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OperationsManagement Chapter 16 –Chapter 16 –JIT and LeanJIT and Lean
OperationsOperationsPowerPoint presentation to accompanyPowerPoint presentation to accompany
Heizer/enderHeizer/ender
Princip!es o" Operations Management# $ePrincip!es o" Operations Management# $e
Operations Management# %eOperations Management# %e
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O&t!ine – Contin&ed O&t!ine – Contin&ed
J&st*in*TimeJ&st*in*Time
JIT PartnershipsJIT Partnerships
Concerns o" +&pp!iersConcerns o" +&pp!iers
JIT Layo&t JIT Layo&t
0istance ed&ction0istance ed&ction
Increased !e2i(i!ity Increased !e2i(i!ity
Impact on ,mp!oyeesImpact on ,mp!oyees
ed&ced +pace and In.entory ed&ced +pace and In.entory
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O&t!ine – Contin&ed O&t!ine – Contin&ed
JIT In.entory JIT In.entory
ed&ce aria(i!ity ed&ce aria(i!ity
ed&ce In.entory ed&ce In.entory ed&ce Lot +izesed&ce Lot +izes
ed&ce +et&p Costsed&ce +et&p Costs
JIT +ched&!ing JIT +ched&!ing
Le.e! +ched&!esLe.e! +ched&!es
3an(an3an(an
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O&t!ine – Contin&ed O&t!ine – Contin&ed
JIT 4&a!ity JIT 4&a!ity
Toyota Prod&ction +ystemToyota Prod&ction +ystem
Contin&o&s Impro.ement Contin&o&s Impro.ement espect "or Peop!eespect "or Peop!e
+tandard -or5 Practices+tandard -or5 Practices
Lean OperationsLean Operations
&i!ding a Lean Organization&i!ding a Lean Organization
Lean Operations in +er.icesLean Operations in +er.ices
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Learning O(7ecti.esLearning O(7ecti.es
-hen yo& comp!ete this chapter yo&-hen yo& comp!ete this chapter yo&sho&!d (e a(!e to)sho&!d (e a(!e to)
1818 0e"ine 7&st*in*time# TP+# and !ean0e"ine 7&st*in*time# TP+# and !eanoperationsoperations
9898 0e"ine the se.en wastes and the0e"ine the se.en wastes and the: +s: +s
;8;8 ,2p!ain JIT partnerships,2p!ain JIT partnerships
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Learning O(7ecti.esLearning O(7ecti.es
-hen yo& comp!ete this chapter yo&-hen yo& comp!ete this chapter yo&sho&!d (e a(!e to)sho&!d (e a(!e to)
:8:8 0e"ine 5an(an0e"ine 5an(an
6868 Comp&te the re=&ired n&m(er o"Comp&te the re=&ired n&m(er o"5an(ans5an(ans
$8$8 ,2p!ain the princip!es o" the Toyota,2p!ain the princip!es o" the ToyotaProd&ction +ystemProd&ction +ystem
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Toyota Motor CorporationToyota Motor Corporation
Largest .ehic!e man&"act&rer in theLargest .ehic!e man&"act&rer in thewor!d with ann&a! sa!es o" o.er %wor!d with ann&a! sa!es o" o.er %mi!!ion .ehic!esmi!!ion .ehic!es
+&ccess d&e to two techni=&es# JIT+&ccess d&e to two techni=&es# JITand TP+ and TP+
Contin&a! pro(!em so!.ing is centra!Contin&a! pro(!em so!.ing is centra!
to JIT to JIT ,!iminating e2cess in.entory ma5es,!iminating e2cess in.entory ma5es
pro(!ems immediate!y e.ident pro(!ems immediate!y e.ident
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Toyota Motor CorporationToyota Motor Corporation
Centra! to TP+ is a contin&ing e""ortCentra! to TP+ is a contin&ing e""ortto prod&ce prod&cts &nder idea!to prod&ce prod&cts &nder idea!conditionsconditions
espect "or peop!e is "&ndamenta! espect "or peop!e is "&ndamenta!
