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Summary
Summary
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BOOST PROFITS AND REDUCE COSTS BY EFFICIENTLY DELIVERING SUPERIOR MRO SERVICES
Lean Maintenance Repair and Overhaul describes how MRO organizations can achieve significant improvement in financial performance by applying the Theory of Constraints (TOC) to guide the implementation of Lean manufacturing tools. This Lean/TOC approach facilitates a growth strategy by providing customer value, such as faster turnaround times, that the competition cannot match. Lean/TOC creates the capacity for this growth by eliminating waste.
This practical guide shows how Lean/TOC also provides the improvement strategy for dealing with the variation that distinguishes MRO from high-volume, repetitive manufacturing. The methodology expands the improvement efforts beyond the manufacturing floor to make the organizational changes needed to facilitate growth and toempower the workforce to be enthusiastic participants in the improvement processes. You will learn how these concepts have been applied to MRO organizations in the commercial and defense sectors.
COMPREHENSIVE COVERAGE INCLUDES:
The MRO business opportunity The goal of Lean and how Lean for MRO is different Achieving sustained growth in the MRO business Managing the MRO process Enabling flow in an MRO environment The Lean MRO toolkit Managing the back-shops Creating a visual culture for the implementation of Lean/TOCAuthor Notes
Mandyam ("Srini") Srinivasan, Ph.D., is the Pilot Corporation Chair of Excellence in Business at the University of Tennessee. He is the author of Streamlined: 14 Principles for Building and Managing the Lean Supply Chain and Building Lean Supply Chains with the Theory of Constraints and is co-author of Supply Chain Management for Competitive Advantage and Global Supply Chains: Evaluating Regions on an EPIC Framework - Economy, Politics, Infrastructure, and Competence . Dr. Srinivasan has many years of experience with leading automobile manufacturing organizations and has consulted with a large number of industries. He received the 2006 Edelman Award for radically streamlining the MRO process for the Air Force's largest transport plane, the C-5. Dr. Srinivasan has won numerous awards at the University of Tennessee for outstanding teaching, for research and creative activity, and for leadership in executive education. He is on the faculty of the Aerospace and Defense Executive MBA Program and of the Lean MRO one-week executive course at the University of Tennessee.
Melissa R. Bowers, Ph.D., is the Beaman Professor of Business at the University of Tennessee. Her research interests are in the areas of production planning and scheduling, Lean manufacturing, and supply chain optimization, and analytics. Dr. Bowers has years of experience consulting with numerous industries. She is a recipient of the Richard Sanders Award for Leadership in Executive Education and the John B. Ross Outstanding Teacher Award as well as several other College of Business teaching awards at the University of Tennessee. Dr. Bowers is on the faculty of the Aerospace and Defense Executive MBA Program and of the Lean MRO one-week executive course at the University of Tennessee.
Kenneth Gilbert, Ph.D., is the Regal Entertainment Group Professor of Business and Department Head of Statistics, Operations, and Management Science at the University of Tennessee. He holds the University of Tennessee's Allen Keally Award for Outstanding Teaching, the Chancellors Award for Vision and Leadership in Graduate Education, and the Richard Sanders Award for Leadership in Executive Education. Dr. Gilbert is past associate editor of Naval Research Logistics and has published in numerous academic journals. He is on the faculty of the Aerospace and Defense Executive MBA Program and of the Lean MRO one-week executive course at the University of Tennessee.
