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Transcript of Heizer 16
© 2008 Prentice Hall, Inc. 16 – 1
Operations ManagementOperations ManagementChapter 16 – Chapter 16 – JIT and Lean JIT and Lean OperationsOperations
PowerPoint presentation to accompany PowerPoint presentation to accompany Heizer/Render Heizer/Render Principles of Operations Management, 7ePrinciples of Operations Management, 7eOperations Management, 9e Operations Management, 9e
© 2008 Prentice Hall, Inc. 16 – 2
OutlineOutline
Global Company Profile: Global Company Profile: Toyota Motor CorporationToyota Motor Corporation
Just-in-Time, the Toyota Just-in-Time, the Toyota Production System, and Lean Production System, and Lean OperationsOperations Eliminate WasteEliminate Waste
Remove VariabilityRemove Variability
Improve ThroughputImprove Throughput
© 2008 Prentice Hall, Inc. 16 – 3
Outline – ContinuedOutline – Continued
Just-in-TimeJust-in-Time JIT PartnershipsJIT Partnerships
Concerns of SuppliersConcerns of Suppliers
JIT LayoutJIT Layout Distance ReductionDistance Reduction
Increased FlexibilityIncreased Flexibility
Impact on EmployeesImpact on Employees
Reduced Space and InventoryReduced Space and Inventory
© 2008 Prentice Hall, Inc. 16 – 4
Outline – ContinuedOutline – Continued
JIT InventoryJIT Inventory Reduce VariabilityReduce Variability
Reduce InventoryReduce Inventory
Reduce Lot SizesReduce Lot Sizes
Reduce Setup CostsReduce Setup Costs
JIT SchedulingJIT Scheduling Level SchedulesLevel Schedules
KanbanKanban
© 2008 Prentice Hall, Inc. 16 – 5
Outline – ContinuedOutline – Continued
JIT QualityJIT Quality
Toyota Production SystemToyota Production System Continuous ImprovementContinuous Improvement
Respect for PeopleRespect for People
Standard Work PracticesStandard Work Practices
Lean OperationsLean Operations Building a Lean OrganizationBuilding a Lean Organization
Lean Operations in ServicesLean Operations in Services
© 2008 Prentice Hall, Inc. 16 – 6
Learning ObjectivesLearning Objectives
When you complete this chapter you When you complete this chapter you should be able to:should be able to:
1.1. Define just-in-time, TPS, and lean Define just-in-time, TPS, and lean operationsoperations
2.2. Define the seven wastes and the Define the seven wastes and the 5 Ss5 Ss
3.3. Explain JIT partnershipsExplain JIT partnerships
4.4. Determine optimal setup timeDetermine optimal setup time
© 2008 Prentice Hall, Inc. 16 – 7
Learning ObjectivesLearning Objectives
When you complete this chapter you When you complete this chapter you should be able to:should be able to:
5.5. Define kanbanDefine kanban
6.6. Compute the required number of Compute the required number of kanbanskanbans
7.7. Explain the principles of the Toyota Explain the principles of the Toyota Production SystemProduction System
© 2008 Prentice Hall, Inc. 16 – 8
Toyota Motor CorporationToyota Motor Corporation
Largest vehicle manufacturer in the Largest vehicle manufacturer in the world with annual sales of over 9 world with annual sales of over 9 million vehiclesmillion vehicles
Success due to two techniques, JIT Success due to two techniques, JIT and TPSand TPS
Continual problem solving is central Continual problem solving is central to JITto JIT
Eliminating excess inventory makes Eliminating excess inventory makes problems immediately evidentproblems immediately evident
© 2008 Prentice Hall, Inc. 16 – 9
Toyota Motor CorporationToyota Motor Corporation
Central to TPS is a continuing effort Central to TPS is a continuing effort to produce products under ideal to produce products under ideal conditionsconditions
Respect for people is fundamentalRespect for people is fundamental
Small building but high levels of Small building but high levels of productionproduction
Subassemblies are transferred to the Subassemblies are transferred to the assembly line on a JIT basisassembly line on a JIT basis
High quality and low assembly time High quality and low assembly time per vehicleper vehicle
© 2008 Prentice Hall, Inc. 16 – 10
Just-In-Time, TPS, and Just-In-Time, TPS, and Lean OperationsLean Operations
