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Transcript of Lean Operations McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights...
Lean Operations
Chapter 14
McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
Lean OperationsLean operation
A flexible system of operation that uses considerably less resources than a traditional systemTend to achieve
Greater productivityLower costsShorter cycle timesHigher quality
Instructor Slides 14-2
Lean: Ultimate GoalThe ultimate goal:
Achieve a system that matches supply to customer demand; supply is synchronized to meet customer demand in a smooth uninterrupted flow
A balanced systemOne that achieves a smooth, rapid flow of materials
and/or work through the system
Instructor Slides 14-3
Goals and building blocks of lean systems
Instructor Slides 14-4
Lean: Supporting GoalsThe degree to which lean’s ultimate goal is
achieved depends upon how well its supporting goals are achieved:1. Eliminate disruptions2. Make the system flexible3. Eliminate waste, especially excess inventory
Instructor Slides 14-5
WasteWaste
Represents unproductive resourcesSeven sources of waste in lean systems:
1. Inventory2. Overproduction3. Waiting time4. Unnecessary transporting5. Processing waste6. Inefficient work methods7. Product defects
Instructor Slides 14-6
Lean: Building BlocksProduct designProcess designPersonnel/organizational elementsManufacturing planning and control
Instructor Slides 14-7
Building Blocks: Product DesignFour elements of product design important
for lean systems:1. Standard parts2. Modular design3. Highly capable systems with quality built in4. Concurrent engineering
Instructor Slides 14-8
Building Blocks: Process DesignSeven aspects of process design that are
important for lean systems:1. Small lot sizes2. Setup time reduction3. Manufacturing cells4. Quality improvement5. Production flexibility6. A balanced system7. Little inventory storage8. Fail-safe methods
Instructor Slides 14-9
Process Design: Small Lot SizesIn the lean philosophy, the ideal lot size
is oneBenefits of small lot size
Reduced in-process inventoryLower carrying costsLess storage space is necessary
Inspection and rework costs are less when problems with quality do occur
Permits greater flexibility in scheduling Less inventory to ‘work off’ before implementing
product improvements Increased visibility of problems Increased ease of balancing operations
Instructor Slides 14-10
Process Design: Setup Time Reduction
Small lot sizes and changing product mixes require frequent setups
Unless these are quick and relatively inexpensive, they can be prohibitive
Setup time reduction requires deliberate improvement efforts Single-minute exchange of die (SMED)
A system for reducing changeover time Group technology may be used to reduce setup time by
capitalizing on similarities in recurring operations
Instructor Slides 14-11
Process Design: Manufacturing CellsOne characteristic of lean production
systems is multiple manufacturing cellsBenefits include
Reduced changeover timesHigh equipment utilizationEase of cross-training workers
Instructor Slides 14-12
Process Design: Quality Improvement
Quality defects during the process can disrupt the orderly flow of work
Autonomation (jidoka)Automatic detection of defects during
productionTwo mechanisms are employed
1. One for detecting defects when they occur2. Another for stopping production to correct the
cause of the defects
Instructor Slides 14-13
Process Design: Work Flexibility Guidelines for increasing flexibility
1. Reduce downtime due to changeovers by reducing changeover time
2. Use preventive maintenance on key equipment to reduce breakdowns and downtime
3. Cross-train workers so they can help when bottlenecks occur or other workers are absent
4. Use many small units of capacity; many small cells make it easier to shift capacity temporarily and to add or subtract capacity
5. Use off-line buffers. Store infrequently used safety stock away from the production area
6. Reserve capacity for important customersInstructor Slides 14-14
Process Design: Balanced SystemTakt time
The cycle time needed to match customer demand for final product
Sometimes referred to as the heartbeat of a lean systemTakt time is often set for a work shiftProcedure:
1. Determine the net time available per shift2. If there is more than one shift per day, multiply the
net time by the number of shifts3. Compute the takt time by dividing the net available
time by demand
Instructor Slides 14-15
Process Design: Inventory StorageLean systems are designed to minimize
inventory storage Inventories are buffers that tend to cover up recurring
problems that are never resolvedpartly because they are not obviouspartly because the presence of inventory makes them
seem less serious
Instructor Slides 14-16
Process Design: Fail-Safe MethodsPoka-yoke (Fail Safing)
Building safeguards into a process to reduce or eliminate the potential for errors during a processExamples
Electric breakersSeatbelt fastener warningsATMs that signal if a card is let in a machineDesigning parts that can only be assembled in the
correct position
Instructor Slides 14-17
Building Blocks: Personnel/Organizational
Five personnel/organizational elements that are important for lean systems:Workers as assetsCross-trained workersContinuous improvementCost accountingLeadership/project management
Instructor Slides 14-18
Personnel/Organizational: Workers as Assets
Workers as assetsWell-trained and motivated workers are the
heart of the lean systemThey are given greater authority to make
decisions, but more is expected of them
Instructor Slides 14-19
Personnel/Organizational: Cross-Trained Workers
Cross-trained workersWorkers are trained to perform several parts
of a process and operate a variety of machinesFacilitates flexibilityHelps in line balancing
Instructor Slides 14-20
Personnel/Organizational: Continuous Improvement
Continuous improvementWorkers in lean systems have greater
responsibility for quality, and they are expected to be involved in problem solving and continuous improvement
Lean workers receive training in Statistical process controlQuality improvementProblem solving
Instructor Slides 14-21
Personnel/Organizational: Cost Accounting
Cost accountingActivity-based costing
Allocation of overhead to specific jobs based on their percentage of activities
Instructor Slides 14-22
Personnel/Organizational: Leadership
Leadership/project managementManagers are expected to be leaders and
facilitators, not order giversLean systems encourage two-way
communication between workers and managers
Instructor Slides 14-23
Building Blocks: MPCSeven elements of manufacturing planning
and control (MPC) are particularly important for lean system:1. Level loading2. Pull systems3. Visual systems4. Limited work-in-process (WIP)5. Close vendor relationships6. Reduced transaction processing7. Preventive maintenance and housekeeping
Instructor Slides 14-24
MPC: Level LoadingLean systems place a strong emphasis on
achieving stable, level daily mix schedulesMPS – developed to provide level capacity
loadingMixed model scheduling
Three issues need to be resolvedWhat is the appropriate product sequence to use?How many times should the sequence be repeated
daily?How many units of each model should be produced in
each cycle?
