Buddha Bahadur Shakya

JIT and
Lean
Operations
Toyota Production System (TPS)
Toyota's development of ideas that later became lean
may have started at the turn of the 20th century, in a
textile factory with looms that stopped themselves
when a thread broke.
This became the seed of autonomation and Jidoka.
Toyota's journey with JIT may have started back in 1934
when it moved from textiles to produce its first car.
Toyota Production System (TPS)
Kiichiro Toyoda, founder of Toyota Motor Corporation,
directed the engine casting work and discovered many
problems in their manufacture.
He decided he must stop the repairing of poor quality by
intense study of each stage of the process.
In 1936, when Toyota won its first truck contract with
the Japanese government, his processes hit new
problems and he developed the "Kaizen" improvement
teams.
Toyota Production System (TPS)
1. (Kaizen) Continuous Improvement
2. Respect for People
Training, empowerment
3. Standard Work Practice
Work is completely specified as to content, sequence, timing
and outcome.
Lean Operations
Lean operations began as lean manufacturing in
the mid-1900s.
It was developed by Toyota.
Toyotas focus was on elimination of waste.
In mid 1980s, revival of GM auto plant at
Fremont, California under joint venture of Toyota
& GM called New United Motor Manufacturing
Inc. (NUMMI).
Lean Operation
The term was first coined by John Krafcik in his 1988 article,
"Triumph of the Lean Production System," based on his
master's thesis at the MIT Sloan School of Management.
Krafcik had been a quality engineer in the Toyota-GM
NUMMI joint venture in California before coming to MIT for
MBA studies.
Krafcik's research was continued by the International Motor
Vehicle Program (IMVP) at MIT, which produced the
international best-seller book co-authored by Jim Womack,
Daniel Jones, and Daniel Roos called The Machine That
Changed the World.
JIT and Lean Operations
Just-in-time (JIT)
A highly coordinated
processing system in which
goods move through the
system, and the services are
performed, just as they are
needed.
Lean Operation
A highly coordinated
system that uses minimal
resources and produces
high quality goods or
services depending on high
quality process.
Now the two terms are often used interchangeably .
Terms associated with lean operations
1. Muda:
Waste and inefficiency.
2. Kanban:
Each container holds a small supply of parts or
materials. New containers are delivered to
replace empty containers.
A manual system used for controlling the
movements of parts and materials that
responds to signals of the need for delivery of
parts or materials.
3. Pull system:
Replacing materials or parts based on
demand; produce only what is needed.
Terms associated with lean operations
4. Kaizen:
Continuous improvement of the system. There is always room
for improvement, so this effort must be ongoing.
5. Jidoka (Autonomation):
Quality at the source. Automatic detection of defects during
production. Detecting defects when they occur and stopping
production to correct the cause of the defects.
The objective is to avoid passing defective products to
following work stations, and to make workers aware of quality.
6. Poka-yoke:
Safe guards built into a process to reduce the possibility of
committing an error.
Terms associated with lean operations
7. Heijunka:
Variation in production volume lead to waste.
The work load must be leveled; volume and variety must be
averaged to achieve a steady flow of work.
8. Team concept:
Use small teams of worker for process improvement.
9. Muri
"overburden and
10. Mura
unevenness
Terms associated with lean operations
11. Andon:
Each workstation is equipped
with a set of three lights
A green light means no
problem
An amber light means a
worker is falling a little bit
behind
A red light indicates a serious
problem.
Goals and Building Blocks of Lean System
1. Eliminate disruptions
Caused by
1. Poor quality
2. Equipment breakdowns
3. Changes to schedule
4. Late deliveries
2. Make the system flexible
DEFINITION
A system that is robust enough
to handle a mix of products, often on a daily basis
and
to handle changes in the level of output
while maintaining balance and throughput speed.
Requirement for flexibility
Short setup time
Short lead time
3. Eliminate Waste
Waste is anything that does not add value
from the customer point of view.
Storage,
Inspection,
Delay,
Waiting in queues, and
Defective products do not add value and
are 100% waste.
Taiichi Ohnos Seven Wastes
1. Overproduction
2. Queues
3. Transportation
4. Inventory
5. Motion
6. Over processing
7. Defective products
Wastes
Other resources such as energy, water, and
air are often wasted.
Efficient, ethical, and socially responsible
production minimizes inputs, reduces waste.
Traditional housekeeping for a neat,
orderly and efficient workplace.
Waste in Operations
Waste in Operations
Waste in Operations
Kaizen Philosophy for eliminating waste
1. Waste is the enemy.
2. Improvement should be done gradually
and continuously.
3. Everyone should be involved.
4. Built on a cheap strategy.
5. Can be applied anywhere.
Kaizen Philosophy for eliminating waste
6. Supported by a visual system: a total
transparency of procedures, processes and values,
making problems and wastes visible to all.
7. Focuses attention where value is created
8. Process oriented
9. Stresses main effort of improvement should
come from new thinking and work style.
10.The essence of organizational learning is to
learn while doing.
Product Design:
Standard parts
Modular design
Quality
Concurrent
engineering
Process Design:
Small lot sizes
Setup time reduction
Manufacturing cells
Quality improvement
Production flexibility
A balanced system
Little inventory storage
Fail-safe methods
Personnel/Organizat
ional Elements:
Workers as assets.
Cross-trained workers
Continuous
improvement
Cost accounting
Leadership/project
management
Manufacturing
Planning Control:
Level loading
Pull systems
Visual systems
Limited WIP
Closed vendor
relationship
Reduced transaction
processing
Preventive
maintenance &
housekeeping
1. Eliminate disruptions
2. Make the system flexible
3. Eliminate waste
A
balanced
rapid flow
Ultimate Goal
Supporting Goals
JIT Building Blocks
1. Product design
2. Process design
3. Personnel/organizational
elements
4. Manufacturing
planning and control
1. Product Design
Modular design
Reduces the number of parts to deal with.
Simplifies assembly, purchasing, handling,
training.
Simplifies the bill of material.
Quality (Product, Process)
Concurrent engineering