Table of Contents
Foreword | p. xi |
Preface | p. xv |
Acknowledgments | p. xix |
Chapter 1 The MRO Business Opportunity | p. 1 |
The MRO Landscape | p. 3 |
Industry Cost Structure | p. 4 |
Barriers to Entry and Operation | p. 4 |
Safety and Regulations | p. 5 |
Maintenance Service Checks on Aircraft | p. 5 |
Characterizing the MRO Process | p. 7 |
Variability in Demand | p. 8 |
Uncertainty in Work Scope | p. 8 |
Uncertainty in Supply | p. 9 |
Cannibalization | p. 9 |
Outsourcing | p. 10 |
Outsourcing Pros and Cons | p. 11 |
Traditional Decision Making and the Cost World | p. 13 |
Why the Cost World Perspective Is Pervasive | p. 13 |
The Through World Perspective | p. 15 |
TOC: The Driver of the Growth Strategy | p. 16 |
TOC: and "Big Picture" Thinking | p. 17 |
Cost World versus Throughput World | p. 18 |
The DuPont Model | p. 21 |
Translating Process Execution to Financial Performance | p. 22 |
Summary and Conclusions | p. 24 |
Key Takeaways | p. 25 |
Notes | p. 25 |
Chapter 2 The Goal of Lean and How Lean for MRO is Different | p. 27 |
Lean as the Enabler of a Growth Strategy | p. 28 |
Lean as the Enabler of a Growth Strategy: An Example | p. 29 |
Creating Capacity by Eliminating Waste | p. 30 |
Leveraging the Captial Investment | p. 31 |
Growing the Market | p. 31 |
Transforming the Organization | p. 32 |
Creating a Team of Enthusiastic Entrepreneurs | p. 32 |
Applying TOC Thinking to Strategically Focus Lean Efforts | p. 33 |
How Lean for MRO is Different | p. 31 |
The Techniques May Differ, But the Goal Is the Same: A Tale of Two Factories | p. 34 |
Process Variation and Work-Scope Variation | p. 37 |
Some General Guidelines for Lean/TOC in MRO | p. 38 |
Focus on the Intent, Not on the Techniques | p. 39 |
Reduce Process Variation and Develop a Strategy to Manage Work-Scope Variation | p. 40 |
Focus Performance Metrics on Growth, Not on Cost Reduction | p. 41 |
Focus Improvement Efforts on the Constraint | p. 42 |
Control Inductions to Match the Processing Capacity of the Constraint | p. 42 |
Lay Out Processes to Facilitate Flow | p. 43 |
Assign Priorities to Tasks That Compete for Shared Resources | p. 43 |
Summary and Conclusions | p. 43 |
Key Takeaways | p. 44 |
Notes | p. 45 |
Chapter 3 Achieving Sustained Growth in the MBO Business | p. 47 |
The Ever-Flourishing MRO Organization | p. 49 |
The TOC Philosophy | p. 51 |
Enabling Paradigms | p. 52 |
Strategy and Tactics Trees | p. 56 |
Traditional Approach to Strategy Formulation and Deployment | p. 57 |
The Theory of Constraints Perspective on Strategies and Tactics | p. 58 |
Developing the S&T Tree | p. 60 |
Using the S&T Tree to Drive Lean Implementations | p. 62 |
Concluding Remarks | p. 69 |
Key Takeaways | p. 69 |
Appendix 3A: The Thinking Processes | p. 70 |
Sufficient-Cause and Necessary-Condition Logic | p. 72 |
Categories of Legitimate Reservation | p. 73 |
Current Reality Tree | p. 74 |
Evaporating Cloud | p. 79 |
The Three-Cloud Technique | p. 87 |
Other Tools in the Thinking Processes | p. 87 |
Notes | p. 88 |
Chapter 4 Managing the MRO Process | p. 91 |
MRO Process and Project Management | p. 93 |
Project Management with Gantt Charts and PERT/CPM | p. 95 |
Gantt Chart | p. 96 |
PERT/CPM | p. 98 |
Problems with Traditional Project Management | p. 102 |
Applying the Thinking Processes: What to Change? | p. 103 |
Multitasking | p. 104 |
Parkinson's Law | p. 105 |
Sandbagging | p. 106 |
The Student Syndrome | p. 106 |
Inducting Work as Soon as Possible | p. 107 |
Impact of Uncertainties on Task Times | p. 108 |
Applying the Thinking Processes: What to Change To? | p. 111 |
Balancing Conflicting Requirements | p. 112 |
Uncommon Sense | p. 114 |
Critical Chain Project Management | p. 115 |
Planning the CCPM Schedule in a Single-Project Environment | p. 116 |
Planning the CCPM Schedule in a Multiple-Project Environment | p. 119 |
An Uncommon-Sense Moment | p. 122 |
