Just-In-Time Systems

History and Philosophy of Just- In-Time A philosophy that seeks to eliminate all types of waste, including carrying excessive levels of inventory and long lead times. A philosophy that seeks to eliminate all types of waste, including carrying excessive levels of inventory and long lead times. Takes its name from the idea of replenishing material buffers just when they are needed and not before or after. Takes its name from the idea of replenishing material buffers just when they are needed and not before or after. Developed by Toyota Motor Company in mid-1970s Developed by Toyota Motor Company in mid-1970s Best applied to a production system, such as automobile assembly, that would be considered repetitive, such as a flow shop. Best applied to a production system, such as automobile assembly, that would be considered repetitive, such as a flow shop.

History and Philosophy of Just-In- Time Three Tenets Three Tenets minimize waste in all forms: avoid waste of materials, space, and labor. They pay significant attention to identifying and correcting problems that could potentially lead to such waste. Operation and procedures are constantly being improved and fine-tuned to increase productivity and yield, further eliminating waste (Overproduction, waiting time, unnecessary transportation, processing waste, inefficient work methods, product defects, waste of motion). minimize waste in all forms: avoid waste of materials, space, and labor. They pay significant attention to identifying and correcting problems that could potentially lead to such waste. Operation and procedures are constantly being improved and fine-tuned to increase productivity and yield, further eliminating waste (Overproduction, waiting time, unnecessary transportation, processing waste, inefficient work methods, product defects, waste of motion). continually improve processes and systems: JIT is considered not simply a means of converting the transformation system from a sloppy, wasteful form to an efficient, competitive form, but also as producing continuing improvements throughout the system to keep the firm competitive and profitable in the future continually improve processes and systems: JIT is considered not simply a means of converting the transformation system from a sloppy, wasteful form to an efficient, competitive form, but also as producing continuing improvements throughout the system to keep the firm competitive and profitable in the future maintain respect for all workers: equal respect is paid to all workers, and the trappings of status are minimized so that respect among all can be maintained. maintain respect for all workers: equal respect is paid to all workers, and the trappings of status are minimized so that respect among all can be maintained.

Characteristics of Lean Systems: Just-in-Time  Pull method of materials flow  Consistently high quality  Small lot sizes  Uniform workstation loads  Standardized components and work methods  Close supplier ties  Flexible workforce  Line flows  Automated production  Preventive maintenance

JIT Means … Keeping work flows moving Keeping work flows moving Eliminating inventories Eliminating inventories Reducing travel distances Reducing travel distances Eliminating defects and scrap Eliminating defects and scrap Maximizing usage of space Maximizing usage of space

JIT Demand-Pull Logic Customers Sub Fab Vendor Final Assembly Here the customer starts the process, pulling an inventory item from Final Assembly… Then sub- assembly work is pulled forward by that demand… The process continues throughout the entire production process and supply chain

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

Traditional Systems Compared to JIT

Priorities Traditionally Traditionally Accept all customer orders Accept all customer orders Provide a large number of options from which customers may order Provide a large number of options from which customers may order JIT JIT low cost/high quality within limited market low cost/high quality within limited market

Engineering Traditional Traditional design custom outputs design custom outputs JIT JIT design standard outputs design standard outputs incremental improvements incremental improvements design for manufacturability (DFM) design for manufacturability (DFM)

Capacity Traditional Traditional excess capacity designed into system just-in-case problem arises excess capacity designed into system just-in-case problem arises highly utilized highly utilized inflexible inflexible JIT JIT minimize waste of having extra capacity minimize waste of having extra capacity flexible capacity flexible capacity moderately utilized moderately utilized

Transformation System Traditional Traditional job shop job shop materials handling equipment materials handling equipment lots of space to store inventory lots of space to store inventory JIT JIT mostly used in repetitive production situations mostly used in repetitive production situations job shops often converted to cellular manufacturing job shops often converted to cellular manufacturing

Transformation System continued Traditional -long lead times are often thought to allow more time to make decisions and get work performed. Traditional -long lead times are often thought to allow more time to make decisions and get work performed. JIT JIT short lead times mean easier, more accurate forecasting and planning. short lead times mean easier, more accurate forecasting and planning. If lead times are reduced, there is less time for things go awry, to get lost, or to be changed If lead times are reduced, there is less time for things go awry, to get lost, or to be changed “Don’t let the parts touch the floor” (the parts have to be kept on the machines and thus be worked on until completed) “Don’t let the parts touch the floor” (the parts have to be kept on the machines and thus be worked on until completed) Smaller batches result in shorter lead times and less inventory, at the same time. With smaller batches, engineering changes get to the customer sooner, problems with quality are corrected more quickly, rework is reduced, there is less obsolete inventory, and new products get to market more promptly. Smaller batches result in shorter lead times and less inventory, at the same time. With smaller batches, engineering changes get to the customer sooner, problems with quality are corrected more quickly, rework is reduced, there is less obsolete inventory, and new products get to market more promptly.