JIT is a philosophy of continuous and JIT is a philosophy of continuous and forced problem solving via a focus on forced problem solving via a focus on throughput and reduced inventorythroughput and reduced inventory
TPS emphasizes continuous TPS emphasizes continuous improvement, respect for people, and improvement, respect for people, and standard work practicesstandard work practices
Lean production supplies the Lean production supplies the customer with their exact wants when customer with their exact wants when the customer wants it without wastethe customer wants it without waste
© 2008 Prentice Hall, Inc. 16 – 11
Just-In-Time, TPS, and Just-In-Time, TPS, and Lean OperationsLean Operations
JIT emphasizes forced problem JIT emphasizes forced problem solvingsolving
TPS emphasizes employee TPS emphasizes employee learning and empowerment in an learning and empowerment in an assembly-line environmentassembly-line environment
Lean operations emphasize Lean operations emphasize understanding the customerunderstanding the customer
© 2008 Prentice Hall, Inc. 16 – 12
Eliminate WasteEliminate Waste
Waste is anything that does not Waste is anything that does not add value from the customer point add value from the customer point of viewof view
Storage, inspection, delay, waiting Storage, inspection, delay, waiting in queues, and defective products in queues, and defective products do not add value and are 100% do not add value and are 100% wastewaste
© 2008 Prentice Hall, Inc. 16 – 13
Ohno’s Seven WastesOhno’s Seven Wastes
OverproductionOverproduction
QueuesQueues
TransportationTransportation
InventoryInventory
MotionMotion
OverprocessingOverprocessing
Defective productsDefective products
© 2008 Prentice Hall, Inc. 16 – 14
Eliminate WasteEliminate Waste
Other resources such as energy, Other resources such as energy, water, and air are often wastedwater, and air are often wasted
Efficient, ethical, and socially Efficient, ethical, and socially responsible production minimizes responsible production minimizes inputs, reduces wasteinputs, reduces waste
Traditional “housekeeping” has Traditional “housekeeping” has been expanded to the 5 Ssbeen expanded to the 5 Ss
© 2008 Prentice Hall, Inc. 16 – 15
The 5 SsThe 5 Ss
Sort/segregateSort/segregate – when in doubt, – when in doubt, throw it outthrow it out
Simplify/straightenSimplify/straighten – methods – methods analysis toolsanalysis tools
Shine/sweepShine/sweep – clean daily – clean daily StandardizeStandardize – remove variations – remove variations
from processesfrom processes Sustain/self-disciplineSustain/self-discipline – review work – review work
and recognize progressand recognize progress
© 2008 Prentice Hall, Inc. 16 – 16
The 5 SsThe 5 Ss
Sort/segregateSort/segregate – when in doubt, – when in doubt, throw it outthrow it out
Simplify/straightenSimplify/straighten – methods – methods analysis toolsanalysis tools
Shine/sweepShine/sweep – clean daily – clean daily StandardizeStandardize – remove variations – remove variations
from processesfrom processes Sustain/self-disciplineSustain/self-discipline – review work – review work
and recognize progressand recognize progress
Two additional Ss
Safety – build in good practices
Support/maintenance – reduce variability and unplanned downtime
© 2008 Prentice Hall, Inc. 16 – 17
Remove VariabilityRemove Variability
JIT systems require managers to JIT systems require managers to reduce variability caused by both reduce variability caused by both internal and external factorsinternal and external factors
Variability is any deviation from the Variability is any deviation from the optimum processoptimum process
Inventory hides variabilityInventory hides variability
Less variability results in less Less variability results in less wastewaste
© 2008 Prentice Hall, Inc. 16 – 18
Sources of VariabilitySources of Variability
1.1. Incomplete or inaccurate drawings Incomplete or inaccurate drawings or specificationsor specifications
2.2. Poor production processes Poor production processes resulting in incorrect quantities, resulting in incorrect quantities, late, or non-conforming unitslate, or non-conforming units
