Ch 14: Lean Supply chains

--what is JIT --what does JIT do --what does JIT require --what does JIT assume

-- a management philosophy, pull system through the plant --attacks waste, exposes problems and bottlenecks, streamlined production --employee participation, industrial engineering basics, continuing improvement, total quality control, small lot sizes --assumes a stable environment (heijunka)

how is uniform plant loading beneficial?

-- minimizes bullwhip effect --saves labor costs: no need to pay overtime when production high is suddenly higher

lean supply chains entail

--Specialized plants --collaboration with suppliers --Building a lean supply chain

What is the logic of JIT Demand-pull logic?

--customer puts an inventory item from final assembly. --sub-assembly work is pulled forward by that demand --process continues throughout the entire process and supply chain.

Lean involves

--elimination of waste in production --timing of production resources

principles of value stream mapping

--keep the value stream at maximum velocity --eliminate the waste that stops, slows down or diverts the value stream --concentrate on removing waste rather than than speeding up value-adding operations --look for waste in the factory, office, physical, procedural and technical operations

Lean Focused Supply Chain Components

--lean suppliers: able to respond to changes, lower prices, higher quality --lean procurement: automation, suppliers must see into the customers' operations and customers must see into their suppliers' operations --lean warehousing: eliminate non-value added steps and waste in storage process lean logistics: optimized mode selection & pooling orders, combined multi-stop truckloads, optimized routing, cross docking, import/export transportation processes, backhaul minimization --lean customers: understand their business needs, value speed and flexibility, establish effective partnerships with suppliers

Respect for people entails

--level payrolls and lifetime employment --cooperative employee unions --subcontractor networks (long-term partnering) --bottom-round management style (make decisions at the lowest possible level) --quality circles (consensus through teams)

Lean/JIT production is focused on

--lot size reduction --reduced inventory/WIP --quick changeovers/setup reduction

push vs. pull

--push: schedules the release of work based on actual or forecasted demand. --pull: authorizes the release of work based on a system status, establishes a limit on the amount of WIP inventory.

12 steps to reduce setup times

1. Make self positioning tooling e.g alignment pins, slots, notches. 2. Standardize the design of tooling to accommodate the largest number of parts (lengths, widths, heights) 3. Use preset tooling and/or perform as many activities as possible while the machine is running. 4. Quick set lever, clamps, pins, cams, pins to reduce clamping times 5. Standardize bolt hole patterns, hardware sizes and types to reduce the number of tools required to fasten tooling to a machine 6. Schedule and run jobs in families of parts to minimize the number of machine/tooling changes required in switching from one job to the next 7. Power tools to reduce manual motions 8. Special handling, rolling, positioning equipment 9. Plan and schedule steps to insure that all materials... 10. Special teams for setup

what are 5S programs

1. Separate/sort: get rid of everything not needed 2. Straighten: put things away 3. Scrub (shine): clean and paint 4. Standardize: develop rules to keep everything clean and organized 5.Systematize/sustain: audit the workplace to ensure rules are being followed

five principles of lean

1. Value: define value from the customer's perspective 2. Value Stream: identify and map the value strem that creates and delivers the value 3. Flow: ensure material flows to the customer 4. Pull: respond to demand only when there is a clear signal to do so 5. Perfection: strive to achieve perfection

The Toyota production system is based on these 2 philosophies

1. elimination of waste 2. respect for people

kanban

A signaling device used to control production

backflush

Calculating how many of each part were used in production and using these calculations to adjust actual on-hand inventory balances. This eliminates the need to actually track each part used in production.

lean production

Integrated activities designed to achieve high-volume, high-quality production using minimal inventories of raw materials, work-in-process, and finished goods.

kaizen

Japanese philosophy that focuses on continuous improvement

what is more appropriate for non-repetitive production

MRP

quality at the source

The philosophy of making workers personally responsible for the quality of their output. Workers are expected to make the part correctly the first time and to stop the process immediately if there is a problem.

value stream

These are the value-adding and non-value-adding activities required to design, order, and provide a product from concept to launch, order to delivery, and raw materials to customers.