Sustaining the Change | p. 123 |
The Projects Strategy and Tactics Tree Revisited | p. 124 |
Summary and Concluding Remarks | p. 126 |
Key Takeaways | p. 127 |
Notes | p. 128 |
Chapter 5 Enabling Flow in an MRO Environment | p. 131 |
Creating Flow by Standing on the Shoulders of Giants | p. 132 |
The Origins of TOC | p. 134 |
Bottlenecks and Constraints | p. 136 |
Five Focusing Steps of TOC | p. 139 |
Step 1: Identify the System's Constraint(s) | p. 139 |
Step 2: Decide How to Exploit the System's Constraint(s) | p. 139 |
Step 3: Subordinate Everything Else to That Decision | p. 140 |
Step 4: Elevate the System's Constraints | p. 141 |
Step 5: If a Constraint Was Broken in a Previous Step, Go Back to Step 1 | p. 141 |
Policy Constraints That Hinder Flow: The Cost World | p. 142 |
Case Study: Mike's Mechanix | p. 142 |
Policies and Standard Cost Accounting Systems | p. 148 |
Tedesky, Trucks, and Mattison, Inc | p. 151 |
Standard Cost Accounting and Variances | p. 154 |
Activity-Based Costing | p. 156 |
The Throughput World: Throughput Accounting | p. 157 |
Throughput Accounting Measures | p. 158 |
Applying Throughput Accounting to Improve Profitability at TTM | p. 159 |
The Drum-Buffer-Rope Model | p. 160 |
Time Buffers versus Inventory Buffers | p. 162 |
Determining Buffer Size | p. 163 |
Simplified Drum-Buffer-Rope Model | p. 164 |
Buffer Management | p. 166 |
Summary and Conclusions | p. 167 |
Notes | p. 168 |
Chapter 6 The Lean MRO Toolkit | p. 169 |
Getting Started: Value-Stream Mapping | p. 171 |
Overview of Lean Tools | p. 172 |
Role of the Lean Tools in Value-Stream Integration | p. 174 |
Lean and the Quality Feedback Loop | p. 175 |
Preventing Overproduction: Pull Replenishment | p. 176 |
Establishing the Drumbeat: Takt Time | p. 182 |
Preserving the Drumbeat: Heijunka Scheduling and Setup-Time Reduction | p. 184 |
Creating Flow: Cellular Layout and One-Piece Flow | p. 187 |
Platform for Improvement: Standard Work and Method Sheets | p. 189 |
Minimum Staffing Requirement and Load Charts | p. 190 |
Point-of-Use Tooling and Point-of-Use Material Storage | p. 192 |
5S | p. 193 |
Mistake-Proofing, Total Predictive Maintenance, and Six Sigma Quality | p. 196 |
Summary and Conclusions | p. 197 |
Notes | p. 198 |
Chapter 7 Managing the Back-Shops | p. 199 |
The Traditional Back-Shop | p. 201 |
Queuing Theory Basics | p. 202 |
More Managerial Practices Commonly Encountered in the Back-Shop | p. 207 |
Improving Back-Shop Performance | p. 210 |
Integrating CCPM and DBR in the Back-Shop | p. 212 |
Simplified DBR Model in the Back-Shop | p. 213 |
Delta Airlines: A Case Study Focused on Integrating CCPM and S-DBR in Engine Maintenance | p. 220 |
Background: Engine Maintenance at Delta | p. 221 |
Past Practices | p. 221 |
Vehicles for Change: CCPM and S-DBR | p. 222 |
Identifying the System's Constraint | p. 222 |
S-DBR Management System for the Back-Shops | p. 223 |
CCPM for Managing Parent Assets in the Engine Shops | p. 224 |
Integrating S-DBR and CCPM at Delta | p. 225 |
The Key to Success and Sustainment at Delta | p. 229 |
True Measure of Success at Delta or Any MRO Organization | p. 230 |
Summary and Conclusions | p. 230 |
Notes | p. 231 |
Chapter 8 Making It Happen: Creating a Visual Culture for the Implementation of Lean/TOC | p. 233 |
Visuals and 5S: Some Examples | p. 234 |
Visuals and Point-of-Use Tooling | p. 238 |
Parts Vending Machines and Automated Tools Cribs | p. 245 |
"Visual People": Co-location of Key Decision Makers | p. 253 |
Visual Equipment Layout: Eliminating Handoffs with Support Equipment | p. 255 |
Visuals in Facilitating Concurrent Work | p. 256 |
Visual Quality Control | p. 257 |
Visuals to Create Flow at a Bottleneck | p. 259 |
Summary: A Visual Culture to Eliminate Waste and Create Flow | p. 266 |
Appendix 8A: The Power of Visualization | p. 268 |
Notes | p. 270 |
Index | p. 273 |