Chapter 12: Lean Supply Chains
Respect for People - Toyota Production System
Lifetime employment for permanent positons Maintain level payrolls even when business conditions deteriorate Company unions Bonuses View workers as assets Value of cross-trained employee
Production problems hidden by inventory
Machine downtime Scrap Vendor delinquencies Work-in-process queues "banks" Engineering design redundancies Change orders Inspection backlog Paperwork backlog Order entry backlog Decision backlogs
Elimination of waste - Toyota Production System
Waste from over production Waste of waste of waiting time Transportation waste Inventory waste Processing waste Waste of motion Waste from product defects
Value Stream Mapping
-a special type of flowcharting tool used to analyze where value is or is not being added as material flows through a process -requires a full understanding of the business, including production processes
Examples of Waste
Defects overproduction excessive inventories excess motion transportation waiting time idle employees
What are the two tenants of Toyota's Production System
Elimination of waste Respect for people
Kaizen Burst
Japanese word for continuous improvement
Principles of Lean Supply Chain Design
Lean Layouts Lean Production Schedules Lean Supply Chains
Lean Production schedules (2)
Level schedule Uniform plant loading
"A systematic approach to identifying and eliminating waste (non-value-added activities) through continuous improvement by flowing the product at the pull of the customer in pursuit of perfection"
MEP Lean Network's definition
Kanban Systems
Means "sign" or "instruction card" cards or containers are used
Is Lean a Pull or Push system?
Pull
RFID
Radio Frequency Identification Tags - Improved Inventory Tracking
Uniform Plant Loading
Smoothing the production flow to dampen schedule variation
Customer Value
Something for which the customer is willing to pay
Waste reduction
The optimization of the value adding activities and the elimination of non-value-adding activities
VMI
Vendor Managed Inventory
Manufacturing Cells
a philosophy in which similar parts are grouped into families -eliminated movement and queue time between operations, reduces inventory and reduces employees
Waste
anything that does not add value from the customer's perspective
Colored Golf Balls (kanban)
appropriate golf ball signals production
CFR
collaborative Planning, forecasting and replenishment
Quality at the Sourcee
do it right the first time and if something goes wrong stop the process immediately -workers are responsible and become inspectors
Lean Value Chain
each step in the supply chain should create value or it is considered waste and should be removed
Kanban squares
marked spaces on the floor to identify where material should be stored
3 Characteristics of Lean Suppliers
o Able to respond to changes o Lower prices o Higher quality
2 Characteristics of Lean Procurement
o Key is automation (e-procurement) o Suppliers must see into the customers' operations and the customers must see into their suppliers' operation
Lean is centered on...
preserving value with less work
Just-in-Time Production
producing what is needed when needed and nothing more, anything excess is waste -several shipments a day -JIT exposes problems hidden by inventory
Level schedule
pulls material into final assembly at a constant rate for the best efficiency in production
Container system (kanban)
the container is used as a signal device
Value Stream
the value-added and non-value-added activities required to design, order and provide a product or service