Standard parts
Fewer parts to deal with.
Training times and costs are reduced.
Purchasing, handling and checking quality are more routine.

2. Process Design
1. Small lot sizes
2. Setup time reduction
3. Manufacturing cells
4. Quality improvement
5. Production flexibility
6. A balanced system
7. Little inventory storage
8. Fail-safe methods
A
A A B B B C
JIT Small Lots
Large-Lot Approach
Time
Time
A A B B B C
A A A B B B B B B C C
JIT produces same amount
in same time if setup times
are lowered
2.1 Small-Lot Production
Small lots also increase flexibility to meet
customer demands
Comparison of
Level and Large Lot Material-use Approaches
Reduce Lot Sizes
200
100
I
n
v
e
n
t
o
r
y

Time
Q
2
When average order size = 100
average inventory is 50
Q
1
When average order size = 200
average inventory is 100
Benefits of small lot sizes
1. Reduced inventory, lower carrying cost.
2. Less space required to store inventory.
3. Less rework if defects occur.
4. Less inventory to work off before
implementing product improvements.
5. Increased visibility of problems.
6. Increased production flexibility.
7. Increase ease of balancing operations.
2.2 Setup time reduction
Small lots and changing product mixes require
frequent setups.
Unless these are quick and inexpensive the time and
cost to accomplish them can be prohibitive.
Setup time can be reduced through
Preparation prior to shutdown and changeover.
Simple and standardized setup tools and equipment.
Multipurpose equipment or attachment.
Group technology
Single-Minute Exchange of Die (SMED)
Developed by Shigeo Shingo
First categorize changeover activity as
internal and external.
Internal activities can only be done while a
machine is stopped.
External activities are those that do not involve
stopping the machine.
Convert as many internal activities as possible
to external activities.
Reduce Setup Times
Use one-touch system to
eliminate adjustments (save
10 minutes) Step 4
Step 5
Training operators and
standardizing work procedures
(save 2 minutes)
Initial Setup Time
Step 2
Move material closer and
improve material handling
(save 20 minutes)
Step 1
Separate setup into preparation and actual
setup, doing as much as possible while the
machine/process is operating
(save 30 minutes)
Step 3
Standardize and
improve tooling (save
15 minutes)
90 min
60 min
40 min
25 min
15 min
13 min

