Lean Kitting

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D

IPARTIMENTO DI

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NERGIA DEI

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ISTEMI

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ERRITORIO E DELLE

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RELAZIONE PER IL CONSEGUIMENTO DELLA LAUREA MAGISTRALE IN INGEGNERIA GESTIONALE

Lean Kitting

A study about waste elimination and improvement

opportunities in low-volume/high-variety kitting processes

RELATORI IL CANDIDATO

Prof. Ing. Gino Dini Marta Lupi

Dipartimento di Ingegneria Civile e Industriale martalupi@hotmail.it

Dott. Peter Ball

Academic Supervisor, Cranfield University

Dott. Andrew Carroll

Head of the AIT department, Airbus Defence and Space

Sessione di Laurea del 24/09/2014 Anno Accademico 2013/2014 Consultazione NON consentita

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Lean Kitting Marta Lupi Marta Lupi

Sommario

Abstract

The kitting process is a practice used by all kinds of companies to drive the assembly operations. Wastes and inefficiencies can slow down the pace of this process, causing quality and productivity issues, and the understanding of this problem is the starting point for the application of the lean concepts and creation of a leaner kitting process. However, while the literature has always focused on studying the best practices for the improvement of high-volume/low-variety environments, little attention have been paid to how the lean features may fit in different types of environments. This represents the challenge faced by the research and the gap where the creation of a methodology to evaluate and address the most common kitting issues fits as the main objective. In order to gain a deep understanding of the lean kitting process, an industrial case study was used to support the development and test the research. The methodology created incorporates the research of the best practice and a bottom-up problem analysis. Furthermore, the definition of the kitting requirements and possible industrial constraints has been essential steps for the creation of an ideal and a realistic solution proposal. This research project derives from the Individual Project that was developed at Cranfield University in the period May/September 2014.

Il processo di kitting rappresenta una pratica utilizzata da ogni tipo di azienda per guidare le operazioni di assemblaggio. Potenziali sprechi e inefficienze che possono rallentare il ritmo di questo processo multi-livello, causando problemi di produttività e qualità, sono il punto di partenza per l'applicazione dei concetti di lean manufacturing e riflessione sul concetto di lean kitting. Tuttavia, mentre la letteratura si è sempre concentrata sul miglioramento della produzione di massa, poca attenzione è stata prestata ad ambienti lavorativi diversi. Questa rappresenta la sfida affrontata dal progetto di tesi e il gap dove si inserisce l’ obiettivo di creare di una metodologia per affrontare e risolvere i problemi più comuni del processo di kitting. La necessità di risultati di valore ha innescato l'utilizzo di un caso di studio industriale, che ha contribuito a costruire il quadro generale del processo di kitting e ottenere una più profonda comprensione del tema lean kitting. La metodologia creata spazia dalla ricerca delle best practices alla proposta di soluzioni ideali e realistiche, includendo un’analisi dei problemi con approccio bottom-up, la comprensione dei requisiti ed eventuali vincoli industriali del processo stesso. Questo lavoro di ricerca deriva dell’Individual Project svolto presso Cranfield University nel periodo Maggio/Settembre 2014.

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Lean Kitting Marta Lupi

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Acknowledgments

This thesis would not have been possible without the guidance and helpful contribution of several individuals.

First and foremost, I would like to express my sincere thanks to prof. Gino Dini, Professor of my Master Degree in Industrial Engineering at the Universita’ degli Studi di Pisa. He allowed me to join the Double degree program, which has been agreed between Cranfield University and Pisa.

Furthermore, I am also extremely grateful to my academic supervisor, Dr. Peter Ball, for his availability, effective guidance and valuable feedback. He helped me to do my very best and surpass the expectations set and he has been a source of constant encouragement throughout the entire project.

In addition, I take this opportunity to thank my industrial supervisor, Mr. Andrew Carroll, who courageously accepted the project challenges and has always been supportive and present throughout my period of stay in the Airbus D&S site. Also, I would like to thank all the managers, the production controllers, the operators and all the other people that made this project possible and accepted me as part of the Airbus family.

A special thank to Dr. Patrick Mclaughlin, who generously shared his knowledge, technical expertise and industrial experience with me and all the Academic Staff for being helpful and supportive throughout the entire year.

Most importantly, I would especially like to direct my deepest gratitude and thank my family, my boyfriend and all my friends for their continuous and unconditional support and encouragements. Even though many of them have been far away from me, I never felt lonely. Thanks.

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List of Figures

Figure 1 - Kitting Process Overview ... 2

Figure 2 - Product/Process Matrix(Quizlet LLC) ... 3

Figure 3 - Mura/Muri/Muda wastes(Leanisrael,2012) ... 7

Figure 4 - 7 Ohno's wastes(Prateek,2011) ... 7

Figure 5 - 5 Lean Principles(Cardiff University) ... 8

Figure 6 - The House of Lean ... 9

Figure 7 - 5S(Dorsett,2012) ... 11

Figure 8 - Example of a kit(MID,2014) ... 12

Figure 9 - Central Store Kitting Method ... 14

Figure 10 - Logic of the Kitting Process ... 14

Figure 11- Traditional Approach before SPS(Lean Enterprise Institute,1997) ... 20

Figure 12 - SPS Approach(Lean Enterprise Institute,1997)... 21

Figure 13 - Comparison traditional/SPS(Lean Enterprise Institute,1997) ... 21

Figure 14 - Lean Key Concepts(LeanCor,2014) ... 22

Figure 15 - Bomford Logo... 25

Figure 16 - Cerulean Logo... 25

Figure 17 - Change in the Layout ... 25

Figure 18 - Initial Supply Chain Configuration ... 26

Figure 19 - Modified Supply Chain Configuration ... 27

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Figure 21 - Areas Involved in the Kit Preparation(Airbus,2014)... 34

