IW Best Plants Profile - 2002

Mapping Manufacturing Remarkable results at Medtronic's medical-devices plant flow from value-stream mapping. By John S. McClenahen Medtronic Inc., Xomed, Jacksonville, Fla. At a Glance

  • Plant size: 52,000 square feet
  • Start-up date: 1982; acquired by Medtronic Inc. in 1999.
  • Special Achievements
    • Total production leadtime, including the leadtime of suppliers, has been cut to 129 days from 253 days during the last three years.
    • Productivity, as measured by annual sales per employee, has increased 40% during the last three years.
Pick up just about any map of Jacksonville, Fla., and it's easy to find your way to Medtronic Inc.'s Xomed plant off I-95 south of town. Navigating the value-stream mapping process that is critical to the medical-products plant's impressive manufacturing achievements is a bit more challenging. First, there is the shear number of those streams: 48 at last count. There are the Lean Enterprise Institute's distinctive icons -- for such things as suppliers, customers, order entry and changeover time -- that are used in drawing maps of everything that figures into the plant's manufacturing processes. And finally, but certainly not least, there is that term. Value-stream mapping sounds as if it has more to do with charting a river than with producing stuff used in ear, nose, throat and eye surgery. Jon Swanson, director of manufacturing at Medtronic Xomed's Jacksonville plant for the past two years, recognizes that. And he patiently explains the words. Value-stream mapping is the process of documenting the flow from supplier through production to delivery of products to the doctors, hospitals and surgery centers that are the plant's final customers. More precise than value-chain analysis, "value-stream mapping is a standardized way of documenting what's happening and a systematic way to analyze that to develop an improvement plan," Swanson stresses. "We actually look at the physical flow and map that. And then we map the information flow that links the processes together. And the whole idea is to identify what the waste is in the value stream, with the objective of eliminating the waste," explains Swanson. A result is that a plant that once was a traditional, inflexible batch-and-queue operation is now a flexible, fluid machine that thrives on change, its management boasts. Weekly production meetings and capacity plans are out, and pull systems are in. Cycle time once measured in weeks is now measured in hours. Including the high-volume value streams that turn out hand-held hot-wire cauteries that eye doctors use to stem bleeding during surgery, the value stream that makes two or three nerve integrity monitors per day, and the value stream that produces up to 10 tiny prosthetic stapes a month for people with middle-ear problems, there are four dozen individual value streams at Medtronic Xomed in Jacksonville. Each one has been mapped at least once since April 26, 2000, the day a group of managers committed the full facility to lean manufacturing. "I think that the hardest part to map is the information flow, because there are a lot of different ways that information gets to somebody -- and in most cases there are duplicate ways," says Swanson. "The key [to change] is to find out what all those information flows are because those are all ways that errors can get introduced into the process." Value-stream mapping at the Jacksonville plant is a tactical tool that allows management to identify bottlenecks and other production problems in individual value streams. "It forces you to eliminate all the things you think you know by seeing what is actually happening," Swanson stresses. For example, on the cautery line, value-steam mapping helped identify fixture changeover as a production bottleneck. A technician designed a new fixture that replaces the 14 fixtures that formerly had to be rotated in and out of the line depending upon the type of cautery being produced. Value-stream mapping also is a strategic tool. "We have used it as a strategic planning tool to figure out where to go with the flow of the entire facility," says Swanson. In effect, the maps of the individual value streams get put together to produce a bigger map, not only of the entire plant's flow now (known as "current state"), but also of what management wants the flow to be (known as "future state"). For example, value-stream mapping showed that the days-long process of sterilizing products -- whether done at the plant or off-site -- constitutes a facility-wide bottleneck that adds to lead times, inventory levels and costs. The plant continues to evaluate alternatives even as it expects this fall to step up the pace at which its Merocel surgical sponges move through an off-site sterilizer. Results from value-stream mapping at the Medtronic Xomed plant have been remarkable. Total production leadtime, including the leadtime of suppliers, has been cut to 129 days from 253 days during the last three years. Standard order-to-shipment leadtime has been reduced by 50% during the last three years. The cost of a shipped product, including the costs of purchased materials, has fallen 38% during the last three years. Productivity, as measured by annual sales per employee, has increased 40% during the last three years. The plant's on-time delivery rate, based on the date the customer requested, is 96%. And the operating equipment efficiency for major production lines is 98.8%. "Based on the maps, we have completely changed the manufacturing processes with the goal of improving