The philosophy of JIT can be traced back to Henry Ford, but formalized JIT originated in Japan as the Toyota Production System. W. Edwards Deming’s lesson of variability reduction was a huge influence.

The focus of JIT is to improve the system of production by eliminating

all forms of WASTE.

Just-In-Time Philosophy

JIT is a long-term approach to process improvement. It uses timeliness as a lever to lower costs, improve quality and improve responsiveness. However, JIT requires enormous commitment. It took Toyota more than 25 years to get right!

Just-in-Time

• Downstream processes take parts from upstream as they need.– Get what you want– when you want it– in the quantity you want.

4. Just In Time-- What is It?

• Just-in-Time: produce the right parts, at the right time, in the right quantity – Requires repetitive, not big volume– Batch size of one– Short transit times, keep 0.1 days of supply

Characteristics of Just-in-Time

Pull method of materials flow Consistently high quality Small lot sizes Uniform workstation loads Standardized components and work methods Close supplier ties Flexible workforce Line flows Automated production Preventive maintenance

Push versus Pull

• Push system: material is pushed into downstream workstations regardless of whether resources are available

• Firms with processes that involve long lead times, a variety of products, customers who will not wait long for product use Push method.

• Pull system: material is pulled to a workstation just as it is needed (customer demand activates the production of goods and services)

• Firms that tend to have highly repetitive manufacturing processes and well-defined material flows use the pull method because it allows closer control of inventory and production at the workstations

Push versus Pull

From a a « push » to a « pull » System

Work is pushed to the next station as it is completed

SUPPLIERS

CUSTOMERS

A workstation pulls output as needed

SUPPLIERS

CUSTOMERS

From a a « push » to a « pull » System

JIT Demand-Pull Logic

Customers

Sub

Sub

Fab

Fab

Fab

Fab

Vendor

Vendor

Vendor

Vendor

Final Assembly

Here the customer starts the process, pulling an inventory item from Final Assembly…

Here the customer starts the process, pulling an inventory item from Final Assembly…

Then sub-assembly work is pulled forward by that demand…

Then sub-assembly work is pulled forward by that demand…

The process continues throughout the entire production process and supply chain

The process continues throughout the entire production process and supply chain

Pull Versus Push SystemsPull Versus Push Systems

A pull system uses signals to request A pull system uses signals to request production and delivery from upstream production and delivery from upstream stationsstations

Upstream stations only produce when Upstream stations only produce when signaledsignaled

System is used within the immediate System is used within the immediate production process and with suppliersproduction process and with suppliers

Pull Versus Push SystemsPull Versus Push Systems

By pulling material in small lots, inventory By pulling material in small lots, inventory cushions are removed, exposing problems cushions are removed, exposing problems and emphasizing continual improvementand emphasizing continual improvement

Manufacturing cycle time is reducedManufacturing cycle time is reduced Push systems dump orders on the Push systems dump orders on the

downstream stations regardless of the downstream stations regardless of the needneed

Consistently high quality• Consistently meeting customer’s expectations. • Just-in-time systems seek to eliminate scrap and

rework in order to achieve a uniform flow of materials

• Use quality at the source which is having employees act as their quality inspectors such that never passing on defective units to the next process.

• Poka-yoke (mistake proofing method) designing fail-safe systems to minimize human errors. Ex: design parts to be assembled in only one way- the correct way.

Small lot sizes

• JIT systems maintain inventory with lot sizes that are as small as possible.

• Small lot sizes have three benefits:1)small lot sizes reduce cycle inventory which

reduces the time and space involved in manufacturing and holding inventory.

2)small lot sizes help cut lead times then cutting pipeline and (WIP) inventory. (longer processing, longer inspection, defects delays)

Small lot sizes

• Benefits of small lot sizes:3) small lots help achieve a uniform operating

system workloadsetup times must be reduced to realize the

benefits of small-lot production.

Uniform Workstation Loads• Uniform loads can be achieved by assembling the

same type and number of units each day, thus creating a uniform daily demand at all workstations

• Two models of production1)Line production: all daily requirements of a model

are produced in one batch before another model is started

2)Mixed model assembly: mix of models in smaller lots in a sequence (set up times should be low)

Standardized Components and Work Methods

• The standardization of components, called part commonality or modularity, increases repeatability.

