LEAN system

LEAN referred as JIT (because the activities and delivery of goods occur just as they are needed) Begun in the mid 1900’s, developed by Toyota its goal is to eliminate every waste from every aspects of the process Waste – didn’t add value to the process

Value ws.waste "value" is defined as any action or process that a customer would be willing to pay for Waste muda ("non-value-adding work"), muri ("overburden"), and mura ("unevenness"),

The toyota approach Muda: waste and inefficiency must be minimized by using the following technics Kanban – a manual system responds to signals of the need for delivery of parts and materials (both to the factory and between the workstation) Pull system – produce only what is needed Heijunka – work load must be leveled to achive stedy flow of work

Not leveled workload time Worksteps

Leveled workload time Worksteps

Kaizen – continuous improvement of the system Jidoka – each worker is expected to perform ongoing quality assurance, objective is to avoid passing defective products to the following work station Poka-Yoke – safeguards built into the process to reduce the possibility of errors There are levels of the jidoka. The highest level menas that the process is developed in the sense of avoiding mistakes. For example ATM autmats Other mistakes cannot be avoid totally, so there are a monitoring system, which observe the products, and if there is somethig different form normal, it stop the process of production. In this case the main task is to find reason of the mistake. „stop the process and it won’t be stoped again”

JIT vs Ford system the JIT system rooted in the system of Henry Ford, But it can accomplish that Ford coludn’t: the system that colud handle with variety (product variety and range of volume)

Supporting goals A balanced system, smooth, rapid flow of materials and/or work To make a process time as short as possible Supporting goals: Eliminate disruption Make the system flexible eliminate waste, especially exess inventory

1. Disruption It upsets the smooth flow of the system It is caused by poor quality, equipment breakdowns, late deliveries

2. Flexible system A system which is robust enough to handle a mix of products and changes in the level of output Short setup time (Period required to prepare a device, machine, process, or system for it to be ready to function or accept a job.) Short lead time (is the period of time between the initiation of any process of production and the completion of that process.) Lead time for ordering a new car from a manufacturer may be anywhere from 2 weeks to 6 months

3. waste The key step in LEAN is the identification of which steps add value and which do not: A process adds value by producing goods or providing a service that a customer will pay for. value-adding work has been separated from waste then waste can be subdivided into 'needs to be done but non-value adding' waste and pure waste.

There are 7 wastes in LEAN (TIMWOOD): Inventory - represents a capital outlay that has not yet produced an income either by the producer or for the consumer. It takes up floor space and adds to cost.  inventory must be minimized Overproduction – engage more resources than needed to deliver to the customers. It is because batch production. Because of productivity improvement, operators are required to produce more than customer needs. It generates all other wastes, especially inventory. Waiting - Whenever goods are not in transport or being processed, they are waiting. (becouse of not leveled workload.

Unnecessary transportation - Each time a product is moved it stands the risk of being damaged, lost, delayed, etc. as well as being a cost for no added value. Transportation does not make any transformation to the product that the consumer is supposed to pay for. Processing waste – unecessary steps of production, moves of workers, searching activities for tools, Defects - Whenever defects occur, extra costs are incurred reworking the part, rescheduling production, Inefficient work methods – decrease productivity, for example inefficient replacement of inventory’s, continuous quality check

Kaizen The wastes are potential tartgets for continuous improvement, called kaizen.

JIT Building Blocks Product design Process design Personnel/organizational elements Manufacturing planning and control

Product Design Standard parts – fewer parts to deal with lower training costs use standard processing Modular design – clusters of partsn treated as a single unit.  easy to satisfy different needs Highly capable production systems – quality is designed into the product and the production process Concurrent engineering

Process Design Small lot sizes Setup time reduction Manufacturing cells Limited work in process Quality improvement Production flexibility Little inventory storage

Benefits of Small Lot Sizes Reduces inventory Less storage space Less rework Problems are more apparent Increases product flexibility Easier to balance operations The ideal lot size is one piece. – it is not always realistic (machines process multiple items simultaneously, or with very long setup times) Rework cost are less, ecause there are fewer items in a lot to inspect and rework. Treditionally: long run of A product, then a long run of B product While in the case of LEAN, small lots would frequantly shiftr from producing A to B and C. thes enables t respond more quickly to changing customer demand

Production Flexibility Reduce downtime by reducing changeover time - small lots require frequent setups. SMED (single minute exchange of die) External Internal activities. Use preventive maintenance to reduce breakdowns Song setup time require more inventory. Strong emphasis on educing setuo times. Single –minute exchange of die (SMED). It needs catgorize changeover activities as either internal or external activiies. Internal activities can be done while machine is stopped. External activities do not invilve stopping the machine – it doens’t affect change over time Convert as many activities as possible to external activities (In 1982 at Toyota SMED was reduced from 100 sec to 3 sec.)

