S. Sandilya, Chairman of the Lean Management Institute of India, introduces this special on lean in the subcontinent explaining why India’s lean journey has just begun.
As we know, lean is a journey of continuous improvement that aims to deliver value to customers by consistently eliminating waste. This journey in India is in the initial phase if we look at the country as a whole.
The concepts of kaizen and total quality management (TQM) reached India in the late ‘80s when a few automotive companies started manufacturing cars and commercial vehicles in collaboration with Japanese firms. Simultaneously we had some consultants from the United States who had practised TQM and wanted to spread the movement in India.
Companies like Eicher became TQM pioneers. Many Japanese consultants found traction in Indian manufacturing organisations.
The Confederation of Indian Industry (CII) organised a Lean Summit in 2002 with a focus on spreading lean principles in the country. Jim Womack and a few other experts spoke at the summit, which created interest among a few automotive components manufacturers, which started implementing lean in their manufacturing departments.
As these companies were located near the OEMs it made sense to form clusters, to learn and benchmark against each other. But the focus remained on manufacturing and did not spread to other business areas.
In 2009, a Lean Summit was organised by the Lean Management Institute of India (LMII), an affiliate of Lean Global Network. We had many case studies presenting at the Summit, which was held in two different locations: Mumbai and Chennai. Mr Womack delivered his keynote address at both locations and presented some international case studies. Stephen Parry talked about lean in services, which stimulated interest in non-manufacturing sectors.
While the Auto Clusters kept progressing, a few other clusters were created in other manufacturing-heavy areas. A few service organisations approached LMII to conduct workshops and made their first shy steps towards lean.
At the same time, the Indian government had launched a number of programmes to boost the competitiveness of micro, small and medium-sized companies, through the National Competitiveness Council.
But this is just the beginning. While lean is implemented in some areas and quite a few companies have been recognised for their improvement efforts (some won Deming Quality Awards, for example), at a country level lean thinking is just scratching the surface. We have a long way to go.
Lean principles and techniques are used as tools rather than a way to instil a new way of thinking in organisations. The manufacturing sector may boast a few examples of advanced lean implementation, but it rarely sees lean leave the shop floors. We still have very few examples from the services industry. A few hospitals, software companies and banks manage some of their processes based on lean principles, but the level of penetration of lean in India remains quite low.
Lean is evolving here. The potential is huge, just like our country. With global competitiveness becoming more critical, the hope is that many more Indian organisations will embrace it and let the journey continue.
Facing fierce competition, high cost pressure and the need to fulfil the customer expectations led automotive manufacturer Wabco India to adopt lean principles. P. Kaniappan, Managing Director, gives LMJ an overview of the company’s improvement journey.
Two were the moments in which the foundations for Wabco India’s lean journey were laid. First in 1999, when the company’s leadership took part in a lean manufacturing summit. Then in 2002, when Tom Luyster, a consultant from the Lean Enterprise Institute in the United States, started guiding us through the implementation of lean manufacturing in an air dryer cell.
The main issues we encountered, which convinced us to adopt lean in our processes, were high lead times, high inventory, process scrap, defects and rework, low productivity and lack of flexibility.
Introducing lean, however, did not prove particularly difficult in itself. Our priority was to first apply it to a runner product line (one that runs frequently with high volumes), followed by a repeater (one that runs with comparatively less frequency and moderate volumes) and a stranger (which runs occasionally and very small volumes).
Since WABCO had achieved 100% participation in total employee involvement (TEI) by 2002, lean principles and practices were well received by all sections of the maintenance and logistics population. Lean improvements came either in the form of employee suggestions, quality control circle (QCC) projects or supervisory improvement (SIT) projects.
We have applied lean to manufacturing and logistics so far, in particular in product assembly cells. We are currently working with our suppliers to get them to adopt lean thinking. Our next step will be to extend lean to non-manufacturing functions, like product development, sourcing and purchasing, etc.
Some lean tools have worked very well for us. Shop floor operators, for example, use jishu hozen (autonomous maintenance) to identify and correct abnormalities. Team leaders and value stream executives solved production problems using QC tools. Productivity improved through kaizens and potential mistakes were eliminated deploying poka-yoke in assembly – a very successful example being the dual brake valve assembly line.
Through the implementation of lean principles we have been able to improve process ratio (from 5% to 25%), achieve higher overall line efficiency (over 85%), reduce ppm (rejection level is near zero) and single minute change over time. Results in the chart below.