• each worker performs a standardized task , Productivity tends to increase.

Close Supplier Ties

• JIT systems operate with very low levels of inventory, close relationships with suppliers are necessary.

• Stock shipments must be frequent, have short lead times, arrive on schedule, and be of high quality

• Purchasing managers focus on three areas: reducing the number of suppliers, using local suppliers, and improving supplier relations

Flexible Work Force

• Workers in flexible work forces can be trained to perform more than one job.

• Workers can be shifted among workstations to help relieve bottlenecks as they arise without resorting to inventory buffers--an important aspect of the uniform flow of JIT systems.

• they can step in and do the job for those on vacation or out sick.

Line Flow Strategy• A line flow strategy can reduce the frequency of

setups.• If volumes of specific products are large enough,

groups of machines and workers can be organized into a product layout (line) to eliminate setups entirely.

• If volume is insufficient to keep a line of similar products busy, group technology can be used to design small production lines that manufacture, in volume, families of components with common attributes

Preventive Maintenance

• Because JIT emphasizes low inventory between workstations, unplanned machine downtime can be disruptive.

• Preventive maintenance can reduce the frequency and duration of machine downtime.

• One tactic is to make workers responsible for routinely maintaining their own equipment and develop employee pride in keeping their machines in top condition

Waste in Operations1. Waste from overproduction (manufacturing an item before

it is needed and with more quantities) this increase both inventory and lead time

2. Waste of waiting time (product is not moved and processed, poor materials flow, poor processes linkages this waiting may be 90 percent of LT)

3. Transportation waste (excessive movement and materials handling, risk of being damaged, lost, delayed, a cost for no added value

4. Inventory waste (a capital outlay that has not yet produced an income, excessive Inv hides shop floor problems, Increased inv is a result of overproduction and waiting)

5. Processing waste (more work is done on a piece than what is required by the customer, high precision equipment when simple machine is sufficient, overutilization of expensive assets)

6. Waste of motion (unnecessary efforts related to ergonomics like bending, stretching, reaching, lifting and walking) jobs with excessive motion should be redesigned

7. Waste from product defects (quality defect results in scrap and rework and wasteful costs lost capacity, scheduling efforts, increased inspection, and loss of customer good will)

8. Underutilization of people

Waste in Operations

Streamlined Production

Flow with JIT

Traditional Flow

CustomersSuppliers

Customers

Suppliers

Production Process (stream of water)

Inventory (stagnant ponds) Material

(water in stream)

WIP Level• Less WIP means products go through system faster• reducing the WIP makes you more sensitive to

problems, helps you find problems faster• Stream and Rocks analogy:

– Inventory (WIP) is like water in a stream– It hides the rocks– Rocks force you to keep a lot of water (WIP) in the stream

Lowering Inventory Reduces Waste

WIP hides problems

Lowering Inventory Reduces Waste

WIP hides problems

Lowering Inventory Reduces Waste

Reducing WIP makesproblem very visible

STOP

Lowering Inventory Reduces Waste

Reduce WIP again to findnew problems

Reduce VariabilityReduce Variability

Inventory levelInventory level

Process downtimeScrap

Setup time

Late deliveries

Quality problems

Inventory Inventory levellevel

Reduce VariabilityReduce Variability

Scrap

Setup time

Late deliveries

Quality problems

Process downtime

Causes of VariabilityCauses of Variability

1.1. Employees, machines, and suppliers produce Employees, machines, and suppliers produce units that do not conform to standards, are units that do not conform to standards, are late, or are not the proper quantitylate, or are not the proper quantity

2.2. Engineering drawings or specifications are Engineering drawings or specifications are inaccurateinaccurate

3.3. Production personnel try to produce before Production personnel try to produce before drawings or specifications are completedrawings or specifications are complete

4.4. Customer demands are unknownCustomer demands are unknown

Variability ReductionVariability Reduction

JIT systems require managers to reduce JIT systems require managers to reduce variability caused by both internal and variability caused by both internal and external factorsexternal factors