Repeat cycle until
subminute setup is achieved
Step 6
Lower Setup Costs
Sum of ordering
and holding costs
Holding cost
Setup cost curves (S
1
, S
2
)
T
1

S
1

T
2

S
2

C
o
s
t

Lot size
High setup costs encourage large lot sizes.
Reducing setup costs reduces lot size and reduces
average inventory.
Determination of Set Up time
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Set up time = Set up cost / (hourly labor rate)
2.3 Manufacturing cells
Cells containing the tools and machines needed to process
families of parts having similar processing requirements.

Benefits
Reduced changeover time
High utilization of equipment
Ease of cross training operators
Cellular Layouts
JIT objective: Reduce movement of people and material
Movement is waste!
JIT requires work-cells for product families (group
technology)
movable, changeable, flexible machinery
short distances
high level of workplace organization and neatness
Improve employee communication
Use poka-yoke devices
Cross train workers to add flexibility to layout
Balanced workstation capacities

Cellular Layouts
Group dissimilar machines in manufacturing cell to produce
family of parts
Work flows in one direction through cell
Cycle time adjusted by changing worker paths
Decreasing set-up times
2.4 Quality Improvement
JIT exposes quality problems by reducing inventory.
JIT eliminates number defects with small lots.
JIT requires quality by suppliers.
Team approach and continuous improvement are important for
ensuring quality.
Quality is maintained by the following procedure:
Find the root cause of the problem, solve permanently and use
team approach in solving the problems
Quality Improvement
JIT requires TQM
Statistical process control
Worker involvement & empowered employees
Inspect own work
Quality circles
Immediate feedback
Fail-safe methods such as poka-yoke (prevents defectives)
Quality Improvement
1. Jidoka (Autonomation) assures quality at the source
2. Andon lights signal quality problems
Visual Control
Visual control makes problems visible.

Visual Control
Visual Control
2.5 Increasing Production Flexibility
1. Reduce downtime due to changeovers by reducing
changeover time.
2. Use preventive maintenance on key equipment to
reduce breakdowns and downtime.
3. Cross-train workers so they can help when
bottlenecks occur or other workers are absent.
4. Train workers to handle equipment adjustments
and minor repairs.
2.5 Increasing Production Flexibility
4. Use many small units of capacity;
many small cells make it easier to shift capacity temporarily
and to add or subtract capacity than a few units of large
capacity.
5. Use off-line buffers.
Store infrequently used safety stock away from the
production area to decrease congestion and to avoid
continually turning it over.
6. Reserve capacity for important customers.
Streamlined Production
Flow with JIT
Traditional Flow
Customers
Suppliers
Customers
Suppliers
Production Process
(stream of water)
Inventory (stagnant
ponds)
Material
(water in
stream)
2.6 A Balanced System
Balanced system:
Distributing the workload evenly
among work stations
Work assigned to each work station
must be less than or equal to the
cycle time.
Cycle time is set equal to the takt
time.
Takt time is the cycle time needed
to match the pace of production to
customer demand for final product.
Takt time
Total time = 480 minutes
Rest Breaks = 40 minutes
Lunch = 30 minutes

Net time available
= 410 minutes/shift * 2 shifts/day
= 820 minutes per day

Takt time
= (Net time available per day)/( Daily demand)
= (820 minutes per day) /(80 units per day)
= 10.25 minutes per cycle

Traditional: inventory exists in case problems arise
JIT objective: eliminate inventory
JIT requires
Small lot sizes
Low setup time
Containers for fixed number of parts
JIT inventory: Minimum inventory (raw material, WIP and
finished goods) to keep the system running
Specialized bins for holding previously set number of parts

2.7 Inventories
JIT Inventory Tactics
Use a pull system to move
inventory
Develop Just-in-Time delivery
systems with suppliers
Deliver directly to point of use
Perform-to-schedule
Use group technology

