Terms - Chapter 7

A philosophy developed by Toyota in Japan that emphasizes manufacturing and delivery of small lotsizes only when needed by the customer.

Just-in-Time (JIT)

• Quick business results • Disruption limited to the event • Rapid experiments in the gemba • Involvement of the gemba • Workers own the process and the results

Kaizen workshop Advantages

A lean methodology that helps organizations simplify, clean, and sustain a productive work environment. The 5S methodology originated in Japan and is based on the simple idea that the foundation of a good production system is a clean and safe work environment. Translated from Japanese words that begin with the letter "S," the closest English equivalents normally used are Sort, Set in order, Shine, Standardize, and Sustain. The following list is a combination of many variants of the 5S list found in various publications: 1. Sort (separate, scrap, sift) - Separate the necessary from the unnecessary and get rid of the unnecessary. 2. Set in order (straighten, store, simplify) - Organize the work area (red tag, shadow boards, etc.) and put everything in its place. 3. Shine (scrub, sweep) - Sweep, wash, clean, and shine everything around the work area. 4. Standardize - Use standard methods to maintain the work area at a high level so it is easy to keep everything clean for a constant state of readiness. 5. Sustain (systematize, self-discipline) - Ensure that all 5S policies are followed through the entireorganization by means of empowerment, commitment, and accountability. Some lean practitioners add a sixth "S" for Safety. They use this "S" to establish safety procedures in and around the process. However, most organizations include safety as a normal part of the set in order step. The benefits of a 5S program include reduced waste and improved visibility of problems, safety, morale, productivity, quality, maintenance, leadtimes, impression on customers, and sense of ownership of the workspace. More fundamentally, a 5S program can help the firm develop a new sense of discipline and order that carries over to all activities.

5S

Seven original forms of waste identified by Taiichi Ohno, plus one widely used in North America. Taiichi Ohno, the father of the Toyota Production System, defined seven categories of waste (Ohno 1978). Waste ("muda") includes any activity that does not add value to the customer. More recently, Bodek (2009) defined the eighth waste and called it "underutilized talents of workers." Liker (2004) used the similar phrase "unused employee creativity." Most sources now label this "waste of human potential." The 8 wastes include: 1. Overproduction - Producing more than what is needed or before it is needed. 2. Waiting - Any time spent waiting for tools, parts, raw material, packaging, inspection, repair, etc. 3. Transportation - Any transportation of parts, finished goods, raw materials, packaging, etc. Waste is particularly apparent here when materials are moved into and out of storage or are handled more than once. 4. Excess processing - Doing more work than necessary (e.g., providing higher quality than needed, performing unneeded operations, or watching a machine run). 5. Inventory - Maintaining excess inventory of raw materials, in-process parts, or finished goods. 6. Excessive motion - Any wasted motion or poor ergonomics, especially when picking up or stacking parts, walking to look for items, or walking to look for people. 7. Defects (correction) - Repair, rework, recounts, re-packing, and any other situation where the work is not done right the first time. 8. Unused human potential - Unused employee minds and creativity. One of the best approaches for eliminating these wastes is to implement a 5S program. The lean thinking entry also suggests many specific approaches for eliminating each of these wastes. Macomber and Howell (2004) identified several additional wastes, including too much information, complexity, design of goods and services that do not meet users' needs, providing something the customer does not value, not listening, not speaking, assigning people to roles that they are not suited for, not supporting people in their roles, and high turnover. Many experts distinguish between necessary waste and unnecessary waste (also known as pure waste). Unnecessary waste is any activity that adds no direct value to the customer, to the team making the product, or to other activities that add direct value to the customer. In contrast, necessary waste is any activity that does not add value directly to the customer, but is still necessary for the team or for another step that does add value. Necessary waste supports the best process known at the current time, but will ideally be eliminated sometime in the future. Examples of necessary waste might include planning meetings and preventive maintenance.