+ma!! (&i!ding (&t high !e.e!s o"+ma!! (&i!ding (&t high !e.e!s o" prod&ction prod&ction
+&(assem(!ies are trans"erred to the+&(assem(!ies are trans"erred to theassem(!y !ine on a JIT (asisassem(!y !ine on a JIT (asis
High =&a!ity and !ow assem(!y timeHigh =&a!ity and !ow assem(!y time
per .ehic!e per .ehic!e
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J&st*In*Time# TP+# andJ&st*In*Time# TP+# and
Lean OperationsLean Operations JIT is a phi!osophy o" contin&o&s andJIT is a phi!osophy o" contin&o&s and
"orced pro(!em so!.ing .ia a "oc&s on"orced pro(!em so!.ing .ia a "oc&s on
thro&ghp&t and red&ced in.entory thro&ghp&t and red&ced in.entory TP+ emphasizes contin&o&sTP+ emphasizes contin&o&s
impro.ement# respect "or peop!e# andimpro.ement# respect "or peop!e# andstandard wor5 practicesstandard wor5 practices
Lean prod&ction s&pp!ies theLean prod&ction s&pp!ies thec&stomer with their e2act wants whenc&stomer with their e2act wants whenthe c&stomer wants it witho&t wastethe c&stomer wants it witho&t waste
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J&st*In*Time# TP+# andJ&st*In*Time# TP+# and
Lean OperationsLean Operations JIT emphasizes "orced pro(!emJIT emphasizes "orced pro(!em
so!.ing so!.ing
TP+ emphasizes emp!oyeeTP+ emphasizes emp!oyee!earning and empowerment in an!earning and empowerment in anassem(!y*!ine en.ironment assem(!y*!ine en.ironment
Lean operations emphasizeLean operations emphasize&nderstanding the c&stomer &nderstanding the c&stomer
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,!iminate -aste,!iminate -aste
-aste is anything that does not-aste is anything that does notadd .a!&e "rom the c&stomer pointadd .a!&e "rom the c&stomer point
o" .iew o" .iew +torage# inspection# de!ay# waiting+torage# inspection# de!ay# waiting
in =&e&es# and de"ecti.e prod&ctsin =&e&es# and de"ecti.e prod&cts
do not add .a!&e and are 1>>?do not add .a!&e and are 1>>?wastewaste
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Ohno@s +e.en -astesOhno@s +e.en -astes
O.erprod&ctionO.erprod&ction
4&e&es4&e&es
TransportationTransportation
In.entory In.entory
MotionMotion
O.erprocessing O.erprocessing
0e"ecti.e prod&cts0e"ecti.e prod&cts
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,!iminate -aste,!iminate -aste
Other reso&rces s&ch as energy#Other reso&rces s&ch as energy#water# and air are o"ten wasted water# and air are o"ten wasted
,""icient# ethica!# and socia!!y,""icient# ethica!# and socia!!yresponsi(!e prod&ction minimizesresponsi(!e prod&ction minimizesinp&ts# red&ces wasteinp&ts# red&ces waste
Traditiona! Aho&se5eepingB hasTraditiona! Aho&se5eepingB has(een e2panded to the : +s(een e2panded to the : +s
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The : +sThe : +s
+ort/segregate+ort/segregate – when in do&(t# – when in do&(t#throw it o&t throw it o&t
+imp!i"y/straighten+imp!i"y/straighten – methods – methods
