14 jit lean operations

Lean Operations

Chapter 14

McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.

Lean OperationsLean operation

A flexible system of operation that uses considerably less resources than a traditional systemTend to achieve

Greater productivityLower costsShorter cycle timesHigher quality

Instructor Slides 14-2

Lean: Ultimate GoalThe 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 systemOne that achieves a smooth, rapid flow of materials

and/or work through the system


Goals and building blocks of lean systems


Lean: Supporting GoalsThe degree to which lean’s ultimate goal is

achieved depends upon how well its supporting goals are achieved:1. Eliminate disruptions2. Make the system flexible3. Eliminate waste, especially excess inventory


WasteWaste

Represents unproductive resourcesSeven sources of waste in lean systems:

1. Inventory2. Overproduction3. Waiting time4. Unnecessary transporting5. Processing waste6. Inefficient work methods7. Product defects


Lean: Building BlocksProduct designProcess designPersonnel/organizational elementsManufacturing planning and control


Building Blocks: Product DesignFour elements of product design important

for lean systems:1. Standard parts2. Modular design3. Highly capable systems with quality built in4. Concurrent engineering


Building Blocks: Process DesignSeven aspects of process design that are

important for lean systems:1. Small lot sizes2. Setup time reduction3. Manufacturing cells4. Quality improvement5. Production flexibility6. A balanced system7. Little inventory storage8. Fail-safe methods


Process Design: Small Lot SizesIn the lean philosophy, the ideal lot size

is oneBenefits of small lot size

Reduced in-process inventoryLower carrying costsLess storage space is necessary

Inspection and rework costs are less when problems with quality do occur

Permits greater flexibility in scheduling Less inventory to ‘work off’ before implementing

product improvements Increased visibility of problems Increased ease of balancing operations


Process Design: 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 Single-minute exchange of die (SMED)

A system for reducing changeover time Group technology may be used to reduce setup time by

capitalizing on similarities in recurring operations


Process Design: Manufacturing CellsOne characteristic of lean production

systems is multiple manufacturing cellsBenefits include

Reduced changeover timesHigh equipment utilizationEase of cross-training workers


Process Design: Quality Improvement

Quality defects during the process can disrupt the orderly flow of work

Autonomation (jidoka)Automatic detection of defects during

productionTwo mechanisms are employed

1. One for detecting defects when they occur2. Another for stopping production to correct the

cause of the defects


Process Design: Work Flexibility Guidelines for increasing flexibility

1. Reduce downtime due to changeovers by reducing changeover time

2. Use preventive maintenance on key equipment to reduce breakdowns and downtime

3. Cross-train workers so they can help when bottlenecks occur or other workers are absent

4. Use many small units of capacity; many small cells make it easier to shift capacity temporarily and to add or subtract capacity

5. Use off-line buffers. Store infrequently used safety stock away from the production area

6. Reserve capacity for important customersInstructor Slides 14-14

Process Design: Balanced SystemTakt time

The cycle time needed to match customer demand for final product

Sometimes referred to as the heartbeat of a lean systemTakt time is often set for a work shiftProcedure:

1. Determine the net time available per shift2. If there is more than one shift per day, multiply the

net time by the number of shifts3. Compute the takt time by dividing the net available

time by demand


Process Design: Inventory StorageLean systems are designed to minimize

inventory storage Inventories are buffers that tend to cover up recurring

problems that are never resolvedpartly because they are not obviouspartly because the presence of inventory makes them

seem less serious


Process Design: Fail-Safe MethodsPoka-yoke (Fail Safing)

Building safeguards into a process to reduce or eliminate the potential for errors during a processExamples

Electric breakersSeatbelt fastener warningsATMs that signal if a card is let in a machineDesigning parts that can only be assembled in the

correct position


Building Blocks: Personnel/Organizational

Five personnel/organizational elements that are important for lean systems:Workers as assetsCross-trained workersContinuous improvementCost accountingLeadership/project management


Personnel/Organizational: Workers as Assets

Workers as assetsWell-trained and motivated workers are the

heart of the lean systemThey are given greater authority to make

decisions, but more is expected of them


Personnel/Organizational: Cross-Trained Workers

Cross-trained workersWorkers are trained to perform several parts

of a process and operate a variety of machinesFacilitates flexibilityHelps in line balancing