3.3. Unknown customer demandsUnknown customer demands
© 2008 Prentice Hall, Inc. 16 – 19
Sources of VariabilitySources of Variability
1.1. Incomplete or inaccurate drawings Incomplete or inaccurate drawings or specificationsor specifications
2.2. Poor production processes Poor production processes resulting in incorrect quantities, resulting in incorrect quantities, late, or non-conforming unitslate, or non-conforming units
3.3. Unknown customer demandsUnknown customer demandsBoth JIT and inventory
reduction are effective tools
in identifying causes of
variability
© 2008 Prentice Hall, Inc. 16 – 20
Improve ThroughputImprove Throughput
The time it takes to move an The time it takes to move an order from receipt to deliveryorder from receipt to delivery
The time between the arrival of The time between the arrival of raw materials and the shipping of raw materials and the shipping of the finished order is called the finished order is called manufacturing cycle timemanufacturing cycle time
A pull system increases A pull system increases throughputthroughput
© 2008 Prentice Hall, Inc. 16 – 21
Improve ThroughputImprove Throughput
By pulling material in small lots, By pulling material in small lots, inventory cushions are removed, inventory cushions are removed, exposing problems and emphasizing exposing problems and emphasizing continual improvementcontinual improvement
Manufacturing cycle time is reducedManufacturing cycle time is reduced
Push systems dump orders on the Push systems dump orders on the downstream stations regardless of downstream stations regardless of the needthe need
© 2008 Prentice Hall, Inc. 16 – 22
Just-In-Time (JIT)Just-In-Time (JIT)
• Powerful strategy for improving operationsPowerful strategy for improving operations
• Materials arrive where they Materials arrive where they are needed when they are are needed when they are neededneeded
• Identifying problems and Identifying problems and driving out waste reduces driving out waste reduces costs and variability and costs and variability and improves throughputimproves throughput
• Requires a meaningful Requires a meaningful buyer-supplier relationshipbuyer-supplier relationship
© 2008 Prentice Hall, Inc. 16 – 23
JIT and Competitive JIT and Competitive AdvantageAdvantage
Figure 16.1Figure 16.1
© 2008 Prentice Hall, Inc. 16 – 24
JIT and Competitive JIT and Competitive AdvantageAdvantage
Figure 16.1Figure 16.1
© 2008 Prentice Hall, Inc. 16 – 25
JIT PartnershipsJIT Partnerships
JIT partnerships exist when a JIT partnerships exist when a supplier and purchaser work supplier and purchaser work together to remove waste and drive together to remove waste and drive down costsdown costs
Four goals of JIT partnerships are:Four goals of JIT partnerships are: Removal of unnecessary activitiesRemoval of unnecessary activities
Removal of in-plant inventoryRemoval of in-plant inventory
Removal of in-transit inventoryRemoval of in-transit inventory
Improved quality and reliabilityImproved quality and reliability
© 2008 Prentice Hall, Inc. 16 – 27
Concerns of SuppliersConcerns of Suppliers
DiversificationDiversification – ties to only one customer – ties to only one customer increases riskincreases risk
SchedulingScheduling – don’t believe customers can – don’t believe customers can create a smooth schedulecreate a smooth schedule
ChangesChanges – short lead times mean – short lead times mean engineering or specification changes can engineering or specification changes can create problemscreate problems
QualityQuality – limited by capital budgets, – limited by capital budgets, processes, or technologyprocesses, or technology
Lot sizesLot sizes – small lot sizes may transfer – small lot sizes may transfer costs to supplierscosts to suppliers
© 2008 Prentice Hall, Inc. 16 – 28
JIT LayoutJIT Layout
Table 16.1Table 16.1
Reduce waste due to movementReduce waste due to movement
JIT Layout TacticsJIT Layout Tactics