ana!ysis too!sana!ysis too!s +hine/sweep+hine/sweep – c!ean dai!y – c!ean dai!y
+tandardize+tandardize – remo.e .ariations "rom – remo.e .ariations "rom
processes processes +&stain/se!"*discip!ine+&stain/se!"*discip!ine – re.iew wor5 – re.iew wor5
and recognize progressand recognize progress
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The : +sThe : +s
+ort/segregate+ort/segregate – when in do&(t# – when in do&(t#throw it o&t throw it o&t
+imp!i"y/straighten+imp!i"y/straighten – methods – methods
ana!ysis too!sana!ysis too!s +hine/sweep+hine/sweep – c!ean dai!y – c!ean dai!y
+tandardize+tandardize – remo.e .ariations "rom – remo.e .ariations "rom
processes processes +&stain/se!"*discip!ine+&stain/se!"*discip!ine – re.iew wor5 – re.iew wor5
and recognize progressand recognize progress
Two additiona! +s
+a"ety – (&i!d in good practices
+&pport/maintenance – red&ce.aria(i!ity and &np!anneddowntime
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+o&rces o" aria(i!ity +o&rces o" aria(i!ity
1818 Incomp!ete or inacc&rate drawingsIncomp!ete or inacc&rate drawingsor speci"icationsor speci"ications
9898 Poor prod&ction processesPoor prod&ction processesres&!ting in incorrect =&antities#res&!ting in incorrect =&antities#!ate# or non*con"orming &nits!ate# or non*con"orming &nits
;8;8 n5nown c&stomer demandsn5nown c&stomer demands
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+o&rces o" aria(i!ity +o&rces o" aria(i!ity
1818 Incomp!ete or inacc&rate drawingsIncomp!ete or inacc&rate drawingsor speci"icationsor speci"ications
9898 Poor prod&ction processesPoor prod&ction processesres&!ting in incorrect =&antities#res&!ting in incorrect =&antities#!ate# or non*con"orming &nits!ate# or non*con"orming &nits
;8;8 n5nown c&stomer demandsn5nown c&stomer demands6oth JIT
and in.entor y
r ed&ction ar e e" " ecti.e too!s
in identi" ying ca&
ses o"
.ar ia(i!ity
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Impro.e Thro&ghp&t Impro.e Thro&ghp&t
The time it ta5es to mo.e anThe time it ta5es to mo.e anorder "rom receipt to de!i.ery order "rom receipt to de!i.ery
The time (etween the arri.a! o"The time (etween the arri.a! o"raw materia!s and the shippingraw materia!s and the shippingo" the "inished order is ca!!edo" the "inished order is ca!!ed
man&"act&ring cyc!e timeman&"act&ring cyc!e time D p&!! system increases D p&!! system increases
thro&ghp&t thro&ghp&t
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J&st*In*Time EJITFJ&st*In*Time EJITF
• Power"&! strategy "or impro.ing operationsPower"&! strategy "or impro.ing operations
• Materia!s arri.e where theyMateria!s arri.e where theyare needed when they areare needed when they areneeded needed
• Identi"ying pro(!ems andIdenti"ying pro(!ems anddri.ing o&t waste red&cesdri.ing o&t waste red&cescosts and .aria(i!ity andcosts and .aria(i!ity and
impro.es thro&ghp&t impro.es thro&ghp&t • e=&ires a meaning"&!e=&ires a meaning"&!
