Lean Decision Making
Use an operator balance chart to make informed manpower decisions
Chris Harris and Rick Harris
Lean Enterprise Institute
In this volatile market, manufacturers that produce automotive products (e.g. instrument panels) must react to that volatility correctly and quickly. One way that production plants have to deal with changing customer demands is to create flexibility in their manufacturing systems by using an operator balance chart.
The operator balance chart can be a key tool for creating flexibility in a facility supplying products. When used properly, the operator balance chart provides the information needed to correctly staff a manufacturing area or manufacturing cell. There are three steps to creating an operator balance chart.
Step 1: Work Elements. The first step is to gather all of the work elements needed to complete the product. A work element can be defined as the smallest increment of work that could be moved from one person to another. For example, "get a hose clamp and assemble to hose" would be a work element, where "get a hose clamp" would not be a work element.
The table Initial Work Elements shows a list of work elements that are needed to complete an automobile's instrument panel. The current physical layout appears in the figure Process Before Redesign. On the left side of the Initial Work Elements list are the times needed to complete each individual work element. On the right side, the work elements are classified as one of the three types of work discussed in the next section.
Step 2: Classifying the Work Elements. There are three types of work in a production process. The first type, and the lowest percentage of the work in the process, is normally value-added (VA) work. In our implementation efforts, we find that more than 90% of work elements are usually non-valueadded. The definition of a value-added work element is any work element that directly adds value to the product. For example, assembling a radio to an automobile instrument panel is a value-added work element.
The remaining two work elements are both non-value-added. The first of these is what we call incidental work (I). Incidental work is work that has to be done, but does not directly add value to the product. Getting the instrument panel from table 2 and placing it on table 1 is an incidental work element. The operator must move the instrument panel to assemble it, but getting the instrument panel does not directly add value to the product.
The third work element is waste (W). Waste can be defined as a work element that does not add value to the product being produced, and isn't necessary to produce the product. Walking to get the instrument panel is a wasted work element. No value is produced by walking to get the instrument panel, and if the instrument panel was moved closer to the operator, the operator could get it quickly (incidental) and assemble it (value added).
Our goal is to remove all of the wasted work elements and reduce incidental work elements as much as possible. Eliminating waste and reducing incidental work causes value-added work to become a much higher percentage of the work content in the process, which means our production associates use a larger portion of their time and talents to add value for the customer.
As you can see in the table Initial Work Elements, the first six work elements are classified as waste. There are two points to consider: The first is that when designing a manufacturing area for the value-added production associate, noncyclical work should be given to other people. Material should be delivered directly to the production associate's fingertips, not to a table far from the production associate. Including this type of work in the production associate's job is a common mistake.
The second point is that in Initial Work Elements removing the cut part from the fixture is classified as waste. The reason for doing so is that the machine can easily be modified by simple automation to automatically eject the instrument panel to table two, and provide an empty nest for the operator. This approach changes the process so that the associate doesn't need to remove a part from the machine before placing the new part in the machine. By providing an empty nest for the operator, the work elements of removing the cut part and placing the cut part on table two no longer need to be done by the production associate. These two actions—giving out-of-cycle work to another operator, and providing empty nests at the machine—can increase productivity in the manufacturing cell.
Step 3: The Paper Kaizen. The paper kaizen process is fairly simple, and it's an important part of the improvement effort. Paper kaizen is a process where those who have gathered the information discussed earlier begin to improve the process. The paper kaizen process looks at the classification of each work element, removes the work elements classified as waste, and determines which incidental work elements can be reduced.
Once the paper kaizen is complete, there is a new list of work elements that are needed to produce the product. This list often provides the opportunity and need to rearrange the production area, so the process can be completed without the wasted work elements of walking and waiting. Such a reorganization of the floor has led many organizations to cellular manufacturing. The figure Process After Redesign and the table New Work Elements show the new physical layout and list of work elements (after the paper kaizen) that will be used to manufacture the product in a more efficient manner.