WABCO India at a glance
- Manufacturer of air and air assisted braking systems for commercial vehicles
- Staff: 2,700 (of which 350 are engineers)
- Locations: Ambattur (Chennai), Mahindra World City (Chennai), Jamshedpur and Pantnagar
- KPIs: top line growth (OE market outperformance, aftermarket sales growth); bottom line (incremental contribution margin); quality (zero km rejection-ppm and warranty-incidence per thousand vehicles); and delivery (customer delivery percentage and project delivery percentage)
L. Krishnan, Managing Director of TaeguTec India, explains how the machining solutions manufacturer is building the cultural foundations necessary to support a successful lean programme.
To the average lean practitioner, what TaeguTec has done so far may only qualify as baby steps towards the optimisation of the value stream. However, with a vision to become world class, we believe we have laid a solid platform for effective lean implementation in the future.
We embarked on a journey to mobilise total employee involvement (TEI) as a critical pre-requisite to the success of the programme.
Increased employee involvement, we believe, is central to developing a high-performance work culture and strengthening competencies. 5S was the first of the initiatives taken therein to enable gradual, sustainable transformation of the work place. Essentially a housekeeping technique to achieve better organisation, cleanliness and standardisation of the work areas, this exercise helps us to boost the morale of employees, promoting a sense of pride in their work and ownership of their responsibilities.
And if you thought we are only talking about the shop floor, just come and visit the TaeguTec office, to see how well-entrenched across the board is the 5S culture.
Started in 2004, meticulous adherence to 5S has repeatedly won us the Excellence and Sustenance Awards and Rolling Trophies, and this year we are set to participate and prove ourselves a Model 5S Company.
At the same time, we have been focusing on continuous improvement by organising kaizen events. In 2012, a record 780 kaizens were successfully completed across functions in the TaeguTec facility. As a result, tangible benefits (including but not limited to marked reduction in scrap levels, breakdown leads and safety incidents) have been achieved. Consequently, product retrieval and delivery performance in addition to employee participation and satisfaction levels have shot up.
Quality circle was yet another TEI initiative undertaken to facilitate decision-making and problem-solving on the shop floor. QC activities help remove bottlenecks, improve processes and encourage better teamwork among employees. Last year, nine QC projects involving nearly 100% of employee strength were executed. The overall TEI participation levels have also increased from 30% in 2008 to 75% in 2012.
TEI events have paved the way for TaeguTec India to advance to the next level of its lean implementation. In December 2012, four value stream mapping projects were initiated with an aim to streamline the value chain by identifying and eliminating waste plaguing a production environment in the form of lead times, overprocessing, inventory etc. Constant VSM review meetings are being conducted and we are currently analyzing our findings.
With encouraging employee contribution, we are positive about the results and hope to be able to see the benefits of VSM implementation by the end of this year.
TaeguTec India at a glance
- Location: Bangalore
- Staff: 150
- Machining solutions specialist
- Subsidiary of TaeguTec Korea, which is part of the second biggest cutting tool manufacturing group in the world, the Iscar Metalworking Companies
- Established in 2000
- Results: employee participation from 30 to 75% in four years
S. Parthasarathy, President of automotive supplier Rane (Madras) Limited, talks about the company’s eight-year journey and about how a model line helped set the course for the rest of the business.
There are several challenges that we face as a business, from growing competition to a volatile market, increasing commodity prices, fluctuating exchange rates and little availability of cost effective skilled manpower. These, together with the need to fulfil customer demands in terms of quality, cost and delivery, convinced us to walk down the lean route back in 2005.
We initially faced resistance from both management and the workforce. In particular, managers were worried that, since we were moving from batch processing to one piece flow, any production loss due to machine breakdowns or material availability would result in a drastic drop in output. They also feared that the operators did not have the skills to operate different machines.
People on the shop floor, on their part, felt that management was throwing more work their way and did not like the idea of moving from one machine and station to another.
We began by introducing lean in one model line. We rearranged the machines in the sequence of operation and through some simple kaizens for material movement between the machines we helped solve issues related to equipment availability (we already had experience with TPM). In only one month, we saw good results on the model line.
Productivity gains followed as we reassured the team that our prime focus would be on safety, quality and operator comfort. I told our workers that we didn’t intend to “squeeze work” out of them – anyone who felt overloaded was free to walk into my office and express their concerns.
