Transcript Lean Operations & JIT Chapter 14 Learning Objectives  You should be able to: 1.

Lean Operations & JIT
Chapter 14
Learning Objectives
 You should be able to:
1. Explain what is meant by the term lean operations
system
2. List each of the goals of a lean system and explain its
importance
3. List and briefly describe the building blocks of lean
4. List the benefits and risks of a lean system
Instructor Slides
2
Lean Operations
• Lean operations
– A philosophy that encompasses every aspect of
the process, from design to after the sale of a
product.
– Pursues a system that functions with minimal
levels of inventory, waste, space and transactions.
– A flexible system of operation that uses
considerably less resources (activities, people,
inventory, space) than a traditional system
• Tends to achieve
–
–
–
–
Greater productivity
Lower costs
Shorter cycle times
Higher quality
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Lean: Ultimate Goal
• The ultimate goal:
– Achieve a system that matches supply to
customer demand; supply is synchronized to
meet customer demand in a smooth
uninterrupted flow
– A balanced system
• One that achieves a smooth, rapid flow of materials
and/or work through the system
History of Lean Operation & Just In Time
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Goals and building blocks
of lean systems
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Lean:
Supporting Goals
• The degree to which lean’s ultimate goal is achieved
depends upon how well its supporting goals are
achieved:
1. Eliminate disruptions
•
Poor quality (lean systems do not carry extra
inventory), equipment breakdowns, schedule changes,
late deliveries.
2. Make the system flexible
•
•
Mix of products, levels of output.
Require reducing setup-times & lead-times.
3. Eliminate waste, especially excess inventory
•
Minimize inventory
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Waste
 Represents unproductive resources
 Seven sources of waste in lean systems:
1. Inventory
–
Idle resource, requires space, cost
2. Overproduction
–
Overuse of manufacturing resources
3. Waiting time
–
Require space, WIP
4. Unnecessary transporting
–
Handling cost, WIP inventory
5. Processing waste
–
Unnecessary production steps, scrap
6. Inefficient work methods
–
Reduced productivity, increased scrap, increased WIP
7. Product defects
–
Rework costs, customer dissatisfaction
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Lean: Building Blocks
1. Product design
2. Process design
3. Personnel/
organizational
elements
4. Manufacturing
planning and control
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Building Blocks
1. Product Design
• Four elements of product design important for
lean systems:
1. Standard parts
•
Fewer parts, less training, lower costs, routine purchasing,
handling and quality inspection. Can use standard
processing.
2. Modular design
•
Fewer parts, simpler assembly, purchasing, handling,
training.
3. Highly capable systems with quality built in
•
•
small lot sizes and absence of buffer stock.
Quality designed into the product and production process.
Standardized products, methods and equipment, workers
familiar with their jobs.
4. Concurrent engineering
•
Bringing together design and manufacturing personnel
together early in the design phase to prevent engineering
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changes.
Building Blocks
2. Process Design
• Seven aspects of process design that are
important for lean systems:
A.
B.
C.
D.
E.
F.
G.
H.
Small lot sizes
Setup time reduction
Manufacturing cells
Quality improvement
Production flexibility
A balanced system
Little inventory storage
Fail-safe methods
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2. Process Design
A. Small Lot Sizes
 In the lean philosophy, the ideal lot size is 1.
 Goal: reduce lot size as much as possible (given
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 Benefits of small lot size
 Reduced in-process inventory Q  2DS  2(annualdemand)(setup cost)
O
H
annualper unit holdingcost
 Lower total carrying costs
 Inspection and rework costs are lower when quality problems
do occur
 Permits greater flexibility in scheduling = better response to
customer demands.
 Less inventory to ‘work off’ before implementing product
improvements
 Increased visibility of problems
 Increased ease of balancing operations
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2. Process Design
B. Setup Time Reduction
• Small lot sizes and changing product mixes
require frequent setups
– Unless these are quick and relatively inexpensive, they can
be prohibitive
• Setup time reduction requires deliberate
improvement efforts
– Workers are trained to do their own setups
– Single-minute exchange of die (SMED)
• A system for reducing changeover time (e.g. 1982 Toyota
from 100 to 3 minutes).
• Convert activities form “internal” to “external”.
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What is “die?”
Instructor Slides
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2. Process Design
D. Quality Improvement
• Quality defects during the process can disrupt the
orderly flow of work
• Focus on finding and eliminating the causes of
problems.
• Autonomation (jidoka)
– Automatic detection of defects during production
• Two mechanisms are employed
1.
2.
One for detecting defects when they occur
Another for stopping production to correct the cause of the
defects (force immediate attention to the problem)
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2. Process Design
F. Balanced System
• Line balancing helps to achieve a rapid work flow.
• Work assigned to each workstation must not exceed
cycle time (Takt time).
• Takt time
– The cycle time needed to match customer demand for final
product.
– Sometimes referred to as the heartbeat of a lean system
• Procedure:
1.
2.
3.
•
Determine the net time available per shift
If there is more than one shift per day, multiply the net
time by the number of shifts
Compute the takt time by dividing the net available time
by demand
Using takt time minimizes WIP inventory.
