Continuous Improvement and Understanding Lean's Role at Your Company

Editor's Note, update May 19, 2010:
Society of Manufacturing Engineers member and author, Mark Hamel, has been awarded The Shingo Prize Research & Professional Publications Award for the Kaizen Event Fieldbook. Given out in May 2010 in Utah at The Shingo Prize Annual Conference, the Shingo Research Award recognizes and promotes research and writing regarding new knowledge and understanding of lean and operational excellence.

SMT recently received a copy of Mark R. Hamel’s Kaizen Event Fieldbook for review. Hamel is a consultant to the manufacturing industry, facilitating the transition to Lean. Lean manufacturing has been a noteworthy electronics assembly strategy for many years, raised to a necessity level by the profit-margin, supply chain, and quality strains of the recession that began in 2008. While manufacturers must work to be lean, they also must make lean principles work for them. “Learn by doing” is the mantra of Hamel, encouraging readers to apply the lean principles that best improve their business. Hamel explains kaizen as “small, cumulative continuous improvements.” While some may be tempted to engage Lean as an abrupt overhaul of their business, these incremental changes will likely result in a more successful and sustainable manufacturing environment. Read a brief description of the book from its publishers here.

The workbook is divided into three sections, an education on the foundations of lean: kaizen, leadership, definitions, and ways to get started; four phases for developing, deploying, and maintaining kaizen events and strategy; and a final section on customizing these principles and actions for the specific business. Perhaps the most valuable resource of the Kaizen Event Fieldbook is appendix of worksheets: forms that can be used for audits, event planning, tracking initiatives, and more. The book is also closely synched with its Website, http://www.kaizenfieldbook.com/, where readers are welcome to ask the author questions, download the blank forms for their employees, and link to related resources suggested by Hamel.

For most electronics manufacturers, aspects of the Lean system are familiar, while others are not. The Fieldbook includes many clear definitions for the terms employed in the lean concept, while Hamel continuously points out that readers should come to the system with an idea of their own goals and interests. There is a difference between memorizing the system and terminology and learning it. Hamel encourages readers to learn the system and adapt it for their individual needs.

To quote Hamel, “the Fieldbook can be applied in several ways: at a corporate level as a framework for developing (improving, if the developing is done) and deploying standard work throughout the organization, and for the personal development of motivated kaizen practitioners. Kaizen’s role within a lean business structure is defined, and the point is frequently made that kaizen is a daily and weekly application of lean, not a single-event makeover. Detailed descriptions of how a kaizen event is planning, how it functions, and how best to maintain its effect are provided.

Contrary to the hype, lean systems can create plenty of waste, when communication lags, implementation is too ambitious, or when follow-up is lacking. Hamel points out that, while the main thrust of the kaizen event is kick-off, training, storyline, leaders’ progress meeting, work strategy, reporting, and recognition, this event is worthless without planning and follow-up. The Fieldbook’s suggestions for communicating include reporting methods as well as input methods to gain fresh ideas from employees. Suggestions even include visual communication, such as different colored shirts for people involved in different parts of a project.

Lean manufacturing demands continuous investment in making the production flow work; eliminating waste; and increasing your business’s performance through higher throughput, fewer errors, faster turn-around, or other metrics. With the Society of Manufacturing Engineers’ seal on this workbook, it looks to be a valuable addition to, or starting point for, a Lean initiative at the manufacturing facility.

For more information, read SME Releases the Kaizen Event Fieldbook

Meredith Courtemanche, managing editor

The APEX Question: How Much Money Can I Save?

Cost is the main theme at APEX this year, which is no surprise. The electronics manufacturing industry doesn’t exist in a vacuum, and everyone is seeing the decline in global spending and production. Suppliers are designing systems for assemblers that are both low investment up front — we’ve seen entry-level machines showcased at the booths more than new high-end ones — and low cost of ownership (COO), meaning the operational costs cut out inefficiencies or long downtimes, high energy use, and other undesirable side effects of electronics manufacturing. Shopfloor management software that enables truly lean production is getting a lot of attention at APEX. As one exhibitor put it, attendees are asking “How much is the machine? And how much will it cost me to run it?” With capital equipment spending dwindling, vendors must get the answers to both of those questions right.