Figure 22 - Air View of the Site in Stevenage ... 35

Figure 23 - Airbus Defence and Space Logo ... 35

Figure 24 - Telecommunication Satellite(Airbus D&S, 2014) ... 35

Figure 25 - Decomposition of a Satellite ... 36

Figure 26 - Research Methodology ... 39

Figure 27 - Relevant Areas of the Kitting Process ... 41

Figure 28 - Steps of the Kit Use ... 42

Figure 29 - Issues Identified with Interviews ... 43

Figure 30 - Issues Identified with Observations ... 49

Figure 31 - Pareto Analysis ... 49

Figure 32 - Fishbone Diagram-Incomplete Kit ... 52

Figure 33 - Fishbone Diagram-SOP Issues ... 53

Figure 34 - Steps of the PC Job ... 59

Figure 35 - P6 Software(Oracle,2014) ... 63

Figure 36 - Common Issues ... 65

Figure 37 - Logic Behind the Creation of the Proposed Solutions ... 68

Figure 38 - Kitting Process Requirements ... 69

Figure 39 - Airbus D&S Key Constraints ... 72

Figure 40 - Over-the-wall Approach(Entrepreneurness,2010) ... 72

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Figure 43 - Window for the Mix Request-Lab ... 86

Figure 44 - Re-Organisation of the Boxes ... 87

Figure 45 - 5S Posters ... 89

Figure 46 - SOP Label ... 90

Figure 47 - Additional Bags ... 91

Figure 48 - Segmented Boxes ... 92

Figure 49 - Digital Process Flow ... 98

Figure 50 - Overall Final Methodology ... 111

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List of Tables

Table 1- Kit Preparation Methods(Adapter from Vujosevic,2008) ... 13

Table 2 - Most common kitting wastes(Adapted from Hanson,2012) ... 17

Table 3 - Kit Creation Guidelines ... 19

Table 4 - SPS Benefits and Drawbacks ... 20

Table 5 - Methodology ... 30

Table 6 - Satellite Components Legend ... 36

Table 7 - Size of the Analysis ... 42

Table 8 - Example of Case Studies ... 46

Table 9 - Excel Spreadsheet ... 51

Table 10 - PC Walking Time Estimation ... 60

Table 11 - WI Creation ... 61

Table 12 - Ideal Changes ... 77

Table 13 - Original Excel Spreadsheet ... 80

Table 14 - Modified Excel Spreadsheet ... 80

Table 15 - IT Requirements-Visual Management ... 81

Table 16 - Visual Management: Cost/Benefit ... 83

Table 17 - IT Requirements-Mix ... 85

Table 18 - Mix: Cost/Benefit ... 86

Table 19 - Visual Order: Cost/Benefit ... 19

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Table 21 - ST Store Changes: Cost/Benefit ... 93

Table 22 - ST PC Relocation: Cost/Benefit ... 94

Table 23 - ST Suggested Changes ... 196

Table 24 - MT Digital System:Cost/Benefit ... 199

Table 25 - MT Area Manager Relocation: Cost/Benefit ... 101

Table 26 - MT Suggested Changes ... 104

Table 27 - Key Findings-Academic Research ... 109

Table 28 - Key Findings-Case Study ... 109

List of Equations

Equation 1 - Calculation of the Issues’s Frequency ... 50

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List of Abbreviations

AIT- Assembly Integration and Test AM- Area Manager

BOM- Bill of Materials

CPS- Combined Propulsion System ERP- Enterprise Resource Planning IT- Information Technology

JIT- Just In Time

ME- Manufacturing Engineer MT- Medium Term

NCR- Non Conformance Report PC- Production Controller

PR- Purchase Requisition RC- Routing Card

SAP- Software used by the company SOP- Shop Order Pack (WI+ RC) ST- Short Term

TPS- Toyota Production System WC- Work Centre

WI- Work Instruction WIP- Work in Progress WO- Work Order

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1 Introduction

This section aims to provide an extended explanation of the research background together with a clarification of the research problem that will be addressed.

1.1 Background

This research is based on the idea of merging and analysing two key concepts: lean manufacturing and the kitting process. As the manufacturing world is generally struggling because of a period of crisis (Alcorta, 2011) that has been lasting for many years, many manufacturing organizations have realised over time the importance of practicing lean techniques.

According to the Lean Enterprise Institute (1997) “Lean is a set of concepts, principles and tools used to create and deliver the most value from the customers’ perspective while consuming the fewest resources and fully utilising the skills and knowledge of those who do the work”. Lean is the concept that derives from Toyota Production System (TPS) and it is applied to many industrial environments through the use of techniques and tools, which have different features, but all the same objective of improvement: waste elimination and process flow (Tapping, 2002).

Kitting is the name for the practice of feeding components and subassemblies to the assembly area in predetermined quantities that are placed together in specific containers (Corakci, 2008), to simplify the material handling and reduce the time spent on fetching parts. A kit can be used in a variety of industrial environments and can fit with both automatic assembly lines (i.e. automotive industry) and manual assembly operations (i.e. Airbus D&S)(Hanson and Mebdo, 2010). What may change is the size of the kit and the components/parts/tools that it contains. From a logical point of view, the generic kitting process comes before the assembly process, while other processes precede and enable the preparation of the kit, as shown in the simple example of Figure 1.

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Figure 1- Kitting Process Overview

Even though each organisation may adapt the features of the kitting process to its working environment, there are some guidelines to follow regarding the design of a kitting process that would allow efficiency, quality and flexibility (Fong-Yuen, 1990).

When kitting is not the common practice for the operations, the so-called method of continuous supply, where each component is presented separately in a container on the shop floor, can be used. The principle of kitting is often discussed, as it has been stated to offer a number of advantages over the more traditional principle of continuous supply. However, even though kitting has been used in industry for years, relatively little research has examined its impact more specifically.

1.2 Research problem

Companies tend to consider the kitting process an essential step in the whole workflow, as kits are usually used transversally by the shop floor (Bozer and Mc Ginnis, 1992). So, being inefficient in the kitting process means creating a knock-on effect to the assembly operations and this is what generally wants to be avoided and prevented. Usually, there are many departments, organisational levels and people involved in this process: managerial, operational and support roles. However, the importance of the operator on the shop floor that manually assembles the product and works directly with the kit should be always highlighted. Since it is the shop floor work that creates the value (Bicheno, 2009), the priority is to help and facilitate the operator, understanding which is the best way to deliver the kit.

