JIT and Lean Ops

Jit and leanAnyone who has never made a mistake has never tried anything new~ Albert EinsteinManufacturing HistoryAfter World War II, U.S. was dominant manufacturing powerJapan needed to rebuild infrastructure from wartime and also deal with raw material scarcityWaste and inefficiency could not be toleratedPhilosophy of ManufacturingMake to Stock (MTS): Build as long as there is stock

Make to Order (MTO): Build only if an order exists

Assemble to Order (ATO): Assemble only if order exists

Can have a combination of the above within a companyExample: McDonaldsToyota ApproachTerms

Muda: Waste and inefficiencyPull system: Manufacturing only when demand is presentKanban: Manual signal system used to control movement of parts and materialHeijunka: Variations in production volumeKaizen: Continuous improvement of the systemJidoka: Quality at the sourceJIT/Lean ProductionJust-in-time (JIT): Repetitive production system in which processing and movement of materials and goods occur just as they are needed.

JIT is characteristic of lean production systemsJIT operates with very little waste

JIT GoalsEliminate disruptionsMake system flexible by reducing setup and lead timesEliminate waste, especially excess inventory (Work in Progress and Finished Goods)Sources of Waste (Muda)MotionEmployees and/or machineDelayWaiting for parts/material or line stoppageConveyanceInefficient layout, batch production, right-size equipmentCorrectionFixing defective partsSources of Waste (Muda)OverprocessingToo many features, technology for sake of technologyInventoryKeeping unnecessary amounts of raw materials and Work in Process (WIP)OverproductionMaking more product than necessaryKnowledge disconnectionLack of understanding between employees, departments, suppliers, vendors, distributors and/or customersBig JIT vs. Little JITBig JIT broad focusVendor relationsHuman relationsTechnology managementMaterials and inventory managementLittle JIT narrow focusScheduling materialsScheduling services of production

JIT Building BlocksProduct designProcess designPersonnel/organizationalelementsManufacturing planning and control

Product DesignStandard partsModular designHighly capable production systemsConcurrent engineering

Process DesignSmall lot sizesSetup time reductionSingle Minute Exchange of Die (SMED)Manufacturing cellsLimited work in process (WIP)Quality improvementLimit or eliminate reworkProcess DesignProduction flexibilityLittle inventory storageSystem balanceFail-safe methodsPoka-yoke Mistake ProofingBenefits of Small Lot SizesReduces inventoryLess reworkLess storage spaceProblems are more apparentIncreases product flexibilityEasier to balance operations

Setup Time ReductionSupports flexibility in manufacturing Need for more expensive, specialized equipment is diminishedRequires Single-Minute Exchange of Die (SMED)Die: Referring to a mold

System BalanceTime needed for work at a process must be equal to or less than the cycle time or Takt timeTakt time: Cycle time needed to match customer demand for the finished goodTakt: German for musical meterPronounced: tactSystem BalanceTo determine Takt time:

Calculate working time per shiftTotal Time Availableper shift480 minutesWork Breaks- 60 minutesWorking Time420 minutesSystem BalanceTo determine Takt time:

Calculate net working time per dayWorking Time per shift420 minutesNumber of shiftsx 2 shiftsNet Working Time840 minutesSystem BalanceTo determine Takt time:

Compute Takt timeNet Time per Day=840 minutes = 5.25 minutes per cycleDaily Demand160 unitsProduction FlexibilityAdvantage of achieving Production Flexibility is the system is able to change quickly and painlessly

To achieve Production Flexibility:Reduce downtime by reducing changeover timeUse preventive maintenance to reduce breakdownsCross-train workers to help clear bottlenecksReserve capacity for important customersPersonnel/Organizational ElementsThe direct labor force is vital for lean operationsTreat workers as assets, not equipment or automatonsCross-trained workersContinuous improvementCost accountingNeed a system that accurately assigns overheadLeadership/project managementManufacturing Planning & ControlRequired elements for lean systemsLevel loadingPull systemsVisual systemsClose vendor relationshipsReduced transaction processingPreventive maintenancePull/Push SystemsPull 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 completedVisual SystemsSignal to indicate status in a work areaShout, waveAndon lightKanban cardEmpty spot on the floor

Kanban Production Control SystemKanban: Card or other device that communicates demand for work or materials from the preceding stationKanban is the Japanese word meaning signal or visible recordPaperless production control systemAuthority to pull, or produce comes from a downstream process.Kanban (the visual system)

How many containers?N = Total number of containersD = Planned usage rate of using WCT = Average wait time + production timeX = Efficiency number (by policy)C = Capacity per containerNumber of containersNPlanned usage rate WCD5000Cycle TimeT0.33Efficiency FactorX0.02Parts per ContainerC250

N=DT (1 + X)CN=1683250N=6.732 ~ 7Traditional Supplier NetworkBuyerSupplierSupplierSupplierSuppilerSupplierSupplierSupplierTiered Supplier NetworkSupplierSupplierSupplierSupplierSupplierSupplierBuyerSupplierFirst Tier SupplierSecond Tier SupplierThird Tier SupplierSummary JIT Goals and Building BlocksProduct DesignProcessDesignPersonnelElementsManuf.PlanningEliminate disruptionsMake the system flexibleReduce setup & lead timesEliminate waste

Minimize inventoriesAbalancedrapid flowUltimateGoalSupportingGoalsBuildingBlocksConverting to a JIT SystemGet top management commitmentObtain support of workersDecide which parts need most effortStart by trying to reduce setup timesGradually convert operationsConvert suppliers to JITPrepare for obstaclesObstacles to ConversionManagement may not be committedWorkers/management may not be cooperativeCulture change within organization is difficultSuppliers may resistJIT in ServiceBasic goal of the demand flow technology in the service organization is to provide optimum response to the customer with the highest quality service at the lowest possible cost.

Eliminate disruptionsMake system flexibleReduce setup and lead timesEliminate wasteMinimize WIPSimplify the processJIT PurchasingNew challengesMeeting manufacturing requirementsChanging from traditional thinking and practices frequent on-time delivery of small quantitiesLong term relationships with suppliers as partners

JIT IIJIT II: the practice of allowing vendors to manage some aspects of buying their products or services for the buyerAllow suppliers and customers access to organizations informationBenefits of JIT SystemsReduced inventory levelsHigh qualityFlexibility Reduced lead timesIncreased productivityBenefits of JIT Systems (contd)Increased equipment utilizationReduced scrap and reworkReduced space requirementsPressure for good vendor relationshipsReduced need for indirect laborElements of JITSmooth flow of work (the ultimate goal)Elimination of wasteContinuous improvementEliminating anything that does not add valueSimple systems that are easy to manageUse of product layouts to minimize moving materials and partsQuality at the sourceElements of JIT (contd)Poka-yoke fail safe tools and methodsPreventative maintenanceGood housekeepingSet-up time reductionCross-trained employeesA pull system