8 wastes

The advantages of a cell over a product layout include reduced cycle time, travel time, setup time, queue time, work-in-process inventory, space, and materials handling cost. Reduced cycle time allows for quicker detection of defects and simpler scheduling. When firms create cells, they often cross-train workers in a cell, which leads to better engagement, morale, and labor productivity. Some firms also implement self-managed work teams to develop workers, reduce overhead, and accelerate process improvement.

Advantages of a cell over a product layout

Lean thinking focuses on reducing waste though a high level of engagement of the people in the "gemba" (the place that real work is done). Many firms that embraced lean thinking have been able to achieve significant benefits, such as reduced cycle time, inventory, defects, waste, and cost while improving quality and customer service and developing workers

Benefits of lean

A time cushion used to protect the bottleneck from running out of work (starving).

Buffer

Jidoka frees equipment from the necessity of constant human attention, makes it possible to separate people from machines, allows workers to handle multiple operations, and prevents equipment breakdowns. Ideally, jidoka stops the line or machine automatically, which reduces the burden of workers to monitor the process. In fact, many sources define jidoka as stopping production automatically when a problem occurs. Jidoka is often implemented with a signal to communicate the status of a machine. For example, a production process might use andon lights with a green light if everything is okay, a yellow light to signal an abnormal condition, and a red light if the process is stopped.

Cost benefits of jidoka

The main disadvantage of a cell is that the machines dedicated to a cell may not have sufficient utilization to justify the capital expense. Consequently, cellular manufacturing is often difficult to implement in a facility that uses large expensive machines. When a firm has one very large expensive machine, it might still use cells for all other steps.

Disadvantages of a cell over a product layout

Completion of one unit at the bottleneck is the drum that signals (authorizes) all upstream workcenters to produce one unit. The unconstrained resources must serve the constrained resource.

Drum

A Theory of Constraints (TOV) concept that sends a signal every time the bottleneck completes one unit, giving upstream operations the authority to produce. DBR is a production control system based on the TOC philosophy. Like other TOC concepts, DBR focuses on maximizing the utilization of the bottleneck (the constrained resource) and subordinates all non-bottleneck resources so they meet the needs of the bottleneck.

Drum-Buffer-Rope (DBR)

• Disruption of business • Sometimes not enough time for data-based decision making • Items on the "30-day list" for more than 30 days • Sometimes hasty decisions are bad ones

Kaizen workshop Disadvantages

A high level plan for a few key items used to determine the materials plans for all end items; also known as the master schedule

Master Production Schedule (MPS)

Jidoka causes work to stop immediately when a problem occurs so defective parts are never created. In other words, Jidoka conducts 100 percent inspection, highlights the causes of problems, forces constant process improvement, and results in improved quality. Whereas automation focuses on labor reduction, jidoka (autonomation) focuses on quality improvement. Note that jidoka is closely related to Shigeo Shingo's concept of poka yoke.

Quality benefits of jidoka

A tool to pull production from the non-bottleneck resources to the bottleneck. The DRB concept is very similar to the "pacemaker workcenter" concept used in lean manufacturing.

Rope

A management philosophy developed by Dr. Eliyahu M. Goldratt that focuses on the bottleneck resources to improve overall system performance. The Theory of Constraints (TOC) recognizes that an organization usually has just one resource that defines its capacity

Theory of Constraints (TOC)

An approach to manufacturing developed by Eiji Toyoda and Taiichi Ohno at Toyota Motor Company in Japan; some people use TPS synonymously with lean thinking

Toyota Production System (TPS)