Limited Work in Process
Benefits
Lower carrying costs.
Less space.
Increased flexibility.
Aids scheduling.
Saves cost of rework and scrap.
Inventory Hides Problems Just as
Water in a Lake Hides Rocks
Unreliable
supplier
Setup
time
Late
deliveries
Quality
problems
Process
downtime
Setup
time
Late
deliveries
Quality
problems
Process
downtime
Inventory level
Inventory level
nefficient
layout
Bad
design
Machine
breakdown
Bad
design
nefficient
layout
Unreliable
supplier
Machine
breakdown
Scrap
Work in process inventory level
(hides problems)
Unreliable
Vendors
Capacity
Imbalances
Lowering Inventory Reduces Waste
Scrap
Reducing inventory exposes
problems so they can be solved.
Unreliable
Vendors
Capacity
Imbalances
WIP
Lowering Inventory Reduces Waste
Scrap
Reducing inventory reveals
problems so they can be solved.
Unreliable
Vendors
Capacity
Imbalances
WIP
Lowering Inventory Reduces Waste
2.8 Fail-Safe Methods
Japanese call this Poka-yoke. (Shingeo Shingo)

Examples:
An alarm that sounds if the
weight of a packaged item is too low.
Putting assembly components in egg cartoons to ensure that no
parts are left out.
Designing parts that can only be attached in correct position.
In a vehicle, signals that warn:
The key is still in the ignition if the car door is opened
If door is ajar, Seatbelts are not fastened, Fuel level is low
ATM signal if a card is left in a machine.
Detectors at departmental store if a monitoring tag hasnt been
removed
Computer password
Electrical fuses and circuit breakers
3. Personnel/Organizational Elements
1. Workers as assets
2. Cross-trained workers
3. Employee empowerment
4. Continuous improvement
5. Cost accounting
6. Leadership/project management
7. Commitment
Workers as assets
Well trained and motivate workers are the
heart of a JIT system
Workers are given more authority to make
decisions.
Cross-trained workers
Workers are cross trained to perform several
parts of a process and operate a variety of
machines.
This adds system flexibility because workers are
able to help one another when bottlenecks
occur or when a coworker is absent.
It also helps line balancing.
Employee Empowerment
Empowered and cross-trained
employees (to help clear
bottlenecks).
Get employees involved in product &
process (employees know the job
best!).
Few job classifications to ensure
flexibility of employees.
Training support.
Continuous improvement
JIT workers receive extensive training in
statistical process control, quality improvement,
and problem solving.
Continual improvement of the system
Reducing inventories
Reducing setup cost & time
Improving quality
Increasing the output rate
Cutting waste and inefficiency

Cost accounting
Activity based costing
Allocation of overhead to specific jobs based on their
percentage of activities.
First identifies traceable costs
Assigns those costs to various types of activities such
as machine set up, inspection, machine hours, direct
labor hours and movement of materials.
Specific jobs are then assigned overhead based on the
percentage of activities they consume.
Leadership/project management
Managers are supposed to be leaders and
facilitators not order givers.
Support of management, employees and
suppliers
Any improvement must be made in
accordance with the scientific method,
under the quidance of a teacher, at the
lowest possible level in the organization
(Toyota Production Systems work rule)
4. Manufacturing Planning and Control
Level loading (level schedules)
Pull systems
Visual systems
Limited work-in-process (WIP)
Closed vendor relationship
Reduced Transaction processing
Preventive maintenance & housekeeping

- Reduce ripple effect of small variations in schedules
(e.g., final assembly)
- Production quantities evenly distributed over time
(e.g., 7/day)
- Build same mix of products every day
- Results in many small lots
- Item Monthly Quantity Daily Quantity
A 40 2