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2. Process Design
G. Inventory Storage
• Lean systems are designed to minimize inventory (waste)
– Inventories are buffers that tend to cover up recurring problems that are
never resolved
• partly because they are not obvious
• partly because the presence of inventory makes them seem less
serious
• The lean approach is to gradually reduce inventories in order to
uncover problems and then resolve them.
• Advantages:
–
–
–
–
–
Lower carrying cost
Less space
Less dependence on buffers
Less rework
Less need use current inventory before implementing design
improvements.
• Risks:
– No safety stock
– Opportunity loss when problems arise
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Building Blocks
3. Personnel/Organizational
• Five personnel/
organizational elements
that are important for lean
systems:
A. Workers as assets
B. Cross-trained workers
C. Continuous
improvement
D. Cost accounting
E. Leadership/project
management
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3. Personnel/Organizational:
A. Workers as Assets
• Workers as assets
– Well-trained and motivated workers are the
heart of the lean system
• They are given greater authority to make decisions…
but more is expected of them
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3. Personnel/Organizational
B. Cross-Trained Workers
• Cross-trained workers
– Workers are trained to perform several parts of a
process and operate a variety of machines
• Facilitates flexibility
• Helps in line balancing
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3. Personnel/Organizational
C. Continuous Improvement
• Continuous improvement (Kaizen, 改善)
– Workers in lean systems have greater responsibility for
quality, and they are expected to be involved in
problem solving and continuous improvement
– Teams of workers and managers who routinely work
on problems.
– Problem solving “culture”: workers are encouraged to
report problems and potential problems.
– Andon: System of lights used at each workstation to
signal problems or slowdowns (green, amber, red
lights)
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Building Blocks
4. MPC
• Seven elements of
Manufacturing Planning
and Control (MPC) are
particularly important for
lean system:
A.
B.
C.
D.
Level loading
Pull systems
Visual systems
Limited work-in-process
(WIP)
E. Close vendor relationships
F. Reduced transaction
processing
G. Preventive maintenance and
housekeeping
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4. MPC
B. Pull Systems
 Push system
 Work is pushed to the next station as it is completed (without
regard to the next station’s readiness).
 Work may pile up at workstations that fall behind schedule.
 Pull system
 Work moves on in response to demand from the next stage in
the process.
 A workstation pulls output from the preceding workstation as
it is needed
 Output of the final operation is pulled by customer demand or
the master schedule
 Pull systems are not appropriate for all operations
 Require fairly steady flow of reparative work.
 Large variations in volume, product mix, or product design will
undermine the system
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4. MPC
B. Pull Systems: Communication
• Communication moves backward through the
system from station to station
– Each workstation (customer) communicates its
need for more work to the preceding workstation
(supplier)
• Assures that supply equals demand
– Work moves “just in time” for the next operation
• Flow of work is coordinated
• Accumulation of excessive inventories is avoided
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4. MPC
C. Visual Systems
 Kanban (看板）
 Card or other device that communicates demand
for work or materials from the preceding station
 Kanban is the Japanese word meaning “signal” or “visible
record”
 Paperless production control system
 Authority to pull, or produce, comes from a
downstream process.
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4. MPC
C. Visual Systems - kanban
 Kanban
 A kanban card is affixed to each container
 When a workstation needs to replenish its supply
of parts, a worker withdraws on container
 Each container holds a predetermined quantity
 The worker removes the kanban card from the
container, posts it, and take the container to the
workstation.
 The posted card is picked up by a stock person
who replenishes the stock with another container
 and so on down the line.
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4. MPC
E. Close Vendor Relationships
• Relatively small number of suppliers.
• Close relationships with (certified) vendors
– They are expected to provide frequent, small deliveries of
high-quality goods
– The burden of ensuring component quality is shifted to the
vendor.
• Local supplier are preferred in order to reduce lead
time (of small frequent deliveries)
• Ideally the suppliers themselves will be operating
under JIT.
• The suppliers become part of an extended
integrated JIT system.
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Lean Services
• In service the focus is often on the time needed to
perform the service - speed is often the order winner
• Provide services when they are needed
• Lean benefits can be achieved in the following ways:
– Eliminate disruptions
• e.g., avoid having service providers also answer phones.
– Make system flexible
• Train workers to handle more variety.
– Reduce setup and lead times
• Estimate what parts and tools are frequently needed and have them on
hand
– Eliminate waste
• Eliminate errors and duplicate work.
– Minimize WIP
• e.g., orders waiting to be processed, calls waiting to be answered,
packages waiting for delivery, truck waiting to be loaded/unloaded etc.
– Simplify the process
• e.g., self-service systems such as in retail, ATMs, vending machines,
service systems
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Lean vs. Traditional Philosophies
Factor
Traditional
Lean
Inventory
Much to offset
forecast errors, late
deliveries
Minimal necessary to operate
Deliveries
Few, large
Many, small
Lot sizes
Large
Small
Setup; runs
Few, long runs
Many, short runs
Vendors
Long-term
relationships are
unusual
Partners
Workers
Necessary to do the
work
Assets
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Lean Systems
• Key benefits:
– Reduced waste
• inventory levels
• scrap and rework
• space requirements
– High quality
– Flexibility
– Reduced lead times
– Increased productivity
and equipment
utilization
• Key Risks:
• Absence of buffers
(personnel,
inventory) to fall
back on if something
goes wrong.
• Possible loss off sale
and lost customers.
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