Lesson 19
Just-In-Time and Lean Systems
repetitive production system in which
processing and movement of materials and
goods occur just as they are needed, usually
in small batches
developed by Taiichi Ohno at Toyota
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What Is JIT
What Is JIT
. Management philosophy (produce
only what is needed when it is needed)
. Pull system
JIT is a manufacturing philosophy
involving an integrated set of
procedures/activities designed to
achieve a high volume of
production using minimal
inventories (raw materials, workin-process, and finished goods).
Raw materials, parts & sub
assemblies are pulled through the
manufacturing process when they
are needed.
Simply put, JIT is a philosophy of
“make what is needed … when it
is needed”.
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What Is JIT
Ultimate
Goal
Supporting
Goals
A
balanced
rapid flow
Eliminate disruptions
Make the system flexible
Product
Design
Process
Design
Eliminate waste
Personnel
Elements
Manufacturing
Planning
Building Blocks
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Comparison Of JIT & MRP
JIT
MRP
Repetitive production
Lot size or batch production
Minimal shop floor control
Extensive shop floor control
Simpler
More complex
Relies on visual or audible
signals to trigger production and
inventory (e.g. auto carpets)
Relies on computer system to
trigger production and order
inventory
Lower inventories related to need
“at the time”
Inventories related to batch or lot
sizes
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What JIT Does
What JIT Does
. Attacks waste
. Exposes problems & bottlenecks
. Achieves streamlined production
Eliminate disruptions in
production … caused by poor
quality, equipment breakdowns,
schedule changes, late deliveries
Makes the manufacturing
delivery system flexible or more
robust … allowing it to handle a
variety of products and changes in
the level of output while still
maintaining balance and
throughput speed.
Eliminates waste
Reduces setup and delivery
times
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Waste
Waste includes any operation, movement, inventory, processing,
reporting, etc. which does not add value to the resulting product. Areas
of waste include, but are not limited to:
. Overproduction
. Processing waste
. Waiting time
. Inefficient work methods
. Excess Inventory
. Unnecessary movement
. Product defects … rework
. Setup time
. Excess motion
. Machine breakdown
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Strategies For Minimizing Waste
We have already discussed many strategies for minimizing waste.
Some of these include:
Cellular Layouts
Lathe Mill
Drill
Heat Grind
Drill
Heat Grind
Lathe Mill
Heat Grind
Mill
Mill
Assembly
Focused Factories
Drill Grind
Group Technology Layouts
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Strategies For Eliminating Waste
Considerations in Job Design aimed at improving worker productivity
and skill levels.
Specialization
Multi-functional workers
Behavioral Approaches to Job Design
Teams
Methods Analysis
Motion Study
Working conditions
Incentive pay plans
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Strategies For Eliminating Waste
On-hand inventory
100 –
Manufacturing in smaller lot sizes
reduces excess inventory
Average cycle
inventory
75 –
50 –
Lot size = 100
25 –
Lot size = 50
0–
5
10
15
20
25
30
Time (hours)
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Strategies For Eliminating Waste
Reducing inventory levels allows
Excess
the inventory hides problems
problems to be uncovered … thus
in the manufacturing process
creating opportunities for
manufacturing process improvement.
Machine
downtime
Scrap
Work in
process
queues
(banks)
Paperwork
backlog
Vendor
delinquencies
Engineering design
redundancies
Inspection
backlogs
Change
orders
Design
backlogs
Decision
backlogs
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Strategies For Eliminating Waste
Setting-up a machine to perform a task is very time consuming. Efforts
toward improving product flow, having the right equipment at the right
place at the right time, and simple techniques can be used to minimize
product change set-up waste. Some simple techniques include:
Presetting operational settings
Using quick fasteners & quick change tools
Using locator pins
Preventing misalignments
Making movements easier
Multi-functional machines
Scheduling product flow to minimize changeover (e.g. ice
cream)
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What JIT Requires
What JIT Requires
. Product Design
. Process Design
. Employee participation
. Industrial engineering/basics
. Continuing improvement
. Total quality control
. Small lot sizes
. Vendor relations
Product/Process Design standard parts, modular design,
quality, setup time reduction,
production flexibility, etc.
Manufacturing planning and
control - level loading, small lots,
pull systems, visual systems,
close vendor relationships,
reduced transaction processing
Personnel/Organizational elements - regard workers as assets, cross
trained workers, continual improvement, cost accounting, leadership and
project management
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What JIT Requires
Standardization of product design refers to the absence of variety in
products/services
. interchangeable parts, modular design (fewer items)
. reduced time for training workers
. may require less effort (purchasing, facilities, inventory
management)
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What JIT Requires
Design Simplification
Original design
Revised design
Final design
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What JIT Requires
Concurrent Engineering brings all interested parties together early in
the design process to deal with issues associated with design,
marketing, manufacturing, quality, supply, etc. Manufacturing can
identify production capabilities, capacities, materials, and design
alternatives to assist in efficient manufacturability.
