1. Lean Supply Chain Management
Lecturer: David Holman
Summer School 2015
ŠKODA AUTO University
Mladá Boleslav
Czech Republic

2. Lecture Content
TOYOTA Production System Introduction – History, Why System
Lean management. Why lean? When did it start? Principles
Lean Supply Chain Management in Automotive
JIS – Just In Sequence deliveries – the leanest process in automotive (cockpit example)

3. Toyota Production System
From weaving loom to luxury car “Lexus” production and World Number 1
Mio
Sold
Cars
9,0
1930
1950
1990
2008
8,4

4. Because it works only as the complete system?
Why
The
House
Because it works only as the complete system

5. TPS and LEAN difference
TPS – Toyota Production System developed by Taichi Ohno (1950 – now)
LEAN – Lean thinking book by J. Womack, D. Ross, D.T. Jones (1991)
Describes TPS and analyse its productivity (comparing to other OEM):

6. Production value added vs logistics value added in SCM
Production VA processes - PVA
Transformation of physical and nonphysical production resources into final product or service, which is customer willing to pay for
Logistics VA processes - LVA
Optimal availability of physical and nonphysical resources in the whole supply chain from withdrawing of raw material to delivery to final customer
in Supply Chain
Final Producer
PVA
Supplier
PVA
LVA
Supplier
PVA
LVA
LVA
EDI, RFID, ECR, bar codes
transport, manipulation, packaging, warehousing, crossdocking, forecasting, etc.

7. Mass supply chain management
Lean supply chain management in automotive
What exists before Lean ? MassSCM
Logistics relevant KPI
Mass supply chain management
Frequency of deliveries (Max.- Min.)
Weeks – days
Warehouse level (Max.-Min.)
Accuracy of deliveries (loading, unloading)
Days
Communication
Limited
Information flow
Directive
Level of standardisation
Low

8. Waste in mass supply chain management
Waste, non value added activities:
Value added activites:
WASTE
95% 5%

9. Insufficient communication
Typical kinds of waste
Overproduction
Inventory
Waiting
Low ergonomics of work
Motion
Transport
Insufficient communication
Extra processing
Defects

10. Lean supply chain management
Elimination of Waste in Mass SCM – Lean SCM
Inbound
logistics
Inhouse
logistics
Supplier
Supplier
Mass supply chain management
Lean supply chain management
Frequency of deliveries (Max.- Min.)
Weeks - days
Days – hours
Warehouse level (Max.-Min.)
Days - hours
Accuracy of deliveries (loading, unloading)
Days
Minutes
Communication
Limited
Regular
Information flow
Directive
Co-operative
Level of standardisation
Low
High
LEAN SUPPLY CHAIN MANAGEMENT, David Holman,

11. The leanest supply chain in the automotive industry
Typical process chains in the automotive industry
JIS – Just in Sequence
Delivery in time and sequence according to production scale of customer
JIT – Just in Time
Delivery in exact time slots based on customer demand (EDC)
Standard delivery
Standard delivery to the warehouse without exact timeslots and based on long-term call off from customer

12. JIS – Just in Sequence delivery detail
Production at the assembly line
Call off
Supplier
Forwarder

13. JIS in numbers One car has around 2,500 parts JIS parts are 15 – 20
It is the biggest parts – 70% of volume of final car (cockpit, frontend, wheels, seats, roof panel, front and back bumper, door panel etc.)
There are hundreds and thousand of variants (cockpit more than 1,000)
There is a difference between delivery in sequence and production in sequence.

14. Examples of JIS deliveries
cockpit
roof panel
front bumper

15. Practical example – deliveries of cockpit – JIS production

16. Comparison of productivity in 2013
Profit Margin – Net profit / Revenue

17. Thanks for your attention