Personnel/Organizational: Continuous Improvement

Continuous improvementWorkers in lean systems have greater

responsibility for quality, and they are expected to be involved in problem solving and continuous improvement

Lean workers receive training in Statistical process controlQuality improvementProblem solving


Personnel/Organizational: Cost Accounting

Cost accountingActivity-based costing

Allocation of overhead to specific jobs based on their percentage of activities


Personnel/Organizational: Leadership

Leadership/project managementManagers are expected to be leaders and

facilitators, not order giversLean systems encourage two-way

communication between workers and managers


Building Blocks: MPCSeven elements of manufacturing planning

and control (MPC) are particularly important for lean system:1. Level loading2. Pull systems3. Visual systems4. Limited work-in-process (WIP)5. Close vendor relationships6. Reduced transaction processing7. Preventive maintenance and housekeeping


MPC: Level LoadingLean systems place a strong emphasis on

achieving stable, level daily mix schedulesMPS – developed to provide level capacity

loadingMixed model scheduling

Three issues need to be resolvedWhat is the appropriate product sequence to use?How many times should the sequence be repeated

daily?How many units of each model should be produced in

each cycle?


MPC: Pull SystemsPush system

Work is pushed to the next station as it is completedPull system

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 operationsLarge variations in volume, product mix, or product

design will undermine the system


MPC: CommunicationCommunication moves backward

through the system from station to stationEach 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 operationFlow of work is coordinatedAccumulation of excessive inventories is avoided


MPC: Visual SystemsKanban

Card or other device that communicates demand for work or materials from the preceding stationKanban is the Japanese word meaning “signal” or

“visible record”Paperless production control systemAuthority to pull, or produce, comes

from a downstream process.Two main types of kanbans:

1.Production kanban (p-kanban): signals the need to produce parts

2.Conveyance kanban (c-kanban): signals the need to deliver parts to the next work center.


KanbansIdeal number of kanban cards

part theof usagedaily percentof 10than more no be (shouldcontainer standard a ofCapacity

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MPC: Limited WIPBenefits of lower WIP

Lower carrying costsIncreased flexibilityAids schedulingSaves costs of scrap and rework if there are

design changesLower cycle-time variability


MPC: Close Vendor RelationshipsLean systems typically have close

relationships with vendorsThey are expected to provide frequent, small

deliveries of high-quality goodsA key feature of many lean systems is the

relatively small number of suppliers used


MPC: Reduced Transaction Processing

Lean systems seek to reduce costs associated with the ‘hidden factory’:Logistical transactionsBalancing transactionsQuality transactionsChange transactions


Preventive Maintenanceand Housekeeping

Preventive maintenanceMaintaining equipment in good operating

condition and replacing parts that have a tendency to fail before they actually do fail

HousekeepingMaintaining a workplace that is clean and free

of unnecessary materials


Lean vs. Traditional Philosophies

Factor Traditional LeanInventory Much to offset forecast

errors, late deliveriesMinimal necessary to operate

Deliveries Few Many

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


Transitioning to Lean Systems1. Make sure top management is committed and

that they know what will be required

2. Decide which parts will need the most effort to convert

3. Obtain support and cooperation of workers

4. Begin by trying to reduce setup times while maintaining the current system

5. Gradually convert operations, begin at the end and work backwards

6. Convert suppliers to JIT

7. Prepare for obstacles


Obstacles to Conversion

1. Management may not be fully committed or willing to devote the necessary resources to conversion

2. Workers/management may not be cooperative

3. It can be difficult to change the organizational culture to one consistent with the lean philosophy

4. Suppliers may resist


Lean ServicesIn service the focus is often on the time

needed to perform the service because speed is often the order winner

Lean benefits can be achieved in the following ways:Eliminate disruptionsMake system flexibleReduce setup and lead timesEliminate wasteMinimize WIPSimplify the process


JIT IIJIT II:

• A supplier representative works right in the company’s plant, making sure there is an appropriate supply on hand

• It is often referred to as Vendor Managed Inventory (VMI)


Operations StrategyBe careful to study the requirements and benefits

of lean systems before making a decision to convert operations Evaluate strengths and weaknesses of current

operations

The decision to convert can be sequentialWeigh the pros and cons of a lean approach to

inventoriesSupplier management is critical to a lean

operation


14 jit lean operations

Documents

system instructor slides14

control instructor slides14

lean philosophy

process inventorylower

small lot sizesin

system flexibleeliminate

product mixes

ideal lot size