Recently, I was reviewing the incredible statistics that were produced by the recipients of the 2003 Shingo Prize for Manufacturing Excellence. Despite encompassing a variety of industries, all of the winning organizations demonstrated the same results in their continuing efforts to achieve World Class status. Just some of their accomplishments were:
- 65% reduction in scrap
- 80% reduction of cycle times
- 66% reduction in manufacturing floor space
- 80% reduction in rework
The Shingo Prize, which Business Week calls “The Nobel Prize of Manufacturing,” was established in 1988 to recognize North American companies that achieve World Class Status. The prize was named after Dr. Shigeo Shingo, the Japanese Industrial Engineer often referred to as an “engineering genius.” Dr. Shingo revolutionized manufacturing by creating many of the practices that make up the Toyota Production System, now referred to as Lean Manufacturing. While Dr. Shingo’s accomplishments are numerous and his system well proven, organizations often struggle to comprehend and implement his system.
In the process of developing JIT while working for Toyota in 1962, Dr. Shingo was able to reduce the set-up time for a 1000-ton press from four hours to one and a half hours. Shortly thereafter he was asked by management to further reduce the set-up time to three minutes. He developed an approach that was in complete contrast to traditional manufacturing procedures. In a few short months, he accomplished his goal, reducing the time from hours to a single digit. Hence, Single Minute Exchange of Dies or SMED was born. Even more remarkable, no capital spending was required. Based on his vast experience, this method to analyze the changeover process enabled the people performing the changeover to find out why the changeover took so long, and how this time can be reduced. In many cases, his system can reduce changeover and setup times to less than ten minutes.
In modern times with rapidly increasing diversity and smaller batch sizes, using setup time reduction to improve cash flow and profitability is becoming critical to the survival of manufacturers. Many companies spend more than 20% of their planned production time on changeovers. The basic concept of SMED is to reduce machine setup time, which directly results in smaller batch sizes for parts, allowing the manufacturer to produce only what is demanded by the customer. A smaller batch size also translates to lower WIP inventory holding costs in the form of:
- Less floor space required
- Less money tied up in inventory
- Less labor required to manage the inventory
- Less scrap due to part obsolescence
Dr. Shingo’s SMED System consists of the following 4 phases:
- Mixed phase
- Separated phase
- Transferred phase
- Improved phase
The method's strength is its systematic analysis of what is actually done and how time is spent during the changeover activity.
Dr. Shingo’s approach was to isolate and identify the setup time as two entities: internal setup time and external setup time. His simple approach to achieving a quick setup and changeover of the dies consists of the following steps:
- Separating internal and external setup as it exists.
- Converting internal to external setup.
- Streamlining all aspects of the setup operation.
Internal operations are those that are done while the machine (or line) is shut down. External operations are those that can be done while the machine is running. Externalizing operations reduces downtime, which is the major cost associated with setup or changeover. (It is not labor, as some might assume.) Streamlining involves eliminating unnecessary operations as a first step followed by instituting process changes to shorten or eliminate other operations.
Shingo’s classic "A Revolution in Manufacturing: The SMED system" should be required reading for anyone involved in manufacturing. In the book, Dr. Shingo describes how he developed SMED and how the reader can apply the same techniques to any industrial process. In his book, Shingo gives many practical illustrations of application of the SMED concept to a variety of different processes. There are many photos and sketches that supplement the text.
One common objection to SMED is its metalworking industry focus. It is true that Dr. Shingo's experience was in such industries, and the illustrations in the book are of machines like stamping presses, lathes, and other heavy metal-working equipment. But the basic principles behind SMED are universal, and the system has been used to successfully reduce setup and changeover times in many types of industries.
A good analogy to the concept of SMED or quick changeover is changing an automobile tire. Changing a tire typically takes between seven and fifteen minutes. Just list the number of operations involved. Now, why can a pit crew change four tires in a few seconds during an auto race? Some of the reasons are:
- They are prepared.
- They have the right tools immediately available.
- The tires only have one bolt each.
- They undergo continuous training.
The reason they have all of these things in place should be the same reason any manufacturing organization should implement a SMED or Quick changeover program: they are in a fierce competition!
In the Lean toolbox, SMED / Quick Changeover is one of the most rewarding programs that a manufacturing organization can utilize.The benefits include lower inventories, faster deliveries, and improved efficiency. Above all, you will see an increase in the morale, pride, and overall attitude of your employees. Whether your changeovers involve setting up a machine or are less traditional, SMED can reduce your changeover time. And this will ultimately result in more productivity, satisfied customers, and increased profits.