Build work cells for families of productsBuild work cells for families of productsInclude a large number operations in a small areaInclude a large number operations in a small areaMinimize distanceMinimize distanceDesign little space for inventoryDesign little space for inventoryImprove employee communicationImprove employee communicationUse poka-yoke devicesUse poka-yoke devicesBuild flexible or movable equipmentBuild flexible or movable equipmentCross-train workers to add flexibilityCross-train workers to add flexibility
© 2008 Prentice Hall, Inc. 16 – 29
Distance ReductionDistance Reduction
Large lots and long production Large lots and long production lines with single-purpose lines with single-purpose machinery are being replaced by machinery are being replaced by smaller flexible cellssmaller flexible cells
Often U-shaped for shorter paths Often U-shaped for shorter paths and improved communicationand improved communication
Often using group technology Often using group technology concepts concepts
© 2008 Prentice Hall, Inc. 16 – 30
Increased FlexibilityIncreased Flexibility
Cells designed to be rearranged Cells designed to be rearranged as volume or designs changeas volume or designs change
Applicable in office environments Applicable in office environments as well as production settingsas well as production settings
Facilitates both product and Facilitates both product and process improvementprocess improvement
© 2008 Prentice Hall, Inc. 16 – 31
Impact on EmployeesImpact on Employees
Employees are cross trained Employees are cross trained for flexibility and efficiencyfor flexibility and efficiency
Improved communications Improved communications facilitate the passing on of facilitate the passing on of important information about important information about the processthe process
With little or no inventory With little or no inventory buffer, getting it right the first buffer, getting it right the first time is criticaltime is critical
© 2008 Prentice Hall, Inc. 16 – 32
Reduced Space and Reduced Space and InventoryInventory
With reduced space, inventory With reduced space, inventory must be in very small lotsmust be in very small lots
Units are always moving because Units are always moving because there is no storagethere is no storage
© 2008 Prentice Hall, Inc. 16 – 33
InventoryInventory
Inventory is at the minimum level Inventory is at the minimum level necessary to keep operations runningnecessary to keep operations running
JIT Inventory TacticsJIT Inventory Tactics
Use a pull system to move inventoryUse a pull system to move inventoryReduce lot sizesReduce lot sizesDevelop just-in-time delivery systems with suppliersDevelop just-in-time delivery systems with suppliersDeliver directly to point of useDeliver directly to point of usePerform to schedulePerform to scheduleReduce setup timeReduce setup timeUse group technologyUse group technology
Table 16.2Table 16.2
© 2008 Prentice Hall, Inc. 16 – 34
Reduce VariabilityReduce Variability
Inventory levelInventory level
Process downtimeScrap
Setup time
Late deliveries
Quality problems
Figure 16.3Figure 16.3
© 2008 Prentice Hall, Inc. 16 – 35
Inventory Inventory levellevel
Reduce VariabilityReduce Variability
Scrap
Setup time
Late deliveries
Quality problems
Process downtime
Figure 16.3Figure 16.3
© 2008 Prentice Hall, Inc. 16 – 36
Reduce Lot SizesReduce Lot Sizes
Figure 16.4Figure 16.4
200 200 –
100 100 –
Inve
nto
ryIn
ven
tory
TimeTime
QQ22 When average order size When average order size = 100= 100average inventory is average inventory is 5050
QQ11 When average order size When average order size = 200= 200average inventory is average inventory is 100100
© 2008 Prentice Hall, Inc. 16 – 37
Reduce Lot SizesReduce Lot Sizes Ideal situation is to have lot sizes Ideal situation is to have lot sizes
of one pulled from one process to of one pulled from one process to the nextthe next
Often not feasibleOften not feasible
Can use EOQ analysis to calculate Can use EOQ analysis to calculate desired setup timedesired setup time
Two key changes necessaryTwo key changes necessary Improve material handlingImprove material handling
Reduce setup timeReduce setup time
© 2008 Prentice Hall, Inc. 16 – 38