(&yer*s&pp!ier re!ationship(&yer*s&pp!ier re!ationship
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JIT and Competiti.eJIT and Competiti.e
Dd.antage Dd.antage
Figure 16.1Figure 16.1
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JIT and Competiti.eJIT and Competiti.e
Dd.antage Dd.antage
Figure 16.1Figure 16.1
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JIT PartnershipsJIT Partnerships
JIT partnerships e2ist when aJIT partnerships e2ist when as&pp!ier and p&rchaser wor5s&pp!ier and p&rchaser wor5together to remo.e waste and dri.etogether to remo.e waste and dri.e
down costsdown costs
o&r goa!s o" JIT partnerships are)o&r goa!s o" JIT partnerships are)
emo.a! o" &nnecessary acti.itiesemo.a! o" &nnecessary acti.ities
emo.a! o" in*p!ant in.entory emo.a! o" in*p!ant in.entory
emo.a! o" in*transit in.entory emo.a! o" in*transit in.entory
Impro.ed =&a!ity and re!ia(i!ity Impro.ed =&a!ity and re!ia(i!ity
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JIT PartnershipsJIT Partnerships
Figure 16.2Figure 16.2
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Concerns o" +&pp!iersConcerns o" +&pp!iers
0i.ersi"ication0i.ersi"ication – ties to on!y one c&stomer – ties to on!y one c&stomerincreases ris5 increases ris5
+ched&!ing +ched&!ing – don@t (e!ie.e c&stomers can – don@t (e!ie.e c&stomers can
create a smooth sched&!ecreate a smooth sched&!e ChangesChanges – short !ead times mean – short !ead times mean
engineering or speci"ication changes canengineering or speci"ication changes cancreate pro(!emscreate pro(!ems
4&a!ity 4&a!ity – !imited (y capita! (&dgets# – !imited (y capita! (&dgets# processes# or techno!ogy processes# or techno!ogy
Lot sizesLot sizes – sma!! !ot sizes may trans"er – sma!! !ot sizes may trans"er
costs to s&pp!ierscosts to s&pp!iers
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JIT Layo&t JIT Layo&t
Table 16.1Table 16.1
ed&ce waste d&e to mo.ement ed&ce waste d&e to mo.ement
JIT Layo&t TacticsJIT Layo&t Tactics
&i!d wor5 ce!!s "or "ami!ies o" prod&cts&i!d wor5 ce!!s "or "ami!ies o" prod&ctsInc!&de a !arge n&m(er operations in a sma!! areaInc!&de a !arge n&m(er operations in a sma!! area
Minimize distanceMinimize distance
0esign !itt!e space "or in.entory 0esign !itt!e space "or in.entory
Impro.e emp!oyee comm&nicationImpro.e emp!oyee comm&nicationse po5a*yo5e de.icesse po5a*yo5e de.ices
&i!d "!e2i(!e or mo.a(!e e=&ipment &i!d "!e2i(!e or mo.a(!e e=&ipment
Cross*train wor5ers to add "!e2i(i!ity Cross*train wor5ers to add "!e2i(i!ity
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0istance ed&ction0istance ed&ction
Large !ots and !ong prod&ctionLarge !ots and !ong prod&ction!ines with sing!e*p&rpose!ines with sing!e*p&rpose
machinery are (eing rep!aced (ymachinery are (eing rep!aced (ysma!!er "!e2i(!e ce!!ssma!!er "!e2i(!e ce!!s
O"ten *shaped "or shorter pathsO"ten *shaped "or shorter pathsand impro.ed comm&nicationand impro.ed comm&nication
O"ten &sing gro&p techno!ogyO"ten &sing gro&p techno!ogyconceptsconcepts
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Increased !e2i(i!ity Increased !e2i(i!ity
Ce!!s designed to (e rearrangedCe!!s designed to (e rearrangedas .o!&me or designs changeas .o!&me or designs change
Dpp!ica(!e in o""ice en.ironments Dpp!ica(!e in o""ice en.ironmentsas we!! as prod&ction settingsas we!! as prod&ction settings
aci!itates (oth prod&ct andaci!itates (oth prod&ct and
process impro.ement process impro.ement
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Impact on ,mp!oyeesImpact on ,mp!oyees
,mp!oyees are cross trained,mp!oyees are cross trained"or "!e2i(i!ity and e""iciency "or "!e2i(i!ity and e""iciency
Impro.ed comm&nicationsImpro.ed comm&nications"aci!itate the passing on o""aci!itate the passing on o"important in"ormation a(o&timportant in"ormation a(o&tthe processthe process
-ith !itt!e or no in.entory-ith !itt!e or no in.entory(&""er# getting it right the "irst(&""er# getting it right the "irsttime is critica! time is critica!
