Chapter 12: Lean Operations
What are alternative forms of Muda? What do they mostly help?
1. Conveyance and transportation 2. Overprocessing 3. Delays and waiting 4. Defects - help service organizations
What are the broader philosophical principals of lean systems?
1. Eliminate Waste 2. Strive for visibility and flexibility in the system 3. Pursue closer relationships with outside suppliers 4. Seek continuous improvement
What changes should an organization make to accomodate frequent deliveries?
1. Eliminate the warehouse 2. Deliver directly to the user 3. Reduce lead times
What are common improvements to reduce the value of S?
1. Eliminating the paperwork traditionally associated with ordering and receiving through electronic data interchange (EDI) with suppliers 2. Streamlining order stocking, retrieval, and handling through bar coding and radio frequency identification (RFID) tagging inventory 3. Investigating in the process of machine setup, to make frequency changeovers quicker and more efficent
To implement lean production, organizations must adopt what three principals?
1. Plan smaller lot sizes to support lower inventory levels 2. Employ effective signaling to support implicit planning 3. Smooth production to support efficient operation
What two items must be investigated before reducing lot sized?
1. potential reduction of any fixed costs associated with ordering 2. Preparation for the frequent deliveries that will result from smaller lot sizes
Run Size
A batch size, or order size, associated with the production of an item
Material Requirements Planning (MRP)
A technique for scheduling the production of multiple items related by both independent and dependent demand
Level Production Strategy
Aggregate planning approach that relies on fixed capacity despite changing demand
Situational Awareness
An individual or organization's comprehension of the surrounding environment and its potential near-future states.
What is a cellular layout? What is the main advantage to a cellular layout?
Cellular Layout is a U-shaped Assembly Line, the main advantage is that it has the ability to shape supply traffic patterns such that they are less likely to interfere with themselves and with the operation of the line
Economies of Scale
Decreasing average unit cost by increasing volume
Lead Time
Display between requesting a product and receiving it
Safety Stock
Inventory held to protect against uncertain supply or demand
Kaizen
Japanese term for a focus on continuous improvements
Andon
Japanese term for a signaling system announcing problems encountered and assistance requested, often implemented as sets of lights over workstations
Poka Yoke
Japanese term for process improvements striving to make the desired outcome of a process inevitable largely by preventing mistakes
Muda
Japanese term for waste, particularly anything a customer is not willing to pay for -enemy of value-added
What is Toyota's formula for the optimal number of Kanban cards to circulate in the loop?
N = DL(1+X)/C
Lean
Operating without waste
Stockpiling
Producing or securing goods in advance of demand
Electronic Data Interchange (EDI)
The linking of two information systems from two different organizations to transfer data and conduct transcations
Radio Frequency Identification (RFID)
The tagging of objects with devices that may be detected and interrogated for information by remote electronic readers, allowing identification and tracking without contact
Run Time
The time required to produce a batch of some item
Vendor-Managed Inventory (VMI)
Transferal of ownership and management of inventory within a system to its external provider, who will be compensated after its use by the system
Quality Ciricle
a group of employees that meets regularly to discuss and develop opportunities for continuous improvement of their operation.
Single Card Kanban
a kanban control arrangement consisting of a single kanban loop, controlling production and limiting inventory levels of some item
Dual Card Kanban
a kanban control arrangement consisting of two kanban loops. The first kanban loop signals and limits production of an item, while the second loop signals and limits withdrawals for consumption of the item
JIT II
a phrase first populated by the Bose Company, emphasizing vendor managed inventory and colocation of those vendors within a production facility
Pull System
a production system that reacts to signals of demand, relying on internal coordination instead of the implementation of explicit plans to achieve outcomes
Planned Order Releases
a schedule of the ordering of a particular item to meet its requirements over a specific time interval
Just-in-time (JIT)
an earlier and alternate term for lean operation, in which a system implicitly operated with minimum inventory and waste -reorder point is deliberately set to zero or near-zero
reorder point
an inventory level that triggers replenishment of an item
Lean Operations trade-off
eliminating inventory vs. eliminating the need for inventory (reasons)
Kanban
in operations, a Japanese term for a signal, often a card. Kanban systems use these signals to regulate production
Draw the historical development of inventory management diagram
in the book Traditional Reorder Point Systems --> Material Requirments Planning --> Lean Operations
Work in Process (WIP)
inventory resulting from transformation of raw materials, but not yet ready for sale to consumers
Partnering
long-term strategic alliance that benefits both parties
Push System
main driver is the forecast, a production system that calculates and anticipates demand, relying on the implementation of explicit plans instead of internal coordination to achieve outcomes
Mixed-model assembly
production of a range of products with a single assembly line, primarily by varying features on an otherwise standardized product
How do you minimize the amount recomended for ordering?
reduce S in the economic order quantity EOQ = sqrt(2DS/H)
Sole Sourcing
relying on a single supplier
Inventory
tangible items awaiting sale or use
Little's Law
the average number of some item in a system equals its average arrival rate multiplied by the average time each unit spends in the system
Kanban Loop
the continuous path of travel of a set of kanbans, governing the production or consumption of some inventory item
Value-added
the difference between the total value of the outputs and the total value of the inputs associated with an operation