Lot Size ExampleLot Size ExampleDD == Annual demand Annual demand = 400,000= 400,000 units unitsdd == Daily demand Daily demand = 400,000/250 = 1,600= 400,000/250 = 1,600 per day per daypp == Daily production rate Daily production rate = 4,000= 4,000 units unitsQQ == EOQ desired EOQ desired = 400= 400HH == Holding cost Holding cost = $20= $20 per unit per unitSS == Setup cost (to be determined)Setup cost (to be determined)
Q =Q = 2DS2DSHH(1 -(1 - d/p d/p))
QQ22 = = 2DS2DSHH(1 -(1 - d/p d/p))
S S = = = $2.40= = = $2.40((QQ22)()(HH)(1 -)(1 - d/p d/p))
22DD(3,200,000)(0.6)(3,200,000)(0.6)
800,000800,000
Setup time Setup time = $2.40/($30/= $2.40/($30/hourhour) = 0.08 ) = 0.08 hrhr = 4.8 = 4.8 minutesminutes
© 2008 Prentice Hall, Inc. 16 – 39
Reduce Setup CostsReduce Setup Costs
High setup costs encourage large High setup costs encourage large lot sizeslot sizes
Reducing setup costs reduces lot Reducing setup costs reduces lot size and reduces average size and reduces average inventoryinventory
Setup time can be reduced through Setup time can be reduced through preparation prior to shutdown and preparation prior to shutdown and changeoverchangeover
© 2008 Prentice Hall, Inc. 16 – 40
Lower Setup CostsLower Setup Costs
Figure 16.5Figure 16.5
Sum of ordering Sum of ordering and holding costsand holding costs
Holding costHolding cost
Setup cost curves Setup cost curves ((SS11, S, S22))TT11
SS11
TT22
SS22
Co
stC
ost
Lot sizeLot size
© 2008 Prentice Hall, Inc. 16 – 41
Reduce Setup TimesReduce Setup Times
Figure 16.6Figure 16.6
Use one-touch system to eliminate Use one-touch system to eliminate adjustments (save 10 minutes)adjustments (save 10 minutes)Step 4Step 4
Step 5Step 5Training operators and standardizing Training operators and standardizing work procedures (save 2 minutes)work procedures (save 2 minutes)
Initial Setup Time
Step 2Step 2
Move material closer and improve material handling
(save 20 minutes)
Step 1Step 1
Separate setup into preparation and actual setup, doing as much as possible while the
machine/process is operating (save 30 minutes)
Step 3Step 3
Standardize and improve tooling
(save 15 minutes)
90 min —90 min —
60 min —60 min —
45 min —45 min —
25 min —25 min —
15 min —15 min —13 min —13 min —
——Repeat cycle until subminute Repeat cycle until subminute setup is achievedsetup is achieved
Step 6Step 6
© 2008 Prentice Hall, Inc. 16 – 42
JIT SchedulingJIT Scheduling
Schedules must be communicated Schedules must be communicated inside and outside the organizationinside and outside the organization
Level schedulesLevel schedules Process frequent small batchesProcess frequent small batches
Freezing the schedule helps Freezing the schedule helps stabilitystability
KanbanKanban Signals used in a pull systemSignals used in a pull system
© 2008 Prentice Hall, Inc. 16 – 43
Table 16.3Table 16.3
Better scheduling improves performanceBetter scheduling improves performance
JIT Scheduling TacticsJIT Scheduling Tactics
Communicate schedules to suppliersCommunicate schedules to suppliersMake level schedulesMake level schedulesFreeze part of the scheduleFreeze part of the schedulePerform to schedulePerform to scheduleSeek one-piece-make and one-piece moveSeek one-piece-make and one-piece moveEliminate wasteEliminate wasteProduce in small lotsProduce in small lotsUse kanbansUse kanbansMake each operation produce a perfect partMake each operation produce a perfect part
JIT SchedulingJIT Scheduling
© 2008 Prentice Hall, Inc. 16 – 44
Level SchedulesLevel Schedules
Process frequent small batches Process frequent small batches rather than a few large batchesrather than a few large batches
Make and move small lots so the Make and move small lots so the level schedule is economicallevel schedule is economical
““Jelly bean” schedulingJelly bean” scheduling
Freezing the schedule closest to the Freezing the schedule closest to the due dates can improve performancedue dates can improve performance
© 2008 Prentice Hall, Inc. 16 – 45
Scheduling Small LotsScheduling Small Lots
AA BB CCAA AAAABB BB BB BB BB CC
JIT Level Material-Use ApproachJIT Level Material-Use Approach
AA CCAA AAAA BB BB BB BB BB CC CCBB BB BB BBAA AA
Large-Lot ApproachLarge-Lot Approach
TimeTimeFigure 16.7Figure 16.7
