Lean, Just-in-time,and Toyota Production System

Lean, Just-in-time, and Toyota Production System DSC 335 Zhibin Yang Assistant Professor, Decision Sciences

Toyota: The Auto Giant ,[object Object]

Toyota: Growing Market Share ,[object Object],[object Object],[object Object],[object Object],[object Object]

Toyota Production System – Key to Success ,[object Object],[object Object]

Eight Types of Waste Waste Definition ,[object Object],Manufacturing an item before it is needed. ,[object Object],Using expensive high precision equipment when simpler machines would suffice. ,[object Object],Wasteful time incurred when product is not being moved or processed. ,[object Object],Excessive movement and material handling of product between processes. ,[object Object],Unnecessary effort related to the ergonomics of bending, stretching, reaching, lifting, and walking. ,[object Object],Excess inventory hides problems on the shop floor, consumes space, increases lead times, and inhibits communication. ,[object Object],Quality defects result in rework and scrap, and add wasteful costs to the system in the form of lost capacity, rescheduling effort, increased inspection, and loss of customer good will. ,[object Object],Failure of the firm to learn from and capitalize on its employees’ knowledge and creativity impedes long term efforts to eliminate waste.

House of Toyota Highest quality, lowest cost, shortest lead time by eliminating wasted time and activity ,[object Object],[object Object],[object Object],[object Object],Culture of Continuous Improvement ,[object Object],[object Object],[object Object],[object Object],[object Object],Operational Stability Heijunka Standard Work TPM Supply Chain

Just-in-time (JIT): Pull vs. Push System ,[object Object],[object Object],[object Object],[object Object],[object Object]

Kanban System ,[object Object],[object Object],[object Object],[object Object],[object Object]

(cont’d) ,[object Object],[object Object],[object Object],[object Object],[object Object]

Pull System – Kanban System Receiving post Kanban card for product 1 Kanban card for product 2 Fabrication cell O 1 O 2 O 3 O 2 Storage area Empty containers Full containers Assembly line 1 Assembly line 2

The Kanban System Storage area Empty containers Full containers Receiving post Kanban card for product 1 Kanban card for product 2 Fabrication cell O 1 O 2 O 3 O 2 Assembly line 1 Assembly line 2

The Kanban System ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Calculate Number of Containers ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Number of Containers WIP = (average demand rate)  (average time a container spends in the manufacturing process) + safety stock WIP = kc kc = d ( w + p )(1 + α ) k = d ( w + p )(1 + α ) c where k = number of containers d = expected daily demand for the part w = average waiting time p = average processing time c = number of units in each container α = policy variable

Capacity Utilization and JIT ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Capacity Utilization of JIT 10 20 30 40 50 60 70 80 90 100 30 10 20 % Capacity Utilization 60 Production Lead Times (days) 40 50 Traditional Manufacturing JIT Manufacturing

Increasing Production Capacity Reduces Manufacturing Lead Times ,[object Object],[object Object],[object Object],[object Object]

[object Object],[object Object],Necessary Production Capacity

Work-in-Process Inventory ,[object Object]

Exercise: Necessary Production Capacity ,[object Object],[object Object],[object Object]

(cont’d) ,[object Object],[object Object],[object Object]

Exercise: Reduction in WIP ,[object Object],[object Object]

Example: Reduction in WIP ,[object Object],[object Object],[object Object]

Managed System “Stressing” ,[object Object],[object Object],[object Object],[object Object],[object Object]

Stress the System to See Problems ,[object Object],Visible Production Problems are Only 5% of the Total! Quality Problems Material Shortages Machine Breakdowns Workload Imbalances Worker Absenteeism Out-of-Spec Materials Quality Problems In-Process Inventory

Lean, Just-in-time,and Toyota Production System

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