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ed&ced +pace anded&ced +pace and
In.entory In.entory
-ith red&ced space# in.entory-ith red&ced space# in.entory
m&st (e in .ery sma!! !otsm&st (e in .ery sma!! !ots nits are a!ways mo.ing (eca&senits are a!ways mo.ing (eca&se
there is no storagethere is no storage
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In.entory In.entory
In.entory is at the minim&m !e.e!In.entory is at the minim&m !e.e!necessary to 5eep operations r&nning necessary to 5eep operations r&nning
JIT In.entory TacticsJIT In.entory Tacticsse a p&!! system to mo.e in.entory se a p&!! system to mo.e in.entory
ed&ce !ot sizesed&ce !ot sizes
0e.e!op 7&st*in*time de!i.ery systems with s&pp!iers0e.e!op 7&st*in*time de!i.ery systems with s&pp!iers
0e!i.er direct!y to point o" &se0e!i.er direct!y to point o" &sePer"orm to sched&!ePer"orm to sched&!e
ed&ce set&p timeed&ce set&p time
se gro&p techno!ogy se gro&p techno!ogy Table 16.2Table 16.2
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ed&ce aria(i!ity ed&ce aria(i!ity
In.entory !e.e! In.entory !e.e!
Processdowntime
+crap
+et&ptime
Late de!i.eries
4&a!ity pro(!ems
Figure 16.3Figure 16.3
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In.entoryIn.entory!e.e! !e.e!
ed&ce aria(i!ity ed&ce aria(i!ity
+crap
+et&ptime
Late de!i.eries
4&a!ity pro(!ems
Processdowntime
Figure 16.3Figure 16.3
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ed&ce Lot +izesed&ce Lot +izes
Figure 16.4Figure 16.4
9>>9>> –
1>>1>> – I n . e n
t o r y
I n . e n
t o r y
TimeTime
4 4 22 -hen a.erage order size-hen a.erage order size = 100= 100a.erage in.entory isa.erage in.entory is 5050
4 4 11 -hen a.erage order size-hen a.erage order size = 200= 200a.erage in.entory isa.erage in.entory is 100100
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ed&ce Lot +izesed&ce Lot +izes
Idea! sit&ation is to ha.e !ot sizesIdea! sit&ation is to ha.e !ot sizeso" one p&!!ed "rom one process too" one p&!!ed "rom one process tothe ne2t the ne2t
O"ten not "easi(!eO"ten not "easi(!e
Can &se ,O4 ana!ysis to ca!c&!ateCan &se ,O4 ana!ysis to ca!c&!atedesired set&p timedesired set&p time
Two 5ey changes necessary Two 5ey changes necessary
Impro.e materia! hand!ing Impro.e materia! hand!ing
ed&ce set&p timeed&ce set&p time
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ed&ce +et&p Costsed&ce +et&p Costs
High set&p costs enco&rage !argeHigh set&p costs enco&rage !arge!ot sizes!ot sizes
ed&cing set&p costs red&ces !oted&cing set&p costs red&ces !otsize and red&ces a.eragesize and red&ces a.eragein.entory in.entory
+et&p time can (e red&ced thro&gh+et&p time can (e red&ced thro&gh preparation prior to sh&tdown and preparation prior to sh&tdown andchangeo.er changeo.er
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Lower +et&p CostsLower +et&p Costs
Figure 16.5Figure 16.5
+&m o" ordering+&m o" orderingand ho!ding costsand ho!ding costs
Ho!ding cost Ho!ding cost
+et&p cost c&r.es+et&p cost c&r.es ((+ + 11# + # + 22))T T 11
+ + 11
T T 22
+ + 22
C o s t
C o s t
Lot sizeLot size
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ed&ce +et&p Timesed&ce +et&p Times
Figure 16.6Figure 16.6
se one*to&ch system to e!iminatese one*to&ch system to e!iminatead7&stments Esa.e 1> min&tesFad7&stments Esa.e 1> min&tesF
+tep min&tesF
+tep 1+tep 1
+eparate set&p into preparation and act&a!set&p# doing as m&ch as possi(!e whi!e the
machine/process is operatingEsa.e ;> min&tesF
+tep ;+tep ;
+tandardize andimpro.e too!ing
Esa.e 1: min&tesF
%> min %> min
6> min 6> min
