Just-In-Time and Lean Systems Chapter 7 Just-In-Time and Lean Systems

Just-In-Time (JIT) Getting the right goods to the right place at the right time. In an ideal JIT system, inventory = ?? JIT is a goal and a philosophy.

Lean System: A Broad View of JIT Extending JIT philosophy to the entire organization, it is the Lean System. In a lean system, everything is “right”, therefore no waste existing.

What are “Wastes”? Waste is anything that doesn’t add value: time, money, resource, material, space, energy, labor activity, … What may cause wastes? Inventory Unsynchronized production Unstreamlined layouts Unnecessary material handling Scrap & rework …

Central Beliefs of Philosophy of JIT / Lean System Elimination of waste Broad view of operations Simplicity Continuous improvement Visibility Flexibility

Eliminate Waste Anything in an operation that does not add value is waste. Method A and method B can both get a task done. If A can do it better, or faster, or in a cheaper way, then there exist wastes in method B.

Everyone Has a Broad View of Organization Instead of focusing on the assigned jobs only, a worker has a broad view of the organization: its mission and goals, and place his job in that big picture.

Simplicity If a problem can be solved in a simple way, do not go complicate.

Continuous Improvement Good enough is not good enough. “Kaizen blitz” is a Japanese way of implementing continuous improvement idea. It is a few day’s intensive work of a cross-functional team aiming at resolving a bite-size chunk of a problem.

Visibility Visibility is to make waste visible. Waste can only be eliminated after it’s discovered. Clutter and inventory hide waste. JIT requires clean facilities and open space so that no waste can be hidden.

Flexibility Flexible so as to adapt to changes in the demand and environment. Volume flexibility Variety flexibility

Three Elements that Make JIT Work Just-in-time manufacturing Total quality management Respect for people

JIT Manufacturing Kanbans & pull production systems Quick setups & small lots Uniform plant loading Flexible resources Efficient facility layouts

Pull Production Process is driven by real demands (rather than demand forecasts). Doing nothing unless a real demand calls (demand pull). All work stations are “demand pull”.

Kanban Production System A “pull production” system. Real demand information is passed in relay backward from the last work station by using ‘kanbans (cards)’. Each work station works according to the kanbans passed from the next station. Each work station is responsible to pass proper kanbans to the previous station.

Illustration of Kanban in Textbook © Wiley 2010

Number of Kanbans in a Withdraw Work Station N = number of containers in a withdraw station D = demand rate at the withdraw station T = lead time from supply station C = container size S = safety stock to protect against uncertainty

Quick Setups & Small Lots Setup times = time required to get the machine ready cleaning, calibrating, changing tools, ... Internal setups The machine must stop when doing setup. External setups Setup can be performed when machine is running.

Uniform Plant Loading “Leveling” of the production schedule so that the production of a product is evenly spread over the planning horizon in small batches. Leveling the schedule can have big impact along whole supply chain.

An Example of Uniform Plant Loading © Wiley 2010

Flexible Resources General purpose equipment: Multifunctional workers: E.g.: drills, lathes, printer-fax-copiers, etc. Capable of being setup to do many different things Multifunctional workers: Cross-trained to perform several different duties

Efficient Facility Layouts Workstations in close physical proximity to reduce transport & movement Streamlined flow of material Often uses: Cellular Manufacturing (instead of job shops) U-shaped lines: (allows material handler to quickly drop off materials & pick up finished work)

Cellular Manufacturing (Group Technology) Components are grouped according to their similarities. Machines are grouped in cells so that a cell can complete the processing of some groups of components Similar components are processed completely in a cell composed of dissimilar machines.

Job Shop Layout

Cellular Manufacturing (Group Technology)

TQM & JIT Quality at the Source Jidoka (authority to stop line) Poka-yoke (foolproof the process) Preventive maintenance

Respect for People: The Role of Workers Cross-trained workers Actively engaged in problem-solving Workers are empowered Everyone responsible for quality Workers gather performance data Team approaches used for problem-solving Decision made bottom-up Workers responsible for preventive maintenance

Respect for People: The Role of Management Responsible for culture of mutual trust Serve as coaches & facilitators Support culture with appropriate incentive system Responsible for developing workers Provide multi-functional training Facilitate teamwork

Supplier Relations & JIT Use single-source suppliers Build long-term relationships Co-locate facilities to reduce transport Stable delivery schedules Share cost & other information

Benefits of JIT Smaller inventories Improved quality Reduced space requirements Shorter lead times Lower production costs Increased productivity Increased machine utilization Greater flexibility

Implementing JIT Manufacturing Identify & fix problems Reorganize workplace Remove clutter & designate storage Reduce setup times Reduce lot sizes & lead times Implement layout changes Cellular manufacturing & close proximity Switch to pull production Extend methods to suppliers

Implementing JIT Is a Process of Continuous Improvement © Wiley 2010

JIT in Services Multifunctional workers Reduce cycle times Minimize setups Parallel processing Good housekeeping Simple, highly-visible flow of work