Operation management 9e stevenson mcgrwhill chap015

15 JIT and Lean Operations McGraw-Hill/Irwin Copyright © 2007 by The McGraw-Hill Companies, Inc All Learning Objectives       Explain what is meant by the term lean operations system List each of the goals of JIT and explain its importance List and briefly describe the building blocks of JIT List the benefits of the JIT system Outline the considerations important in converting a traditional mode of operations to a JIT system List some of the obstacles that might be encountered when converting to a JIT system 15-2 JIT/Lean Production  Just-in-time (JIT): A highly coordinated processing system in which goods move through the system, and services are performed, just as they are needed,  JIT   lean production  JIT  pull (demand) system  JIT operates with very little “fat” 15-3 Goal of JIT The ultimate goal of JIT is a balanced system Achieves a smooth, rapid flow of materials through the system 15-4 Summary JIT Goals and Building Blocks Figure 15.1 Ultimate A Goal balanced rapid flow Supporting Goals Eliminate disruptions Make the system flexible Product Design Process Design Eliminate waste Personnel Elements Manufacturing Planning Building Blocks 15-5 Supporting Goals  Eliminate disruptions  Make system flexible  Eliminate waste, especially excess inventory 15-6 Sources of Waste  Overproduction  Waiting time  Unnecessary transportation  Processing waste  Inefficient work methods  Product defects 15-7 Kaizen Philosophy  Waste is the enemy  Improvement should be done gradually and continuously  Everyone should be involved  Built on a cheap strategy  Can be applied anywhere 15-8 Kaizen Philosophy (cont’d) Supported by a visual system Focuses attention where value is created Process orienteted Stresses main effort of improvement should come from new thinking and work style  The essence of organizational learning is to learn while doing     15-9 Big vs Little JIT  Big JIT – broad focus     Vendor relations Human relations Technology management Materials and inventory management  Little JIT – narrow focus  Scheduling materials  Scheduling services of production 15-10 Limited Work in Process  Benefits     Lower carrying costs Increased flexibility Aids scheduling Saves cost of rework and scrap  Two general approaches  Kanban – focuses on individual work stations  Constant work in process (CONWIP) – focuses on the system as a whole 15-25 Traditional Supplier Network Figure 15.4a Buyer Buyer Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier 15-26 Tiered Supplier Network Figure 15.4b Buyer Buyer First Tier Supplier Second Tier Supplier Third Tier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier Supplier 15-27 Preventive Maintenance and Housekeeping  Preventative maintenance: Maintaining equipment in good condition and replacing parts that have a tendency to fail before they actually fail  Housekeeping: Maintaining a workplace that is clean and free of unnecessary materials 15-28 Housekeeping Five S’s Sort Straighten Sweep Standardize Self-discipline 15-29 Table 15.3 Comparison of JIT and Traditional Factor Traditional JIT Inventory Much to offset forecast errors, late deliveries Minimal necessary to operate Deliveries Few, large Many, small Lot sizes Large Small Setup; runs Few, long runs Many, short runs Vendors Long-term relationships are unusual Partners Workers Necessary to the work Assets 15-30 Transitioning to a JIT System  Get top management commitment  Decide which parts need most effort  Obtain support of workers  Start by trying to reduce setup times  Gradually convert operations  Convert suppliers to JIT  Prepare for obstacles 15-31 Obstacles to Conversion  Management may not be committed  Workers/management may not be cooperative  Difficult to change company culture  Suppliers may resist  Why? 15-32 Suppliers May Resist JIT      Unwilling to commit resources Uneasy about long-term commitments Frequent, small deliveries may be difficult Burden of quality control shifts to supplier Frequent engineering changes may cause JIT changes 15-33 JIT in Services The basic goal of the demand flow technology in the service organization is to provide optimum response to the customer with the highest quality service and lowest possible cost       Eliminate disruptions Make system flexible Reduce setup and lead times Eliminate waste Minimize WIP Simplify the process 15-34 JIT II  JIT II: a supplier representative works right in the company’s plant, making sure there is an appropriate supply on hand 15-35 Benefits of JIT Systems  Reduced inventory levels  High quality  Flexibility  Reduced lead times  Increased productivity 15-36 Benefits of JIT Systems (cont’d)  Increased equipment utilization  Reduced scrap and rework  Reduced space requirements  Pressure for good vendor relationships  Reduced need for indirect labor 15-37 Table 15.4 Elements of JIT Smooth flow of work (the ultimate goal) Elimination of waste Continuous improvement Eliminating anything that does not add value  Simple systems that are easy to manage  Use of product layouts to minimize moving materials and parts  Quality at the source     15-38 Table 15.4     Elements of JIT (cont’d) Poka-yoke – fail safe tools and methods Preventative maintenance Good housekeeping Set-up time reduction  Cross-trained employees  A pull system 15-39 ... JIT  Big JIT – broad focus     Vendor relations Human relations Technology management Materials and inventory management  Little JIT – narrow focus  Scheduling materials  Scheduling services... JIT System  Get top management commitment  Decide which parts need most effort  Obtain support of workers  Start by trying to reduce setup times  Gradually convert operations  Convert suppliers...Learning Objectives       Explain what is meant by the term lean operations system List each of the goals of JIT and explain its importance List and briefly describe