JIT/Lean Production
Some Statistics from 1986 ... <ul><li>Framingham (GM) </li></ul><ul><li>40.7 hours </li></ul><ul><li>130 defects </li></ul...
Post World War II <ul><li>Growing and rebuilding world economy </li></ul><ul><li>Demand > Supply </li></ul><ul><li>US Manu...
View from Japan <ul><li>Very little capital </li></ul><ul><li>War-ravaged workforce </li></ul><ul><li>Little space </li></...
Japanese Approach to Operations <ul><li>Maximize use of people </li></ul><ul><li>Simplify first, add technology second </l...
The Toyota Production System <ul><li>Based on two philosophies: </li></ul><ul><ul><li>1.  Elimination of waste  </li></ul>...
Just-in-Time Repetitive production system in which processing and movement of materials and goods occur  just as they are ...
Pre-JIT:  Traditional Mass Production
Post-JIT:  “Lean Production” Tighter coordination along the supply chain Goods are pulled along —  only make and ship what...
JIT Goals (throughout the supply chain) <ul><li>Eliminate disruptions </li></ul><ul><li>Make the system flexible </li></ul...
Waste <ul><li>Definition: </li></ul><ul><li>Waste  is ‘anything other than the minimum amount of equipment, materials, par...
Forms of Waste: <ul><li>Overproduction </li></ul><ul><li>Waiting time </li></ul><ul><li>Transportation </li></ul><ul><li>P...
Elimination of Waste <ul><li>Focused factory networks </li></ul><ul><li>Group technology </li></ul><ul><li>Quality at the ...
Inventory as a Waste <ul><li>Requires more storage space </li></ul><ul><li>Requires tracking and counting </li></ul><ul><l...
Examples of Eliminating “Wastes” Big Bob’s Automotive Axles: Wheels bought from outside supplier Axles made and assembled ...
BEFORE: Shipping in Wheels Truck Cost: $500 (from Peoria) Maximum load of wheels: 10,000 Weekly demand of wheels: 500
AFTER: Shipping in Wheels Truck Cost: $50 (from Burlington) Maximum load of wheels: 500 Weekly demand of wheels: 500 What ...
Process Design <ul><li>“ Focused Factories” </li></ul><ul><li>Group Technology </li></ul><ul><li>Simplified layouts with l...
Personnel and Organizational Elements <ul><li>Workers as assets </li></ul><ul><li>Cross-trained workers </li></ul><ul><li>...
Planning and Control Systems <ul><li>“ Small” JIT </li></ul><ul><li>Stable and level schedules </li></ul><ul><ul><li>Mixed...
Kanban <ul><li>Uses simple visual signals to control production </li></ul><ul><li>Examples: </li></ul><ul><ul><li>empty sl...
Kanban Example Workcenter B uses parts produced by Workcenter A How can we control the flow of materials so that B always ...
Kanban card:  Signal to  produce When a container is opened by Workcenter B, its  kanban card  is removed and sent back to...
Empty Box:  Signal to  pull Empty box sent back.  Signal to  pull  another full box into Workcenter B. Question:  How many...
How Many Kanbans? y  =  number of kanban cards D  =  demand per unit of time T  =  lead time C  =  container capacity X  =...
Lean Production <ul><li>Lean Production  can be defined as an integrated set of activities designed to achieve high-volume...
Minimizing Waste:  Focused Factory  Networks Coordination System Integration These are small specialized plants that limit...
Minimizing Waste:  Group Technology  (Part 1) <ul><li>Using  Departmental Specialization  for plant layout can cause a lot...
Minimizing Waste:  Group Technology (Part 2) <ul><li>Revising by using  Group Technology Cells  can reduce movement and im...
Minimizing Waste:  Uniform Plant Loading (heijunka) Not uniform Jan. Units Feb. Units Mar. Units Total 1,200 3,500 4,300 9...
Minimizing Waste: Inventory  Hides Problems Work in process  queues (banks) Change orders Engineering design redundancies ...
Respect for People <ul><li>Level payrolls </li></ul><ul><li>Cooperative employee unions </li></ul><ul><li>Subcontractor ne...
Toyota Production System’s Four Rules <ul><li>All work shall be highly specified as to content, sequence, timing, and outc...
Lean Implementation Requirements: Total Quality Control <ul><li>Worker responsibility  </li></ul><ul><li>Measure SQC  </li...
