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16–1OperationsManagementOperationsManagementChapter16–Just-in-TimeandLeanProductionSystemsChapter16–Just-in-TimeandLeanProductionSystemsPowerPointpresentationtoaccompanyPowerPointpresentationtoaccompanyHeizer/RenderHeizer/RenderPrinciplesofOperationsManagement,6ePrinciplesofOperationsManagement,6eOperationsManagement,8eOperationsManagement,8e16–2OutlineOutlineGlobalCompanyProfile:GreenGlobalCompanyProfile:GreenGearCyclingGearCyclingJustJust--inin--TimeandLeanProductionTimeandLeanProductionSuppliersSuppliersGoalsofJITPartnershipsGoalsofJITPartnershipsConcernsofSuppliersConcernsofSuppliers16–3OutlineOutline––ContinuedContinuedJITLayoutJITLayoutDistanceReductionDistanceReductionIncreasedFlexibilityIncreasedFlexibilityImpactonEmployeesImpactonEmployeesReducedSpaceandInventoryReducedSpaceandInventory16–4OutlineOutline––ContinuedContinuedInventoryInventoryReduceVariabilityReduceVariabilityReduceInventoryReduceInventoryReduceLotSizesReduceLotSizesReduceSetupCostsReduceSetupCostsSchedulingSchedulingLevelSchedulesLevelSchedulesKanbanKanban16–5OutlineOutline––ContinuedContinuedQualityQualityEmployeeEmpowermentEmployeeEmpowermentLeanProductionLeanProductionBuildingaLeanOrganizationBuildingaLeanOrganization5S5S’’ssSevenWastesSevenWastesJITInServicesJITInServices16–6LearningObjectivesLearningObjectivesWhenyoucompletethischapter,youWhenyoucompletethischapter,youshouldbeableto:shouldbeableto:IdentifyorDefine:IdentifyorDefine:VariabilityVariabilityKanbanKanban5SSystem5SSystemSevenWastesSevenWastes16–7LearningObjectivesLearningObjectivesWhenyoucompletethischapter,youWhenyoucompletethischapter,youshouldbeableto:shouldbeableto:DescribeorExplain:DescribeorExplain:JustJust--inin--time(JIT)Philosophytime(JIT)PhilosophyPullSystemsPullSystemsPushSystemsPushSystemsTheGoalsofJITPartnershipsTheGoalsofJITPartnershipsLeanProductionLeanProductionPrinciplesofToyotaProductionSystemPrinciplesofToyotaProductionSystem16–8GreenGearCyclingGreenGearCyclingDesignsandmanufactureshighDesignsandmanufactureshighperformancetravelbicycles(bikeperformancetravelbicycles(bike--inin--aa--suitcase)suitcase)StrategyismasscustomizationwithlowStrategyismasscustomizationwithlowinventory,workcells,andeliminationofinventory,workcells,andeliminationofmachinesetupsmachinesetupsMajorfocusonJITandsupplyMajorfocusonJITandsupply--chainchainmanagementmanagementOnedaythroughputtimeOnedaythroughputtimeFocusonqualityFocusonquality16–9JustJust--InIn--TimeandTimeandLeanProductionLeanProductionJITisaphilosophyofcontinuousJITisaphilosophyofcontinuousandforcedproblemsolvingthatandforcedproblemsolvingthatsupportsleanproductionsupportsleanproductionLeanproductionsuppliestheLeanproductionsuppliesthecustomerwiththeirexactwantscustomerwiththeirexactwantswhenthecustomerwantsitwithoutwhenthecustomerwantsitwithoutwastewasteKeyissuesarecontinualKeyissuesarecontinualimprovementandapullsystemimprovementandapullsystem16–10WasteReductionWasteReductionWasteisanythingthatdoesnotWasteisanythingthatdoesnotaddvaluefromthecustomerpointaddvaluefromthecustomerpointofviewofviewStorage,inspection,delay,waitingStorage,inspection,delay,waitinginqueues,anddefectiveproductsinqueues,anddefectiveproductsdonotaddvalueandare100%donotaddvalueandare100%wastewaste16–11WasteReductionWasteReductionFasterdelivery,reducedworkFasterdelivery,reducedwork--inin--process,andfasterthroughputallprocess,andfasterthroughputallreducewastereducewasteReducedwastereducesroomforReducedwastereducesroomforerrorsemphasizingqualityerrorsemphasizingqualityReducedinventoryreleasesassetsReducedinventoryreleasesassetsforother,productivepurposesforother,productivepurposes16–12VariabilityReductionVariabilityReductionJITsystemsrequiremanagerstoJITsystemsrequiremanagerstoreducevariabilitycausedbybothreducevariabilitycausedbybothinternalandexternalfactorsinternalandexternalfactorsVariabilityisanydeviationfromtheVariabilityisanydeviationfromtheoptimumprocessoptimumprocessInventoryhidesvariabilityInventoryhidesvariabilityLessvariabilityresultsinlessLessvariabilityresultsinlesswastewaste16–13CausesofVariabilityCausesofVariability1.1.Employees,machines,andsuppliersEmployees,machines,andsuppliersproduceunitsthatdonotconformtoproduceunitsthatdonotconformtostandards,arelate,orarenotthestandards,arelate,orarenottheproperquantityproperquantity2.2.EngineeringdrawingsorspecificationsEngineeringdrawingsorspecificationsareinaccurateareinaccurate3.3.ProductionpersonneltrytoproduceProductionpersonneltrytoproducebeforedrawingsorspecificationsarebeforedrawingsorspecificationsarecompletecomplete4.4.CustomerdemandsareunknownCustomerdemandsareunknown16–14PullVersusPushSystemsPullVersusPushSystemsApullsystemusessignalstoApullsystemusessignalstorequestproductionanddeliveryrequestproductionanddeliveryfromupstreamstationsfromupstreamstationsUpstreamstationsonlyproduceUpstreamstationsonlyproducewhensignaledwhensignaledSystemisusedwithintheimmediateSystemisu