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As the starting point for the improvement of the current state is always the understanding of the real situation, the research required the complete study of the kitting process, including all the relevant areas. According to Hanson and Mebdo (2010), kitting can be used in any type of company, but the literature extensively documents only how to include the lean methodology into a high-volume/low-variety environment.

However, there are many other companies operating in a low-volume/high-variety environment (PROJECT section in Figure 2), receiving almost unique orders from the customer and then organising the processes to satisfy the customer’s requirements.

For these reasons, the challenge faced by this research is related to the application of those lean concepts that have originally been analysed and introduced in assembly lines as well as continuous process in an opposite type of environment.

In order to develop a methodology that would make the kitting process leaner, all the relevant areas were considered in terms of waste and issues, to identify possible improvements that would fit with the operative conditions of a low-volume/high-variety environment.

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The best way to evaluate and assess both the issues and the possible improvements is to work closely with an industrial company that becomes an essential source for the data collection and the validation of the proposed ideas. Consequently, an industrial case study was included in the research to test the methodology for the kitting improvement.

1.3 Aims and Objectives

The aim of the research is to apply the lean thinking to the kitting processes to improve the flow throughout the process, considering a low-volume/high-variety environment of companies.

A set of objectives was defined to support the achievement of this aim:

 Identify the existing Best Practices for the kitting process in literature, which would contribute to the understanding of the ideal framework for the kit preparation and the lean kitting concept;

 Find and assess evidence of potential inefficiencies and wastes affecting the process, considering the relevant areas involved. The focus is on the development of the key steps to follow in a generic kitting process analysis;

 Develop and validate a generic methodology for the solution of the common issues of the kitting process, which can be applied to different companies operating in a similar environment, taking into consideration a realistic industrial environment.

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2 State of the Art

This section aims to investigate and explain the main concepts that create the basis for the research. According to the aim and the objectives, the literature research was focused on three main areas:

 The concept of lean;  The kitting process;

 The concept of Lean Kitting.

After reviewing the literature, it was possible to identify some key findings and most important the research gaps that are currently affecting these topics. Then, a glossary of terms regarding the lean manufacturing has been introduced in Appendix I, to facilitate the understanding about Lean.

2.1 The Concept of Lean

2.1.1 Lean Framework

Lean means reducing wastes, optimising cost and quality. Regarding the terminology, the word lean was first used in the 1990s in the book “The machine that changed the world” by Womack and Jones (1996) and the concept derived from the Toyota Production System (TPS), developed by Toyota (Tinoco, 2004). The term lean manufacturing is synonymous with different names, such as agile, just-in-time (JIT), synchronous and world-class manufacturing.

In other words, lean manufacturing is a management philosophy that is based on an integrated set of principles, practices, tools and techniques designed to address the root causes of operational underperformance. However, it is essential to highlight the fact that lean is definitely more than just tools.

Indeed, the two main pillars of lean are (Larman and Vodde, 2009):

 Continuous Improvement: change everything and always embrace the change;

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This philosophy is based on the active engagement and commitment of the management, which is required to involve the whole enterprise in the everyday learning and improvement.

It involves a systematic approach to eliminating the sources of loss, optimising cost, quality and efficiency, while improving safety. In order to meet these objectives, it aims to increase the value-added activities by eliminating wastes and reducing unnecessary work (Drew et al., 2004). The waste elimination is related to the need of a process to flow without interruptions that can prevent the smooth sequence of activities. So, flow is the key word for the lean production.

To deeply understand what lean production means, it is important to highlight the key concepts and features of this philosophy.

Lean is based on the definition of value added and non-value added activities and this distinction can be explained with regard to the manufacturing processes. Indeed, the process of transforming raw materials into finished goods is the objective of any manufacturing company (Dudley, 2005). The processes that make that transformation possible are the result of two different activities: those that add value and those that do not.

Value-added activities are considered the actions and the process elements that accomplish those transformations and add value to the product from the perspective of the customer.

Non-value-added activities are those process tasks that do not add value to the product from the perspective of the customer and have to be eliminated or optimised.

There are three types of wastes: MURI, MURA, MUDA derived from the Japanese language (Bicheno, 2009):

 Muri represents all the unreasonable work that management imposes on workers and machines because of poor organisation;

 Mura is related to the unevenness or irregularities in the production;

 Muda means waste and it refers to a wide range of non-value-adding activities.

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A graphical explanation can be found in Figure 3.

Taiichi Ohno (1988) defined 7 types of Muda and these are illustrated in Figure 4.

Figure 4 - 7 Ohno’s wastes (Prateek, 2011) Figure 3 - Muri/ Mura/Muda Wastes (Leanisrael, 2012)

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There are 5 principles that are central to the lean thinking, illustrated in Figure 5 (Womack and Jones, 1996):

 Customer value: specify value from the customer point of view is the first principle, because it is important to produce what the customer wants;

 Value stream: identification of the value stream is the process of understanding all the activities that are performed across the areas, to be able to propose improvements;

 Flow:create the flow means that the product or service flows through all the value adding steps in the most effective and efficient way possible;

 Pull:understand what the customer wants and organise the processes and the whole enterprise to meet that demand with a short-term response;

 Perfection: pursuing perfection does not mean defect free, but being able to deliver exactly what the customer wants, when it is required, at a fair price and with minimum waste.

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This philosophy with the principles and techniques embedded are conceptualized in the “House of Lean” model derived from the TPS (Tinoco, 2004). The house is shown in Figure 6.

As the “House of Lean” model suggests, lean is a conceptual and physical system, therefore it is not a toolbox. Lean practitioners who consider lean as a toolbox and become familiar with only one or few tools and try to implement them in their organization do not capture the real essence of lean (Liker, 2004).

