Just-in-Time and Lean Operations. Developments of JIT and Lean Operations 1960’s: Developed as Toyota Production System by Taiichi Ohno and his colleagues.

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Presentation transcript:

Just-in-Time and Lean Operations

Developments of JIT and Lean Operations 1960’s: Developed as Toyota Production System by Taiichi Ohno and his colleagues 1970’s: U.S. and European auto makers began to apply JIT to improve quality and productivity 1990’s and beyond: Expanded the JIT concept to streamline all types of operations

Definition of JIT A set of techniques to increase, productivity, improve quality, and reduce cost of an operations A management philosophy to promote elimination of waste and continuous improvement of productivity

What Could Be the Expected Benefits of JIT?

Main Elements of JIT Elimination of waste Quality at the source Balanced and flexible work flow Respect for people Continuous improvement (Kaizen) Simplification and visual control Focus on customer needs Partnerships with key suppliers

What is A “Waste?”

Why is Inventory Reduction Important?

Quality at the Source Jidoka – autonomation (automatic detection of defects, e.g., Poka-yoke) Employee empowerment Statistical process control Prevention orientation (elimination of root causes through PDSA cycle)

Balanced and Flexible Work Flow Yo-i-don (ready, set, go) system Stable production schedule Set-up time reduction Flow-shop and cellular layouts Shojinka (flexible & multi-skilled workforce) Teamwork Total productive maintenance (TPM)

Respect for People Productivity improvement needs employee support Demonstrate by providing cross-training opportunities creating a safe and equitable work environment encouraging people to achieve their potential by giving them greater responsibility and authority promoting teamwork (formal and informal) developing partnerships with unions

Continuous Improvement (Kaizen) Employee suggestion system Process improvement 5S’s Seiri - organization Seiton - tidiness Seiso - purity Seiketsu - cleanliness Shitsuke - discipline

Simplification and Visual Control Standard and simple product designs Andon boards Kanban pull system Flag systems Music as signals Performance display systems

Focus on Customer Needs Customer needs determine the “value” of a product or service Be responsive to customers needs (present and future) Strive to “delight,” not just “satisfy” customers

Partnerships with Suppliers Reduce number of suppliers Use long-term contracts Emphasize price, delivery, and services Improve communication Share information Develop local just-in-time delivery Provide technical support to suppliers

JIT Implementation Top management commitment Steering committee Education program Pilot project planning Employee training Pilot implementation Pilot post mortem Feedback to steering committee Expansion to next project

Advancements in JIT (JIT II) Backwards Integration of staff and line functions to suppliers (e.g., purchasing) Requires EDI or web access to materials and logistics systems On-site supplier representative(s) with transaction processing authority Goal: link suppliers’ cycle to firm’s cycle to mutually reduce wait and move times

How Can JIT Be Applied to Non- Manufacturing Operations?

What Are Toyota’s Secrets of Success?