flexibility," Swanson says. "Moving processes from islands into flow, creating a signal that a doctor's order has pulled product from finished goods and sending that signal to the pacing process, balancing the lines to meet takt time and then working to improve performance have all led to dramatic changes in leadtime and improved flexibility." Significantly, value-stream mapping at Medtronic Xomed in Jacksonville itself is a continuous yet flexible approach to continuous improvement. "We don't necessarily follow a kaizen process -- and [the approach] depends upon the business," says Swanson. "A lot of our value streams are relatively small and short and contained -- and they are very visual. So we wouldn't necessarily map after every improvement," he relates. Indeed, "the employees could be making improvements daily, and it would actually be a waste to try to map them every time you achieved a future state," he explains. "In the bigger-picture sense, we actually set out longer-term future states, like a year and sometimes even more," says Swanson. Swanson is a map maker -- and so, he says, have been "a good portion" of the other professionals in the plant. Individual value-stream production employees haven't yet been taught the art of mapping. But that may be in their future. "It actually would allow them to see what is happening in their area and give them a tool to improve process directly," says Swanson. Mapping is being extended to the plant's suppliers and customers in an effort to make them "lean" as well. For Swanson personally, value-stream mapping has "completely changed" what he thought was possible. "If someone had asked me if we could have freed up 50% of the floor space, and improved the flow rate, and improved productivity and reduce inventory, I would have said we might have been able to take one of those and improve it," he says. In contrast, "we don't think twice now about very high goals and very high expectations for the plant," he states. "These are stretch goals, and maybe we won't be able to reach them this year, but we are going to get there eventually."
Web-Exclusive Best Practices
By John S. McClenahen Benchmarking contact: Jon Swanson, director of manufacturing, [email protected], 904/279-2624 On The 'Net Medtronic Inc.'s Jacksonville, Fla., Xomed division plant uses Internet/Web-based technology primarily for employee support. Employees have access to myMedtronic, which provides online access to information, among other things, about pay, benefits and available jobs. "You can change your 401(k), employee stock purchase plan and your benefits enrollment stuff on-line," notes Jon Swanson, the plant's director of manufacturing. "There's a managers' self-service [section] where we can do promotions, pay changes, merit increases, separations-those kinds of things," he adds. "There's a contract labor section, so we can approve and hire temps." Another section allows value-stream managers to retrieve data on the last three years' fill rates. Still another section lists current training offerings. There's a people section that shows where a person is located in Medtronic and to whom they report. Power To The People Jon Swanson, director of manufacturing at Medtronic Inc's Jacksonville, Fla. Xomed division plant, characterizes creation of the Daily Work Order Requirements Report as the "biggest thing " the facility has done to empower employees. Itself a product of the plant's value stream mapping process, the report allows production employees to plan all production based on the pull signal from customers. The report allows the production employees to see what products are on-the-shelf, what products are in the sterilizer, what orders are due. "They look at that [report] every single morning and figure out what needs to be made on the line," says Swanson. "They are now in control of what they make, when they make it, an how they make it." The employees determine what the sequence in which the products will be produced, put together the value stream teams, and ensure that only the equipment needed to manufacture each product is on the line, a step mandated by federal Food & Drug Administration regulations. The employees have immediate feedback on whether they are behind or ahead of orders and whether they need to schedule overtime. "If a part goes out, they know immediately if that's going to be a problem or not, and they can reassign people," adds Swanson. Means To Lean Shortly after the Jacksonville, Fla. Plant of Medtronic Inc.'s Xomed division got serious about implementing lean manufacturing in 2000, Rick Kundert was hired as training manager. Described as "awesome" by director of manufacturing Jon Swanson, Kundert developed a series of lean learning modules. "We sent every operations employee, every plant employee including production employees, through them," says Swanson. "We talked 5Ss, pull, flow, and basic communications things." Training was reinforced by placing posters with lean slogans around the plant. There was a division-wide contest to develop a lean slogan Employees received small, foam models of "lean brains" to encourage them to think lean. (Swanson's is on his desk, near his computer). Even the outdoor walkway between that contacts the plant's distribution center to the main manufacturing building carries such lean reminders. The walkway, known as "Lean Way" takes a bend at "Kaizen Corner." Each of the pillars supporting the open-air walkway carries a lean term, and at either end of the walkway there's a lean glossary.
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