© 2008 Prentice Hall, Inc. 16 – 46
KanbanKanban
Kanban is the Japanese word for cardKanban is the Japanese word for card
The card is an authorization for the next The card is an authorization for the next container of material to be producedcontainer of material to be produced
A sequence of kanbans A sequence of kanbans pulls material through pulls material through the processthe process
Many different sorts of Many different sorts of signals are used, but signals are used, but the system is still called the system is still called a kanbana kanban
© 2008 Prentice Hall, Inc. 16 – 47
KanbanKanban
1.1. User removes a User removes a standard sized standard sized containercontainer
2.2. Signal is seen by Signal is seen by the producing the producing department as department as authorization to authorization to replenishreplenish
Part numbers Part numbers mark locationmark location
Signal marker Signal marker on boxeson boxes
Figure 16.8Figure 16.8
© 2008 Prentice Hall, Inc. 16 – 48
KanbanKanban
Figure 16.9Figure 16.9
Work Work cellcell
Raw Raw Material Material SupplierSupplier
KanbanKanban
Purchased Purchased Parts Parts
SupplierSupplier
Sub-Sub-assemblyassembly
ShipShip
KanbanKanban
KanbanKanban
KanbanKanban
KanbanKanban
Finished Finished goodsgoods
Customer Customer orderorder
Final Final assemblyassembly
KanbanKanban
© 2008 Prentice Hall, Inc. 16 – 49
More KanbanMore Kanban
When the producer and user are not in When the producer and user are not in visual contact, a card can be usedvisual contact, a card can be used
When the producer and user are in visual When the producer and user are in visual contact, a light or flag or empty spot on contact, a light or flag or empty spot on the floor may be adequatethe floor may be adequate
Since several Since several components may components may be required, be required, several different several different kanban techniques kanban techniques may be employedmay be employed
© 2008 Prentice Hall, Inc. 16 – 50
More KanbanMore Kanban
Usually each card controls a specific Usually each card controls a specific quantity or partsquantity or parts
Multiple card systems may be used if Multiple card systems may be used if there are several components or there are several components or different lot sizesdifferent lot sizes
In an MRP system, the schedule can In an MRP system, the schedule can be thought of as a build authorization be thought of as a build authorization and the kanban a type of pull system and the kanban a type of pull system that initiates actual productionthat initiates actual production
© 2008 Prentice Hall, Inc. 16 – 51
More KanbanMore Kanban
Kanban cards provide a direct control Kanban cards provide a direct control and limit on the amount of work-in-and limit on the amount of work-in-process between cellsprocess between cells
If there is an immediate storage area, a If there is an immediate storage area, a two-card system can be used with one two-card system can be used with one card circulating between the user and card circulating between the user and storage area and the other between the storage area and the other between the storage area and the producerstorage area and the producer
© 2008 Prentice Hall, Inc. 16 – 52
The Number of Kanban CardsThe Number of Kanban Cardsor Containersor Containers
Need to know the lead time needed to produce a container of parts
Need to know the amount of safety stock needed
Number of kanbansNumber of kanbans(containers)(containers)
Demand during Demand during SafetySafetylead timelead time ++ stockstockSize of containerSize of container==
© 2008 Prentice Hall, Inc. 16 – 53
Number of Kanbans ExampleNumber of Kanbans Example
Daily demandDaily demand == 500500 cakes cakes
Production lead timeProduction lead time == 22 days days(Wait time + (Wait time + Material handling time + Material handling time + Processing time)Processing time)
Safety stockSafety stock == 1/21/2 day day
Container sizeContainer size == 250250 cakes cakes
Demand during lead time Demand during lead time = 2= 2 days days x 500x 500 cakes cakes = 1,000= 1,000
Number of kanbans Number of kanbans = = 5= = 51,000 + 2501,000 + 250
