LEAN & Green (English)

Bring Your Business to a Higher Level of Performance
With The LEANecoProfits™ Improvement Strategy
LEANecoProfits™
Revision November 30, 2009

Jean-Pierre Dubé, Eng.
Vice-President, Lean Solutions

Fujitsu Consulting (Canada) inc.
Mobile: (514) 710-1550
E-mail: jean-pierre.dube@ca.fujitsu.com

FUJITSU CANADA 1 Profits for Your Business and the Planet

Agenda

Fujitsu in Brief
Profits for Your
Business and
We’ve Got a Problem
the Planet
What is LEANecoProfits™?


Agenda

Fujitsu in Brief
Profits for Your
Business and
the Planet


Fujitsu

International business with 175,000 employees in 70 countries
75 years of experience and success
Financially sound with annual revenues of US $47B
World class know-how and technological knowledge with over 1,500
researchers and 14,000 engineers
Major R&D to remain on the cutting edge of new technologies with
more than 32,000 patents
High performance standards
Power to attract top professionals
Fujitsu Canada is run by Canadians and has over 2,500 employees
who are very familiar with your business environment


Fujitsu Canada’s Lean Solutions - Industrial

Consulting group that specializes in strategy and
optimization providing engineering + management to
rethink productivity and profitability for the 21st century
business

“Business Engineers" who understand your language
Engineers

Precision, rigor and technical depth of engineering
combined with the knowledge of modern management
and best business practices


LEAN Projects Conducted in 17 Countries

Poland
England

Canada
Germany
United States Netherlands
China
Belgium
Switzerland
France
Mexico
Thailand
Suriname
Morocco

Malaysia
Brazil

Australia


Some Of Our Customers


Agenda

Fujitsu in Brief
Profits for Your
Business and
the Planet


“We’ve got a problem”


The Industrial Revolution of The 19th Century was
Based on …

Endless economic growth

The intensive use of Earth’s resources

The belief those resources were limitless and would always be
cheap


Today’s Economic Development Process was
Conceived in the 19th Century!!!

Extract Transform Manufacture Consume Discard


Less than 25% of what Goes into that Process is
Transformed into Goods and Services


If all countries adopted
the Western way of life
based on mass
consumption, … it would
take 5 planets to meet
everyone’s needs


End of The Current Economic Development Model

Growth Maturity Decline

19th century 20th century 21st century


Depletion of Earth’s Resources at Current Rate of
Consumption
2021: end of silver
2025: end of gold and zinc
2028: end of tin
2030: end of lead
2039: end of copper
2040: end of uranium
2048: end of nickel
2050: end of petroleum
2064: end of platinum
2072: end of natural gas
2087: end of iron
2120: end of cobalt
2139: end of aluminum
2158: end of coal
According to Science et Vie hors série N° 243, construire un monde durable, June 2008
durable,


The New Industrial Development Model Will Have To
Be Sustainable And More Effective

To survive and
st
prosper in the 21
century, businesses
must immediately
adopt a new model
of sustainable and
more effective
industrial
development


What Is Sustainable Development?

A pattern of resource use that aims to meet human
needs while preserving the environment so that these
needs can be met not only in the present, but also for
future generations United Nations proposed definition (1986)

Fair

Society Economy
Durable
Liveable Viable

Environment


Food For Thought ...

We’re doing a lot to prepare our kids for the
future… but are we doing enough to prepare
the future for our kids?


Agenda

Fujitsu in Brief
Profits for Your
Business and
the Planet


FUJITSU’s Exclusive Strategy for Sustainably
Developing Your Business

To help you move from concept to action, Fujitsu
Canada’s business engineers have designed a
new strategy called LEANecoProfits™, to
develop your business in a more sustainable and
efficient way


LEANecoProfits™: A Logical Evolution of
Operational Strategies
1900 1900 – 1975 1975 – 1990 1990 – 2009 2009 –
Home-made Mass Toyota Production LEAN Production LEANecoProfits™
Production Production System and Enterprise Enterprise

Demand Demand greater Demand equal to Demand lower Competition for
development than supply supply than supply, raw materials
global production and energy;
overcapacity greater
environmental
regulation

Custom Standardized Standardized Standardized Greater product
products/services goods/services products/services products/services sustainability and
tailored to client with options tailored to client recycling
needs chosen by clients needs

Accent on quality Accent on Accent on Accent on client Accent on
and client increasing production and satisfaction and operational,
relationship production delivery of top production environmental
capacity, quality products, system agility and energy
productivity, price at the right time efficiencies
and management and in the right
controls quantity - Just-
In-Time


The Deployment of LEAN in Enterprises

Extended Value Chain 1 Extended Strategic Approach -
1- Supply Chain
2- Internal Value Chain
Vision to 5000 m. altitude
Emphasis on the overall
+
3- Logistic Chain

Benefits ($) / Efforts ($) Ratio
4- Product Life Cycle
performance of the company and
its partners

Internal Value Chain 2 Internal Strategic Approach

Level of Detail
The processes for manufacturing a Vision to 3000 m. altitude
product family Emphasis on the overall
performance of the company

Operational Process 3 Operational Approach
Ex: Your production process Vision 500 m. altitude
Emphasis on the achievement of
Kaizen Workshops

Production Unity 4 Tactical Approach
Ex: The work methods to operate and Flew over the daisies
maintain a machine Emphasis on the deployment of
LEAN tools: 5S, Kanban, Cellules,
- +
Poka Yoke, …


LEANecoProfits™ Objectives

Continually eliminate the waste of resources
consumed by businesses …
human
information
material (equipment, tools, etc.)
financial
natural (water, air, land, forest, etc.)
energy (electricity, gas, oil, etc.)