B 60 3
4.1 Level Schedules
Mixed-Model Sequencing
Model Daily Quantity Units per cycle
A 10 10/5 = 2
B 15 15/5 = 3
C 5 5/5 = 1
Three issues that need to be resolved
1. Which sequence to use?
2. How many times the sequence should be repeated daily?
3. How many units of each model to produce in each cycle?
Mixed-Model Sequencing
Model Daily Quantity Units per cycle
A 7 10/5 = 1.4
B 16 15/5 = 3.2
C 5 5/5 = 1
Cycle 1 2 3 4 5
Pattern A B(3) C A(2) B(3) C A B(4) C A B(3) C A B(3) C
Extra units A B A
Cycle 1 2 3 4 5
Pattern A(2) B(3) C A B(3) C A(2) B(4) C A B(3) C A(2) B(3) C
Extra units A AB A
A = 8, B = 16, C = 5
Mixed-Model Sequencing
4.2 Pull/Push Systems
Pull system:
System for moving work where a workstation pulls output
from the preceding station just as it is needed. (e.g.
Kanban)
Push system:
System for moving work where output is pushed to the
next station as it is completed.

Push System
Every worker maximizes own output, making as many
products as possible
Pros and cons:
Focuses on keeping individual operators and workstations
busy rather than efficient use of materials.
Volumes of defective work may be produced.
Throughput time will increase as work-in-process increases
(Littles Law).
Line bottlenecks and inventories of unfinished products will
occur.
Hard to respond to special orders and order changes due to
long throughput time.
The Pull System
Material is pulled through the system when
needed(JIT).
Reversal of traditional push system where material
is pushed according to a schedule
Forces cooperation
Prevent over and underproduction
4.3 Visual systems
In a pull system work flow is dictated by next-step
demand.
A system can communicate such demand in a variety of
ways, including a shout or a wave.
Most commonly used device is
KANBAN Card
74
Kanban Example
Workcenter B uses parts produced by Workcenter A

How can we control the flow of materials so that B always
has parts and A doesnt overproduce?
Workcenter A Workcenter B
75
When a container is opened by Workcenter B, its kanban card is
removed and sent back to Workcenter A.
This is a signal to Workcenter A to produce another box of parts.
Kanban card: Signal to produce
Workcenter A Workcenter B
Kanban Card
Kanban
Kanban
Kanban
Final
assembly
Work
cell
Kanban
Material/Parts
Supplier
Finished
goods
Customer
order
Kanban
1. User removes a
standard sized
container
2. Signal is seen by the
producing
department as
authorization to
replenish
Part numbers
mark location
Signal marker
on boxes
Kanban Production Control System
Japanese word meaning signal or
visible record may be a card, or
may be a flag, ball etc.
Paperless production control system
Kanban card indicates standard
quantity of production
Used often with fixed sized container
Kanban: Card or other device that communicates demand
for work or materials from the preceding station.
Kanban Production Control System
The kanban cards provide direct control (limit) on the amount of
work-in-process between cells.
Derived from two-bin inventory system
Maintains discipline of pull production
Signifies an authority to pull or produce which comes from a
downstream process
Production kanban authorizes production
Withdrawal kanban authorizes movement of goods
Determination of the Number of Kanbans-formula
(N) Total number of kanbans
=
Demand during lead time + Safety Stock
Size of container
Daily demand = 500 cakes
Production lead time = wait time + material handling time + processing time = 2 days
Safety stock = days
Container size = 250 cakes