It is based upon a foundation of standard and stable processes and works together with the other pillar Jidoka or Built in Quality (additional details and definitions can be found in Appendix I). Typically, organisations want the benefits of JIT, but often reduce inventory to a level lower than their processes are capable of supporting. This can result in missed schedules, customer service problems and higher costs. For this reason it is called “Just about in Time” or “Almost in Time” and has a bad, almost negative, connotation to it. In fact JIT can be very powerful in driving quick response to problems by making problems visible and urgent. However, it is needed to have

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human response system capable of responding to problems as they arise and putting counter measures in place before running out of materials (Norval, 2011).

It is important to keep in mind that it takes time to become a lean organisation and the change process can be compared to a journey, as the book “Journey to lean” by Drew et al. (2004) suggests. It states that only with the commitment of all the teams and the willingness to change the final objective is achievable.

2.1.2 Relevant Tools

It has previously been stated that lean manufacturing is not only about tools, but there are plenty of them that are currently used to apply the lean philosophy. The main tools associated to lean manufacturing that are considered relevant to the research are in the visual management category: kanban and 5S. Only these tools are presented because in literature they have been used to solve many of the issues that are expected to be experienced in the kitting process, as it will be fully explained in the section 2.2.

Visual Management: it is a clear and simple way to organise and present information. It affects the so-called visibility and is a key theme of the lean manufacturing (Williamson, 2009). Not having immediate, apparent and up-to-date schedules or problem solving process is a symptom that the operations are far off lean (Bicheno et al., 2009). Visual management is a generic expression and concept that is spread across the whole shop floor and can be applied in many ways. It may affect machines, people and the physical work area as well. A few examples are: transparent covers for the machines, light to indicate a status, a skill matrix that indicates the experience of the operators etc. The impact that visuals can have on productivity, cost, quality, on-time delivery, inventory and equipment reliability is truly enormous.

Kanban: it is a system that helps programming, controlling and regulating the work in an extremely simplified way and apply JIT to the working environment. Kanban is the name for a card (physical or electronic) that accompanies the single container of materials or parts. The information contained in a kanban refers to what to produce

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or handle and generally indicates: name of the part, the design number, the amount and the name of the final product (Santillo, 2008).

The first rule of the kanban is that nothing can be produced without an available card authorization; departments upstream should, therefore, produce only the parts that have been consumed by the downstream stages with the eventuality of stopping the operations when there are no kanban to authorise production. Another rule than needs to be strictly respected is that the downstream departments can request upstream only those components/parts that are needed in the necessary quantity and when needed (at the moment of consumption).

5S: the method of 5S is an attempt to always get the order and cleanliness in the workplace of each operator, as prerequisites for quality, reliability and efficient production. Each S (described in Figure 7) represents a Japanese word that have been translated according to the meaning:

Using this method can be very beneficial for the workplace as there are numerous advantages for the elimination of superfluous material: operational staff, for example, will be able to move more freely on the shop floor without walking between obstacles. Then, they will not have to spend time searching to find some tools to use or wasting time in releasing the benches occupied by unnecessary materials. Moreover, the working environment will result in a safer place to work. Also, keep unnecessary items involves a "maintenance costs" and, in the case of stocks of products, even of

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"borrowing costs". Remove all unnecessary items from the work area means therefore saving money (Santillo, 2008).

2.2 Kitting process

The assembly process plays an important role in the production environment. Indeed, there are a lot of strategies for modelling the assembly systems (Yu et al., 2003) and for the design of assembly systems for which expert systems have been developed (Sanders et al., 2009). Nevertheless, another important subject related to the assembly process is the assembly operation feeding systems. The two main common methods (Hua and Johnson, 2010) are: kitting and continuous supply.

Bozer and McGinnis (1992) define a kit as “a specific collection of components and/or subassemblies that together (i.e. in the same container) support one or more assembly operations for a given product or shop order.” Simple examples of a kit is shown in Figure 8.

The kit may contain not only physical components, but also documentation that the shop floor needs, for instance work instructions, the routing card describing the operations required by the specific component etc. Generally, plastic boxes are used to present the kit and this may be segmented or not, depending on the purpose and the materials involved. The quantity and the need for the paperwork vary a lot according to the requirements of the end product and components, as well as the features of the organisation (Ramachandran and Delen, 2005).

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The kitting process, that is the name for the process that creates the kit, is usually compared to the continuous supply method, where each part number is generally presented in a separate container directly on the shop floor.

According to literature (Vujosevic, 2008), there are several methods associated to the preparation of the kit (Table 1) and each of them affects the physical layout of the company.

Method Description

Central Stock Room

The information for the preparation of the kit and the whole process is derived from an Information Technology system (i.e. ERP).

The storage location may be located directly on the shop floor close to the assembly area. The kit may be prepared in the stock room or in a separate area.

Shop Floor Supermarket

Fed by:

 Supplier directly (no central stock room, so it requires integration with the supplier)

 Central stock room (kanban are used to replenish the supermarket).

The operator in the assembly area creates the kit and is responsible for the material management.

Outsourcing

The kitting process is externalised. The supplier delivers the complete kit on the shop floor.

The lead-time may increase and it requires supply chain management skills.

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Each method explained previously has pros and cons and what the literature does not state is which is the best one, the so-called best practice. However, the preferred method and by far the most used is the one that involves the presence of a central store (Baudin, 2004), even though it may be not the best method.

Figure 9 illustrates a simple example of the first kitting method, where the kit is prepared according to the parts stored in the central warehouse and it is then delivered to the assembly area. The picture shows the assembly line, but this method can also be used with manual assembly operations (Dudley, 2005).

The kit preparation is an intermediate step in the whole process that leads to the creation of the final product (Bozer and McGinnis, 1992). As it is shown in Figure 10, the kit is prepared with components that may be raw materials (nuts, bolts etc.) or subassemblies, which has been previously assembled. Regardless of what is in the kit, each assembly operation requires one of them to deliver the final product to the customer.