Sunstone Circuits and partners National Instruments, Digi-Key, and Screaming Circuits gathered at the show to discuss their ECOsystem product, which brings PCBs from design through sourcing and manufacturing in one cohesive supply chain. Design for manufacturing (DfM) was the theme at JTAG Technologies’ booth as well, where they discussed the possibilities of utilizing boundary scan from first prototype through PCB test through in-field service to cut down prototype iterations, make service less invasive, and increase yield. JTAG refers to this as DfTALES, which means design for test, assembly, logistics, engineering, and service.

The manufacturing execution software (MES) suite from Valor also incorporates DfM, along with machine integration and inventory management to detect and call out inefficient or out-of-spec processes. Valor just surpassed the 800 customer mark globally. Juki debuted a shop-floor management software program, Intelligent Shop-floor Solutions (IS), to complement its component placement and selective soldering machines at the show. Aegis released the third revision to its Version 7 manufacturing operations software (MOS), called R3. This also is designed to cut costs through maintaining peak efficiency and streamlining operations in everything from screen print to thru-hole insertion to box build. Without a main computer interface, and with operators interacting with the MOS suite verbally, R3 targets a less skilled, less trained workforce on the line, cutting out that monetary burden.

Aegis’s R3 system was recently selected by Sanmina-SCI to go into about 20 facilities globally. Sanmina has installed the system in a handful of assembly plants and approved it for company-wide deployment. Maximizing the effectiveness of equipment and people saves users from investing in new machines, which likely isn’t an option for many assemblers in 2009.

Equipment providers can found innovative ways to cut costs as well. Aqueous Technologies, which recently acquired the Austin American Technologies MicroJet defluxers, pointed out that the in-line defluxers stagger the force, or energy, of the wash to remove flux intelligently rather than blasting it with cleaning solution indiscriminately. This means the machine requires a smaller motor, less energy draw on the factory floor, and therefore a smaller footprint. Aqueous also redesigned its Zero-Ion cleanliness tester and in doing so reduced the purchase price.

Inspection system manufacturer Koh Young brought its lower-priced machines to the show, KY8030 series, which typically target manufacturers in China. With a primarily North American attendance base at APEX, this seems like a shift to more cost-conscious purchasing at domestic manufacturers.

Essemtec showed a full suite of screen printers, component placement systems and reflow oven at APEX, but they were also promoting the company’s stability, with a fully owned manufacturing plant in Switzerland and no debt/good credit. One has to believe this reassuring tone is prompted by the bankruptcies and shaky footing of major companies all over the world, such as the “Big 3” U.S. auto makers.

Siemens introduced the Siplace CPP MultiStar placement head, which switches on-the-fly between high-speed and pick-and-place modes. It effectively eliminates the need for both a chipshooter and an end-of-line pick-and-place machine, performing the tasks of both. Placement “silos” that lack this range slow the production line down and have the added burdens of machine downtime, underutilization, maintenance, etc. The MultiStar head’s flexibility brings it beyond the silo model, yet maintains the accuracy found in dedicated machines.

Solder recovery systems supplier EVS International highlighted the COO advantage of investing in a dross recovery system. Users can cut solder purchasing by 40% in some cases, representing a huge savings in consumables. The system also brings dross management in-house, eliminating a step in the EMS/OEM supply chain that was not controllable by the manufacturers.

CeTaQ Americas, which manufactures machine calibration equipment, emphasized the importance of running in-spec and at top efficiency in an era of tight profit margins. Keeping a paste printing machine at its best level of performance will extend the system’s usefulness and lifetime, delaying investment in new capital equipment. CeTaQ offers all of its equipment as a service as well as for purchase.