Variability is any deviation from the Variability is any deviation from the optimum processoptimum process

Inventory hides variabilityInventory hides variability Less variability results in less wasteLess variability results in less waste

Performance and WIP Level

• Less WIP means products go through system faster• reducing the WIP makes you more sensitive to

problems, helps you find problems faster• Stream and Rocks analogy:

– Inventory (WIP) is like water in a stream– It hides the rocks– Rocks force you to keep a lot of water (WIP) in the stream

Reduce Lot SizesReduce Lot Sizes

200 200 –

100 100 –

Inve

ntor

yIn

vent

ory

TimeTime

QQ22 When average order size = 100When average order size = 100average inventory is 50average inventory is 50

QQ11 When average order size = 200When average order size = 200average inventory is 100average inventory is 100

Customer orders 10

Lot size = 5

Lot 1 Lot 2

Lot size = 2Lot 1 Lot 2 Lot 3 Lot 4 Lot 5

Reducing Lot Sizes Increases the Number of Lots

Reduce Lot SizesReduce Lot Sizes Ideal situation is to have lot sizes of one Ideal situation is to have lot sizes of one

pulled from one process to the nextpulled from one process to the next Often not feasibleOften not feasible Can use EOQ analysis to calculate Can use EOQ analysis to calculate

desired setup timedesired setup time Two key changesTwo key changes

Improve material handlingImprove material handling Reduce setup timeReduce setup time

Reduce Setup TimesReduce Setup Times

Use one-touch system to eliminate Use one-touch system to eliminate adjustments (save 10 minutes)adjustments (save 10 minutes)Step 4Step 4

Step 5Step 5Training operators and standardizing work Training operators and standardizing work procedures (save 2 minutes)procedures (save 2 minutes)

Repeat cycle until subminute Repeat cycle until subminute setup is achievedsetup is achieved

Initial Setup Time

Step 2Step 2Move material closer and

improve material handling (save 20 minutes)

Step 1Step 1

Separate setup into preparation and actual setup, doing as much as possible while the machine/process is

operating (save 30 minutes)

Step 3Step 3Standardize and

improve tooling (save 15 minutes)

90 min —90 min —

60 min —60 min —

45 min —45 min —

25 min —25 min —

15 min —15 min —13 min —13 min —

——

Kanban

• Japanese for ‘signboard’• Method for implementing JIT• In order to produce, you need both material

to work on, and an available kanban.• Each work station has a fixed # kanbans.

Kanban

• Worker 2 finishes a part, outbound moves over• 2 has a blue tag avaliable, so 2 gets another part to

work on:– 2 takes off 1’s green tag giving it back to 1, and – puts on her blue tag and moves it into position.

Flow of work

32

Kanban

• When 3 finishes a part, – Finished parts move over one spot– He has to have a red tag available to put on,– He gets a part from 2’s outbound pile, – And gives the blue back to 2

Flow of work

32

Kanban

• When 3 finishes a part, – Finished parts move over one spot– He has to have a red tag available to put on,– He gets a part from 2’s outbound pile, – And gives the blue back to 2

• 3’s production will be taken by 4, offstage right.– Tag goes back into 3’s bin

Flow of work

32

Kanban

• Red finishes his part next.

• But 4 hasn’t freed up any of the red kanbans, so there is nothing for 3 to work on now.

• 3 could maintain his machine, or see if 4 needs help

32

32

The Number of CardsThe Number of Cardsor Containersor Containers

Need to know the lead time needed to produce a container of parts Need to know the amount of safety stock needed

Number of kanbans =Number of kanbans =

Demand during Demand during SafetySafetylead timelead time ++ stockstock

Size of containerSize of container

Number of Kanbans ExampleNumber of Kanbans Example

Daily demandDaily demand == 500 cakes500 cakesProduction lead timeProduction lead time == 2 days2 days(wait time + (wait time + material handling time + material handling time + processing time)processing time)Safety stockSafety stock == 1/2 day1/2 dayContainer sizeContainer size == 250 cakes250 cakes

Demand during lead time = 2 days x 500 cakes = 1,000Demand during lead time = 2 days x 500 cakes = 1,000

Number of kanbans = = 5Number of kanbans = = 51,000 + 2501,000 + 250250250

Example

• A switch is assembled in batches of 4 units at an “upstream” work area.