Figure 9 - Central Store Kitting Method

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Especially in assembly lines there may be different starting points for the part production that would be then included in the kit (Hanson et al., 2012):

 Pulled by part: the kit is empty and the parts to refill the kit are taken from an intermediate storage. Whenever a part container is empty, that triggers the production for the specific component. This is usually the most commonly used method, as it allows a faster process and more flexibility;

 Pulled by kit: when the kit is empty the production is triggered and the components will be included in the kit when ready. The kit will be complete only when all the parts have been manufactured.

Furthermore, the kitting process can be classified according to the type of material fetching: picker-to-part, when the picker is travelling to the picking locations to collect the kit or part-to-picker, where the materials are brought to the picker for the use. The choice of the system configuration has a big impact on the travel time and distances, however there is not a right or wrong decision (Brynzer and Johansson, 1995). It depends on the company and the specific features.

According to Johansson (2006), the reasons for implementing the kitting system usually involve parallelised assembly systems, product structures with many part numbers, quality assurance of the assembly and high value components, but this is only a guideline.

Compared to continuous supply, where the material is delivered directly to the shop floor, kitting has been associated with a number of potential advantages (Christmansson et al., 2002):

 Space-efficient parts presentation that means saving space in the work stations when the materials are supplied in containers (i.e. tote pans, with numerous identical components in the same container, this would have resulted in an enormous plant) (Hua and Johnson 2010; Bozer and McGinnis 1992);  Improved assembly quality due to reduced part damage because of excess handling. Indeed, high value components can be secured in kitting packages (Hanson, 2012) and it also allows an early identification of low quality components (Bozer and McGinnis 1992; Johansson 1991);

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 Reduced and better controls over the WIP, as the parts of existing kits provide immediate information regarding the WIP level (indeed each kit consists of a predetermined quantity of parts) (Anonymous, 1997; Applied Industrial Technologies, 2014);

 The assembly areas could become more flexible and free from leftover components. Moreover, it can bring an improved control and better visibility of the flow of components on the shop floor (Bozer and Mc Ginnis, 1992);

 Less time spent by the assembler looking for parts that are supplied all in the same kit, so it increases productivity (Hua and Johnson 2010; Johansson 1996).

On the other hand, kitting is also associated with certain drawbacks (Hanson and Melbo, 2010):

 The kits need to be prepared in advance, which requires space and additional handling (Hua and Johnson 2010; Bozer and McGinnis 1992);

 Preparing the kits requires some time and effort which is a non value adding activity (waste) (Bozer & McGinnis, 1992);

 Additional transportation may also be necessary if kits are prepared in a separate area that is not linked to either storage or assembly. Furthermore, an increased number of handling occasions increases the probability of damaging the components, therefore not all components are suitable for kitting (Johansson and Johansson, 2006);

 Additional planning is required (Bozer and McGinnis 1992);

 Missing, defective or wrong parts in the kit negatively effect the assembly operations. Components that may fail during the assembly process will require special consideration or exceptions (Bozer and McGinnis 1992).

Each of these issues may trigger other issues with an overall increase in downtime, manpower costs (unproductivity costs money) and lead times.

It has been argued that the main difference between kitting and continuous supply is that the non-value-added activities are moved from the assembly to the kitting area, but this has never been confirmed. What it is true is that both methods have advantages and disadvantages and that there is not set of rules stating which is the best solution to implement (Baudin, 2004).

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It is important to highlight that kitting can also be used together with the continuous supply, according to the type of component needed. Indeed, bulk and commodity/low value items should be directly supplied to the shop floor, without being kitted (Baudin, 2004).

Taken into consideration both pros and cons, it has also been stated that kitting is preferable in a low-volume/high-variety environment, while the continuous supply fits better in an opposite type of organisation (Hua and Johnson 2010), however this is only a rule of thumb.

As this research aims to apply the lean thinking to the kitting process, it is considered relevant to summarise the most common issues that may affect the kitting process identified through literature research and link them to the 7 Ohno’s wastes. For this purpose, Table 2 has been created. Data refers to literature research and also include personal judgment and understanding.

Waste Common Kitting Wastes

Overproduction More parts in the kit than required

Waiting Kit waiting on the shop floor or operator waiting for the kit

Transportation Kit prepared far from the shop floor

Overprocessing Operations in the kitting process repeated more than once

Inventory Higher level of inventory than required (store or shop floor)

Movement Unnecessary movements in the whole kitting process

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2.3 Lean kitting

In a lean world, kitting is considered a waste. Indeed, following Toyota’s lean thoughts of the past, the organisation should provide component storage racks, replenished using kanban signals, alongside assembly lines and let the operators pick the parts to set up the job when appropriate (Bozer and McGinnis, 1992).

However, there are two aspects to highlight: the focus is always on the high-volume/low-variety environment, as that is the environment that requires the assembly lines and also eliminating the kitting process may not be the solution to completely eliminate wastes, because other types of wastes may be created in other areas that might more damage the company in terms of time and quality (Vujosevic, 2008). This means that currently there is not one right answer to the question: What does lean kitting mean? What is important, however, is a deep and careful evaluation of the existing constraints prior to a possible kitting elimination.

If elimination is not the right answer or it takes a long period of time to be implemented and it is postponed in a future timeframe, there are some principles that helps making the kitting process lean (Henderson et al. 1993):

 Eliminate waste related to downtime caused by invalid kitting;    Kit right first time;

 Eliminate waste in kitting.

According to Fong-Yuen and Puvitharan (1990), there are a few guidelines that are expected to help the design of a JIT kitting process and they involve 3 key aspects (described in Table 3):

 Part size;  Lot size;  Kit size.

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Part size

Influence  Material handling methods  Choice of kit containers

NB: Bulky parts may not be introduced in the kit, but pulled separately with kanban.

