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PowerPoint presentation to accompany PowerPoint presentation to accompany Heizer and Render Heizer and Render Operations Management, 10e Operations Management, 10e Principles of Operations Management, 8ePrinciples of Operations Management, 8e
PowerPoint slides by Jeff Heyl
OutlineOutlineGlobal Company Profile: Toyota Motor CorporationJust-in-Time, the Toyota Production System, and Lean
Success due to two techniques, JIT and TPSContinual problem solving is central to JITEliminating excess inventory makes problems immediately evident
Toyota Motor CorporationToyota Motor CorporationCentral to TPS is employee learning and a continuing effort to produce products under ideal conditionsRespect for people is fundamental
Small building but high levels of productionSubassemblies are transferred to the assembly line on a JIT basisHigh quality and low assembly time per vehicle
Good production systems require Good production systems require that managers address three issues that managers address three issues that are pervasive and fundamental that are pervasive and fundamental
to operations management:to operations management:
TPS emphasizes continuous improvement, respect for people, and standard work practicesLean production supplies the customer with their exact wants when the customer wants it without waste
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JustJust--InIn--Time, TPS, and Time, TPS, and Lean OperationsLean Operations
JIT emphasizes forced problem solvingTPS emphasizes employee
Shine/sweepShine/sweep – clean dailyStandardizeStandardize – remove variations from processesSustain/selfSustain/self--disciplinediscipline – review work and recognize progress
The 5 SsThe 5 SsSort/segregateSort/segregate – when in doubt, throw it outSimplify/straightenSimplify/straighten – methods analysis toolsTwo additional Ss
Shine/sweepShine/sweep – clean dailyStandardizeStandardize – remove variations from processesSustain/selfSustain/self--disciplinediscipline – review work and recognize progress
Safety – build in good practicesSupport/maintenance – reduce variability and unplanned downtime
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Remove VariabilityRemove Variability
JIT systems require managers to reduce variability caused by both internal and external factorsV i bilit i d i ti f th
neededIdentifying problems and driving out waste reduces costs and variability and improves throughputRequires a meaningful buyer-supplier relationship
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JIT and Competitive JIT and Competitive AdvantageAdvantage
Four goals of JIT partnerships are:Removal of unnecessary activitiesRemoval of in-plant inventoryRemoval of in-transit inventoryImproved quality and reliability
Concerns of SuppliersConcerns of SuppliersDiversificationDiversification – ties to only one customer increases riskSchedulingScheduling – don’t believe customers can create a smooth scheduleLead timeLead time – short lead times mean
Lead timeLead time – short lead times mean engineering or specification changes can create problemsQualityQuality – limited by capital budgets, processes, or technologyLot sizesLot sizes – small lot sizes may transfer costs to suppliers
JIT LayoutJIT LayoutReduce waste due to movement
JIT Layout TacticsBuild work cells for families of productsInclude a large number operations in a small area
Minimize distanceDesign little space for inventoryImprove employee communicationUse poka-yoke devicesBuild flexible or movable equipmentCross-train workers to add flexibility
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Distance ReductionDistance ReductionLarge lots and long production lines with single-purpose machinery are being replaced by smaller flexible cells
Applicable in office environments as well as production settingsFacilitates both product and process improvement
Impact on EmployeesImpact on EmployeesEmployees may be cross trained for flexibility and efficiencyImproved communications facilitate the passing on of
yUnits are always moving because there is no storage
JIT InventoryJIT InventoryInventory is at the minimum level necessary to keep operations runningJIT Inventory TacticsUse a pull system to move inventory
p y yReduce lot sizesDevelop just-in-time delivery systems with suppliersDeliver directly to point of usePerform to scheduleReduce setup timeUse group technology
Can use EOQ analysis to calculate desired setup timeTwo key changes necessary
Improve material handlingReduce setup time
Lot Size ExampleLot Size ExampleD = Annual demand = 400,000 unitsd = Daily demand = 400,000/250 = 1,600 per dayp = Daily production rate = 4,000 unitsQ = EOQ desired = 400H = Holding cost = $20 per unitS S t t (t b d t i d)
Freeze part of the schedulePerform to scheduleSeek one-piece-make and one-piece moveEliminate wasteProduce in small lotsUse kanbansMake each operation produce a perfect part
Level SchedulesLevel Schedules
Process frequent small batches rather than a few large batchesMake and move small lots so the l l h d l i i l
visual contact, a light or flag or empty spot on the floor may be adequateSince several components may be required, several different kanban techniques may be employed
More KanbanMore Kanban
Usually each card controls a specific quantity or partsMultiple card systems may be used if there are several components or
there are several components or different lot sizesIn an MRP system, the schedule can be thought of as a build authorization and the kanban a type of pull system that initiates actual production
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More KanbanMore Kanban
Kanban cards provide a direct control and limit on the amount of work-in-process between cellsIf there is an immediate storage area a
If there is an immediate storage area, a two-card system can be used with one card circulating between the user and storage area and the other between the storage area and the producer
The Number of Kanban CardsThe Number of Kanban Cardsor Containersor Containers
Need to know the lead time needed to produce a container of partsNeed to know the amount of safety
Demand during Safetylead time + stockSize of container=
Number of Kanbans ExampleNumber of Kanbans ExampleDaily demand = 500 cakesProduction lead time = 2 days(Wait time + Material handling time + Processing time)
connection are directProduct and service flows must be simple and directAny improvement must be made in accordance with the scientific method at the lowest possible level of the organization
Lean OperationsLean Operations
Different from JIT in that it is externally focused on the customerStarts with understanding what the
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