With the improvement ideas executed, the team turned its efforts to
measuring results. This step detects and quantifies the work process
and business benefits produced by the Kaizen event. It provides the information
needed to verify whether the event achieved its mission and goals. Our
Kaizen process measures both operating improvements and monetary benefits.
The team measured the operating improvements by repeating its process
observations of each work process doing a similar batch of work but now
executed in a manner that incorporated the improvements made by the team.
Measuring monetary benefits translates the operating and non-operating
changes into dollar savings or revenue gains, adjusting for the cost
associated with implementing any of the changes. We computed both hard
and soft monetary benefits. Hard monetary benefits are savings or revenue
gains that begin to flow as soon as the event ends. Soft monetary benefits
require an additional management action before they can be realized.
In this event, hard monetary benefits were realized for the two work
processes the team modified. The soft benefits would flow from the replication
of the improvements to the flammable fill side of the Oakland plant and
then to the nonflammable and flammable blending fill operations at the
three remaining plants producing blended gases. These replication benefits
are judged "soft" because the managers at these sites will need to authorize
the changes before the improvements can be made.
Computation of operating improvements is facilitated by a spreadsheet
contained in the Kaizen Tool Kit. Exhibit 22, next page, presents the
operating improvement realized for the cylinder preparation work process;
Exhibit 23 (page 56) presents the operating improvements achieved for
the nonflammable blending work process.
The cylinder preparation work process went from requiring 141 steps
to just 92 steps after implementation of the team's improvements. This
reduction in the number of required operations is even more striking
given that the work accomplished by this process was increased to absorb
scraping labels and touch-up painting of cylinderstasks previously
done in the blending work process.
The cycle time of the cylinder preparation work process was reduced
by 35%. This shrinking of the work while expanding its outputs was largely
due to installing a second vacuum pump which accelerated the preparation
process and by eliminating unnecessary paperwork. The addition of the
scrapping and painting activities did not add to cycle time because the
activities are accomplished concurrent with the vacuuming, purging, and
venting operations. In this way, wait time is transformed into productive
activity. Indeed, wait time was completely eliminated (reduced 100%).
The other significant improvement was in unnecessary processing, which
was reduced 22%. An unwanted byproduct of moving the scrapping and touch-up
painting of cylinders into the cylinder preparation work process was
an increase in setup activities, as scrapping and painting are entirely
setup in naturethat is, these work activities prepare cylinders
to be filled but do not accomplish the filling. Nonetheless, the improvement
resulted in a 55% increase in labor productivity. The team also felt
that a follow-up Kaizen event focusing on setup would reduce its presence
in the cylinder preparation work process.
The improvements reduced nonflammable blending process activities from
336 steps to 227. The major benefits were in cycle time (reduced 31%),
value-added ratio (increased 98%), wait (reduced 96%), setup (reduced
23%), and travel/transport (reduced 20% in time and 18% in distance).
These improvements were largely due to reducing rolling time; eliminating
the vacuum, purge, and vent operations; transferring cylinder prep activities
to the cylinder preparation work process; installing the battery charger
and nets in the blending area; and eliminating unneeded paperwork. The
value-added ratio was increased by
trimming down these elements of waste. Overall, the improvements elevated
labor productivity by 45% and increased throughput capability by 80%.
One anomalous finding in the post-observation was a spike in rework (almost
four minutes). This was due to three problems that were not observed
earlier: a faulty safety valve, a improperly purged cylinder, and a blending
sheet with the incorrect mix specified. Clearly, rework should be an
area looked into in future events.