A lean term (pronounced "Ann-Don") that refers to a warning light, warning board, or signal on (or near) a machine or assembly line that calls attention to defects or equipment problems; also called an andon board; the Japanese word for andon (行灯) means "lamp." An andon is any visual indicator signaling that a team member has found an abnormal situation, such as poor quality, lack of parts, improper paperwork, missing information, or missing tools. When a worker pulls an andon cord (or pushes a button), the red light goes on, the line is stopped, and a supervisor or technician responds immediately to help diagnose and correct the problem. It is important for management to define exactly who is responsible as the support person. The idea here is to have a simple visual system that immediately calls for the right kind of help from the right people at the right time. This is a good example of Rule 5 in the Spear and Bowen (1999) framework. The number of lights and their possible colors can vary even by workcenter within a plant. Most implementations have three colors: red, yellow, and green (like a stoplight). Red usually means the line is down, yellow means the line is having problems, and green means normal operations. Some firms use other colors to signal other types of issues, such as material shortages or defective components. Some firms use a blinking light to signal that someone is working on the problem.

andon light

The lean practice of not allowing a process to produce when an output storage area is full. Examples of output storage areas include a container, cart, bin, or kanban square. A kanban square is rectangular area on a table or floor marked with tape. Blocking is good for non-bottleneck processes because it keeps them from overproducing (i.e., producing before the output is needed). Blocking avoids overproduction and keeps the total work-in-process inventory down to a reasonable level. Blocking for a bottleneck process is bad because it causes the system to lose valuable capacity. Remember that an hour lost on the bottleneck is an hour lost for the entire system. Starving and blocking are often discussed in the same context.

blocking

A Theory of Constraints (TOC) concept of strategically placing "extra" inventory or a time cushion in front of constrained resources to protect the system from disruption.

buffer management

The use of a group of machines dedicated to processing parts, part families, or product families that require a similar sequence of operations. Concept - In a traditional functional (process) layout, machines and workers are arranged in workcenters by function (e.g., drills or lathes), large batches of parts are moved between workcenters, and workers receive limited cross-training on the one type of machine in their workcenter. With cellular manufacturing, machines and workers are dedicated to making a particular type of product or part family. The machines in the cell, therefore, are laid out in the sequence required to make that product. With cells, materials are moved in small batches and workers are cross-trained on multiple machines and process steps. Cells are often organized in a Ushaped layout so workers inside the "U" can communicate and help each other as needed. The figure below contrasts functional and cellular layouts showing that cells can have a much higher value added ratio.

cellular manufacturing

Training workers in several different areas or functions outside their normal job responsibilities. Having workers learn a wide variety of tasks has many advantages: 1. Increased flexibility - Workers can provide backup when the primary worker is unavailable or when the demand exceeds the capacity. This makes it easy to improve flow and reduce inventory. This increased flexibility allows the line workers to dynamically balance the line without any help from an industrial engineer. 2. Process improvement - When workers have a broader understanding of the organization, they can be more knowledgeable about how to improve it. 3. Develops human capital - Cross-trained workers are more valuable to the company and often find more satisfaction in their jobs. Cross-training is often an investment in the future for a firm.

cross-training

A Japanese term for the actual place where "real" work takes place; sometimes spelled genba. The Japanese word "gemba" is frequently used for the shop floor or any place where value-adding work actually occurs. The main idea communicated by the term is that improvement really only takes place with (1) engagement of the people who work the process and (2) direct observation of the actual current conditions. For example, standardized work cannot be documented in the manager's office, but must be defined and revised in the "gemba." According to one source21, the more literal translation is the "actual spot" and was originally adapted from law enforcement's "scene of the crime."

gemba

(1) A methodology for classifying parts (items) based on similar production processes and required resources. (2) A manufacturing cell (cluster of machines, equipment, and workers) dedicated to making a set of parts that share similar routings.