Lean Implementation Requirements: Stabilize Schedule <ul><li>Level schedule  </li></ul><ul><li>Underutilize capacity </li>...
Lean Implementation Requirements: Kanban-Pull <ul><li>Demand pull  </li></ul><ul><li>Backflush  </li></ul><ul><li>Reduce l...
Lean Implementation Requirements: Work with Vendors <ul><li>Reduce lead times  </li></ul><ul><li>Frequent deliveries  </li...
Lean Implementation Requirements: Reduce Inventory More <ul><li>Look for other areas </li></ul><ul><li>Stores  </li></ul><...
Lean Implementation Requirements: Improve Product Design <ul><li>Standard product configuration  </li></ul><ul><li>Standar...
Lean Implementation Requirements: Concurrently Solve Problems <ul><li>Root cause </li></ul><ul><li>Solve permanently </li>...
Lean Implementation Requirements: Measure Performance <ul><li>Emphasize improvement  </li></ul><ul><li>Track trends </li><...
Lean in Services (Examples) <ul><li>Organize Problem-Solving Groups </li></ul><ul><li>Upgrade Housekeeping </li></ul><ul><...
Lean in Services (Examples) <ul><li>Level the Facility Load </li></ul><ul><li>Eliminate Unnecessary Activities </li></ul><...
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©2006 Pearson Prentice Hall — Introduction to Operations and ...

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©2006 Pearson Prentice Hall — Introduction to Operations and ...

  1. 1. JIT/Lean Production
  2. 2. Some Statistics from 1986 ... <ul><li>Framingham (GM) </li></ul><ul><li>40.7 hours </li></ul><ul><li>130 defects </li></ul><ul><li>2 weeks </li></ul><ul><li>Toyota Takaoka </li></ul><ul><li>16 hours </li></ul><ul><li>45 defects </li></ul><ul><li>2 hours </li></ul><ul><li>A comparison of: </li></ul><ul><ul><li>assembly hours </li></ul></ul><ul><ul><li>defects per 100 cars </li></ul></ul><ul><ul><li>average inventory levels </li></ul></ul>
  3. 3. Post World War II <ul><li>Growing and rebuilding world economy </li></ul><ul><li>Demand > Supply </li></ul><ul><li>US Manufacturing: </li></ul><ul><ul><li>Higher volumes </li></ul></ul><ul><ul><li>Capital substitution </li></ul></ul><ul><ul><li>“Breakthrough” improvements </li></ul></ul><ul><ul><li>“The production problem has been solved” </li></ul></ul>
  4. 4. View from Japan <ul><li>Very little capital </li></ul><ul><li>War-ravaged workforce </li></ul><ul><li>Little space </li></ul><ul><li>Poor or no raw materials </li></ul><ul><li>Lower demand levels </li></ul><ul><li>Little access to latest technologies  U.S. methods would not work </li></ul>
  5. 5. Japanese Approach to Operations <ul><li>Maximize use of people </li></ul><ul><li>Simplify first, add technology second </li></ul><ul><li>Gradual, but continuous improvement </li></ul><ul><li>Minimize waste (including poor quality)  Led to the development of the approach known as Just-in-Time </li></ul>
  6. 6. The Toyota Production System <ul><li>Based on two philosophies: </li></ul><ul><ul><li>1. Elimination of waste </li></ul></ul><ul><ul><li>2. Respect for people </li></ul></ul>
  7. 7. Just-in-Time Repetitive production system in which processing and movement of materials and goods occur just as they are needed
  8. 8. Pre-JIT: Traditional Mass Production
  9. 9. Post-JIT: “Lean Production” Tighter coordination along the supply chain Goods are pulled along — only make and ship what is needed