We soon started to expand the system to other lines across all plants.
During our promotional phase, between 2008 and 2010, the recession hit. We tried to progress our lean journey carrying out activities like cell formation, tool cost reduction, OEE improvement with minimal investment. Ultimately, Rane was able to boost productivity and reduce WIP significantly.
From 2011 onwards we concentrated on the improvement phase, which has the aim to enhance flexibility and reduce manufacturing lead time. We have been able to ensure a smooth flow of materials across our value chain by completing activities like setup time reduction and ergonomics assessments and improvements.
While we have done significant work with lean primarily in manufacturing, the biggest problem we faced was communication. In the past, if a customer changed an order, it took as much as 10 days for the information to reach the shop floor.
Today, with the help of IT, the information flow is much better across all functions. Changes in volumes or models are communicated to production in less than 24 hours.
Since lean was implemented, however, we have achieved many other results, including a 45% improvement in productivity and the achievement of 100% level of on-time delivery for key customers.
We’ll keep focusing on implementing product- instead of component-level cells, further reducing setup time, and optimising inventory across the supply chain.
Rane at a glance
- Staff: 1,073
- Locations: five plants across India, in Chennai, Mysore, Pondicherry, Kancheepuram and Pantnagar
- Manufactures steering and suspension systems
- Results: output increased from INR3,425 to INR6,560 million in the last four years; productivity up 45% in four years
- KPIs: sales growth at 14%; fixed asset turns at 5.51 times (a benchmark); consistent profit even during downturn
These days, clients want service providers to be strategic partners who can help not only optimise IT cost structures and service levels, but also define new business models. Malolan Sarangapani, Senior Director of Quality at Cognizant, a US-headquartered global provider of information technology, consulting, and business process outsourcing services, explains how a strong focus on lean and training is helping the company to achieve great results.
The Cognizant Value Creation Framework has been instrumental in guiding the company’s clients through the process of reconfiguring their business models and operational processes to enhance their performance.
In today’s economy, achieving efficiency alone is not enough. Enterprises also need effectiveness to aspire to operational excellence and higher productivity; innovation through agility and revenue growth; and virtualisation by sharing knowledge across distributed teams.
Keeping this in mind, Cognizant’s team of lean six sigma experts formed a core team to come up with the “Optimize” programme.
Cognizant’s lean journey was launched with a 16-week implementation road map. The first pilot was conducted in November 2009 in two waves for select customer projects.
Based on the encouraging results from this exercise, the company decided to extend the pilots to cover the entire organisation at a much faster pace. The Optimize scale-up was launched across all service offerings, namely application development, application maintenance, business process services, IT infrastructure services, and testing services.
During the pilot, the company understood the different nature and high complexity of IT projects, and felt the need to customise the Optimize programme for each of the service lines.
To address this need, the company came up with alternative deployment methodologies and published customised lean cookbooks for each of the service offerings. At the same time, a standardised lean tool kit was built.
What ensured the programme’s success was that Cognizant also looked into the softer aspects, such as workforce mindset and behaviour, in addition to the operating practices and management systems.
With the aim to effectively empower people, the company introduced “before” and “after” surveys to gauge the mindset of the team and operational performance analysis to assess the employees’ knowledge of KPIs, rewards and metrics.
One of the major challenges the company faced was the on-time training of associates. The lean team then came up with a unique, multi-faceted approach to training, which included: “Learn @ Your Pace” interactive e-learning modules; follow-up “hands-on” lean lab classroom sessions; coaching for these sessions provided by the core team; a partnership with Harvard Business Publishing focused on soft skills and change management techniques for the leads; and an evaluation process to certify learners as lean coaches.
Cognizant’s lean efforts brought about an average productivity increase of 12% across all five service lines, thanks to the reduction in non-value-added activities, the automation of tasks, teaching the right skills, demand and capacity management, and standardisation of operations.
Cognizant has lean-trained more than 5,000 project managers, 110 of whom have been certified as lean coaches.
Building on the success of Optimize, wherein more than 50% of the delivery organisation in India is already covered, Cognizant continues to work towards leaning out the rest of the company in other parts of the world in 2013.
Cognizant at a glance
- Provider of information technology, consulting, and business process outsourcing services
- Headquartered in Teaneck, New Jersey
- 50 delivery centres worldwide
- Staff: 156,700 (as of December 31, 2012)