Lot size

Part production

 Pulled by kits: kit empty triggers the production

 Pulled by parts: kit refilled by parts stored in an intermediate storage (most used)

Kit size

(Number of sets of parts in the kit)

Storage container should be compatible with the kit size because if the n. of units in a container of a

part is < kit size  container useless for the kit

Table 3-Kit Creation Guidelines

Kanban is good tool to use to create a lean environment, however the practical implementation requires a behavioural change together with the physical one, and also the collaboration of the parts that are working together.

There are some case studies in literature developed to explain the concept of lean kitting, but many of them describe a high-volume/low-variety environment (Kilic et al., 2012). Indeed, a study conducted in an electronic company (similar type of environment) (Vujosevic, 2008) suggests that replacing the central store with supermarkets on the shop floor fed by daily deliveries from the supplier can be extremely beneficial. In this case, the kitting process was not removed, but the responsibility for the preparation was shift to the shop floor and kanban used to control the supermarket.

Another example of lean kitting process comes from Toyota, that started using kitting in some of its plants for high volume assembly operations (Lean Enterprise Institute, 1997). Toyota implemented a new kitting process, called Set Pallet System (SPS), in its new production facility in San Antonio (USA). This new approach is mainly based

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assembly stations to get parts. Instead, electronic signals to tell the material handlers what parts to select from bins separated from the line, to then select and place them on pallets traveling with the engines being assembled (Lean Enterprise Institute, 1997).

There are several benefits associated to this concept, but at the same time there are some drawbacks to take into consideration. Table 4 summarises the SPS main aspects.

Benefits Drawbacks

More value added time by the operators/

Easier training Increased Manpower

Cleaner work areas with visual control Takt-time Changes

Fewer part selection errors Best suited to automated lines, rather than cells.

Table 4 - SPS Benefits and Drawbacks

Figure 11- Traditional Approach Before SPS (Lean Enterprise Institute, 1997)

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Figures 11 and 12 are presented to visually show what changed from the traditional assembly line concept and the new SPS method. Operators on the traditional assembly line at Toyota spent non value-adding time walking to the racks to select parts, while with the new configuration the time spent on fetching parts and walking is dramatically reduced (Figure 13). This brings an increase in the productivity and efficiency.

Figure 12 - SPS Approach (Lean Enterprise Institute, 1997)

Figure 13 - Comparison traditional/SPS (Lean Enterprise Institute, 1997) Figure 12 – SPS Approach(Lean Enterprise, 1997)

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2.4 Key findings

After collecting information and creating the conceptual framework, it was essential to summarise and identify the main key learning points that were then addressed by this research, that are visually represented in Figure 14.

The lean philosophy is based on the 7 wastes investigation (8th_{waste related to}

people knowledge may be included as a separate category) and the main aim is to remove them from the activities, to obtain the flow with only value-adding tasks. This is what the research focused on with the kitting problems identification and analysis.

Kitting means organising the needed parts and components to be easily used by the operators and this is considered a waste in the lean environment, but the elimination may not always be the right decision and trigger other issues. The research addressed the ideal way of performing kitting process, evaluating the possibility of a future elimination.

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2.5 Research Gap

Best practices for the kitting systems have rarely been described in the literature and many uncertainties regarding the performance and design options of these systems exist, leading to assembly systems providing kitting sometimes being rejected.

The literature is mainly focused on the comparison between the continuous supply and the kitting methods choice, investigating the pros and cons. Moreover, attention is primarily paid to the study of how high-volume/low-variety environments may be improved, but a little time is spent discussing about how lean concepts may fit opposite types of environment.

Indeed, traditional lean manufacturing is set up for relatively high-volume/low-mix operations, in which the workflow can be balanced. This really does not apply to most job shops. In fact, high-mix causes variations in loading the production operation (Dick Kallage, principal of KDC & Associates, Barrington)

Furthermore, the concept of lean kitting has not been fully cleared and different researchers may consider kitting a waste or a value-adding activity, in the way it helps the flexibility and the cleanness of the workplace.

This is the context where this research is insert, aiming to contribute to the understanding of the kitting process best practices and also whether kitting is more a waste or a value-adding activity.

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3 Best Practices from Industry

Creating the state of the art and building the understanding about the best practices existing in literature is always the starting point for a study. However, there are not many case studies in literature, as explained in the Research Gap, to take into consideration representing the so-called best practices. Furthermore, the low-volume/high-variety environment has never been extensively documented.

For this reason, investigating about industrial best practices to understand how other companies are dealing with the kitting process is considered an essential step to use as a basis for this research. This type of information is not available in literature (this is way this data has not been introduced in the State of the Art section) and the main sources of information are interviews with the person who was personally involved in the following case studies (McLaughlin, 2014). These two case studies have been labelled best practices because of the idea that the kitting is considered a waste in lean manufacturing. Indeed, both the companies cited completely removed the kitting process and the store, with benefits in terms of productivity, people’s motivation and inventory reduction.

However, it would be meaningful to investigate more collecting additional case studies about kitting best practices in a low-volume/high-variety environment, as these two case studies can be considered as ultimate solution for the kitting process since the whole process is removed.

These two case studies from industry are presented to build the understanding around possible radical changes that may be exploited and become the future key to the success of the companies’ operations; as previously mentioned, they are both based on the idea, stated in the State of the Art, that kitting can be considered a waste in lean manufacturing. The aim of this section is not to give a decisive answer for the lean kitting definition, but to create space for reflection.

However, it is always essential to keep in mind that every company has specific constraints to take into account.

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Lean Kitting Marta Lupi Case Studies

Figure 15 - Bomford Logo Figure 16 - Cerulean Logo

Bomford (Figure 15) is a company that produces vegetation control machinery, while Cerulean (Figure 16) supplies process control instrumentation, test and measuring equipment. The former produces about 50-60 types of products and 2-3 is the maximum quantity for each of them. The same products may not be repeated for weeks or months. The latter is characterised by less product variants, but still low quantities for each of them. Even though they operate in a completely different area, they both belong to the class “low-volume/high-variety”.

They were similar also in the fact that the initial layout was functional, so organised according to work centres. Furthermore, they both had many problems with shortages and inventory management as well.