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JIT +ched&!ing JIT +ched&!ing
+ched&!es m&st (e comm&nicated+ched&!es m&st (e comm&nicatedinside and o&tside the organizationinside and o&tside the organization
Le.e! sched&!esLe.e! sched&!es Process "re=&ent sma!! (atchesProcess "re=&ent sma!! (atches
reezing the sched&!e he!psreezing the sched&!e he!ps
sta(i!ity sta(i!ity 3an(an3an(an
+igna!s &sed in a p&!! system+igna!s &sed in a p&!! system
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Table 16.3Table 16.3
etter sched&!ing impro.es per"ormanceetter sched&!ing impro.es per"ormance
JIT +ched&!ing TacticsJIT +ched&!ing Tactics
Comm&nicate sched&!es to s&pp!iersComm&nicate sched&!es to s&pp!iers
Ma5e !e.e! sched&!esMa5e !e.e! sched&!es
reeze part o" the sched&!ereeze part o" the sched&!e
Per"orm to sched&!ePer"orm to sched&!e
+ee5 one*piece*ma5e and one*piece mo.e+ee5 one*piece*ma5e and one*piece mo.e
,!iminate waste,!iminate waste
Prod&ce in sma!! !otsProd&ce in sma!! !ots
se 5an(ansse 5an(ans
Ma5e each operation prod&ce a per"ect part Ma5e each operation prod&ce a per"ect part
JIT +ched&!ing JIT +ched&!ing
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Le.e! +ched&!esLe.e! +ched&!es
Process "re=&ent sma!! (atchesProcess "re=&ent sma!! (atchesrather than a "ew !arge (atchesrather than a "ew !arge (atches
Ma5e and mo.e sma!! !ots so theMa5e and mo.e sma!! !ots so the!e.e! sched&!e is economica! !e.e! sched&!e is economica!
A A Je!!y (eanB sched&!ing Je!!y (eanB sched&!ing
reezing the sched&!e c!osest to thereezing the sched&!e c!osest to thed&e dates can impro.e per"ormanced&e dates can impro.e per"ormance
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+ched&!ing +ma!! Lots+ched&!ing +ma!! Lots
D D C C D D D D D D C C
JIT Le.e! Materia!*se DpproachJIT Le.e! Materia!*se Dpproach
D D C C D D D D D D C C C C D D D D
Large*Lot DpproachLarge*Lot Dpproach
TimeTimeFigure 16.7Figure 16.7
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3an(an3an(an
3an(an is the Japanese word "or card 3an(an is the Japanese word "or card
The card is an a&thorization "or the ne2tThe card is an a&thorization "or the ne2tcontainer o" materia! to (e prod&ced container o" materia! to (e prod&ced
D se=&ence o" 5an(ans D se=&ence o" 5an(ans p&!!s materia! thro&gh p&!!s materia! thro&ghthe processthe process
Many di""erent sorts o"Many di""erent sorts o"signa!s are &sed# (&tsigna!s are &sed# (&tthe system is sti!! ca!!edthe system is sti!! ca!!eda 5an(ana 5an(an
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3an(an3an(an
1818 ser remo.es aser remo.es astandard sizedstandard sizedcontainer container
9898 +igna! is seen (y+igna! is seen (ythe prod&cingthe prod&cingdepartment asdepartment asa&thorization toa&thorization to
rep!enishrep!enish
Part n&m(ersPart n&m(ers
mar5 !ocationmar5 !ocation
+igna! mar5er+igna! mar5eron (o2eson (o2es
Figure 16.8Figure 16.8
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3an(an3an(an
Figure 16.9Figure 16.9
-or5-or5
ce!! ce!!
awawMateria!Materia!+&pp!ier +&pp!ier
3an(an3an(an
P&rchasedP&rchasedPartsParts
+&pp!ier +&pp!ier
+&(* +&(* assem(!y assem(!y
+hip+hip
3an(an3an(an
3an(an3an(an
3an(an3an(an
3an(an3an(an
inishedinishedgoodsgoods
C&stomerC&stomerorder order
ina!ina!assem(!y assem(!y
3an(an3an(an
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More 3an(anMore 3an(an
-hen the prod&cer and &ser are not in-hen the prod&cer and &ser are not in.is&a! contact# a card can (e &sed .is&a! contact# a card can (e &sed
-hen the prod&cer and &ser are in .is&a!-hen the prod&cer and &ser are in .is&a!