250250
© 2008 Prentice Hall, Inc. 16 – 54
Advantages of KanbanAdvantages of Kanban
Allow only limited amount of faulty or Allow only limited amount of faulty or delayed materialdelayed material
Problems are immediately evidentProblems are immediately evident
Puts downward pressure on bad Puts downward pressure on bad aspects of inventoryaspects of inventory
Standardized containers reduce Standardized containers reduce weight, disposal costs, wasted space, weight, disposal costs, wasted space, and laborand labor
© 2008 Prentice Hall, Inc. 16 – 55
QualityQuality
Strong relationshipStrong relationship JIT cuts the cost of obtaining good JIT cuts the cost of obtaining good
quality because JIT exposes poor quality because JIT exposes poor qualityquality
Because lead times are shorter, Because lead times are shorter, quality problems are exposed soonerquality problems are exposed sooner
Better quality means fewer buffers Better quality means fewer buffers and allows simpler JIT systems to be and allows simpler JIT systems to be usedused
© 2008 Prentice Hall, Inc. 16 – 56
JIT Quality TacticsJIT Quality Tactics
Use statistical process controlUse statistical process control
Empower employeesEmpower employees
Build fail-safe methods (poka-Build fail-safe methods (poka-yoke, checklists, etc.)yoke, checklists, etc.)
Expose poor quality with small Expose poor quality with small lot JITlot JIT
Provide immediate feedbackProvide immediate feedback
Table 16.4Table 16.4
© 2008 Prentice Hall, Inc. 16 – 57
Toyota Production SystemToyota Production System
Continuous improvementContinuous improvement Build an organizational culture and value Build an organizational culture and value
system that stresses improvement of all system that stresses improvement of all processesprocesses
Part of everyone’s jobPart of everyone’s job
Respect for peopleRespect for people People are treated as People are treated as
knowledge workersknowledge workers
Engage mental and Engage mental and physical capabilitiesphysical capabilities
Empower employeesEmpower employees
© 2008 Prentice Hall, Inc. 16 – 58
Toyota Production SystemToyota Production System
Standard work practiceStandard work practice Work shall be completely specified as to Work shall be completely specified as to
content, sequence, timing, and outcomecontent, sequence, timing, and outcome
Internal and external customer-supplier Internal and external customer-supplier connection are directconnection are direct
Product and service flows must be simple Product and service flows must be simple and directand direct
Any improvement must be made in Any improvement must be made in accordance with the scientific method at the accordance with the scientific method at the lowest possible level of the organizationlowest possible level of the organization
© 2008 Prentice Hall, Inc. 16 – 59
Lean OperationsLean Operations
Different from JIT in that it is Different from JIT in that it is externally focused on the customerexternally focused on the customer
Starts with understanding what the Starts with understanding what the customer wantscustomer wants
Optimize the entire process from Optimize the entire process from the customer’s perspectivethe customer’s perspective
© 2008 Prentice Hall, Inc. 16 – 60
Building a Lean OrganizationBuilding a Lean Organization
Transitioning to a lean system can Transitioning to a lean system can be difficultbe difficult
Lean systems tend to have the Lean systems tend to have the following attributesfollowing attributesUse JIT techniquesUse JIT techniques
Build systems that help employees Build systems that help employees produce perfect partsproduce perfect parts
Reduce space requirementsReduce space requirements
© 2008 Prentice Hall, Inc. 16 – 61
Building a Lean OrganizationBuilding a Lean Organization
Develop partnerships with Develop partnerships with supplierssuppliers
Educate suppliersEducate suppliers
Eliminate all but value-added Eliminate all but value-added activitiesactivities
Develop employeesDevelop employees
Make jobs challengingMake jobs challenging
Build worker flexibilityBuild worker flexibility