Lean Operations (JIT) Module Operations Management: Lean Operations (JIT) Module MBPF House Manufacturing Game The transition to Lean Ops The Paradigm of Lean Operations: The ideal Methods for synchronization & waste reduction Increasing visibility for continuous improvement Approaching the ideal with Product Variety: TPS Managing variety & flexibiltiy Toyota Production System (TPS) S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

MBPF Inc. Factory Layout Production Control Roof Punch Base Punch Roof Form Base Form Notes: Base Weld Final Assembly S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Paradigm of Lean Operations: The Ideal Process Synchronization of all flows 1 x 1 production on demand defect free At lowest possible cost Waste = Gap between ideal and actual How do we set up a system to continually reduce waste ? S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Toyota’s waste elimination in Operations 1. Overproduction 2. Waiting 3. Inessential handling 4. Non-value adding processing 5. Inventory in excess of immediate needs 6. Inessential motion 7. Correction necessitated by defects S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Synchronize: Cut Batch Sizes Example Process: A B 1 min/job C 1 min/job D 1 min/job 1 min/job Batch Mfg (Lotsize = 5) Flow Mfg (Lotsize = 1) 5 Space 1 Space 1 2 3 4 5 1 2 3 4 5 1 1 1 1 5 A B C D A B C D 5 10 10 Time 5 15 15 5 20 20 S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Synchronization with demand: customer demand pulls product Supplier inputs outputs Process Customer PUSH: Inputs availability triggers execution PULL: Outputs need triggers execution S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Implementation: Kanban Production Control Systems Processing center i Processing center i + 1 WIP Job S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Reducing Waste: Quality at the Source S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Reducing Waste: Quality at the Source Fool-proof/Fail-safe design (Poka-Yoke) Inspection Self Automated (Jidoka) Line-stopping empowerment (Andon) Human infrastructure S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Reducing Waste: Flexible Resources Cross training of workforce Use of IT in services S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Reducing Waste: From Functional Layout to Cells Production Control FA Base Cut Roof Assy P r o d u c t i n C l R f B a s e F A y Q Production Control FA Base Cut Roof Assy Production Control FA Base Cut Roof Assy S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Synchronize: Just-In-Time operations JIT = have exactly what is needed, in the quantity it is needed, when it is needed, where it is needed. Reduce transfer batches Pull rather than push work Quality at source Flexible resources Set up cells S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

THE DICE GAME Play The Game INPUT Buffer OUTPUT Buffer Unfair Dice which rolls into either 3 or 4 6 Face Fair Dice Average Capacity of Each Step = Average Capacity of Each Stage = Average Process Capacity = Average Capacity of The Process = Play The Game S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

The impact of inventory and variability: Output of Match Game 135 145 155 165 175 185 195 5 10 15 20 25 Starting Inventory in each Buffer Output after 50 Runs Series1 Series2 Series3 Series4 Series5 Average 2-face die (s=0.7) 6-face die (s=1.9) S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Reducing waste: Increase Problem Visibility Reducing waste: Increase Problem Visibility Lower the Water to Expose the Rocks Scrap & Rework Missed Due Dates Too Much Space Late Deliveries Poor Quality Machine Downtime Engineering Change Orders Long queues Too much paperwork 100% inspection Inventory S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Lean Operations: Causal Link Diagram Source: Lieberman and Demeester S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Time plays the role of Inventory in Lean Service Operations S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Continuous Improvement: Kaizen Increase visibility of waste Targeted improvements Active worker involvement Time for experimentation Supplier involvement Exploratory stress Human infrastructure S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Learning Objectives Basic Lean Operations Paradigm of Lean Operations: Strive for the ideal by eliminating waste Synchronize Reduced batch sizes Pull production control systems (vs. push): Kanban Quality at source Layout: Cellular operations Improve Increase problem visibility (river analogy) S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

How to run Lean Operations: Managing Variety Monthly Production Requirement: How should production be scheduled for the month? S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Synchronize: Heijunka Mixed Level/Balanced Production Batch Production Schedule Mixed Production Schedule (AAAABBBB..) (ABAB...) Product Apr/12.................15...........................30 Apr/12....................15.......................30 A B time FGI time FGI S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Reducing Waste: Reduced Setup Times What happens if we have long setup/changeover times? How to synchronize production with variety (discuss Midwest Molding)? S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Reducing Waste: Mixed-Load Pickup and Delivery Part A Plant Individual Pickup Assembly Line Part B Plant Part C Plant Part A Plant Mixed-Load Pickup Assembly Line Part B Plant Part C Plant S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops

Lean Operations: Best Implementation is TPS TPS is a production management system that aims for the “ideal” through continuous improvement Includes, but goes way beyond JIT. Pillars: Synchronization Quality at Source Continuous Improvement (Kaizen): through visibility & empowerment S. Chopra/Operations/Lean Ops .... S. Chopra/Operations/Lean Ops

Learning Objectives: Lean Operations for Variety Lean Operations: In Search for the Holy Grail and zero Waste Level Mixed Production: Heijunka Reduced batch sizes Pull Execution: Kanbans Quality at source: Jidoka Efficient Workflow: Cellular Layout Continuous Improvement: Kaizen Flow Synchronization Low Cost Get ever closer to ideal S. Chopra/Operations/Lean Ops S. Chopra/Operations/Lean Ops