contact# a !ight or "!ag or empty spot oncontact# a !ight or "!ag or empty spot onthe "!oor may (e ade=&atethe "!oor may (e ade=&ate
+ince se.era!+ince se.era!components maycomponents may
(e re=&ired#(e re=&ired#se.era! di""erentse.era! di""erent5an(an techni=&es5an(an techni=&esmay (e emp!oyed may (e emp!oyed
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More 3an(anMore 3an(an
s&a!!y each card contro!s a speci"ics&a!!y each card contro!s a speci"ic=&antity or parts=&antity or parts
M&!tip!e card systems may (e &sed i"M&!tip!e card systems may (e &sed i"there are se.era! components orthere are se.era! components ordi""erent !ot sizesdi""erent !ot sizes
In an MP system# the sched&!e canIn an MP system# the sched&!e can
(e tho&ght o" as a (&i!d a&thorization(e tho&ght o" as a (&i!d a&thorizationand the 5an(an a type o" p&!! systemand the 5an(an a type o" p&!! systemthat initiates act&a! prod&ctionthat initiates act&a! prod&ction
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The &m(er o" 3an(an CardsThe &m(er o" 3an(an Cards
or Containersor Containers eed to 5now the !ead time needed to
prod&ce a container o" parts
eed to 5now the amo&nt o" sa"etystoc5 needed
&m(er o" 5an(ans&m(er o" 5an(ansEcontainersFEcontainersF
0emand d&ring0emand d&ring +a"ety +a"ety
!ead time!ead time stoc5 stoc5 +ize o" container +ize o" container
GG
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&m(er o" 3an(ans ,2amp!e&m(er o" 3an(ans ,2amp!e
0ai!y demand 0ai!y demand == 500500 ca5esca5es
Prod&ction !ead timeProd&ction !ead time == 22 daysdaysE-ait time E-ait time Materia! hand!ing time Materia! hand!ing time
Processing timeFProcessing timeF
+a"ety stoc5 +a"ety stoc5 == 1/21/2 day day
Container sizeContainer size == 250250 ca5esca5es
0emand d&ring !ead time0emand d&ring !ead time = 2= 2 daysdays x 500x 500 ca5esca5es = 1,000= 1,000
&m(er o" 5an(ans&m(er o" 5an(ans = = 5= = 51,000 2501,000 250
250250
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Dd.antages o" 3an(an Dd.antages o" 3an(an
D!!ow on!y !imited amo&nt o" "a&!ty or D!!ow on!y !imited amo&nt o" "a&!ty orde!ayed materia! de!ayed materia!
Pro(!ems are immediate!y e.ident Pro(!ems are immediate!y e.ident
P&ts downward press&re on (adP&ts downward press&re on (adaspects o" in.entory aspects o" in.entory
+tandardized containers red&ce+tandardized containers red&ceweight# disposa! costs# wasted space#weight# disposa! costs# wasted space#and !a(or and !a(or
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4&a!ity 4&a!ity
+trong re!ationship+trong re!ationship
JIT c&ts the cost o" o(taining goodJIT c&ts the cost o" o(taining good
=&a!ity (eca&se JIT e2poses poor=&a!ity (eca&se JIT e2poses poor=&a!ity =&a!ity
eca&se !ead times are shorter#eca&se !ead times are shorter#=&a!ity pro(!ems are e2posed sooner =&a!ity pro(!ems are e2posed sooner
etter =&a!ity means "ewer (&""ersetter =&a!ity means "ewer (&""ersand a!!ows simp!er JIT systems to (eand a!!ows simp!er JIT systems to (e&sed &sed
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JIT 4&a!ity TacticsJIT 4&a!ity Tactics
se statistica! process contro! se statistica! process contro!
