Latest Trends In Operations Management Just In Time Sannik Seemoli Ganatra Shashank Saptha Anju Maria John Mahale Akshay Uday
WHAT IS JUST IN TIME ????• Producing the quantity if goods that is needed, no more, no less• Producing them on the date and at the time required, not before, not after.• Suppliers deliver the exact quantity demanded, at scheduled time and date• Just in time is a ‘pull’ system of production.• Demand-pull enables a firm to produce only what is required, in the correct quantity and at the correct time.
• This requires a carefully planned scheduling and flow of resources through the production process.• Modern manufacturing firms use sophisticated production scheduling software to plan production for each period of time,.• Information is exchanged with suppliers and customers through EDI (Electronic Data Interchange) to help ensure that every detail is correct.• For example, a car manufacturing plant might receive exactly the right number and type of tyres for one day’s production
• A lean system works best if the daily load on individual workstations is relatively uniform Uniform loads can be achieved by assembling the same type and number of units each day, thus creating a uniform daily demand at all workstations Workers should be trained to operate several machines, to perform maintenance tasks, and to perform quality inspections Use effective machines but the key is to use machine and worker idle time to maintain equipment and prevent break downs
PRIORITIES• Traditionally • Accept all customer orders • Provide a large number of options from which customers may order• JIT • low cost/high quality within limited market
ENGINEERING• Traditional • design custom outputs• JIT • design standard outputs • incremental improvements • design for manufacturability (DFM)
CAPACITY• Traditional • excess capacity designed into system just-in-case problem arises • highly utilized • inflexible• JIT • minimize waste of having extra capacity • flexible capacity • moderately utilized
TRANSFORMATION SYSTEM• Traditional- • long lead times are often thought to allow more time to make decisions and get work performed .• JIT • short lead times mean easier, more accurate forecasting and planning. • If lead times are reduced, there is less time for things go awry, to get lost, or to be changed • “Don’t let the parts touch the floor” (the parts have to be kept on the machines and thus be worked on until completed) • Smaller batches result in shorter lead times and less inventory, at the same time. With smaller batches, engineering changes get to the customer sooner, problems with quality are corrected more quickly, rework is reduced, there is less obsolete inventory, and new products get to market more promptly .
LAYOUT• Traditional • job shop approach of using widely spread-out equipment with space for stockrooms, tool cribs, and work-in-process inventories between the equipment • To handle and move all this inventory, automated or semi automated materials handling equipment (conveyors, forklifts) is required, which takes even more space.• JIT • Equipment is moved as close together as possible so that parts can be actually handed from one worker or machine to the next. • Use of cells, and flow lines dictates small lots of parts with minimal work-in-process and material-moving equipment.
INVENTORIES• Traditional • used to buffer operations • large WIP buffers• JIT • inventory is seen as an evil • small WIP buffers
WORKFORCE• Traditional • competitive attitude between workers and managers • status symbols and privileges • much of the employees’ time is wasted looking for parts, moving materials, setting up machines, getting instructions, and so on. When actually working, they tend to work fast.• JIT • broadly skilled flexible workers who can uncover and solve problems • work teams • cooperative attitudes
ADVANTAGES• Just-in-time manufacturing keeps stock holding costs to a bare minimum.• The release of storage space results in better utilization of space and thereby bears a favorable impact on the rent paid• Just-in-time manufacturing eliminates waste, as out-of-date or expired products; do not enter into this equation at all.• As under this technique, only essential stocks are obtained, less working capital is required, to finance procurement.• Here, a minimum re-order level is set, and only once that mark is reached fresh stocks are ordered, making this a boon to inventory management too.• Due to the afore-mentioned low level of stocks held, the organizations return on investment (referred to as ROI, in management parlance) would generally be high.
• As just-in-time production works on a demand-pull basis, all goods made would be sold, and thus it incorporates changes in demand with surprising ease.• This makes it especially appealing today, where the market demand is volatile and somewhat unpredictable.• High quality products and greater efficiency can be derived from following a just-in-time production system.• Close relationships are fostered along the production chain under a just-in- time manufacturing system.• Constant communication with the customer results in high customer satisfaction.• Over production is eliminated, when just-in-time manufacturing is adopted.
DISADVANTAGES• Just-in-time manufacturing provides zero tolerance for mistakes, as it makes re-working very difficult in practice, as inventory is kept to a bare minimum.• There is a high reliance on suppliers, whose performance is generally outside the purview of the manufacturer.• Due to there being no buffers for delays, production downtime and line idling can occur, which would bear a detrimental effect on finances and on the equilibrium of the production process.• The organization would not be able to meet an unexpected increase in orders, due to the fact that there are no excess finish goods.• Transaction costs would be relatively high, as frequent transactions would be made.• Just-in-time manufacturing may have certain detrimental effects on the environment, due to the frequent deliveries that would result in increased use of transportation which in turn would consume more fossil fuels.
PRECAUTIONS• Management buy-in and support at all levels of the organization are required, if a just-in-time manufacturing system is to be successfully adopted.• Adequate resources should be allocated, so as to obtain technologically advanced software.• Building a close, trusting relationship with reputed and time-tested suppliers will minimize unexpected delays in the receipt of inventory.• Just-in-time manufacturing cannot be adopted overnight. It requires commitment in terms of time and adjustments to corporate culture would be required, as it is starkly different to traditional production processes.
• Lot sizes need to be minimized.• Work station capacity should be balanced whenever possible.• Preventive maintenance should be carried out, so as to minimize machine breakdowns.• Set up times should be reduced wherever possible.• Quality enhancement programs should be adopted, so that total quality control practices can be adopted.
• Reduction in lead times and frequent deliveries should be incorporated.• Motion waste should be minimized, so the incorporation of conveyor belts might prove to be a good idea when implementing a just-in-time manufacturing system.• The design flow process needs to be redesigned and layouts need to be re-formatted, so as to incorporate just-in-time manufacturing.
KANBAN• Kanban is a card that represents a unit of work• Flow work in single units or small batches• Pace the work by limiting WIP• Use signaling to trigger pull• New work can start only when a space is available
• A space becomes available when previous work is complete• Level of mix and quantity to spread risk and optimize portfolio• In ‘push’ system of production start date and finish date is planned up front• But we don’t know what we need to build and how long it will take to build
• WorkCentre B uses parts produced by WorkCentre A• How can we control the flow so that B always has parts and A doesn’t overproduce ??
Signal To Produce• When a container is opened by WorkCentre B, its kanban card is sent back to WorkCentre A• This is a signal to WorkCentre A to produce another box of parts
Signal To Pull• Empty box sent back. Signal to pull another full box to WorkCentre B