1. Beni Asllani University of Tennessee at Chattanooga
Chapter 15
Lean Production
Operations Management - 5th Edition
Roberta Russell & Bernard W. Taylor, III
Beni Asllani University of Tennessee at Chattanooga
Copyright 2006 John Wiley & Sons, Inc.

2. Lecture Outline Introduction Objective of lean production
A comparison of attitudes
Benefits of Lean Production
Basic Elements of Lean Production
Implementing Lean Production
Lean Services
Copyright 2006 John Wiley & Sons, Inc.

3. Objective of Lean Production
To eliminate waste
by:
producing the needed items, at the right time, and the exact quantity
Copyright 2006 John Wiley & Sons, Inc.

4. Benefits of JIT Reduced inventory (up to 90%)
Reduced lead time (up to 90%)
Reduced labor cost (up to 30%)
Reduced manufacturing & storage space (up to 50%)
Improvement of quality (up to 90%)
Increased flexibility and adaptability to changes
Increased productivity
Copyright 2006 John Wiley & Sons, Inc.

5. A Comparison of Attitudes
Conventional Attitudes
Large lots are efficient
JIT attitudes
Ideal lot size is one
Faster production is more efficient
Balanced production is more efficient
Inventory smoothes production
Safety stock is waste
Inventory provides safety
INVENTORY IS THE ROOT OF ALL EVIL
Copyright 2006 John Wiley & Sons, Inc.

6. Inventory Hides Problems
Copyright 2006 John Wiley & Sons, Inc.

7. Less Inventory Exposes Problems
Copyright 2006 John Wiley & Sons, Inc.

8. Lean Production
Doing more with less inventory, fewer workers, less space
Just-in-time (JIT)
smoothing the flow of material to arrive just as it is needed
“JIT” and “Lean Production” are used interchangeably
Muda
waste, anything other than that which adds value to the product or service
Copyright 2006 John Wiley & Sons, Inc.

9. Basic Elements Pull production system Kanban production control
Uniform production levels
Small lots
Quick setups
Flexible resources
Cellular layouts
Quality at the source
Total productive maintenance
Supplier networks
Copyright 2006 John Wiley & Sons, Inc.

10. LEVELED ASSEMBLY INSTRUCTIONS
Pull System
LEVELED ASSEMBLY INSTRUCTIONS
PRODUCTION SCHEDULE C B A
FAB
FAB
VENDOR B A
SUB
FAB
FAB
VENDOR
FINAL ASSEMBLY
FAB
FAB
SUB
VENDOR
FAB
FAB
VENDOR
VENDOR
FAB
Copyright 2006 John Wiley & Sons, Inc.

11. Pull System Material is pulled through the system when needed
Reversal of traditional push system where material is pushed according to a schedule
Forces cooperation
Prevent over and underproduction
While push systems rely on a predetermined schedule, pull systems rely on customer requests
Copyright 2006 John Wiley & Sons, Inc.

12. Kanbans Card which indicates standard quantity of production
Derived from two-bin inventory system
Maintain discipline of pull production
Authorize production and movement of goods
Copyright 2006 John Wiley & Sons, Inc.

13. Sample Kanban
Copyright 2006 John Wiley & Sons, Inc.

14. Origin of Kanban
a) Two-bin inventory system b) Kanban inventory system
Reorder
card
Bin 1
Bin 2
Q - R
Kanban R
Q = order quantity
R = reorder point - demand during lead time
Copyright 2006 John Wiley & Sons, Inc.

15. Types of Kanban Signal kanban Production kanban Withdrawal kanban
a triangular kanban used to signal production at the previous workstation
Material kanban
used to order material in advance of a process
Supplier kanban
rotates between the factory and suppliers
Production kanban
authorizes production of goods
Withdrawal kanban
authorizes movement of goods
Kanban square
a marked area designated to hold items
Copyright 2006 John Wiley & Sons, Inc.