The very first change that was introduced in their facilities was a change in the layout. Indeed, cells replaced the initial functional layout (see Figure 17). This was done because the cellular layout allows more independence and gives additional responsibilities to the operators that are likely to feel more motivated and involved in the work.

WC 1

WC 2 WC 3

CELLS

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Following the modification of the layout, the existing central store was dismissed and the cells used that amount of free space.

Moreover, a kanban system was introduced to control and regulate the internal flow of the materials moving around between the cells. So, it is the downstream request that is pulling the whole process.

The other important change was organisational; in fact, the management and the cell team agrees in week 1 it what to produce in week 3 and that triggers all the steps of the manufacturing process, according to each operation’s lead times.

A big change also addresses the operators. Indeed, they are now in charge of the quality inspection, task that was previously performed by the store. Currently, the shop floor is much more involved in every aspect of the business, as it participates through the team leaders to the design phase as well as the scheduling and the manufacturing and this is a big incentive to have the right thing done correctly the first time.

An additional change that was beneficial for the companies was related to the material management area. Indeed, both companies performed a rationalisation of the suppliers, keeping only the so-called consolidator suppliers. Bomford reduced the number of vendors from about 250 vendors to less than 100, while Cerulean cut the number down to roughly 50 (from the initial 250 suppliers). The idea is the have a change in the whole supply chain, going from the configuration shown in Figure 18 to that in Figure 19.

Company

S1 S2 S3 S4 S5 S6 S7 etc

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The responsibility for the preparation of the kit is shifted from the company to the supplier that is required to deliver the full kit to the shop floor on a weekly basis, according to the agreement made in week 1.

The low value items are kept directly on the shop floor and refilled by the supplier on a regular basis. This helps the control and the reduction of the inventory and at the same time facilitates the operators, who are more independent in the way they manage the materials. Even the high value items that are not kitted because of specific requirements are held on the shop floor. This allows more visibility and helps the operators organising their own work.

The changes explained required the reorganisation of the whole supply chain: company, suppliers and suppliers of the suppliers. Also, the high commitment of the management and even more of the operators it is required to make things working.

The timeframe for all these changes described has been 12 and 18 months (different in the two companies), including steps of changes explanation and trials before reaching the steady state.

It is also to highlight that lean tools such as visual management, 5S and kanban were used to improve the working environment, but it would have been useless without a cultural and behavioural change.

Company S1 S11 S12 S2 S21 S22 S23 S3 S31 S32

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28 Positive Outcomes of the Changes

 Operators felt more responsible for their own work and more involved in all the production process;

 Inventory levels and shortages were reduced;  Free space was reorganised;

 The kits are now prepared outside the company and delivered ready-to-use, saving time and costs;

 Value-adding activities are kept inside the company, while the non-value adding externalised.

Problem of Change Management

At the beginning of the change process operators were sceptical and most of them could not believe in a system without a store and especially without shortages. Indeed, shortages had always been part of the everyday life in the two companies. Furthermore, even the management was obstructing the changes implementation, mainly because it was not fully ready for a radical behavioural and organisational change.

It is true that people are all different, but the change management path has been proved to be real (Chapman, 2005). Fear for something new is innate and is a natural feeling at the beginning, but than the feelings change, as illustrated in Figure 20. To allow the change, a lot of time was spent, in the case studies, on the shop floor working closely to the operators.

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The incentive for the change is what can make the process flow. Indeed, the management should be extremely careful about encouraging the change, without pushing the operators against his/her will that may have the contrary effect. What was used in both cases is external help, because people feel less threatened and more open to the change when the top-level management is not directly involved in the process (Kotter, 2002).

4 Research Methodology

The best method to develop a research starts from building the framework through the analysis of what exists in literature. To increase the value added by the research, an industrial case study has been identified and involved as an essential element for the whole research development. This allowed detailed understanding of kitting in addition to the literature, in order to build a generic methodology, which can identify and address process waste. Furthermore, because there are some gaps in literature that did not allow the complete picture of the best practices for the kitting process to be established, this research included two industrial case studies that represent the industrial best practices for the kit preparation.

At the end of the section a scheme that summarise the whole methodology, including the use of the case study, will be presented.

4.1 Method

The whole methodology used to develop the research has been summarised in Table 5 in terms of steps and aim of each of them. The method described in Table 5 includes the work developed in a timeframe of 4 months.

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Step

Aim

State of the Art

Build the framework and the context of the project at Cranfield University (lean manufacturing, kitting methods etc.).

Tools: Literature Research

Best Practices from Industry

Identification of the industrial best practices for the kitting process.

Tools: Interviews at Cranfield University

Problem Analysis

Build a deep understanding about the generic steps of the kitting process and the relevant areas involved.

Identify the main issues of the process to evaluate the source of potential improvement.

Tools: Documentation, Interviews and Observations (based on Questionnaires and Checklists)

Additional Tools: Pareto Analysis was used as a tool to prioritise the problems identified and Fishbone Diagram for a deeper analysis

Proposed Solutions

Propose an ideal and realistic implementation plan for the issues identified.

Ideal solution: based on the two best practices industrial case studies, literature research and problem analysis.

Realistic Solution: additional interviews were considered

vital to evaluate the feasibility of the proposed changes.

Tools: Interviews, Observations and Literature Research

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Lean Kitting Marta Lupi State of the Art

A review of more than 50 papers was performed and it has been essential in order to build the extensive context of the research. The literature was accessed with the support of academic databases to investigate the concepts of lean manufacturing, kitting process and lean kitting. However, the outcome has not been completely exhaustive and some gaps in the literature were identified.

Best Practices from Industry

While the State of the Art represents a collection of data from the literature, this step aimed to collect data from the industrial environment, which is not available in literature. The identification of the best practices from literature for the kitting process is considered a good starting point, and because the outcomes of the literature review were not satisfactory, the need for deeper investigation about industrial best practices arose. For this reason, this step was introduced and presented prior to the problem analysis and additional industrial case studies were collected with the collaboration of experts from Cranfield University.