Now that the process of producing our automobile instrument panel has been improved and has a larger percentage of value-added work, planning can begin to determine the flexibility the area can have. The tool that we use to accomplish flexibility planning is the Operator Balance Chart (OBC).
The OBC is a picture of the distribution of work among operators in relation to takt time. Takt time is the rate at which the customer buys the product, and therefore represents the pace at which the product should be produced to avoid the most significant waste—overproduction. The OBC provides the management of an area with the numbers that it needs to make quick staffing decisions, and provides the production associates guidance as to the standardized work that they should perform.
In the figures on p. 89 are balance charts based upon the process that we have been following for changing customer demand. The line at the top of each chart represents the takt time (customer demand rate), and also the speed at which we want the product to be produced. Because there is no downtime in this area, our goal is to make each production associate's work content equal to 95% of takt time. By using these guidelines, we are able to effectively staff the workcell based on the customer-demand rate. We also know the work elements that each production associate needs to complete, and the time needed to complete those work elements and consistently meet customer demand.
To correctly staff a manufacturing area, the facility needs to understand the impact of having one more or one less production associate. How many more parts does adding one more production associate to the area create? Does it make good business sense to add one more person to the area? These are questions that must be answered for a facility to make proper staffing decisions based on a changing customer-demand rate.
Now that we have our operator balance charts, they can provide us with enough information to make good staffing decisions. First, however, we need to think about labor linearity. Labor linearity is the relationship between the number of production associates and the output of the production area or cell. Take, for example, the following labor linearity chart.
Now, armed with a labor linearity chart derived from the operator balance charts, we can make informed staffing decisions and understand the impact of those decisions. The manufacturing cell in this area, for example, is equally productive with 1, 2, or 3 production associates, because the output is around 120 pieces per production associate. When the area adds in the fourth production associate, the output of the area only goes up by 90 pieces, and we only get eight less pieces per production associate per hour.
So, will the manufacturing cell ever run with four production associates? Absolutely, if customer demand dictates that it should. If there is a truck coming at the end of the day to pick up a shipment, and there has to be a certain number of parts on that truck, we may choose to run with the four operators while knowing that they are not as productive as they could be, but the output is needed. We call this "sprinting." The reason that we call this approach sprinting is because you can only sprint so long before it hurts you. In this scenario, you would only want to run with four operators for a short time, because it is not as productive as running with three, two, or one. By developing the operator balance charts and creating the labor linearity charts, we now have the knowledge to "sprint" when we must.
Will the manufacturing area or cell in this scenario ever run with five production associates? No, never! The reason is because it does no good. Total output does not go up by even one piece by adding the fifth person to the cell. We describe this situation because in the past we've been part of and worked with facilities that simply throw people at a problem. With operator balance charts and the labor-linearity chart, there is no longer a reason to throw people at a problem in this situation. Armed with the data, informed decisions can be made.
The reason that we discuss the three steps to creating an OBC is because it's important to create an operator balance chart for a good process. We do not believe that a bad process (a process with a lot of wasted motion) should be standardized. Our philosophy is to fix the process through three steps: Get the work elements, classify the work elements, paper kaizen—then standardize.
After the waste is removed from the area and the area is designed to run in the new, more-efficient manner, operator balance charts should be drawn and the labor-linearity chart created. Doing so provides the production associates and area management solid data that allows them to correctly staff the manufacturing area based on customer demand.
In an environment like the one described here, staffing decisions are not made by gut feeling, but after consulting real data. There is no longer a reason to throw people at an area when product needs to get out the door, or to blindly remove production associates when demand drops.
Lean Enterprise Institute
Chris Harris, DBA, and Rick Harris are faculty members at the Lean Enterprise Institute (www.lean.org) where they teach several workshops, including Creating Continuous Flow, which is based on the LEI workbook of the same name. This workbook explains the application of the operator balance chart and related methods to create continuous flow in production cells. The book won a Shingo Research Prize in 2003. Chris is vice president, operations, and Rick is president, of Harris Lean Systems (Murrells Inlet, SC).