• delivered in a bin to a “downstream” control-panel assembly area that requires 5 switch assemblies/hour.

• The switch assembly area can produce a bin of switch assemblies in 2 hours.

• Safety stock = 10% of needed inventory.

2.75 or 3 4

5(2)(1.1) C

dL (1S)

k size of container Expected demand during lead time + safety stock

Scheduling Small LotsScheduling Small Lots

AA BB CCAA AAAABB BB BB BB BB CC

JIT Level Material-Use ApproachJIT Level Material-Use Approach

AA CCAA AAAA BB BB BB BB BB CC CCBB BB BB BBAA AA

Large-Lot ApproachLarge-Lot Approach

TimeTime

Minimizing Waste: Uniform Plant Loading

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

Mixed Batch Example• Company produces

three products with a mixed model assembly line.– Operates 16 hours per

day for 250 days/yr.– Determine the mixed

model MPS for a daily batch.

– Determine minimum batch MPS and the mix schedule for a day.

Products Forecasts (year)

1 20,000

2 10,000

3 5,000

Calculations

    #1 #2 #3

Year Forecast   20000 10000 5000

Daily Batch divide by 250 80 40 20

Hourly Batch divide by 16 5 2.5 1.25

Minimum Batch MPS   4 2 1

For every unit of #3 (minimum batch), we need twice as many #2 and 4 timesAs many #1 so for minimum batch:Produce during each day produce #1,1,1,1,2,2,3 - repeated 20 times

Characteristics of JIT Partnershps

• Few, nearby suppliers• Supplier just like in-house upstream process• Long-term contract agreements• Steady supply rate• Frequent deliveries in small lots• Buyer helps suppliers meet quality• Suppliers use process control charts• Buyer schedules inbound freight

• Promote flow with little WIP• Facilitate workers staffing multiple machines• U-shaped cells

• Maximum visibility• Minimum walking• Flexible in number of workers• Facilitates monitoring of work entering and leaving cell• Workers can conveniently cooperate to smooth flow and

address problems

Cellular Layout

Inbound Stock Outbound Stock

Group TechnologyAn engineering and manufacturing philosophy that identifies physical similarities of parts and establishes their effective production. Assignment of individual products to

product families

Cellular Manufacturing

Assignment of product families to manufacturing cells

Group Technology (Part 1)

• Using Departmental Specialization for plant layout can cause a lot of unnecessary material movement

• Using Departmental Specialization for plant layout can cause a lot of unnecessary material movement

Saw Saw

Lathe PressPress

Grinder

LatheLathe

Saw

Press

Heat Treat

Grinder

Note how the flow lines are going back and forthNote how the flow lines are going back and forth

Group Technology (Part 2)• Revising by using Group Technology Cells can reduce movement and

improve product flow • Revising by using Group Technology Cells can reduce movement and

improve product flow

Press

Lathe

Grinder

Grinder

A

2

BSaw

Heat Treat

LatheSaw Lathe

PressLathe

1

Group Technology (con’d)

• A set of machines dedicated to processing one or more family• Arrange machines in a narrow U• Workers rotate among several machines

Group Technology (con’d)

Advantages Reduce cycle time

Move time Queue timeSet up time

Adjust the output rate by increasing or decreasing the number of workers in a cell

Facilitate job trainingPromote job satisfaction

Typical Benefits of JIT• Cost savings: inventory reductions, reduced scrap, fewer

defects, fewer changes due to both customers and engineering, less space, decreased labor hours, less rework.

• Revenue increases: better service and quality to the customer.

• Investment savings: less space, reduced inventory, increased the volume of work produced in the same facility.

• Workforce improvements: more satisfied, better trained employees.

• Uncovering problems: greater visibility to problems that JIT allows, if management is willing to capitalize on the opportunity to fix these problems.