Chapter 15 Lean Operations McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc All Rights Reserved Chapter 15: Learning Objectives • You should be able to: – – – – – Explain what is meant by the term lean operations system List each of the goals of a lean system and explain its importance List and briefly describe the building blocks of lean List the benefits of a lean system Outline the considerations important to converting a traditional mode of operations to a lean system – List some of the obstacles that might be encountered when converting to a lean system – Describe value stream mapping 15-2 Lean Operations • Lean operation – A flexible system of operation that uses considerably less resources than a traditional system • Tend to achieve – – – – Greater productivity Lower costs Shorter cycle times Higher quality 15-3 Lean Operations: Terminology • Muda – Waste and inefficiency • Kanban – A manual system that signals the need for parts or materials • Pull system – Replacing material or parts based on demand • Heijunka – Workload leveling • Kaizen – Continuous improvement of the system 15-4 Lean Operations: Terminology • Jidoka – Quality at the source (worker) • Poka-yoke – Safeguards built into a process to reduce the possibility of errors • Team concept – Use of small teams of workers for process improvement 15-5 Goals and building blocks of lean systems 15-6 Lean: Supporting Goals • The degree to which lean’s ultimate goal is achieved depends upon how well its supporting goals are achieved: Eliminate disruptions Make the system flexible Eliminate waste, especially excess inventory 15-7 Lean: Building Blocks • Product design • Process design • Personnel/organizational elements • Manufacturing planning and control 15-8 Kanbans • Ideal number of kanban cards DT (1 X ) C where N N Total number of containers(1 card per container) D planned usage rate of using work center Average waiting time for replenishment of parts plus T average production time for a container of parts Policy variable set by management that relects possible inefficiency X in the system (the closer to 0, the more efficient the system Capacity of a standard container (should be no more C than 10 percentof daily usage of the part 15-9 Limited WIP • Benefits of lower WIP – Lower carrying costs – Increased flexibility – Aids scheduling – Saves costs of scrap and rework if there are design changes – Lower cycle-time variability 15-10 Reduced Transaction Processing • Lean systems seek to reduce costs associated with the ‘hidden factory’: – Logistical transactions – Balancing transactions – Quality transactions – Change transactions 15-11 Preventive Maintenance • Preventive maintenance – Maintaining equipment in good operating condition and replacing parts that have a tendency to fail before they actually fail 15-12 Lean vs Traditional Philosophies Factor Traditional Lean 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 1-13 Value Stream Mapping • Value stream mapping – A visual tool to systematically examine the flows of materials and information • Its purpose is to help identify waste and opportunities for improvement • Data collected: – – – – – – Times Distances traveled Mistakes Inefficient work methods Waiting times Information flows 15-14 Operations Strategy • Be careful to study the requirements and benefits of lean systems before making a decision to convert operations – Evaluate strengths and weaknesses of current operations • The decision to convert can be sequential • Weigh the pros and cons of a lean approach to inventories • Supplier management is critical to a lean operation 15-15 ... 15-14 Operations Strategy • Be careful to study the requirements and benefits of lean systems before making a decision to convert operations – Evaluate strengths and weaknesses of current operations. .. traditional mode of operations to a lean system – List some of the obstacles that might be encountered when converting to a lean system – Describe value stream mapping 15-2 Lean Operations • Lean... replenishment of parts plus T average production time for a container of parts Policy variable set by management that relects possible inefficiency X in the system (the closer to 0, the more efficient