(N) Total number of kanbans
=
2 days * 500 cakes/day + 250
250
=
5
Example:
Determination of the Number of Kanbans-Formula
N =
DT(1+X)
C
N = Total number of containers
D = Planned usage rate of using work center
T = Average waiting time for replenishment of parts plus average
production time for a container of parts
X = Policy variable set by management possible inefficiency in the
system
C = Capacity of a standard container
Determination of the Number of Kanbans-Formula
N =
DT(1+X)
C
N = Total number of containers = ?
D = Planned usage rate of using work center = 300 parts per day
T = Average waiting time for replenishment of parts plus average
production time for a container of parts = 0.12 day
X = Policy variable set by management possible inefficiency in the
system = 0.20
C = Capacity of a standard container = 25 parts per container
4.4 Limited Work-In-Progress (WIP)
Littles Law:
WIP = Cycle Time X Arrival Rate
There are two general approaches to controlling
WIP
Kanban, CONWIP
CONWIP: a job exits the system, a new job is
allowed to enter.
4.5 Closed Vendor Relationship
Buyers work with vendors to help them achieve
the desired quality levels.
Suppliers also must be willing and able to ship in
small lots on a regular basis.
Local vendors to shorten the lead time for
deliveries and to reduce lead time variability.
Long term relationship between buyers and
vendors.
Supplier Relationships
Reduced number of vendors.
Supportive supplier relationships.
Quality deliveries on time.
Frequent deliveries in small lot quantities.
Reduced lead times.
Reduced transaction processing.
Certified vendors.
JIT Partnerships
JIT partnerships exist when a supplier and
purchaser work together to remove waste and
drive down costs
Four goals of JIT partnerships are:
Removal of unnecessary activities
Removal of in-plant inventory
Removal of in-transit inventory
Improved quality and reliability
Nearby
Analysis and support to enable desirable suppliers to become
or stay price competitive.
Buyer resists vertical integration and subsequent wipeout of
supplier business.
Suppliers encouraged to extend JIT to their suppliers (2
nd
and
3
rd
tier suppliers)
Characteristics of JIT Partnerships
Traditional Supplier Network
Buyer
Supplier Supplier
Supplier Supplier
Supplier
Supplier
Supplier
Tiered Supplier Network
Supplier
Supplier
Supplier
Supplier Supplier Supplier
Buyer
Supplier
First Tier Supplier
Second Tier Supplier
Third Tier Supplier
JIT Partnerships
4.6 Reduced Transaction Processing
Logistical transactions
Ordering, execution, confirmation of materials
transported from one location to another.
Costs: shipping, receiving personnel, expediting
orders, data entry, data processing.
Balancing transactions
Forecasting, production planning, production
control, procurement scheduling, order processing
Costs: cost of personnel involved in above activities
Reduced transaction processing

Quality transactions
Determining and communicating specifications, monitoring,
recording
Costs: appraisal, prevention, internal failures, external
failures
Change transactions
Ensuing changes generated in specification, bill of materials,
scheduling, processing instructions
Costs: co.st of engineering changes
4.7 Preventive Maintenance
All activities involved in keeping equipment in working order
Maintaining equipment in good condition and replacing parts
that have a tendency to fail before they actually fail
Done to prevent failure
JIT requires
Scheduled & daily PM
Operator involvement in PM
Knows machines
Responsible for product quality

Total Productive Maintenance (TPM)
Breakdown maintenance
Repairs to make failed machine operational
Preventive maintenance
System of periodic inspection & maintenance
to keep machines operating
TPM combines preventive maintenance & total
quality concepts
TPM Requires Management to:
Design products that can be easily produced on existing
machines.
Design machines for easier operation, changeover,
maintenance.
Train & retrain workers to operate machines.
Purchase machines that maximize productive potential.
Design preventive maintenance plan spanning life of machine.
Example 1
The cost of breakdown = Rs.1000
Cost of preventive maintenance = Rs 1250/month

If preventive maintenance is performed, the probability of a machine
breakdown is negligible.

The frequency of breakdown of a machine per month is as shown in the
table
Number of
Breakdowns
Frequency of
occurrence
Expected number
of Breakdowns
without PM
0 0.2 0
1 0.3 0.3
2 0.4 0.8
3 0.1 0.3
Total 1.0 1.4
Expected cost using repair policy is
1.4 breakdowns/month X Rs1000/breakdown = Rs1400/month