Inovaxe also highlighted lean as a way to save money and reduce costs at the assembly house. Inventory management is central to this philosophy. The company showcased its software as a service (SaaS) options, which allow users to track incoming and in-process inventory, eliminate spoilage, and protect sensitive components like moisture-sensitive devices (MSDs). In 2009, manufacturers must find ways to cut out non-value-added time, making each job as profitable as possible.

Human effort can be the largest consumer of non-value-add time, and Europlacer highlighted its camera-based footprint programmer on the inneo placement platform as an example of technology replacing human effort. Parts profiles are obtained via a camera and programming in the inneo system, freeing up operators who would otherwise be drawing in the parts. This also enables more job changeover and more job runs with less downtime.

Cost is by no means the only story coming out of APEX this year. Emerging markets, such as photovoltaics manufacturing, are becoming a complementary focus for some assemblers, and equipment and materials providers are supporting this change. Counterfeit electronics are a hugely important topic, and many new products, from advanced labels by Polyonics Inc. to XRF analyzers by RMD, are coming out to combat the problem. Inspection remains an evolving realm, with some players exiting and others getting more involved in this sector. And the industry can still have fun in bad economic times, as evidenced by the informally dubbed APEX band, which gathered toward the close of Day 1 to play a few songs.

SMT will continue to cover the trends from the show floor at APEX on our Website and in our e-newsletters and issues following the show.

Meredith Courtemanche, managing editor

EMS Trends

Meredith Courtemanche, managing editor

Bringing together the A-Line on-the-conference-floor assembly line for producing a sample board at IPC Midwest with IPC, The Morey Corp., and our equipment providers gave me a unique insight into the amount of work that goes into every PCB assembly manufactured. To dig deeper into the EMS industry, I chaired a panel of EMS providers at the show in September. The speakers provided concise advise for keeping EMS lines running efficiently and keeping OEM customers on track and happy, for product development, project launch/new product introduction (NPI), manufacturing, and program management. Concise, efficient, and resourceful. What else would you expect from this industry?

Presenters included Susan Mucha of Powell-Mucha Consulting, Kevin Stone of Kimball Electronics Group, James Scholler of MEC Innovation, and Ross Clark of The Morey Corporation. Major trends in the EMS industry included robust product launch/new product introduction (NPI), communication and awareness with the customer and your supply chain, and resource and risk responsibilities.

Jim Scholler, VP of technology of Milwaukee Electronics Companies (MEC), presented on the development of knowledge that the EMS company needs to gather from many sources, beginning with suppliers, to produce boards smoothly. Though the ideal situation would be to transfer knowledge to EMS providers so that they have 100% of what's needed to do a run on the first day, most likely that won't happen. Product knowledge transition starts with the customer. Traditionally, batches of knowledge are transferred from one stage to the next. Because of the need to reduce time-to-market, several steps need to be shortened; BOM completion, tooling release, supply chain setup, and material completion all need to have knowledge transferred earlier. Scholler developed flexible stage gates with sign-offs at various points. "If we're going to keep things moving, we've got to get out of the batch delivery stages," Scholler explained. He identified freeze gates incorporated on the critical path, an ever growing list of features frozen (not documents) to keep the project flowing. Package design, suppliers, equipment manufactures must all be part of the equation. Kevin Stone, director of business development, public safety, Kimball Electronics Group, presented some other useful tips for NPI, like the concurrent development model. This keeps production from being held up waiting on materials to come in. If an EMS provider is working with lean or Kan Ban, then it might takes a long time to line up everything early because items aren't on line already in back inventory. Responsibility has to be frozen at critical points to assign responsibility to know who will do what when in an EMS environment to build a product successfully on time and at budget.