16. Copyright 2006 John Wiley & Sons, Inc.

17. Uniform Production Levels
Result from smoothing production requirements
Kanban systems can handle +/- 10% demand changes
Smooth demand across planning horizon
Mixed-model assembly steadies component production
Copyright 2006 John Wiley & Sons, Inc.

18. Copyright 2006 John Wiley & Sons, Inc.

19. Copyright 2006 John Wiley & Sons, Inc.

20. Small Lots Require less space and capital investment
Move processes closer together
Make quality problems easier to detect
Make processes more dependent on each other
Copyright 2006 John Wiley & Sons, Inc.

21. HOOD & FENDER SETUP COMPARISON (800 TON PRESS)
Toyota
U.S.A.
Sweden
Germany
Setup Time
10 min
6 hr.
4 hr.
Setups/Day 3 1 -
1/2
Lot Size
1 day*
10 days
1 month
* For low demand items (less than 1000/month)
Up to 7 days
Copyright 2006 John Wiley & Sons, Inc.

22. Components of Lead Time
Processing time
Reduce number of items or improve efficiency
Move time
Reduce distances, simplify movements, standardize routings
Waiting time
Better scheduling, sufficient capacity
Setup time
Generally the biggest bottleneck
Copyright 2006 John Wiley & Sons, Inc.

23. Quick Setups SMED Principles Internal setup External setup
Separate internal setup from external setup
Convert internal setup to external setup
Streamline all aspects of setup
Perform setup activities in parallel or eliminate them entirely
Internal setup
Can be performed only when a process is stopped
External setup
Can be performed in advance
Copyright 2006 John Wiley & Sons, Inc.

24. Flexible Resources Multifunctional workers Cycle time Takt time
perform more than one job
general-purpose machines perform several basic functions
Cycle time
time required for the worker to complete one pass through the operations assigned
Takt time
paces production to customer demand
Copyright 2006 John Wiley & Sons, Inc.

25. Cellular Layouts Manufacturing cells
comprised of dissimilar machines brought together to manufacture a family of parts
Cycle time is adjusted to match takt time by changing worker paths
Copyright 2006 John Wiley & Sons, Inc.

26. Cells with Worker Routes
Copyright 2006 John Wiley & Sons, Inc.

27. Worker Routes Lengthen as Volume Decreases
Copyright 2006 John Wiley & Sons, Inc.

28. Quality at the Source Visual control Poka-yokes Kaizen Jidoka Andons
makes problems visible
Poka-yokes
prevent defects from occurring
Kaizen
a system of continuous improvement; “change for the good of all”
Jidoka
authority to stop the production line
Andons
call lights that signal quality problems
Under-capacity scheduling
leaves time for planning, problem solving, and maintenance
Copyright 2006 John Wiley & Sons, Inc.

29. Examples of Visual Control
Copyright 2006 John Wiley & Sons, Inc.

30. Total Productive Maintenance (TPM)
Breakdown maintenance
Repairs to make failed machine operational
Preventive maintenance
System of periodic inspection and maintenance to keep machines operating
TPM combines preventive maintenance and total quality concepts
Copyright 2006 John Wiley & Sons, Inc.

31. TPM Requirements
Design products that can be easily produced on existing machines
Design machines for easier operation, changeover, maintenance
Train and retrain workers to operate machines
Purchase machines that maximize productive potential
Design preventive maintenance plan spanning life of machine
Copyright 2006 John Wiley & Sons, Inc.

32. Supplier Networks Long-term supplier contracts Synchronized production
Supplier certification
Mixed loads and frequent deliveries
Precise delivery schedules
Standardized, sequenced delivery
Locating in close proximity to the customer
Copyright 2006 John Wiley & Sons, Inc.

33. Implementing Lean Production
Use lean production to finely tune an operating system
Somewhat different in USA than Japan
Lean production is still evolving
Lean production isn’t for everyone
Copyright 2006 John Wiley & Sons, Inc.

34. Lean Services
Basic elements of lean production apply equally to services
Most prevalent applications
lean retailing
lean banking
lean health care
Copyright 2006 John Wiley & Sons, Inc.