Chapter 12 Just-in-Time and Lean Systems

1. Chapter 12Just-in-Time and Lean Systems • JIT Defined • The Japanese Approach to Productivity • JIT Implementation Requirements • JIT in Services

2. Just-In-Time (JIT)Defined • JIT: • JIT involves:

3. Vendor Fab Sub Vendor Fab Final Assembly Sub Fab Vendor Fab Vendor JIT Demand-Pull Logic Customers

4. The Japanese Approach to Productivity Waste is ‘anything other than the minimum amount of equipment, materials, parts, space, and worker’s time, which are absolutely essential to add value to the product.’ Shoichiro Toyoda, President, Toyota

5. Waste in Operations (1) Waste from overproduction (2) Waste of waiting time (3) Transportation waste (4) Inventory waste (5) Processing waste (6) Waste of motion (7) Waste from product defects

6. Minimizing Waste: Uniform Plant Loading 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. Not uniform Jan. Units Feb. Units Mar. Units Total 1,200 3,500 4,300 9,000 or Uniform Jan. Units Feb. Units Mar. Units Total 3,000 3,000 3,000 9,000 How does the uniform loading help save labor costs?

7. WHAT IT IS WHAT IT DOES WHAT IT REQUIRES WHAT IT ASSUMES Minimizing Waste: Just-In-Time Production

8. Example: By identifying defective items from a vendor early in the production process the downstream work is saved. Machine downtime Scrap Vendor Change delinquencies Work in orders process queues Engineering design Design (banks) redundancies backlogs Example: By identifying defective work by employees upstream, the downstream work is saved. Decision Paperwork Inspection backlogs backlog backlogs Minimizing Waste: Inventory Hides Problems

9. Kanban • Japanese word for card • Authorizes production from downstream operations • May be a card, flag, verbal signal etc. • Used often with fixed-size containers

10. Exhibit 10.6 Minimizing Waste: Kanban Production Control Systems Withdrawal kanban Storage Part A Storage Part A Machine Center Assembly Line Production kanban Material Flow Card (signal) Flow

11. JIT Requirements: • Design Flow Process: Link operations, balance workstation capacities, relayout for flow, emphasize preventive maintenance, reduce lot sizes, reduce setup/changeover time • Total Quality Control: Worker responsibility, measure SQC, enforce compliance, fail-safe methods, automatic inspection

12. JIT Requirements: • Stabilize Schedule: Level schedule, underutilize capacity, establish freeze windows • Kanban-Pull: Demand pull, backflush, reduce lot sizes • Work with Vendors: Reduce lead times, frequent deliveries, project usage requirements, quality expectations

13. Characteristics of JIT VendorPartnerships • Few, nearby suppliers • 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

14. JIT Requirements: • Reduce Inventory More: Look for other areas, stores, transit, carousels, conveyors • Improve Product Design: Standard product configuration, standardize and reduce number of parts, process design with product design, quality expectations

15. Respect for People

16. JIT Implementation Issues

17. JIT Implementation Issues