Lean Systems Defined Just-in-time (JIT): an older name for lean systems Toyota Production System (TPS): another name for lean systems, specifically as implemented at Toyota Lean Systems Approach: a philosophy of minimizing the resources needed for processes What is needed At the time needed In the amount needed 8–2

Lean Systems video http://www.youtube.com/watch?v=c6KVeDbgRgU &feature=related http://www.youtube.com/watch?v=6vmdVR9dzPM &feature=related 8–3

5 Principles of Lean system Precisely specify value of each specific product Identify the value stream for each product Make value flow without interruption Let the customer pull value from the producer Pursue perfection 8–4 4

Principle 1: Specify Value Customers determine value Suppliers must provide products/services with customer desired Outcomes Product features Functionality Capabilities Anything that doesn’t add value is waste 8–5 5

Principle 2: Indentify Value Stream Waste is a symptom of a problem, and does not add value Overproduction: processing more than needed Waiting: resources waiting for work/materials Transportation: units moved unnecessarily Processing: excessive or unnecessary steps Inventory: units waiting for processing or delivery Motion: unnecessary or excessive resource activity Defects: scrap, rework or correction 8–6

Waste in Operations

Waste in Operations (cont.)

Waste in Operations (cont.)

Principle 3 : Make Value Flow w/o interruption Inventory hides problems 8–10

Principle 3 : Make Value Flow w/o interruption 8–11

Principle 3 : Make Value Flow w/o interruption 8–12

Principle 4: Customers Pull Value Pull System: processes are activated by actual, not forecasted demand Push system: Customers get what they want when they want where they want 8–13 13

Real world example of Lean Systems video http://www.youtube.com/watch?v=EEhNkzdKyrw&fea ture=related 8–14

Principle 5: Pursue Perfection Lean System Culture: places a high value on respect for people Acceptance: agree to goals, veterans teach new employees Flexibility: responsive pull systems Teams: cross-functional & cross-organizational Employee empowerment: employees work to attack waste Manage with data: objective over subjective Waste as a symptom: attack root cause Goals are met: set realistic, achievable goals Standardization: reduces variation, simplifies problem solving Process focus: process change for outcome change 8–15 15

Lean Tools and Techniques Total Productive Maintenance (TPM): prevention of breakdowns Group Technology: bring together resources to process a family of items Focused Factories: processes designed to satisfy specific customer segment 8–16 16

Lean Tools and Techniques Takt Time: synchronizing output rate with demand rate Level, Mixed Model : Apportions batches of each product to be produced evenly throughout the day 8–17 17

Lean Tools and Techniques Kanban (Pull): output generated in response to actual demand, production kanban, withdrawal kanban 8–18 18

Lean Tools and Techniques cont’d Set-up Reduction: shorter, easier change- over leads to smaller batches Single Minute Exchange of Dies (SMED): Process for reducing set-up SMED(single-minute exchange of die) Principles Separate internal setup from external setup Convert internal setup to external setup Streamline all activities in a setup Internal setup Can be performed only when a process is stopped External setup Can be performed in advance 8–19 19

Lean Tools and Techniques cont’d Statistical Process Control (SPC): use of statistical tools to monitor processes Visual Control: performance and problems easily, immediately visible Bulletin boards SPC charts Large electronic displays Lighting systems 8–20 20

Lean Tools and Techniques cont’d Quality at the source : Eliminating defects at their origination points Jidoka Stop-and Fix System Andons Kaizen Events: short-term, cross-functional focused, intense process improvement Gemba Kaizen: go see it in person 8–21 21

Lean Tools and Techniques cont’d 5-S: effective housekeeping (sort, straighten, scrub, systematize, standardize) Sort: decide which items are needed to accomplish the work, and keep only items. Straighten: organize the workplace so that the needed items can be accessed quickly and easily 3. Scrub: keep the workplace clean and ready for work. Perform equipment maintenance regularly. 4. Systematize: make cleaning and checking routine 5. Standardize: Standardize the previous four steps into one process and continuously improve it. 8–22 22

Real world example of 5-s (LMI inc.) 8–23 23

Real world example of 5-s (LMI inc.) 8–24 24

Lean Tools and Techniques cont’d Poka-Yoke: redesign so mistakes are impossible or immediately detectable Simplification/Standardization: removing non-value add steps, making processes exactly repeatable 8–25 25

Comparison of JIT and Traditional 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

Homework problems in ch 8 Do problems of 2,3,4,10, and 15 on page 256 and 257 8–27 27