group technology

A Japanese technique used to smooth production over time; also called load leveling, linearity, and stabilizing the schedule. One of the main concepts for smoothing production is frequent changes of the model mix to be run on a given line. Instead of running large batches of one model after another, TPS advocates small batches of many models over short periods of time. This is called mixed model assembly. This requires quick changeovers, but results in smaller lots of finished goods that are shipped frequently. The main tool for heijunka is a visual scheduling board known as a heijunka box, which is generally a wall schedule with rows dedicated to each product (or product family) and columns for each time period (e.g., 20- minute periods). Colored production control kanban cards representing individual jobs are placed in the slots in proportion to the number of items to be built of a given product type during a time interval. The heijunka box makes it easy to see what types of jobs are queued for production. Workers remove the kanban cards from the front of the schedule as they process the jobs. The heijunka box consistently levels demand by short time increments (20 minutes in this example). This is in contrast to the mass-production practice of releasing work for one shift, one day, or even a week to the production floor. Similarly, the heijunka box consistently levels demand by mix. For example, it ensures that Product C and Product D are produced in a steady ratio in small batch sizes. Production process stability introduced by leveling makes it considerably easier to introduce lean techniques ranging from standard work to continuous flow cells. Muda (waste) declines as mura (unevenness in productivity and quality) and muri (overburden of machines, managers, and production associates) decline. When processes are leveled in volume and mix, employees are no longer overburdened, customers get better ontime delivery, and manufacturers reduce cost when muda, mura, and muri are reduced. Although production leveling tools can be used to level the load (hours of work for the factory), demand management tools can be used to level the demand, which makes it easier to level the load.

heijunka

The Toyota Production System practice of designing processes and empowering workers to shut down a process when an abnormal condition occurs; sometimes called autonomation. The Japanese word "jidoka" is often translated as "autonomation," which is a contraction of the words "autonomous" and "automation." Jidoka is sometimes translated as "automation with a human touch (or human mind)." According to Ohno (1978), the original jidoka device was a loom developed by Sakichi Toyoda (1867-1930), the founder of the Toyota Motor Company. This loom stopped instantly if any one of the threads broke so defective products were not built and so problems could be seen immediately. According to Ohno (1979), Toyota sold the patent for his loom in 1930 to the Platt Brothers in England for $500,000, and then invested this money in automobile research, which later led to the creation of the Toyota Motor Company. Originally, jidoka focused on automatic methods for stopping a process when an error condition occurred; however, it is now used to describe both automated and human means for stopping a process when a problem occurs. For example, a process can use limit switches or devices that will automatically shut down the process when the required number of pieces has been made, a part is defective, or the mechanism jams. This same process can be operated with policies that allow the operators to shut down the machine when a warning light goes on.

jidoka

The movement of workers between different jobs in an organization. This policy can be an effective method for cross-training and can improve communications, increase process understanding, and reduce stress and boredom. Job rotation can also prevent muscle fatigue and reduce workplace injuries. Job rotation also makes sense for managers. The vice president of Emerson/Rosemount in Eden Prairie, Minnesota, had been the vice president of Engineering, vice president of Manufacturing, and vice president of Marketing before being named the president of the division. This executive was well prepared for a general management role because of his job rotation experiences.

job rotation

The lean practice of using short (one to five day) projects to improve a process; also known as a kaizen event, kaizen blitz, and rapid process improvement workshop (RPIW). A kaizen workshop uses various lean tools and methods to make the problem visible, and then uses formal root cause analysis and other means to identify and correct the problem at the source. The result is rapid process improvement that can result in lower costs, higher quality, lower cycle time, and better products and services. Although kaizen has historically been applied in manufacturing, many service businesses are also now applying kaizen. One notable example is the Park Nicollet Health Systems, headquartered in St. Louis Park, Minnesota. A kaizen workshop is not a business meeting or a typical process improvement project. It is a hands-on, on the- job, action learning, and improvement activity led by a skilled facilitator. The process involves identifying, measuring, and improving a process. Unlike many approaches to process improvement, kaizen achieves rapid process improvement in many small steps. Kaizen teams include people who work the process and also involve other people who work the process. Therefore, workers usually feel consulted and involved, which goes a long way in overcoming resistance to change. On this same theme, kaizen workshops often try many small "experiments," again with the workers involved, which drives rapid learning and system improvement while maintaining strong "buy-in" from the people who work the process everyday. Compared to DMAIC, a kaizen workshop has a number of disadvantages and advantages as listed in the table on the right. One challenge of kaizen workshops is managing the activities before and after the event

