A Systematic Method to Identify and Prioritize Improvement Opportunities Using the Lean Race Model
Continuous improvement is essential to maintain a competitive edge in any industry. The common approach to Kaizen projects starts with following a product or a product family through the value stream in order to develop the current state map (CSM) and identify the value-added (VA) and non-value added (NVA) activities. Next step is to audit the non-value added activities based on Toyota's eight types of wastes. The eight types of wastes are symptoms of the problems and not the root causes. Most of the continuous improvement efforts stop after reducing or eliminating non-value activities. The challenge is how to identify improvement opportunities beyond the reduction or elimination of NVA and how to prioritize those opportunities. In this research, a five-step methodology, namely: the Lean RACE Process Improvement Cycle (LRPIC) is proposed as a systematic approach to Kaizen projects. It serves as a generic process improvement methodology applicable to any manufacturing systems and is enhanced by the RACE model in terms of identifying improvement opportunities. The five steps of LRPIC are as follow:
I. Follow a product or a product family throughout the value stream to develop CSM of the process and to identify the value-added and non-value added activities.
II. Identify improvement opportunities by utilizing the lean RACE model (Reduce non-value added, Accelerate, Consolidate and Enhance value added).
III. Generate improvement solutions to address the improvement opportunities identified in the previous step.
IV. Analysis of the generated improvement solutions by utilizing Field Force.
V. Verify performance by utilizing key performance indicators to measure the improvement of the process after implementing the generated solutions.
Key Performance Indicators (KPIs) will be assigned to each of the four categories of the lean RACE model in order to measure current state and future state performance. Selected KPIs will be aligned with the goal of each of the categories. These goals are listed as follow:
Reduce non-value-added activities to decrease interruption in the product's flow.
Accelerate value-added activities to improve throughput and lead time.
Consolidate value-added processes into fewer steps in order to shorten the value stream.
Enhance the value added through the processes to improve the value - cost ratio of products and processes beyond the basic needs of the customer to improve competitiveness in the marketplace.
As mentioned above, the five steps methodology is a generic methodology and can be applied to any industry. The lean RACE model was adopted from the literature (Wan, 2018). However, the lean RACE model has no KPIs assigned to it. The contribution of this research can be summarized in the following list:
I. Developed a systematic method to conduct process improvement projects that incorporates the lean RACE model.
II. Assigned KPIs to each of the four categories of the lean RACE model to measure performance improvement.
III. Proposed a new KPI, Fitness to Takt Time (FiTT), a modified OEE, as a better measure of a system's ability to meet customers' demand.
IV. Propose a new KPI, Line Imbalance Measure (LIM) to measure line imbalance.
Several numerical examples are provided throughout this research to demonstrate the uses of the different KPIs that are assigned to the different categories of the lean RACE model. A case study is presented as a proof of concept. The case study is conducted in two ways for comparison: (1) using conventional waste-audit and (2) using Lean RACE Process Improvement Cycle to identify and prioritize improvement opportunities. The finding of this thesis is that the lean RACE cycle methodology can reveal more improvement opportunities that are, otherwise, hidden when using the waste-audit technique.