  10. 10. JIT Goals (throughout the supply chain) <ul><li>Eliminate disruptions </li></ul><ul><li>Make the system flexible </li></ul><ul><li>Reduce setup times and lead times </li></ul><ul><li>Minimize inventory </li></ul><ul><li>Eliminate waste </li></ul>
  11. 11. Waste <ul><li>Definition: </li></ul><ul><li>Waste is ‘anything other than the minimum amount of equipment, materials, parts, space, and worker’s time, which are absolutely essential to add value to the product.’ </li></ul><ul><li>— Shoichiro Toyoda President, Toyota </li></ul>
  12. 12. Forms of Waste: <ul><li>Overproduction </li></ul><ul><li>Waiting time </li></ul><ul><li>Transportation </li></ul><ul><li>Processing </li></ul><ul><li>Inventory </li></ul><ul><li>Motion </li></ul><ul><li>Product Defects </li></ul>
  13. 13. Elimination of Waste <ul><li>Focused factory networks </li></ul><ul><li>Group technology </li></ul><ul><li>Quality at the source </li></ul><ul><li>JIT production </li></ul><ul><li>Uniform plant loading </li></ul><ul><li>Kanban production control system </li></ul><ul><li>Minimized setup times </li></ul><ul><li>Jidoka and Poka-Yoke </li></ul>
  14. 14. Inventory as a Waste <ul><li>Requires more storage space </li></ul><ul><li>Requires tracking and counting </li></ul><ul><li>Increases movement activity </li></ul><ul><li>Hides yield, scrap, and rework problems </li></ul><ul><li>Increases risk of loss from theft, damage, obsolescence </li></ul>
  15. 15. Examples of Eliminating “Wastes” Big Bob’s Automotive Axles: Wheels bought from outside supplier Axles made and assembled in house
  16. 16. BEFORE: Shipping in Wheels Truck Cost: $500 (from Peoria) Maximum load of wheels: 10,000 Weekly demand of wheels: 500
  17. 17. AFTER: Shipping in Wheels Truck Cost: $50 (from Burlington) Maximum load of wheels: 500 Weekly demand of wheels: 500 What wastes have been reduced?
  18. 18. Process Design <ul><li>“ Focused Factories” </li></ul><ul><li>Group Technology </li></ul><ul><li>Simplified layouts with little storage space </li></ul><ul><li>Jidoka and Poka-Yoke </li></ul><ul><li>Minimum setups </li></ul>
  19. 19. Personnel and Organizational Elements <ul><li>Workers as assets </li></ul><ul><li>Cross-trained workers </li></ul><ul><li>Greater responsibility at lower levels </li></ul><ul><li>Leaders as facilitators , not order givers </li></ul>
  20. 20. Planning and Control Systems <ul><li>“ Small” JIT </li></ul><ul><li>Stable and level schedules </li></ul><ul><ul><li>Mixed Model Scheduling </li></ul></ul><ul><li>“ Push” versus “Pull” </li></ul><ul><ul><li>Kanban Systems </li></ul></ul>
  21. 21. Kanban <ul><li>Uses simple visual signals to control production </li></ul><ul><li>Examples: </li></ul><ul><ul><li>empty slot in hamburger chute </li></ul></ul><ul><ul><li>empty space on floor </li></ul></ul><ul><ul><li>kanban card </li></ul></ul>
  22. 22. Kanban Example Workcenter B uses parts produced by Workcenter A How can we control the flow of materials so that B always has parts and A doesn’t overproduce?
  23. 23. Kanban card: Signal to produce When a container is opened by Workcenter B, its kanban card is removed and sent back to Workcenter A. This is a signal to Workcenter A to produce another box of parts.
  24. 24. Empty Box: Signal to pull Empty box sent back. Signal to pull another full box into Workcenter B. Question: How many kanban cards here? Why?
