Company Background
Traditional Tooling Inc., is a 70-year old machine tool business that has been purchased by a venture capital company in the past 6 months. They reached out to Ron, a lean consultant with 50 years of production and improvement experience, under pressure from the venture capital company who is growing impatient with the company’s lack of profit improvement after investing quite a bit of money to update the company’s World War II era machinery with modern CNC machines. Current challenges disclosed to Ron include late customer deliveries, increasing scrap rates, rising customer quality complaints and steadily declining employee dissatisfaction with working conditions.Plant LayoutAs Ron struggled to stand upright, due to slippery floors coated with oily residue from machinery and equipment, he noted the challenges presented by the layout of the plant. Ron wanted to understand why, so he engaged in discussions with operators.During discussions, operators confirmed Ron’s suspicion that there was no order or logic to how the 100+ machines were organized throughout the building. Operators also disclosed that attempts to reorganize the plant layout for improved product flow and employee productivity had been thwarted by a general lack of available floor space, driving an operator philosophy of "stick it where you can find room".Ron estimated that approximately 20% of the machines had not been used in years and noted that supplies and parts were placed on tables and in unmarked bins in various areas of the plant.
Product Quality
Ron’s overview also uncovered haphazard quality processes out on the shop floor. Product checks were infrequently made by operators using un-certified instruments for checks against quality specifications written in permanent marker taped on the sides of adjacent cabinets. Outgoing checks on finished products were made on an audit basis by a final inspection department immediately before packing and shipping. No records of quality issues were visible anywhere in the shop. The scrap table was located in a remote corner of the plant and was piled high with defective product.Ron knew there was a lot of work to be done to improve the company’s profitability to provide a return on the venture capital company’s investment, but those efforts had to be grounded in lean rules and principles.

The quality specifications written in permanent marker taped on the sides of adjacent cabinets support which Lean Principle?
a. Directly Observe Work
b. Establish High Agreement
c. Systematic Waste Elimination
d. Creating a Learning Organization
e. Systematic Problem Solving