Lean Tool of the Month-SMED

SMED or Single Minute Exchange of Dies is a manufacturing based term for the lean idea of minimizing down time of a process. In a traditional manufacturing process a die is a part of the machinery that helps to mold a part. Changing a die requires the machine to stop producing parts, some amount of time and resources devoted to changing the die, then a restart period where the process is dialed in to make the next good parts. The idea is to minimize this down time because its non-value added.

Just because the description I just gave is manufacturing based, does not mean that those of you in an office should stop reading here. Read on, because SMED applies to almost every process, regardless of the "product" that is produced. It does not matter if that process is transactional, front office, or back office, SMED applies to many of them.

Lets start with a visual example of SMED. Click this link for a video of SMED in a non-manufacturing environment.

So, from what we've already discussed and seen the generalized goal of SMED is to reduce Non-Value Added Time (NVA) associated with changing over from one value added activity to the next value added activity. If we consider this general goal, we can find many opportunities to SMED our office and transactional processes. An example might help illustrate. Suppose we have a process for completing a sales forecast. The Value-Add of the process is the end result, the forecast, and all of the steps associated with actually moving that forecast towards completion. Some of those steps might be; 1. Sales force enters known demand changes from their customers, 2. Sales force changes are consolidated to a global forecast, 3. Business leaders adjust forecast for general market conditions. There are many more steps than these but these are good examples of VA steps that move the forecast towards completion. Typical NVA steps in this process might be; 1. Adminstrator corrects file errors before releasing for revision, 2. Review meetings for updates and adjustments, and 3. Publication of forecast to ERP to start demand planning. Looking at our NVA step examples, we could apply SMED to a couple of these to reduce them or move them "off" the system. Correcting errors is definitely a NVA activity, but if errors are present it is a necessary activity to ensure a "good" forecast results. Maybe we could establish an "offline" process of file review that goes on outside of the forecasting process and ensures that when the process kicks off each month, the files are error free and can proceed immediately to the sales input step. This first step of SMED is called converting internal setups to external setups. Using this strategy we take process steps that were conducted during the execution of the process and move them outside of the process. The second step of the SMED process would be to reduce internal setups that remain to a minimum. That idea might drive us to reduce the review meeting activity to a minimum required to move the consolidated forecast towards completion.

While the example used above may not speak to you in your particular office or transactional situation, if you take it in as an example of how SMED can be applied outside of the manufacturing machinery paradigm to reduce or eliminate NVA time from any process.