  25. 25. How Many Kanbans? y = number of kanban cards D = demand per unit of time T = lead time C = container capacity X = fudge factor
  26. 26. Lean Production <ul><li>Lean Production can be defined as an integrated set of activities designed to achieve high-volume production using minimal inventories (raw materials, work in process, and finished goods) </li></ul><ul><li>Lean Production also involves the elimination of waste in production effort </li></ul><ul><li>Lean Production also involves the timing of production resources (i.e., parts arrive at the next workstation “just in time”) </li></ul>
  27. 27. Minimizing Waste: Focused Factory Networks Coordination System Integration These are small specialized plants that limit the range of products produced (sometimes only one type of product for an entire facility) Some plants in Japan have as few as 30 and as many as 1000 employees
  28. 28. Minimizing Waste: Group Technology (Part 1) <ul><li>Using Departmental Specialization for plant layout can cause a lot of unnecessary material movement </li></ul>Saw Saw Lathe Press Press Grinder Lathe Lathe Saw Press Heat Treat Grinder Note how the flow lines are going back and forth
  29. 29. Minimizing Waste: Group Technology (Part 2) <ul><li>Revising by using Group Technology Cells can reduce movement and improve product flow </li></ul>Press Lathe Grinder Grinder A 2 B Saw Heat Treat Lathe Saw Lathe Press Lathe 1
  30. 30. Minimizing Waste: Uniform Plant Loading (heijunka) Not uniform Jan. Units Feb. Units Mar. Units Total 1,200 3,500 4,300 9,000 Uniform Jan. Units Feb. Units Mar. Units Total 3,000 3,000 3,000 9,000 Suppose we operate a production plant that produces a single product. The schedule of production for this product could be accomplished using either of the two plant loading schedules below. How does the uniform loading help save labor costs? or
  31. 31. Minimizing Waste: Inventory Hides Problems Work in process queues (banks) Change orders Engineering design redundancies Vendor delinquencies Scrap Design backlogs Machine downtime Decision backlogs Inspection backlogs Paperwork backlog Example: By identifying defective items from a vendor early in the production process the downstream work is saved Example: By identifying defective work by employees upstream, the downstream work is saved
  32. 32. Respect for People <ul><li>Level payrolls </li></ul><ul><li>Cooperative employee unions </li></ul><ul><li>Subcontractor networks </li></ul><ul><li>Bottom-round management style </li></ul><ul><li>Quality circles (Small Group Involvement Activities or SGIA’s) </li></ul>
  33. 33. Toyota Production System’s Four Rules <ul><li>All work shall be highly specified as to content, sequence, timing, and outcome </li></ul><ul><li>Every customer-supplier connection must be direct, and there must be an unambiguous yes-or-no way to send requests and receive responses </li></ul><ul><li>The pathway for every product and service must be simple and direct </li></ul><ul><li>Any improvement must be made in accordance with the scientific method, under the guidance of a teacher, at the lowest possible level in the organization </li></ul>
  34. 34. Lean Implementation Requirements: Total Quality Control <ul><li>Worker responsibility </li></ul><ul><li>Measure SQC </li></ul><ul><li>Enforce compliance </li></ul><ul><li>Fail-safe methods </li></ul><ul><li>Automatic inspection </li></ul>
  35. 35. Lean Implementation Requirements: Stabilize Schedule <ul><li>Level schedule </li></ul><ul><li>Underutilize capacity </li></ul><ul><li>Establish freeze windows </li></ul>
  36. 36. Lean Implementation Requirements: Kanban-Pull <ul><li>Demand pull </li></ul><ul><li>Backflush </li></ul><ul><li>Reduce lot sizes </li></ul>
  37. 37. Lean Implementation Requirements: Work with Vendors <ul><li>Reduce lead times </li></ul><ul><li>Frequent deliveries </li></ul><ul><li>Project usage requirements </li></ul><ul><li>Quality expectations </li></ul>
  38. 38. Lean Implementation Requirements: Reduce Inventory More <ul><li>Look for other areas </li></ul><ul><li>Stores </li></ul><ul><li>Transit </li></ul><ul><li>Carousels </li></ul><ul><li>Conveyors </li></ul>
  39. 39. Lean Implementation Requirements: Improve Product Design <ul><li>Standard product configuration </li></ul><ul><li>Standardize and reduce number of parts </li></ul><ul><li>Process design with product design </li></ul><ul><li>Quality expectations </li></ul>
  40. 40. Lean Implementation Requirements: Concurrently Solve Problems <ul><li>Root cause </li></ul><ul><li>Solve permanently </li></ul><ul><li>Team approach </li></ul><ul><li>Line and specialist responsibility </li></ul><ul><li>Continual education </li></ul>
  41. 41. Lean Implementation Requirements: Measure Performance <ul><li>Emphasize improvement </li></ul><ul><li>Track trends </li></ul>
  42. 42. Lean in Services (Examples) <ul><li>Organize Problem-Solving Groups </li></ul><ul><li>Upgrade Housekeeping </li></ul><ul><li>Upgrade Quality </li></ul><ul><li>Clarify Process Flows </li></ul><ul><li>Revise Equipment and Process Technologies </li></ul>
  43. 43. Lean in Services (Examples) <ul><li>Level the Facility Load </li></ul><ul><li>Eliminate Unnecessary Activities </li></ul><ul><li>Reorganize Physical Configuration </li></ul><ul><li>Introduce Demand-Pull Scheduling </li></ul><ul><li>Develop Supplier Networks </li></ul>

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