Problem Analysis

Two sub categories representing the two aims listed in Table 5 are included in this phase: data collection and problem identification.

The data collection involved spending time in an aerospace company used as a case study. It included the study of the company documentation, interviews (structured or less structured, including formal and informal meetings) and direct observations of the work (shadowing) of the people involved in the case study. Checklists and questionnaires were used as a basis for interviews and observations, in order to rapidly capture the essence of people’s work and are attached in Appendix II.

The reason for the method used (combination of interviews and observation) is to assure as much objectivity as possible and consider both the internal and the external points of view.

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affects the others, so that it was possible to include all the relevant areas in the analysis.

Also, it acted as the main source of understanding for the following step: the problem identification. In this step the data collected were deeply analysed to identify the main issues of the kitting process. For this reason, these two sub categories will be described together in the Problem Analysis section.

The additional tools used in the Problem Analysis step were the Pareto Analysis and Fishbone Diagrams. These were used for a problem prioritisation and a deeper analysis of selected issues. Indeed, the more it is known about the problems, the more it is likely to find a satisfactory solution that fits with the real feature of the problem.

Proposed Solutions

The step coming after the Problem Analysis is the Proposed Solutions. This represents the step that aimed to develop a solution plan for the issues identified previously. Indeed, it is related to the objective of developing a generic methodology that could be applied to address the issues identified with the case study in other similar companies. The use of the company case study has been extremely useful even in this phase because it was involved in the validation of the methodology.

The main ideal is to present an ideal state for the kitting process and then focus the attention on the creation of a ready-to-use solution (realistic) that would help in the elimination of the wastes. To do that, a fundamental step regards the identification of how the AS IS kitting process differs from the ideal TO BE, going through the identification and the understanding of possible constraints.

Each problem identified has been addressed and ideas generated for the improvement. Then some ideas have been labelled as unfeasible or not implementable in a short period of time, whereas others have been deeply investigated and proved to be feasible with the collaboration of the people involved in the area addressed by the change; additional interviews and observations have been then used at this stage for this purpose. Even the realistic solutions have been

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organised in terms of time, as some ideas are easily applicable in a short period of time, while others would required more time, according to estimations.

Interviews and observations have been used throughout the project, with some parts that have been more involved at an early stage and some others taken more into consideration in the final evaluation of the proposed solution.

The case study has been a vital source of information in all the research phases and, with the use of interviews and observations, the proposed methodology to address the kitting issues has been validated (Validation Method).

To summarise and give an idea of the size and the extension of the analysis, the diagram shown in Figure 21 illustrates in more details all the common steps of the kit preparation that are under the responsibility of various organisational parts. Some of them have been deeply considered and studied as considered more relevant according to a prioritisation related to the objective of the project.

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4.2 Industrial Case Study

The company used as the case study for the research was Airbus Defence and Space (formerly Astrium) based in Stevenage (UK) (Figure 22), where roughly 1300 people are employed.

Airbus D&S (Figure 23) is an aerospace company primarily responsible for the production of telecommunication and scientific satellites. Figure 24 shows an example of telecommunication satellite.

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A satellite can be decomposed in many parts, as it is shown in Figure 25. However, only some of the following product areas (listed in Table 6) were addressed by the research, including structure and propulsion (CPS).

Table 6-Satellite Components Legend

1 Antennas 2 Structure 3 Propulsion 4 Solar Arrays 5 Batteries 1 2 2 3 4 5

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The company is involved in many almost unique projects over the year, receiving orders from national and international customers, so it operates according to projects, in a low-volume/high-variety environment.

Kitting literally means organising items into boxes, but Airbus D&S associates a more extensive meaning to it. In fact, kitting represents the whole process that stretches from the production planning and scheduling to the shop floor where the operators use the kit. Therefore, both managerial and operative areas contribute to the Airbus D&S kitting process and many organisational levels are involved (i.e. production controller, store etc.).

The process is considered critical by the company because each job performed at Airbus D&S requires a different kit. Every kit is supplied to the front line by the production control area using a plastic box of the required size, together with the relevant documentation that supports the specific job (mainly RC, drawings, WI and Appendices to complete). Each of them may vary in terms of complexity of the paperwork and quantity as well as size of items included and the quality of the kit has a great impact on the next steps: assembly and consequently the delivery to the final customer.

What it is not supplied with the kit are different types of tools and the so-called consumables (i.e. adhesive tapes, gloves, hats etc.), that are stored directly on the shop floor or in other areas (i.e. store).

For this reason, the company is seeking to streamline their kitting process that marshals parts, tooling, documentation, etc. ready to be used for assembly in the numerous clean rooms on site and make the process flow. A clean room is namely the area of the shop floor where the operations are physically carried out (each clean room has a different aim and is in charge of specific product areas i.e. panels, CPS, structure etc.).

For the specific industrial case study, the research aimed to find the best way to apply the lean thinking to the kitting process, focusing the attention on a group of products, called mechanical platforms, and more specifically on three main areas: Panels (blanks and assembly), Combined Propulsion System (CPS) subassembly

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Integration and Test (AIT) and all organisational levels included in that area. Also, the aim was also to provide an improvement plan that Airbus D&S may apply across the whole AIT department not only at Stevenage.

Figure 26 summarises the whole methodology, including the use of the Airbus case study.

Lean Kitting

D

I

’E

S

,

T

C

Lean Kitting

A study about waste elimination and improvement

opportunities in low-volume/high-variety kitting processes

Sommario

Abstract

Acknowledgments

TABLE OF CONTENTS

List of Figures

List of Tables

List of Equations

List of Abbreviations

1

Introduction

1.1

Background

1.2

Research problem

1.3

Aims and Objectives

2

State of the Art

2.1

The Concept of Lean

2.2

Kitting process

2.3

Lean kitting

2.4

Key findings

2.5

Research Gap

3

Best Practices from Industry

4

Research Methodology

4.1

Method

Step

Aim

4.2 Industrial Case Study