the 8 classes of waste

Transportation: wastes time Inventory: excess inventory Motion: wastes time Waiting: waiting for materials, equipment, repairs, large lots ==> wastes time Overproduction: making more than is needed Over-processing: wastes time Defects: production failures Skills: overqualified workers' skills being wasted

The US vs the Japanese mindset when it comes to inventory

US: carry extra inventory to protect against uncertainty. Japan: reduce water level (inventory) to clearly expose these problems

customer value

a driving force of lean: something which the customer is willing to pay for. Goal: eliminate everything that is not adding value (waste)

Value Stream Mapping

a graphical way to analyze where value is or is not being added as material flows through a process

group technology

a philosophy in which similar parts are grouped into families, and the processes required to make the parts are arranged in a specialized workcell

level schedule

a schedule that pulls material into final assembly at a constant rate

the number of cards/containers equals

amount of WIP

JIT production/lean

an integrated set of activities that are designed to achieve high volume production with minimal inventories.

kanban pull system

an inventory or production control system that uses a signaling device to regulate flows

waste

anything that does not add value from the customer's perspective

disadvantage of departmental specialization to minimizing waste

causes a lot of unnecessary material movement

general principle to minimize setup times

convert as much internal activities (machine stopped) to external activities (machine running) as possible.

pull

eliminating the primary source of waste-overproduction-by only producing what the customer wants, when they want it

what are the problems with excess production

excess production hides problems and creates extra inventory, handling, equipment usage, space, quality, problem issues etc.

Little JIT

focused narrowly on scheduling goods inventory and providing resources where and when needed

lean layouts entail

group technology/cellular manufacturing, quality at the source, JIT production

Lean requires

high quality, strong supplier relationships, fairly predictable demand

what do Shingo and Ohno have to say about production?

it should be determined by the customer, not false targets such as utilization

what causes excess inventory?

long setups, large batch sizes, comfort mindset, reliance on MRP to order, batch processing

how can we move to a pull system

lot size reduction ==> reduce inventory/WIP==> quick changeovers/setup reduction

value chain

mapping the process steps throughout the supply chain by identifying the steps that add value and striving to eliminate those that add waste

in kandan, always remember to round up!!

okay

preventive maintenance. why is it important?

periodic inspection and repair designed to keep equipment reliable. it avoids downtime

Big JIT

philosophy of operations mgt that seeks to eliminate waste in ALL aspects of a firm's production activities

what causes motion waste

poor layouts and facilities, poor workplace designs, lost items/searching, lack of needed tooling and equipment

what causes transportation waste

poor layouts, large production lots, batch processes, poor scheduling.

causes of production failures/defects

poor training, poor manufacturing instructions, poor equipment and tooling, poor materials

what causes over-processing waste

poorly maintained equipment, improper/proper tooling, excess checking/stopping, improper materials, errors in processing/setup, poor/no working instructions.

advantage of using group technology cells in minimizing waste

reduce movement and improve product flow

flow

removing other sources of waste, bloated inventory and waiting, by ensuring goods flow continuously through the supply chain and never stop

kanbans are most appropriate for

repetitive manufacturing

The traditional vs the kanban approach to relationship between lot size and setup cost

revisit!!!

what are factory focused networks

small specialized plants that limit the range of products produced (sometimes only one type of product for an entire facility)

uniform plant loading (heijunka)

smoothing the production flow to dampen schedule variation

Kaizen (continuous improvement)

striving for total elimination of waste through a succession of kaizen events within the production process

what does each container represent

the minimum production lot size

waste reduction

the optimization of value-adding activities and elimination of non-value-adding activities that are part of the value stream

freeze window

the period of time during which the schedule is fixed and no further changes are possible

bullwhip effect

the phenomenon in supply chains whereby ordering patterns experience increasing variance as you proceed upstream in the chain

lean production schedules entail

uniform plant loading, kanban production control systems, minimized setup times

lean manufacturing is based on

value, value chain, pull, flow, kaizen/continuous improvement

effects of excess inventory

wastes time hides real problems such as quality, scheduling, suppliers, maintenance, attendance