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9

JIT, Lean Operations, and the Toyota Production System
JIT, Lean Operations,
and the Toyota Production
System

Weeks 9 (Chapter 16)

Operations Management, Sustainability and Supply Chain Management, Global Edition, Eleventh Edition, PEARSON

Jay Heizer and Barry Rander

© 2014 Pearson Education

Textbook for Used
Textbook for
Used

Operations Management, Sustainability and Supply Chain Management,

Global Edition, Eleventh Edition, PEARSON

Jay Heizer and Barry Rander (2014)

Outline
Outline

Global Company Profile:

Toyota Motor Corporation Just-in-Time, the Toyota Production System, and Lean Operations Just-in-Time (JIT) Toyota Production System (TPS) Lean Operations Lean Operations in Services

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Global Company Profile
Global Company Profile

Toyota Motor Corporation

© 2014 Pearson Education

DEFINE

Just In Time (JIT)
Just In Time (JIT)

Continuous and forced problem solving via a focus on throughput and

reduced inventory

Toyota Production System (TPS)
Toyota Production System (TPS)

Focus on continuous improvement, respect for people and standart work

practices.

Lean Operations
Lean Operations

Eliminates waste through continuous improvement and focus on exactly what the customer wants.

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JIT/TPS/Lean

Operations

If there is any distinction between JIT, TPS and Lean Operation, it is that:

  • JIT emphasizes forced problem solving

  • TPS emphasizes employee learning and empowerment in an assembly- line environment.

  • Lean Operations emphasize understanding the customer

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eliminate

WASTE

Ohno’s Seven Wastes
Ohno’s Seven Wastes

Overproduction: producing more than the customer order or producing early (before it is demanded) is waste. Inventory of any kind is usually a waste

Queues

:

idle time, storage and waiting are waste (they add no value)

Transportation : moving material between plants or between work centers and handling more than once is waste.

Inventory

: unnecessary raw material, work in process (WIP), finish goods and excess

operating supplies add no value and are wastes

Motion

: movement of equipment or people that adds no value is waste

Overprocessing

: work performed on the product that adds no value is waste

Defective products

: returns, warranty claims, rework and scrap are a

waste.

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remove

VARIABILITY

Any deviation from optimum process that delivers perfect product on time, every time

  • Poor production processes that allow employees and suppliers to produce improper quantities or late or non-conforming units.

  • Unknown customer demands

  • Incomplete or inaccurate drawings, specifications and bills of material

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improve

THROUGHPUT

Throughput
Throughput

The rate at which units move through a production process

Manufacturing Cycle Time
Manufacturing Cycle Time

The time between the arrival of raw materials and the shipping of finished

products

Pull System
Pull System

A concept that results in material being produced only when requested and moved to where it is needed just as it is needed.

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JIT TECHNIQUES
JIT TECHNIQUES

JIT

Just-In-Time

Rapid throughput frees assets Quality improvement reduce waste Cost reduction adds pricing flexibility Variability reduction Rework
Rapid throughput frees assets
Quality improvement reduce waste
Cost reduction adds pricing flexibility
Variability reduction
Rework reduction
WHICH RESULTS IN:

Faster response to the

customer at lower cost and higher quality

A COMPETITIVE ADVANTAGE

WHICH WINS ORDERS BY:
WHICH WINS ORDERS BY:

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JIT

partnership

Partnerships of supplies and purchasers that remove waste and drive down costs for mutual benefits

  • 4 Removal of unnecessary activities: such as receiving, incoming inspection and paperwork related to bidding, invoicing and payment.

goals of JIT partnerships are:
goals of JIT partnerships are:

Removal of in-plant inventory: by delivery in small lots directly to the using department as needed.

Removal of in-transit inventory: by encouraging suppliers to locate nearby and provide frequent small shipments.

Improved quality and reliability: through long term commitments,

communication and coorperation.

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JIT

layout

Reduce another kind of waste-movement

JIT LAYOUT TACTICS Build work cells for families of products Include a large number operations in
JIT LAYOUT TACTICS
Build work cells for families of products
Include a large number operations in a small area
Minimize distance
Design little space for inventory
Improve employee communication
Use poka-yoke devices
Build flexible or movable equipment
Cross-train workers to add flexibility

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JIT

inventory

The minimum inventory necessary to keep a perfect system running

JIT INVENTORY TACTICS Use a pull system to move inventory Reduce lot sizes Develop just-in-time delivery
JIT INVENTORY TACTICS
Use a pull system to move inventory
Reduce lot sizes
Develop just-in-time delivery systems with suppliers
Deliver directly to point of use
Perform to schedule
Reduce setup time
Use group technology

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JIT

inventory

inventory
inventory

“Inventory is Evil” S. Shingo

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EXAMPLE

D

=

Annual demand = 400,000 units

d

=

Daily demand = 400,000/250 = 1,600 per day

p

=

Daily production rate = 4,000 units

Q

=

EOQ desired = 400

H

=

Holding cost = $20 per unit

S

=

Setup cost (to be determined)

S

2 DS 2 DS * 2  Q  Q p H  1  (
2
DS
2
DS
*
2
Q 
Q p
H
1
(
d
/
p
)
H
1
(
d
/
p
)
2
2
Q
 
H
1
d
/
p
(400) (20)(1
1,600 / 4,000)
 $2.40
2
D
2(400,000)

Setup time = $2.40/($30/hour) = 0.08 hr = 4.8 minutes

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JIT

scheduling

Communicatited both within the organization and to outside suppliers, support JIT

2

techniques are paramount:
techniques are paramount:
  • LEVEL SCHEDULES: scheduling products so that each day’s production meets the demand for that day.

  • KANBAN: The Japanese word for card, which has come to mean “signal”; a kanban system moves parts through production via a “pull” from a signal.

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JIT

quality

  • JIT cut the cost of obtaining good quality

  • JIT improves quality.

  • Better quality means fewer buffers are needed and therefore, a better easier-to-employ JIT system can exist.

JIT QUALITY TACTICS Use statistical process control Empower employees Build fail-safe methods (poka-yoke, checklists, etc.) Expose
JIT QUALITY TACTICS
Use statistical process control
Empower employees
Build fail-safe methods (poka-yoke, checklists, etc.)
Expose poor quality with small lot JIT
Provide immediate feedback

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TPS
TPS

toyota production

SYSTEM

3 core components of TPS are:  CONTINUOUS IMPREVEMENT  RESPECT FOR PEOPLE  STANDART WORK
3 core components of TPS are:
CONTINUOUS IMPREVEMENT
RESPECT FOR PEOPLE
STANDART WORK PRACTICE

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standart work

PRACTICE

  • Work shall be completely specified as to content, sequence, timing, and outcome

  • Internal and external customer-supplier connection are direct

  • Product and service flows must be simple and direct

  • Any improvement must be made in accordance with the scientific

method at the lowest possible level of the organization

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lean

OPERATION

  • Broader than JIT in that it is externally focused on the customer

  • Starts with understanding what the customer wants

  • Optimize the entire process from the customer’s perspective

© 2014 Pearson Education

Thankyou very much Operations Management, Sustainability and Supply Chain Management, Global Edition, Eleventh Edition, PEARSON Jay
Thankyou very much Operations Management, Sustainability and Supply Chain Management, Global Edition, Eleventh Edition, PEARSON Jay

Thankyou very much

Operations Management, Sustainability and Supply Chain Management, Global Edition, Eleventh Edition, PEARSON Jay Heizer and Barry Rander (2014) © 2014 Pearson Education