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CHAPTER 15

CHAPTER 15. Just-In-Time and Theory of Constraints. Learning Objectives. Explain the basic concepts of just-in-time (JIT). Describe what is meant by the "pull" system. Describe the goal of Theory of Constraints (TOC) Show how to set up a drum-buffer-rope system.

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CHAPTER 15

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  1. CHAPTER 15 Just-In-Time and Theory of Constraints

  2. Learning Objectives • Explain the basic concepts of just-in-time (JIT). • Describe what is meant by the "pull" system. • Describe the goal of Theory of Constraints (TOC) • Show how to set up a drum-buffer-rope system. • Explain how MRP, JIT, and TOC are similar and different.

  3. Fundamental Concepts of JIT • Flow manufacturing • Simplified processes • Uncovering problems • Emphasis on quality • Organizational philosophy

  4. Water Analogy of JIT

  5. Simplified Production Process • Some companies eliminate setup time by using one simple machine for each part. • Many companies uses blanket purchase requisitions, which authorize a vendor to supply a certain total quantity spread out over a certain time.

  6. Problems Hidden by Inventory

  7. An Emphasis on Quality • producing in batches • total quality management (TQM) program

  8. Push System vs. Pull System

  9. In order for the single-card kanban system to work, the following rules must be observed: • Containers holding parts can be moved only when a card is attached. • Standard containers must always be used. • Each standard container can be filled only with the standard number of units.

  10. Kanban Systems • Standard Containers of Parts • Conveyance Kanban • Production Kanban

  11. Simplifying the Production Process • Plant Layout • Reducing Setup Time • Total Preventive Maintenance • Employee Empowerment

  12. Reducing Setup Time Reduce setup time activities include: • Closely examine each setup to determine steps that can be eliminated or better ways of doing things. • Prepare as much ahead of time as possible. • Try to do as much setup as possible with the machine running. • Use special equipment to shorten downtime whenever possible. • Practice and refine the setup procedures. • Mark machine settings for quick adjustment.

  13. Reducing Setup Time-- Continued Source: Mehran Sepehri, Just-in-Time, Not Just in Japan (Falls Church, Va.: American Production and Inventory Control Society, 1986), pp. 4-11.

  14. Total Preventive Maintenance TPM involves three main components: • An emphasis on preventive maintenance. • The allocation of time each day for maintenance. • Operator responsibility for maintenance.

  15. Planning in JIT Systems • Operations Planning and Master Scheduling • The Final Assembly Schedule • MIXED-MODEL SEQUENCING

  16. Operations Planning and Master Scheduling • The Aggregate Plan • The Master Schedule

  17. Mixed-Model Sequencing Mixed-model sequencing is a procedure for maintaining the uniform production required by a level assembly schedule.

  18. Example 1

  19. Example 1-- Continued Example1 The following is one possibility that would satisfy the company's objectives: A-B-A-B-A-C The following sequence would also be acceptable for short cycle times: A-A-A-B-B-C

  20. Example 2 The cycle time: 420 minutes/42 units = 10 minutes/unit

  21. The Role of MIS in JIT • Cost drivers • Back flushing

  22. JIT in Service Operations • Simplified Production Process • Uncovering Problems Buried by Inventory • An Emphasis on Quality

  23. Strategic Planning and JIT • Quality and reliability • Product flexibility • Volume flexibility • Delivery dependability • Productivity • People utilization • Cost minimization

  24. JIT II • The concept of JIT II was developed by Bose Corporation • Related to vendor-managed inventory and supply chain management

  25. Lean Systems (1) Some people think: JIT and lean systems are interchangeable. Others think: JIT is a component of lean systems. (2) JIT and NVA

  26. Theory Of Constraints • TOC began as a software package called OPT® (Optimized Production Technology). • The developer of OPT®, Dr. Eliyahu Goldratt, has expanded his OPT® Rules into TOC.

  27. The Goal of Operations • Throughput • Inventory • Operating expenses

  28. Relationships Between Throughput, Inventory, Operating Expenses and Profit

  29. The Impact of Constraints • Internal resource constraints • Market constraints • Policy constraints

  30. Theory of Constraints proposes a series of steps to follow in dealing with any type of constraint: • Identify the system's constraints. • Determine how to exploit the system's constraints. • Subordinate everything else to the decisions made in Step 2. • Elevate the constraint so a higher performance level can be reached. • If the constraint is eliminated in step 4 go back to step 1. • Do not let inertia become the new constraint.

  31. Constrained Resource Utilizationfor Each Product

  32. Applying TOC in Operations • Bottlenecks • Process Batches and Transfer Batches • Process Batch Versus Transfer Batch

  33. Bottlenecks Analysis of this example leads to the following two principles: (1)An hour of production time lost at a bottleneck subtracts one hour of output from the entire production system. (2)An hour of time saved at a non-bottleneck only adds an hour to its idle time. A bottleneck is defined as any department, work station, or operation that restricts the flow of product through the production system.

  34. Effect of Increasing Size of Process Batch

  35. Effect of Decreasing Transfer Batch Size

  36. Drum, Buffer, Rope • Drum • Buffer • Rope

  37. The Buffer • Time buffer • Stock buffers

  38. Network Flow Diagramwith One Bottleneck

  39. Comparing TOC, MRP, and JIT • All three techniques are aimed at the same goal – ensuring that production meets customer demand. Each goes about it in a slightly different way. • TOC develops a master schedule. • JIT takes the approach of eliminating all forms of waste.

  40. Comparing TOC, MRP, and JIT

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