Instructor Slides 14-25
MPC: Pull SystemsPush system
Work is pushed to the next station as it is completedPull system
A workstation pulls output from the preceding workstation as it is needed
Output of the final operation is pulled by customer demand or the master schedule
Pull systems are not appropriate for all operationsLarge variations in volume, product mix, or product
design will undermine the system
Instructor Slides 14-26
MPC: CommunicationCommunication moves backward
through the system from station to stationEach workstation (customer) communicates
its need for more work to the preceding workstation (supplier)Assures that supply equals demand
Work moves “just in time” for the next operationFlow of work is coordinatedAccumulation of excessive inventories is avoided
Instructor Slides 14-27
MPC: Visual SystemsKanban
Card or other device that communicates demand for work or materials from the preceding stationKanban is the Japanese word meaning “signal” or
“visible record”Paperless production control systemAuthority to pull, or produce, comes
from a downstream process.Two main types of kanbans:
1.Production kanban (p-kanban): signals the need to produce parts
2.Conveyance kanban (c-kanban): signals the need to deliver parts to the next work center.
Instructor Slides 14-28
KanbansIdeal number of kanban cards
part theof usagedaily percentof 10than more no be (shouldcontainer standard a ofCapacity
system theefficient more the0, closer to (the system in thecyinefficien possible relects that managementby set iablePolicy var
parts ofcontainer afor timeproduction averageplus parts ofent replenishmfor time waitingAverage
center work using of rate usage planned
container)per card (1 containers ofnumber Total
where
)1(
C
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T
D
N
C
XDTN
Instructor Slides 14-29
MPC: Limited WIPBenefits of lower WIP
Lower carrying costsIncreased flexibilityAids schedulingSaves costs of scrap and rework if there are
design changesLower cycle-time variability
Instructor Slides 14-30
MPC: Close Vendor RelationshipsLean systems typically have close
relationships with vendorsThey are expected to provide frequent, small
deliveries of high-quality goodsA key feature of many lean systems is the
relatively small number of suppliers used
Instructor Slides 14-31
MPC: Reduced Transaction Processing
Lean systems seek to reduce costs associated with the ‘hidden factory’:Logistical transactionsBalancing transactionsQuality transactionsChange transactions
Instructor Slides 14-32
Preventive Maintenanceand Housekeeping
Preventive maintenanceMaintaining equipment in good operating
condition and replacing parts that have a tendency to fail before they actually do fail
HousekeepingMaintaining a workplace that is clean and free
of unnecessary materials
Instructor Slides 14-33
Lean vs. Traditional Philosophies
Factor Traditional LeanInventory Much to offset forecast
errors, late deliveriesMinimal necessary to operate
Deliveries Few Many
Lot sizes Large Small
Setup; runs Few, long runs Many, short runs
Vendors Long-term relationships are unusual
Partners
Workers Necessary to do the work Assets
Instructor Slides 14-34
Transitioning to Lean Systems1. Make sure top management is committed and
that they know what will be required
2. Decide which parts will need the most effort to convert
3. Obtain support and cooperation of workers
4. Begin by trying to reduce setup times while maintaining the current system
5. Gradually convert operations, begin at the end and work backwards
6. Convert suppliers to JIT
7. Prepare for obstacles
Instructor Slides 14-35
Obstacles to Conversion
1. Management may not be fully committed or willing to devote the necessary resources to conversion
2. Workers/management may not be cooperative
3. It can be difficult to change the organizational culture to one consistent with the lean philosophy
4. Suppliers may resist
Instructor Slides 14-36
Lean ServicesIn service the focus is often on the time
needed to perform the service because speed is often the order winner
Lean benefits can be achieved in the following ways:Eliminate disruptionsMake system flexibleReduce setup and lead timesEliminate wasteMinimize WIPSimplify the process
Instructor Slides 14-37
JIT IIJIT II:
• A supplier representative works right in the company’s plant, making sure there is an appropriate supply on hand
• It is often referred to as Vendor Managed Inventory (VMI)
Instructor Slides 14-38
Operations StrategyBe careful to study the requirements and benefits
of lean systems before making a decision to convert operations Evaluate strengths and weaknesses of current
operations
The decision to convert can be sequentialWeigh the pros and cons of a lean approach to
inventoriesSupplier management is critical to a lean
operation
Instructor Slides 14-39