Sue Mucha, author of Find It. Book It. Grow It. A Robust Process for Account Acquisition in Electronics Manufacturing Services, and president of Powell-Mucha Consulting, discussed outsourcing and good business relationships. Mucha's advice for the EMS/OEM community revolved around resources. What elements of producing an electronic assembly do you have resources for? What could you do better if you had ample support? "The reality is that even small EMS providers should be able to provide full support to their customers," Mucha explained. OEMs can justify the cost of "additional" services like lifecycle support and design for excellence (DfX) by outsourcing them to the more experienced and more efficient EMS provider. EMS providers already have established relationships with each link in the supply chain, making production times faster and sourcing smoother. As Scholler stated, a deliverable is whatever is of value to the customer. A feasibility audit isn't needed, but design for test is, for example. By outsourcing these aspects to the EMS provider, the OEM is "purchasing" resources without having to dedicate personnel or training to that element of their product, added Mucha.

Stone drew from his experience in engineering and high-reliability markets when he discussed the importance of a robust product launch. A new product introduction can be a new product on the market, a new product for that EMS provider, or even a new product for a particular facility of that EMS provider. Stone pointed out that sooner is always better with measures like design for test (DfT) and design for manufacturability (DfM). "Once you're past the PCB fabrication stage, it is almost too late for DfM/DfT," he asserted. Automation always is better than manual tasks when you're looking for DfM success.

Ross Clark, marketing manager, The Morey Corp., was SMT and IPC's main contact point for developing the keychain PCBA that IPC Midwest attendees took away from the A-Line. His role in orchestrating a cohesive line with all new machines from four different equipment suppliers shaped his presentation about role definition. We had to figure out how to talk to each other, between the machines and the operators, he explained. Time was the most important factor in preparing the product and the assembly line itself. Feature-richness and board complexity decisions were dictated by this important parameter, Clark explained, to ensure that we had a board built to specifications in time for the tradeshow. Awareness of your clients' particular needs and processes is crucial, agreed all of our presenters. Scholler talked about the critical components in a design including boundary scan to illustrate the EMS provider's middle-ground role from supply chain to customer. An assembly house doesn't deal with boundary scan because it's already built in. However, the EMS supplier needs to know how to use boundary scan because it can save on board space.

Mucha also explained the crucial nature of risk ownership. Documentation at each step in the manufacturing process can help prove liability for field failures, for instance. OEM investment in product testing can pay off in mitigated failure risk. Risk, waiting periods, and manual assembly tasks all should be eschewed during the design phase, Stone added. Streamlining the product launch early allows you to define production benchmarks and create accurate lead time expectations for customers. However liability is divvyed up, make sure the terms are clear before production begins. If both the OEM customer and the EMS provider are trying to "win" during contract negotiations, aiming for a large short-term profit, neither company is going to be happy with the relationship. Each presenter underscored this point. If open communication and clear terms are not part of the production agreement or contract, the customer relationship will be strained, possibly costly, and possibly will endanger the success of the product being assembled.

In my day-to-day work, I'm not designing and building electronic assemblies, though that is what's constantly on my mind. I jump at the chance to peek over the shoulders of line operators, board designers, project managers, and so on at OEMs and EMS providers. In planning and executing this A-Line and EMS Trends panel, I got the chance to virtually sit down at their desks, thumb through their contracts, listen in on their strategies. What did I learn? You can't build a good board without a good business working around you, and vice versa.

Communication is key in any industry. Being a media outlet for the electronics assembly community, we at SMT understand the vital role communication plays in moving industry forward, increasing productivity and technological capability, and getting your job done. Each EMS provider on our panel serves a different niche of the electronics market, be it prototype development for new products or ruggedized assemblies, etc. Each share a common goal — to develop deep, open, and continuous relationships with their customers so that both are profitable, productive, and expanding. If you're looking for the broadest trend in the EMS industry, there it is in a nutshell.

SMT will be chairing a second EMS panel, next year at APEX in Las Vegas. "Industry Cost Challenges: EMS Solutions," will present case histories and lessons learned to attack common problems, like ensuring component integrity while filling gaps in the supply chain, and downshifting products from high to lower volumes.