Manufacturing cells In Functional Manufacturing similar machines are placed close together (e.g. lathes, millers, drills etc) In Cellular Manufacturing systems machines are grouped together according to the families of parts produced. The major advantage is that material flow is significantly improved, which reduces the distance travelled by materials, inventory and cumulative lead times.

Quality improvement Autonomation – automatic detection of defects during production. It referres to jidoka It consist two activities: One for detecting defects when they occure Another for stopping production to correct the cuase of defects.

Work flexibility Overall goal of lean is to achieve the ability to process mix of products in a smooth flow. One potential obstacel is botlenecks, which occure when portions of the system become overloaded.

Balanced system Distributing te workload evenly among workstations Takt time – is the cycle time needed in the production system to match th pace of production to the demand rate Example: Total time per shift is 480 minutes per day There are two shifts per day There are two 20-minutes break and a 30 minutes lunch break per shift. Daily demand is 80 pieces Net time available per day= 2*(480-20*2-30)=820minutes Takt time=820minutes/80 pieces=10,25 minutes If the actual ciycle time is higher, our customers won’t get their needs, if the actual cycle time is lower, there will be overproduction, and we have to inventory surplus products.

Inventory sorage Inventory storage in the lean philosophy is a waste, a buffer which can cover up problems, partly beause iventory makes them seem less serious. When a machine breaks down it won’t disrupt the system if there is a sufficient inventory of the machine’s output. Lean approach is to eliminate inventories in order to uncover the problems and solved. Then the systme removes more inventory, finds and solves additional problems. One way of minimizing inventory is to have delivers from suppliers go directly to the product floor . At the end of the process completed units shipped out as soon as possible-JIT But less inventory has also some risk: if a problem arises there is no safety net.

Fail- Safe methods The same as poka-yoke, when safeguards are built into a process to reduce or eliminate the potential errors. The contact method identifies product defects by testing the product's shape, size, color, or other physical attributes. The fixed-value (or constant number) method alerts the operator if a certain number of movements are not made. The motion-step (or sequence) method determines whether the prescribed steps of the process have been followed. Alarm if the weight of a packaged item is too low, ATM signal ifthe card is left in the machine

Personnel/Organizational Elements Workers as assets Cross-trained workers Continuous improvement Cost accounting Leadership/project management Well trained and motivated workers who have more authorithy to make dscisions than their counterparts in the traditinal systems are the heart of lean Perform several parts of the process and operate í variety of machines, able to help one another when bottleneck effect occur, or coworker absent Expected to be involved in problem solving – trainings for this, must be a culture ABC – identifies traceabée costs and then assignes them to various types of activities, se machine setups, inspection,. Specific jobs then assigned overhead based on the percetnage of activities they consume

Manufacturing Planning and Control Level loading Pull systems Visual systems Close vendor relationships Reduced transaction processing Preventive maintenance

Level loading Mixed model sequencing Choice of sequencing (minimal setup cost, or time) The number of cycles per day – smallest integer Number of units – daliy demand divided by number of cycles In some cases these quantities my be unworkable due to restrictions on lot sizes (if we need 4 B to fill a carton, producing 3 means they have to wait untill sufficient quantities are available.

Pull/Push Systems Pull system: System for moving work where a workstation pulls output from the preceding station as needed. (e.g. Kanban) Push system: System for moving work where output is pushed to the next station as it is completed Small buffer of stocks between workstations, because operations are not instantaneous (the next wprkstation must wait for the proceeding station to perform its work.) the size of buffer depends on the cycle time at proceeding work statins.

Kanban Production Control System Kanban: Card or other device that communicates demand for work or materials from the preceding station Kanban is the Japanese word meaning “signal” or “visible record” Paperless production control system Authority to pull, or produce comes from a downstream process.

Close vendor relatonship JIT Frequent small delivers Deliver next to the workstation No quality check Local vendors Tradtitonal List of suppliers Buyer play vendors off against each other Price is the most important No loyalty

Traditional Supplier Network Figure 12.4a Buyer Supplier

Tiered Supplier Network Figure 12.4b Supplier Buyer First Tier Supplier Second Tier Supplier Third Tier Supplier

Preventive maintenance and housekeeping Sort –decide which item is needed Straighten – needed items can be assessed quickly Sweep – clean workplace Standardize – use standard intructions Self discipline – make sure that employees understand the need for uncluttered workplace

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