kaizen workshop

A lean signaling tool developed by Toyota that indicates the need for materials or production. kanban signal comes from the customer (downstream) workcenter and gives a workcenter authority to start work. If a workcenter does not have a kanban signal such as a card, container, or fax, it is blocked from doing any more work. For example, when a kanban square is full, the workcenter is not allowed to produce any more. A kanban system was formerly called a "just-in-time" system because production is done just before the need of a downstream workcenter. However, the term "just-in-time" and the related JIT acronym have fallen out of favor in North America. A kanban system is a "pull system" because the kanban signal is used to "pull" materials from upstream (supplier) workcenters. In contrast, an MRP system (or any schedule-based system) is a push system. Push systems use a detailed production schedule for each part. Parts are "pushed" to the next production stage as required by the schedule.

kanban

A philosophy and set of practices originally developed at Toyota that seeks to eliminate waste; also known as lean manufacturing or just lean.

lean thinking

The practice of assembling multiple products in small batches in a single process. For example, a firm assembled two products (A and B) on one assembly line and used large batches to reduce changeover time with sequence. The advantages of mixed model assembly over the large batch assembly are that it (1) reduces inventory, (2) improves service levels, (3) smoothes the production rate, and (4) enables early detection of defects. Its primary disadvantage is that it requires frequent changeovers, which can add complexity and cost.

mixed model assembly

The practice of assigning workers to operate more than one machine at a time. This is a common Japanese manufacturing practice that is made possible by the application of jidoka and error proofing principles.

multiple-machine handling

A lean manufacturing practice of making only one part at a time (a batch size of one) before moving the part to the next step in the process; also called single-piece flow, make-one-move-one, and one-forone replenishment. This lean ideal is not always achievable. Single Minute Exchange of Dies and other setup time reduction methods are critical for helping organizations reduce setup cost (and ordering cost) and move toward this ideal.

one-piece flow

In a manufacturing context, the cost to prepare a process (e.g., a machine) to start a new product; in a purchasing context, the cost to place a purchase order; also known as the changeover cost or order cost

setup cost

Procedures used to reduce the time and cost to change a machine from making one type of part or product to another; also called Single Minute Exchange of Die48 and rapid changeovers. For many processes, the key to process improvement is to reduce the setup time and cost. Setup time does not add value to the customer and is considered "waste" from the lean manufacturing point of view. Reducing setup times often provides significant benefits, such as less direct labor time, less direct labor cost, moreavailable capacity, better customer service, better visibility, less complexity, and easier scheduling. Setup reduction also enables small lotsizes, which in turn reduces the variability of the processing time, reduces queue time, reduces cycle time, and ultimately improves quality through early detection of defects. In addition, setup reduction helps an organization strategically, because fast setups allow for quick response to customer demands. One of the best methods for reducing setup time is to move setup activities off-line, which is setup time done while the machine is still running.

setup time reduction methods

The discipline of creating and following a single set of formal, written work instructions for each process; also called standard work. Standardized work is particularly important when a process is performed by different people, in different workcenters, in different locations, or on different shifts. Although it is normally applied to repetitive factory and service work, it can also be applied to less repetitive knowledge work done by professionals and salaried workers.

standardized work

The customer demand rate expressed as a time and used to pace production. Takt time, therefore, is set by the customer demand rate, and should be adjusted when the forecasted market demand rate changes. If takt time and the customer demand rate do not match, the firm (and the supply chain) will have either too little or too much inventory. Some people confuse takt time and throughput time. It is possible to have a throughput time of 6 weeks and have a takt time of 6 seconds. Takt time is the time between completions and can be thought of as time between units "falling off the end of the line." The cycle time entry compares cycle time and throughput time.

takt time