence Prevention Organization • Operational Excellence • Visual Controls & Visual • Maintenance Excellence Training Management – 50 ft 15 secs. • 5S & Workplace Organization • Lean Camp, Basic • Employee Training & Involvement Training • Specific Training Problem Solving

The 8 Steps for A3- PDCA 5 WHY – ROOT CAUSE ANALYSIS

“By repeatedly asking ”Why” (five is a good rule of thumb), you can peel away the layers of symptoms which CAUSE AND EFFECT DIAGRAM can lead to the root cause of a problem.” (Also known as fishbone diagram)

1st Why  Clear statement of the reason for the defect or failure to occur, understood even by people that are not familiar with the operation where the problem occurred.  Must be a short, concise sentence.  It is Okay to write it down even if it seems too obvious for you. (It may not seem that obvious to others that will read the document).

2nd Why ‐ A more concise explanation to support the first statement.  Get into the technical arena, the Manpowerp Machines Method explanation can branch out to several different root causes here. It is OK to follow each of them continuing with their own set of remaining 3 why’s and so forth 3rd Why . ‐ Do not jump to conclusions, follow the Effect on regular thought process even though some underlying root causes may start surfacing Problem already.

- This 3rd why is critical for a successful transition between the obvious and the not so obvious. The first two why’s have prepared you to focus on the area where the problem could have been originated. - The last three why’s will take you to a 4th Why Materials deeper comprehension of the problem. Measurement Mother Nature - Clear your mind of preconceived explanations and start the fourth why with a candid approach. ‐ You may have two or more different avenues to explore now, explore them all.

5th Why - When you finally get to the fifth why, it is likely that you have found a systemic cause. Most of the problems in the process can be traced to them. - Even a malfunctioning machine can sometimes be caused by an incorrectly followed Preventive Maintenance or Incorrect machine parameters setup. Root Cause is Identified – To bring ownership to the team /team member

– To bring an emphasis on finding the “right “ problem, with the “right” data

– To emphasize the “right” countermeasure

–To eliminate, not “manage”, the problem 1. The critical thinking behind problem solving

2. Formal resolution

3. Making problem solving stick Concrete action & processes Business Practices and Problem Solving

Drive and Successful Business Dedication Foundation

For many successful companies, drive and dedication underscore the way they do business. Their business practices and problem solving methods are the concrete actions and processes that make their business successful. • The goals of problem solving: – To emphasize the “right” countermeasure

• Once you’ve found the “right” problem, you need to find the correct countermeasure.

• With practice, this will be easy! MRP Work to do list MRP ‐ Live

Control Points – Measures…

What’s Actually Happening

Current Situation (WAH) Standards…

A specific, known expectation of –

What Should Be

Happening Standard (WSBH) Problem Identification Tools…

• Standards • Visual controls • Reports • Variation in measurables • Flow diagrams • Check sheets • SPC • Pareto diagram LEAN SIGMA… Harvesting the fruit - Lean,A3,& Six Sigma Sweet Fruit Six Sigma / Lean Tools Product Development for Six Sigma Process Entitlement Bulk of Fruit Lean Tools / A3 Problem Solving / Six Sigma Process Characterization Degree and Organization of Low Hanging Fruit Difficulty Lean Tools / A3 Problem Solving Continuous Improvement Tools Ground Fruit Logic and Intuition LEAN CULTURE

Standardized Measurables 5S/ Work Visual Management

Lean Manufacturing Kanban Problem Overview Solving

Maintenance Quick Lean Culture Excellence Changeover TPM Focus on Foundational Elements…

Consistency in: • Machines • Manpower • Materials • Methods

STABILITY

Thank You!

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Session Code: “Process Stabilization Through A3 and the Daily Management Process” Angelo Esposito ODG (Ontario Drive and Gear) [email protected]