… to deliver immediate and sustainable
benefits for businesses and the planet


4 LEANecoProfits™ Improvement Targets (The 4 Ps)

Resources:
Human PRODUCTS
Information OPERATIONAL PROCESSES Too much
Material Too long, complex, variable & inefficient material
Financial Too risky & inefficient Too complex
Natural Hazardous
Energies Materials / Use

PERSONNEL
Participates in
improving your
business PLANET
Energy Inefficiency
Pollution
eco Waste

LEAN


1st LEANecoProfits™ Target – Your Products

Materials
Contribution to
Your Costs

General
Expenses
Product Personal
Development
5% 50% 15% 30% =100%
70% 20% 5% 5% =100%
Your Cost Cutting
Potential


An LEANecoProfits™ Product means …

Fewer drawings
Fewer parts for the same functions
Fewer POs for procurement
Lower inventories
Less handling
Faster assembly time
Less breakage with use
Less waste
Less pollution
Less of everything…


2nd LEANecoProfits™ Target – Your Operational
Processes

Quote from Taiichi Ohno, father of
the Toyota Production System:

“All we are doing is looking at the
time line, from the moment the
customer gives us an order to the
point when we collect the cash.
And we are reducing the time line
by reducing the non-value adding
wastes”


Time is Money!

Lead Time = In days, weeks or months !!!

Supply Chain Value Chain Logistic Chain

Suppliers Your Business Customers
Process Process Process
1 2 X 1 2 X 1 2 X

Department A Subcontractor Department X


The Health of Your Operational Processes

Information and materials PCE measure the health of
waiting in each step of your your processes
value chain are an excellent
The PCE of the majority of your
indicator of the health of your processes ≤ 5%
operational processes
The PCE of a LEAN process ≥
30%

Process Process Cycle Efficiency - PCE
1 2 X PCE = ∑ Time Of Value Added Activity X 100
Process Lead Time
Department X


The Race Against The Snail

• The snail moves at an average speed
of 450 inches / hour
450

400
• If you calculate the distance traveled
by your raw materials, from receipt to 350
shipping, through the various stages 300
of processing
250

200
• And you divide that distance by the 150
total time that these materials have
100
remained in your plant ...
50

• You discover that the snail is usually 0
Snail Your
much faster than your business
Processes
processes!!!


Much Effort, Few Results

Businesses devote a lot of effort
and money to improving,
automating and computerizing their Process
value added activities…
1 2 X

those activities represent less Department X
than 5% of the time needed to
satisfy their customers’ needs

… without trying to eliminate or
reduce 95% of the non-creative time
for their customers


The 3 Barriers To The Performance Of Your
Processes
3 types of barriers, known as 3M, affect the
performance of your processes

1 MURA means irregular. The irregularities of
material and informational flow in your
operational processes

2 MURI means excessive or unreasonable.
Your resources overused or underused, and
your business practices which are not
justified by common sense

3 MUDA means waste. Your activities that
consume resources without creating value to
your customers


MURA, MURI & MUDA

The visible part for people trained in LEAN thinking
3- MUDA
Waste

2- MURI
Excessive or
Unreasonable

1- MURA Invisible for most people. Often ignored by
Irregular companies in the deployment of LEAN


3rd LEANecoProfits™ Target – The Planet

From the document Toyota
in Canada, Our Vision

“Eliminating wastes
throughout its operations is
a key objective for Toyota in
Canada. Wastes are not
only harmful for the
environment, they are
synonymous with
inefficiencies and added
costs, as well as potential
lost business opportunities.”


Anything Coming Out of Your Business that is Not a
Product is Waste ($)

Resources
- Raw Material
Products
- Natural : water, air, soil, wood, …
- Energetic : electricity, gas, ...
Business and Manufacturing
Processes, Building, Land
Your Enterprise


4th LEANecoProfits™ Target – Your Personnel

Everything has evolved
considerably over the past
100 years…

However, your work
organization has not evolved
much and is still heavily
driven by mass production
conceived and developed
close to 100 years ago!


Traditional Work Organization

Your management is segmented and organized vertically into silos (departments)
Your products or services move horizontally through those silos
You have nobody responsible for managing the interfaces between the silos
Every silo has its own objectives and your managers are evaluated individually against them

Your Business
General Management

Customers
Suppliers

Objective A1 Objective ST1 Objective X1
Objective A2 Objective ST2 Objective X2
Etc. Etc. Etc.