,mpower emp!oyees,mpower emp!oyees
&i!d "ai!*sa"e methods Epo5a* &i!d "ai!*sa"e methods Epo5a* yo5e# chec5!ists# etc8Fyo5e# chec5!ists# etc8F
,2pose poor =&a!ity with sma!!,2pose poor =&a!ity with sma!!!ot JIT !ot JIT
Pro.ide immediate "eed(ac5 Pro.ide immediate "eed(ac5
Table 16.4Table 16.4
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Toyota Prod&ction +ystemToyota Prod&ction +ystem
Contin&o&s impro.ement Contin&o&s impro.ement
&i!d an organizationa! c&!t&re and .a!&e&i!d an organizationa! c&!t&re and .a!&esystem that stresses impro.ement o" a!!system that stresses impro.ement o" a!! processes processes
Part o" e.eryone@s 7o(Part o" e.eryone@s 7o(
espect "or peop!eespect "or peop!e
Peop!e are treated asPeop!e are treated as
5now!edge wor5ers5now!edge wor5ers ,ngage menta! and,ngage menta! and
physica! capa(i!ities physica! capa(i!ities
,mpower emp!oyees,mpower emp!oyees
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Toyota Prod&ction +ystemToyota Prod&ction +ystem
+tandard wor5 practice+tandard wor5 practice
-or5 sha!! (e comp!ete!y speci"ied as to-or5 sha!! (e comp!ete!y speci"ied as tocontent# se=&ence# timing# and o&tcomecontent# se=&ence# timing# and o&tcome
Interna! and e2terna! c&stomer*s&pp!ierInterna! and e2terna! c&stomer*s&pp!ierconnection are direct connection are direct
Prod&ct and ser.ice "!ows m&st (e simp!eProd&ct and ser.ice "!ows m&st (e simp!eand direct and direct
Dny impro.ement m&st (e made in Dny impro.ement m&st (e made inaccordance with the scienti"ic method at theaccordance with the scienti"ic method at the!owest possi(!e !e.e! o" the organization!owest possi(!e !e.e! o" the organization
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Lean OperationsLean Operations
0i""erent "rom JIT in that it is0i""erent "rom JIT in that it ise2terna!!y "oc&sed on the c&stomer e2terna!!y "oc&sed on the c&stomer
+tarts with &nderstanding what the+tarts with &nderstanding what thec&stomer wantsc&stomer wants
Optimize the entire process "romOptimize the entire process "rom
the c&stomer@s perspecti.ethe c&stomer@s perspecti.e
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&i!ding a Lean Organization&i!ding a Lean Organization
Transitioning to a !ean system canTransitioning to a !ean system can(e di""ic&!t (e di""ic&!t
Lean systems tend to ha.e theLean systems tend to ha.e the"o!!owing attri(&tes"o!!owing attri(&tes
se JIT techni=&esse JIT techni=&es
&i!d systems that he!p emp!oyees&i!d systems that he!p emp!oyees prod&ce per"ect parts prod&ce per"ect parts
ed&ce space re=&irementsed&ce space re=&irements
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&i!ding a Lean Organization&i!ding a Lean Organization
0e.e!op partnerships with0e.e!op partnerships withs&pp!ierss&pp!iers
,d&cate s&pp!iers,d&cate s&pp!iers
,!iminate a!! (&t .a!&e*added,!iminate a!! (&t .a!&e*addedacti.itiesacti.ities
0e.e!op emp!oyees0e.e!op emp!oyees
Ma5e 7o(s cha!!enging Ma5e 7o(s cha!!enging
&i!d wor5er "!e2i(i!ity &i!d wor5er "!e2i(i!ity
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JIT in +er.icesJIT in +er.ices
The JIT techni=&es &sed inThe JIT techni=&es &sed inman&"act&ring are &sed in ser.icesman&"act&ring are &sed in ser.ices
+&pp!iers+&pp!iers
Layo&tsLayo&ts
In.entory In.entory
+ched&!ing +ched&!ing
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