Identifies early opportunities for
special tooling, equipment, training,
etc. some of which have long lead
times.
Early consideration of technical
feasibility of a design
Can shorten overall “time to market”
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What JIT Requires
Design a facilities layout & process flow of work that allows for
Linked operations
Balanced workstation capacities
Flow efficiency
Small lot sizes
Reduced setup/changeover time
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What JIT Requires
Small lot production requires
Less space
Less capital investment
Less inventory
Moves processes closer together
Makes quality problems easier to detect
Makes processes more dependent on each other
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What JIT Requires
Uniform production
. Smooth production requirements
. Smooth demand across planning horizon
. Use mixed-model assembly to steady component production
. Use visual system to
manage product movement
. Can handle up to 10%
change in demand
407
409
410
412
408
411
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What JIT Requires
Visual Systems
. A card or other device that communicates demand for work
or materials from the preceding work station … sometimes
referred to as a kanban system
. Work can not move from one station to the next unless
authorized by the kanban card
. Work is actually “pulled” through the process in this system
in containers of parts/subassemblies from one station to the
next … a “push” system moves work from one work station
to the next as it is produced whether the next station is ready
or not.
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What JIT Requires
Implement a system of Total Productive Maintenance (TPM) designed
to improve
. Breakdown maintenance (quickly repair machines that have
failed)
. Preventative maintenance (periodic inspection &
maintenance aimed at keeping machines operational and in
“tip-top shape)
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What JIT Requires
Considerations need to be given to respect for personnel issues of
. Pay
. Management issues (feeling threatened of losing control)
. People issues (getting along with each other)
. Continuous Improvement
. Total employee involvement
. Empowerment
.. ability to make changes in their work environment
.. spot quality problems
.. halt production when necessary
.. generate ideas for improvement
.. analyze problems
.. learn multi-function tasks
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What JIT Requires
Evaluation and selection of vendor (suppliers) network to develop a
tiered supplier network – reducing the number of primary suppliers.
Traditional Supplier Network
Tiered Supplier Network
Buyer
Buyer
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
Suppler
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What JIT Requires
The criteria usually used to evaluate a vendor network include
. Reduced & highly reliable lead times
. Flexibility & smaller lot sizes
. Frequency & reliability of delivery
. Reliability (variability) of delivery
. Consistently high quality
. Willingness to work together
.. Commitment (“pig not a chicken”)
.. Future development
.. Product improvements
.. Exchange of Information (forecasts, sales)
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What JIT Requires
Contractual Issues need to be worked out to protect both the customer
& vendor. Some of these include:
. Long term contracts with minimal paperwork establishing the
purchase quantities with the ability to ship variable quantities
through out the term.
. Accuracy requirements in both shipment quantities & quality
standards
. Cost issues (who pays for storage costs on un-released
materials, re-tooling, containers, etc.).
While it may seem that some of these issues flow from customer down
through the supplier network, the nature of the relationship (private label
vendor) may allow for negotiation.
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What JIT Requires
Quality Issues need to be worked out to protect both the customer &
vendor. Some of these include:
. Quality levels (AQL, LTPD, etc)
. Working relationship between customer & vendor Quality
Control personnel
. Suppliers encouraged to use Statistical Process Control during
the manufacturing process
.. Acceptance Sampling prior to shipping may be
reduced/eliminated depending on customer
satisfaction with SPC results
. Conflict resolution guidelines
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What JIT Requires
Some recent trends in vendor requirements are
. Willingness to locate near customer
. Use of smaller side loaded trucks
. Shipments of mixed loads
. Consolidation of warehouses with other suppliers
. Use of standardized containers
. Make deliveries according to a precise delivery schedule
. Become a certified supplier
. Accept payments on a regular interval rather than upon
delivery
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JIT Benefits
JIT Benefits
. Many
Improved vendor relations
Simplified scheduling & control
Increased capacity
Reduced Inventory
Better utilization of personnel
Improved quality
More product variety
Lower costs
Increased equipment utilization
Reduced space requirements
Reduced paperwork
Shorter lead-time
Valid production priorities
Increased productivity
Work force participation
Greater flexibility
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JIT … Not For Everyone
JIT concepts work best when goods can be produced in response to
consumer demand; thereby, eliminating the need for large build-ups of
inventory (e.g. automobiles, motorcycles). This is referred to as a make
to order environment.
JIT is less effective and is less likely to be used for the production of
standardized consumer goods (e.g. basic clothing, food, soft drinks,
toasters, etc.) This is referred to as a make to stock environment.
However, there are cases where JIT concepts apply to sub-processes of
a make to stock environment. Consider a computer manufacturer (e.g.
Dell). Computers can be configured at the time of a customer order
where, generic disk drives may be made to stock.