Process Process Process
1 2 X 1 2 X 1 2 X



LEANecoProfits™ Work Organization

Marketing Engineering Purchasing Production H-R
Manager Manager Manager Manager Manager

Product Family A
Manager
LEAN
Projects to improve the value chain A
Agent

Product Family B
Manager
LEAN
Projects to improve the value chain B
Agent

General Manager


Your Employees’ Performance

Only 25% to 40% of the
activities performed by your
employees are value added
3 days
a
week
Performance Indicator: In an
Indicator
LEANecoProfits™
enterprise, the value added
by employees is ≥ 60%


The 3 Main Causes of Employees’ Low Productivity

1. Your employees do not know what
you expect of them
Performance targets have not been
established, explained and
communicated clearly to your
employees

2. Your employees do not know if
they are doing well or not
The current performance of the work
is not measured continuously and
communicated to your employees

3. Your employees use suboptimal
work methods
The working methods were not
standardized and optimized
Your employees are not involved in
the standardization and improvement
of working methods
Most of your employees have been
trained on the "job" by their senior
colleagues


LEANecoProfits™ Performance Management System

STANDARDIZATION of

Increased Productivity By 10 To 20%
improved working methods
IMPROVEMENT of working methods
by your employees (Small Kaizen)
GAP ANALYSIS by your employees and
managers
RIGOROUS MONITORING by your managers of
current KPI VS target KPI
Definition and implementation of a MONITORING &
ACCOUNTABILITY PROCESS for your managers
Analysis and optimization of TIME devoted to DIRECT
SUPERVISION and COACHING by your managers
Definition and implementation of VISUAL DASHBOARDS for KPI
continuous monitoring
Definition of your VALUE CHAINS, key operational performance indicators
(KPI) and a MEASURING SYSTEM (Who, When, How)


MAPS™ Value Creation Process

Measure & Analysis Projects Success
STRATEGIC STRATEGIC STRATEGIC
Modeling your business Improvement Control and correction
by measurement and of your business of projects to ensure
analysis of your through the value creation
information, material, implementation of
financial, energy and projects with the active TACTICAL
environmental flows participation of your Continuous control and
employees improvement of your
This model will help
operations to eliminate
identify projects that TACTICAL performance gaps
create value for your
Implementation of a
stockholders,
stockholders management system to
customers, employees
customers measure and
and the planet
continuously monitor the
performance of your
operations

1 month 18 to 24 months


Why To Model Your Business?

A business that has not been globally defined, measured and
analyzed cannot be improved and controlled

Suppliers Your Business Customers
1 2 X 1 2 4 5 6 7 8 X 1 2 X

Information Flows

1 2 X 1 2 3 4 5 6 7 X 1 2 X

Materials Flows

Financial Flows

Environmental and Energy Flows

eco LEAN


Why To Model Your Business?

You cannot just repeat the best
business practices of other
companies (benchmarking) to
sustainably develop your
business
You must aim for perfection and
define your own picture of it
That picture must become your
reference model, not the picture
of your competitors
This rule allowed Toyota to
become THE world leader


How To Identify Projects That Create Value?

The most successful

High
businesses are those that

BENEFITS
know how to deselect

Medium
projects, despite the
enthusiasm of employees
and managers, to cut their

Low
number to a level Low Medium High

EFFORT
compatible with the
resources they have

High
You cannot settle

BENEFITS
everything at the same

Medium
time because your human
and financial resources are
certainly limited
Low

Low Medium High

EFFORT


Actual Example of an LEANecoProfits™ Enterprise

Manufacturing company founded in 1982 and located in Canada

22,000 ft2 plant

121 employees

2007 revenues of $19,5M

The stockholder decided to become LEANecoProfits™ to
increase his company’s value before selling it


LEANecoProfits™ Projects Delivered

PROJECT 1 - Strategic Planning PROJECT 8 - Improve the planning
Workshop to review the operational process
strategy with the executive committee
PROJECT 9 - Improve the
PROJECT 2 - Develop a change procurement management
management plan to facilitate
business transformation PROJECT 10 - Improve the
production scheduling process
PROJECT 3 - Develop and implement
a LEANecoProfits™ performance PROJECT 11 - Implement virtual
management system production cells

PROJECT 4 - Improve and automate PROJECT 12 - Reduce setup time
the product development (SMED) on bottleneck production
management including eco-design equipments

PROJECT 5 - Review and optimize PROJECT 13 - Improve the finished
the design of products dedicated to good management including shipping
the European market & delivery

PROJECT 6 - Improve the SOP PROJECT 14 - Improve the costing
process (Sales & Operation Planning) system

PROJECT 7 - Improve the customer
orders process


Results

$3.1M growth in value of capital in 18 months

Investments
FUJITSU development of Measure & Analysis phase = $52,480
FUJITSU collaboration on Projects and Success phases = $295,650
TOTAL = $348,130

Total Investment: Only 11,2% of the $3.1M growth in the value
of capital


This document is the sole and exclusive property of
Fujitsu Canada

The unauthorized use, disclosure or reproduction, in any
form whatsoever, of the material found in this document
is expressly prohibited. Any unauthorized or illegal use
will make the user liable to any appropriate legal action
available to Fujitsu Canada

© Fujitsu Canada– All rights reserved
Canada


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