15 JIT and Lean Operations McGraw-Hill/Irwin Copyright 2007

15 JIT and Lean Operations McGraw-Hill/Irwin Copyright  2007

15 JIT and Lean Operations McGraw-Hill/Irwin Copyright 2007 by The McGraw-Hill Companies, Inc. All Learning Objectives

Explain what is meant by the term lean operations system. List each of the goals of JIT and explain its importance. List and briefly describe the building blocks of JIT. List the benefits of the JIT system. Outline the considerations important in converting a traditional mode of operations to a JIT system. List some of the obstacles that might be encountered when converting to a JIT system. 15-2

JIT/Lean Production Just-in-time (JIT): A highly coordinated processing system in which goods move through the system, and services are performed, just as they are needed, JIT lean production JIT pull (demand) system JIT operates with very little fat 15-3 Goal of JIT

The ultimate goal of JIT is a balanced system. Achieves a smooth, rapid flow of materials through the system 15-4 Summary JIT Goals and Building Blocks Figure 15.1 Ultimate A Goal balanced rapid flow

Supporting Goals Eliminate disruptions Make the system flexible Product Design Process Design Eliminate waste Personnel

Elements Manufacturing Planning Building Blocks 15-5 Supporting Goals Eliminate disruptions Make system flexible Eliminate waste, especially excess inventory

15-6 Sources of Waste Overproduction Waiting time Unnecessary transportation Processing waste Inefficient work methods Product defects 15-7 Kaizen Philosophy

Waste is the enemy Improvement should be done gradually and continuously Everyone should be involved Built on a cheap strategy Can be applied anywhere 15-8 Kaizen Philosophy (contd) Supported by a visual system Focuses attention where value is created Process oriented Stresses main effort of improvement should

come from new thinking and work style The essence of organizational learning is to learn while doing 15-9 Big vs. Little JIT Big JIT broad focus

Vendor relations Human relations Technology management Materials and inventory management Little JIT narrow focus Scheduling materials Scheduling services of production 15-10

JIT Building Blocks Product design Process design Personnel/organizational elements Manufacturing planning and control 15-11 Product Design Standard parts Modular design Highly capable production systems

Concurrent engineering 15-12 Process Design Small lot sizes Setup time reduction Manufacturing cells Limited work in process Quality improvement Production flexibility Balanced system Little inventory storage

15-13 Benefits of Small Lot Sizes Reduces inventory Less rework Less storage space Problems are more apparent Increases product flexibility Easier to balance operations 15-14 Single-Minute Exchange Single-minute exchange of die (SMED): A

system for reducing changeover time Categorize changeover activities Internal activities that can only be done while machine is stopped External activities that do not require stopping the machine 15-15 Production Flexibility Reduce downtime by reducing changeover time Use preventive maintenance to reduce breakdowns

Cross-train workers to help clear bottlenecks 15-16 Production Flexibility (contd) Use many small units of capacity Use off-line buffers Reserve capacity for important customers 15-17 Quality Improvement Autonomation

Automatic detection of defects during production Jidoka Japanese term for autonomation 15-18 Production Flexibility Balance system: Distributing the workload evenly among work stations Work assigned to each work station must be less than or equal to the cycle time Cycle time is set equal to the takt time

Takt time is the cycle time needed to match customer demand for final product 15-19 Personnel/Organizational Elements Workers as assets Cross-trained workers Continuous improvement Cost accounting Leadership/project

management 15-20 Manufacturing Planning and Control Level loading Pull systems Visual systems Close vendor relationships Reduced transaction processing Preventive maintenance 15-21

Pull/Push Systems Pull system: System for moving work where a workstation pulls output from the preceding station as needed. (e.g. Kanban) Push system: System for moving work where output is pushed to the next station as it is completed 15-22 Kanban Production Control System Kanban: 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. 15-23 Kanban Formula N =

DT(1+X) C N = Total number of containers D = Planned usage rate of using work center T = Average waiting time for replenishment of parts plus average production time for a container of parts X = Policy variable set by management - possible inefficiency in the system C = Capacity of a standard container 15-24 Limited Work in Process

Benefits Lower carrying costs Increased flexibility Aids scheduling Saves cost of rework and scrap Two general approaches Kanban focuses on individual work stations Constant work in process (CONWIP) focuses

on the system as a whole 15-25 Traditional Supplier Network Figure 15.4a Buyer Buyer Supplier Supplier Supplier Supplier Supplier

Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier

15-26 Tiered Supplier Network Figure 15.4b Buyer Buyer First Tier Supplier Second Tier Supplier Third Tier Supplier Supplier Supplier

Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier

Supplier Supplier 15-27 Preventive Maintenance and Housekeeping Preventative maintenance: Maintaining equipment in good condition and replacing parts that have a tendency to fail before they actually fail. Housekeeping: Maintaining a workplace that is clean and free of unnecessary materials.

15-28 Housekeeping Five Ss 1. 2. 3. 4. 5. Sort Straighten Sweep Standardize

Self-discipline 15-29 Table 15.3 Comparison of JIT and Traditional Factor Traditional JIT

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 15-30 Transitioning to a JIT System Get top management commitment Decide which parts need most effort

Obtain support of workers Start by trying to reduce setup times Gradually convert operations Convert suppliers to JIT Prepare for obstacles 15-31 Obstacles to Conversion Management may not be committed Workers/management may not be cooperative Difficult to change company culture Suppliers may resist

Why? 15-32 Suppliers May Resist JIT Unwilling to commit resources Uneasy about long-term commitments Frequent, small deliveries may be difficult

Burden of quality control shifts to supplier Frequent engineering changes may cause JIT changes 15-33 JIT in Services The basic goal of the demand flow technology in the service organization is to provide optimum response to the customer with the highest quality service and lowest possible cost.

Eliminate disruptions Make system flexible Reduce setup and lead times Eliminate waste Minimize WIP Simplify the process 15-34 JIT II

JIT II: a supplier representative works right in the companys plant, making sure there is an appropriate supply on hand. 15-35 Benefits of JIT Systems Reduced inventory levels High quality Flexibility Reduced lead times Increased productivity

15-36 Benefits of JIT Systems (contd) Increased equipment utilization Reduced scrap and rework Reduced space requirements Pressure for good vendor relationships Reduced need for indirect labor 15-37 Table 15.4 Elements of JIT

Smooth flow of work (the ultimate goal) Elimination of waste Continuous improvement Eliminating anything that does not add value Simple systems that are easy to manage Use of product layouts to minimize moving materials and parts Quality at the source

15-38 Table 15.4 Elements of JIT (contd) Poka-yoke fail safe tools and methods Preventative maintenance

Good housekeeping Set-up time reduction Cross-trained employees A pull system 15-39 Video: Made for you 15-40 Video: New system

15-41 Video: McDonalds Process 15-42 Video: Layout Gortrac 15-43

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