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Planning A Successful JIT Implementation
Planning a successful JIT implementation requires
. Top management commitment
. Assessing operational conversion difficulty & prioritizing
conversion sequence
. Getting support of the work force … training programs,
cross training plans,problem solving procedures, pay plans
. Begin by trying to reduce the setup times while maintaining the
current system … involve work force in problems
. Gradually convert operations … begin at end … work toward
beginning
. Convert suppliers to JIT in a cooperative spirit
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Obstacles To Conversion
Obstacles to Conversion must be addressed.
. Management
. Workers - may not want more responsibility or stress
. Suppliers - why should we?, other customers don’t require
this, can not get their management to commit, smaller
quantities may not be feasible
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Level Loading … Mixed Model Production
Model
A
B
C
Daily
Quantity
8
16
5
Suppose a department produces 3 models with
daily quantities shown here. There are 3 issues
that need to be resolved:
Which sequence to produce?
C-B-A, A-B-C, B-A-C
How many times (cycles) the sequence should repeat?
How many units to produce in each cycle?
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Level Loading … Mixed Model Production
Which sequence to produce?
C-B-A, A-B-C, B-A-C
Involves many factors. Usually the most important is the setup time or
cost involved. This may vary depending on the sequence used.
For example, if the process for A and C are similar and require little
change from one product to the other and the changes to product B
require extensive changes then the the sequences
A - C - B or C - A - B, would be more efficient and less costly than the
sequence A - B - C or C - B - A. as shown in the next schematic.
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Level Loading … Mixed Model Production
Which sequence to produce? C-B-A, A-B-C, B-A-C
A-C-B
Little change
Major change
A-B-C
Major change
Major change
C-A-B
Major change
Little change
C-B-A
Major change
Little change
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Level Loading … Mixed Model Production
How many times (cycles) the sequence should repeat?
The steps involved are:
. Determine the number of cycles = the smallest integer that
can be evenly divided into the daily production quantities
. Determine the units to be produced for each cycle =
daily quantity divided by the number of cycles
. Determine the load level for each cycle
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Level Loading … Mixed Model Production
.
Model
A
B
C
Daily
Quantity
8
16
5
Example 1b: A JIT production manager
wants to plan production (as level as
possible) for these three models using the
manufacturing sequence A-B-C.
.
First, determine the number of cycles = the smallest integer that can
be evenly divided into the daily production quantities
Since there is no integer that will divide all 3 numbers, we will
choose the minimum daily quantity of 5 as the number of cycles.
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Level Loading … Mixed Model Production
Next, determine the units to be produced for each cycle =
daily quantity divided by the number of cycles
Model
A
B
C
Daily
Units
Quantity per Cycle
8
1.6
16
3.2
5
1
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Level Loading … Mixed Model Production
Next, determine the load level for each cycle
Model
A
B
C
Daily
Units
Quantity per Cycle
8
1.6
16
3.2
5
1
A perfectly level loaded production plan would look like this; but we
are short 3-A’s and 1-B.
Cycle
A
B
C
Production Level
1
1
3
1
5
Quantity
2
3
1
3
1
5
To Produce
4
1
1
3
3
1
1
5
5
5
Total
1
3
1
5
5
15
5
25
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Level Loading … Mixed Model Production
Depending on the JIT production manager’s choice the final
loading schedule might look like this.
Cycle
A
B
C
Production Level
1
1
3
1
5
Quantity
2
3
1
4
1
6
To Produce
4
2
2
3
3
1
1
6
6
5
Total
2
3
1
6
8
16
5
29
There is no correct answer to this problem. The objective is to level
production as much as possible given the costs of setup and change
over. The manager just as easily have considered the following
production plan with exactly the same costs as the previous one.
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Visual Kanban System
Setting up a visual (Kanban) system
. requires determining the number of containers (kanbans)
needed
. each container represents the minimum production lot size
. an accurate estimate of the lead time required to produce a
container is key to determining how many kanbans are
required.
. The number of kanbans needed to support the operation is
calculated by the following formula:
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How Many Kanbans?
DT (1   )
N
where
C
N  total number of containers
D  planned usage rate of using work center
T  average waiting time for replenishment
plus average production time for a container
of product
  policy variable set by management reflecting
inefficiency in the system
C  capacity of a standard container
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How Many Kanbans?
Example 2: Usage at a work center is 300 parts per day, and a standard
container holds 25 parts. It takes an average of .12 day for a container
to complete a circuit from the time a kanban card is received until the
container is returned empty. Compute the number of containers needed
to support the operation if the policy variable is .20.
D  300
T .12
 .20
C  25
DT (1   ) 300(.12)(1.20)
N

 1728
.
C
25
Therefore, it will take 2 kanban containers to
meet the process requirements
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Homework
Read and understand all material in the chapter.
Discussion and Review Questions
Recreate and understand all classroom examples
Exercises on chapter web page
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