Cost of preventive maintenance = Rs 1250/month

Preventive maintenance would yield a saving of Rs.150/month
Example -2
1. Average time before breakdown
1. Normally distributed
2. Mean of 3 weeks
3. Standard deviation of 0.60 week
2. Average breakdown cost = Rs. 1000
3. Preventive maintenance cost = Rs 250
4. What is optimal maintenance interval
67 . 0 z 25 . 0
1000
250
Cost Breakdown
Cost eventive Pr
= = =
Optimal maintenance interval = Mean + z(Standard Deviation)
= 3 0.67*(0.60)
= 2.598
2.6 weeks
4.7 Housekeeping
Good factories develop beginning with the 5Ss.
Bad factories fall apart beginning with the 5 Ss.
- Hirouki Hirano
Japanese Translation English
Seiri Proper arrangement Sort
Seiton Orderliness Straighten
Seiso Cleanliness Sweep
Seiketsu Cleanup Standardize
Shitsuke Discipline Self-Discipline
Maintaining a workplace that is clean and free of unnecessary
materials.
The 5 Ss + 2 Ss
Two additional Ss
Safety build in good safety practices
Support/maintenance reduce variability
and unplanned downtime and cost.
Summary: Just-In-Time Production
Management philosophy
Pull system though the plant
WHAT IT IS


Employee participation
Industrial engineering/basics
Continuing improvement
Total quality control
Small lot sizes
WHAT IT REQUIRES
Attacks waste
Exposes problems and bottlenecks
Achieves streamlined production
WHAT IT DOES
Stable environment
WHAT IT ASSUMES
Comparison of JIT and Traditional Systems
Factor Traditional JIT
Inventory
Much to offset forecast
errors, late deliveries
Minimal necessary to operate
Deliveries
Few, large Many, small
Lot sizes
Large Small
Setup; runs
Few, long runs Many, short runs
Vendors
Long-term relationships
are unusual
Partners
Workers
Necessary to do the
work
Assets
Transitioning to a JIT System
Get top management commitment
Decide which parts need most effort
Obtain support of workers
Start by trying to reduce setup times
Gradually convert operations
Convert suppliers to JIT
Prepare for obstacles
Obstacles to Conversion
Management may not be
committed
Workers/management may
not be cooperative
May be difficult to change
company culture
Suppliers may resist
Why?
Suppliers May Resist JIT
Unwilling to commit resources
Uneasy about long-term commitments
Frequent, small deliveries may be difficult
Burden of quality control shifts to supplier
Frequent engineering changes may result from
continuing JIT improvement by buyer.
Benefits of JIT
1. Reduced inventory
2. Improved quality
3. Lower costs
4. Reduced space
requirements
5. Reduced lead times
6. Increased productivity
7. Greater flexibility
8. Reduced scrap and
rework


8. Better relations with
suppliers
9. Simplified scheduling and
control activities
10. Increased capacity
11. Increased equipment
utilization
12. Better use of human
resources
13. More product variety
14. Reduced need for
indirect labor
Lean Operations in Services
The JIT techniques used in
manufacturing are used in services
Suppliers
Layouts
Inventory
Scheduling
JIT in Services
The basic goal of the demand flow technology in
the service organization is
to provide optimum response to the customer
with the highest quality service and lowest possible
cost.



JIT in Services

All the techniques used in manufacturing are used in services
Level the facility load & eliminate disruptions and unnecessary
activities
Reorganize physical configuration
Introduce demand-pull scheduling
Develop supplier networks
Minimize WIP
JIT in Services
All the techniques used in manufacturing are used in services
Eliminate disruptions
Make the system flexible
Reduce setup and lead times
Eliminate waste
Minimize the work in progress
Simplify the process
Organize problem solving groups
Upgrade quality

Big vs. Little JIT
Big JIT broad focus
Vendor relations
Human relations
Technology management
Materials and inventory
management
Little JIT narrow focus
Scheduling materials
Scheduling services for
production

JIT and Competitive Advantage
JIT and Competitive Advantage
A supplier representative works right in the
companys plant, making sure there is an
appropriate supply on hand.
Often referred to as vendor-managed inventory
(VMI)
Popularized by Bose corporation
JIT II
ASSIGNMENT
Based on three Supporting Goals and four
Building Blocks of JIT, write about
implementation of JIT and Lean System in
your organization.
Minimum 4 pages
Problem 1,2,3 Page 719 William J. Stevenson
Problem 15.10 Page 627 Jay Heizer, Barry Render,
Jagadish Rajasekhar, 9
th
Edition
Thank You