1 Modern Manufacturing Management • JIT, Kanban, Toyota Production System (TPS) • LEAN Manufacturing • Theory of Constraints (TOC), Drum Buffer Rope (DBR) • Quick Response Manufacturing (QRM) • Agility (the ability of a firm to sense and respond to business opportunities in order to stay innovative and competitive in a turbulent and rapidly changing environment. ) APICS Definition of JIT “A philosophy of manufacturing based on planned elimination of waste and continuous improvement of productivity ……”
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Modern Manufacturing Management
• JIT, Kanban, Toyota Production System (TPS)
• LEAN Manufacturing
• Theory of Constraints (TOC), Drum Buffer Rope (DBR)
• Quick Response Manufacturing (QRM)
• Agility (the ability of a firm to sense and respond to business opportunities in order to stay innovative and competitive in a turbulent and rapidly changing environment. )
APICS Definition of JIT
“A philosophy of manufacturing based on planned elimination of waste and continuous improvement of productivity ……”
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APICS Definition of JIT
“The primary elements of Just-in-Time are:– to have only the required inventory when
needed;
– to improve quality to zero defects;
– to reduce lead times by reducing setup times, queue lengths, and lot sizes;
– to incrementally revise the operations themselves;
– and to accomplish these things at minimum cost”.
JIT Synonyms
• IBM - Continuous Flow Manufacturing
• HP - Stockless Production
- Repetitive Manufacturing System
• GE - Management by Sight
• Motorola - Short Cycle Manufacturing
• Japanese - The Toyota System
• Boeing - Lean Manufacturing
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APICS Definition of Lean Manufacturing
“A philosophy of production that emphasizes the minimization of the amount of all the resources (including time) used in the various activities of the enterprise. It involves:– … identifying and eliminating non-value-adding activities,
– … employing teams of multi-skilled workers,
– … using highly flexible, automated machines”
• American Production and Inventory Control Society (APICS) is an organization for professionals working in the field of Operations Management
Just in Time Manufacturing
ผลิตตามความตองการของลูกคา:
• ส่ิงท่ีตองการ• เวลาท่ีตองการ• ปริมาณท่ีตองการ
จุดสําคัญ - การผลิตอยางตอเนื่อง-ระบบดึง
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JIT Element - Pull System
Following processes withdraw what they need when they need it.Preceding processes replenish what is taken away.
UpstreamProcesse
s
Downstream
ProcessesNew
Product
NeededProduct
Pull
Withdrawal KanbanProduction Kanban
Store
ABCDEFGHIJKLMNOPQ
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Uncovering Production Problems
QualityQualityProblemsProblems
MaterialMaterialShortagesShortages
MachineMachineBreakdownsBreakdowns
WorkloadWorkloadImbalancesImbalances
WorkerWorkerAbsenteeismAbsenteeism
OutOut--ofof--SpecSpecMaterialsMaterials
QualityQualityProblemsProblems
InIn--ProcessProcessInventoryInventory
We must lower the water level!We must lower the water level! Visible ProductionVisible ProductionProblems are Only Problems are Only 5% of the Total!5% of the Total!
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Ideas for Cutting lot sizes
Ideas for improving JIT
delivery performance
Ideas for controlling
defect
Deliberate withdrawal of buffer inventories/workers
Productivity Improvement– Smaller lot size inventories
– Smaller buffer inventories
– Less scrap
– Less direct labor wasted on rework
– Less indirect cost of inventories
– Less space for inventories
– Less equipment to handle inventories
– Less inventory accounting
– Less physical inventory control effort
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Elimination of unnecessaries, especially inventory
• LEAN is not tools!!””• LEAN focuses on Waste Prevention• LEAN focuses on Value• LEAN focuses on System• LEAN focuses on Process• LEAN focuses on Revolution and Evolution• LEAN focuses on Distributed Decisions• LEAN focuses on Service• LEAN focuses on Built to Order• LEAN focuses on Green• LEAN is only beginning• LEAN is Core
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Seven design practices of lean processes
1. Linked processes are placed near one another – move from a functional layout to a product layout.
2. Standardized procedures –documentation, quality checks, etc.
3. Efficient Process, no loop-backs –
Seven Design Principles (continued from 3. efficient process)
4. Set a common tempo – “takt” time.
5. Balance loads – balance work evenly among employees.
6. Segregate complexity – complex & long duration vs. simple & quick jobs.
7. Post performance results.
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Synchronous Manufacturing and Theory of Constraints
• Goldratt’s Rules
• Goldratt’s Goal of the Firm
• Performance Measurement
• Capacity and Flow issues
• Synchronous Manufacturing
OBJECTIVES
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Goldratt’s Rules of Production Scheduling
• Do not balance capacity balance the flow• The level utilization of a nonbottleneck
resource is not determined by its own potential but by some other constraint in the system
• Utilization and activation of a resource are not the same
• An hour lost at a bottleneck is an hour lost for the entire system
• An hour saved at a nonbottleneck is a mirage
Goldratt’s Rules of Production Scheduling (Continued)
• Bottlenecks govern both throughput and inventory in the system
• Transfer batch may not and many times should not be equal to the process batch
• A process batch should be variable both along its route and in time
• Priorities can be set only by examining the system’s constraints and lead time is a derivative of the schedule
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Goldratt’s Theory of Constraints (TOC)
• Identify the system constraints• Decide how to exploit the system
constraints• Subordinate everything else to that
decision• Elevate the system constraints• If, in the previous steps, the
constraints have been broken, go back to Step 1, but do not let inertia become the system constraint
Goldratt’s Goal of the Firm
The goal of a firm is to make money
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Performance Measurement:Financial
• Net profit– an absolute measurement in
dollars
• Return on investment– a relative measure based on
investment
• Cash flow– a survival measurement
Performance Measurement:Operational
• 1. Throughput– the rate at which money is generated by
the system through sales
• 2. Inventory– all the money that the system has invested
in purchasing things it intends to sell
• 3. Operating expenses– all the money that the system spends to
turn inventory into throughput
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Productivity
• Does not guarantee profitability– Has throughput increased?– Has inventory decreased?– Have operational expenses
decreased?
Unbalanced Capacity
• Balancing assembly lines– The goal was a constant cycle time
across all stations
• Synchronous manufacturing views constant workstation capacity as a bad decision
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Capacity Related Terminology
• Capacity is the available time for production
• Bottleneck is what happens if capacity is less than demand placed on resource
• Nonbottleneck is what happens when capacity is greater than demand placed on resource
• Capacity-constrained resource (CCR) is a resource where the capacity is close to demand placed on the resource
Time Components of Production Cycle
• Setup time is the time that a part spends waiting for a resource to be set up to work on this same part
• Process time is the time that the part is being processed
• Queue time is the time that a part waits for a resource while the resource is busy with something else
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Time Components of Production Cycle (Continued)
• Wait time is the time that a part waits not for a resource but for another part so that they can be assembled together
• Idle time is the unused time that represents the cycle time less the sum of the setup time, processing time, queue time, and wait time
Drum, Buffer, Rope
A B C D E F
Bottleneck (Drum)
Inventorybuffer
(time buffer)Communication
(rope)
Market
Exhibit 18.9
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Quality Implications
• More tolerant than JIT systems– Excess capacity throughout system
• Except for the bottleneck– Quality control needed before