Transformation System continued JIT JIT Employing Kanban (Toyota’s materials management system) Employing Kanban (Toyota’s materials management system) Pull system: System for moving work where a workstation pulls output from the preceding station as needed (control-based systems that signals the requirement for parts as they are needed in reality). Pull system: System for moving work where a workstation pulls output from the preceding station as needed (control-based systems that signals the requirement for parts as they are needed in reality). Push system: System for moving work where output is pushed to the next station as it is completed (planning-based systems that determine when workstations will probably need parts if everything goes according to plan) Push system: System for moving work where output is pushed to the next station as it is completed (planning-based systems that determine when workstations will probably need parts if everything goes according to plan)

Sequential Production System with Two Machines

Kanban Kanban : Card or other device that communicates demand for work or materials from the preceding station Kanban : Card or other device that communicates demand for work or materials from the preceding station Kanban is the Japanese word meaning “signal” or “visible record” Kanban is the Japanese word meaning “signal” or “visible record” Paperless production control system Paperless production control system The idea behind this system is to authorize materials for production only if there is a need for them. The idea behind this system is to authorize materials for production only if there is a need for them. Through the use of Kanban authorization cards, production is “pulled” through the system, instead of pushed out before it is needed and then stored. Through the use of Kanban authorization cards, production is “pulled” through the system, instead of pushed out before it is needed and then stored.

Kanban Process

Layout Traditional Traditional job shop approach of using widely spread-out equipment with space for stockrooms, tool cribs, and work-in-process inventories between the equipment job shop approach of using widely spread-out equipment with space for stockrooms, tool cribs, and work-in-process inventories between the equipment To handle and move all this inventory, automated or semi automated materials handling equipment (conveyors, forklifts) is required, which takes even more space. To handle and move all this inventory, automated or semi automated materials handling equipment (conveyors, forklifts) is required, which takes even more space. JIT JIT Equipment is moved as close together as possible so that parts can be actually handed from one worker or machine to the next. Equipment is moved as close together as possible so that parts can be actually handed from one worker or machine to the next. Use of cells, and flow lines dictates small lots of parts with minimal work- in-process and material-moving equipment. Use of cells, and flow lines dictates small lots of parts with minimal work- in-process and material-moving equipment. manual transfer manual transfer

Group Technology (Part 1) Using Departmental Specialization for plant layout can cause a lot of unnecessary material movement Using Departmental Specialization for plant layout can cause a lot of unnecessary material movement Saw LathePress Grinder Lathe Saw Press Heat Treat Grinder Note how the flow lines are going back and forth

Group Technology (Part 2) Revising by using Group Technology Cells can reduce movement and improve product flow Revising by using Group Technology Cells can reduce movement and improve product flow Press Lathe Grinder A 2 B Saw Heat Treat LatheSaw Lathe Press Lathe 1

Workforce Traditional Traditional competitive attitude between workers and managers competitive attitude between workers and managers status symbols and privileges status symbols and privileges much of the employees’ time is nonworking time: looking for parts, moving materials, setting up machines, getting instructions, and so on. When actually working, they tend to work fast. much of the employees’ time is nonworking time: looking for parts, moving materials, setting up machines, getting instructions, and so on. When actually working, they tend to work fast. JIT JIT broadly skilled flexible workers who can uncover and solve problems broadly skilled flexible workers who can uncover and solve problems workteams workteams cooperative attitudes cooperative attitudes

Inventories Traditional Traditional used to buffer operations used to buffer operations large WIP buffers large WIP buffers JIT JIT inventory is seen as an evil inventory is seen as an evil small WIP buffers small WIP buffers

Scrap Unreliable suppliers Capacity imbalance Inventory Hides Problems

Lowering Inventory Investment to Expose Problems

Suppliers Traditional Traditional suppliers treated as adversaries suppliers treated as adversaries multiple sourcing multiple sourcing JIT JIT supplier considered part of team supplier considered part of team single-sourcing agreements single-sourcing agreements supplier certification programs supplier certification programs

Planning and Control Traditional Traditional focus is on planning focus is on planning planning complex and computerized planning complex and computerized JIT JIT focus is on control focus is on control procedures kept simple and visual procedures kept simple and visual rather than planning and forecasting for an uncertain future, the firm attempts to respond to what actually happens in real time with flexible, quick operations. rather than planning and forecasting for an uncertain future, the firm attempts to respond to what actually happens in real time with flexible, quick operations.

Quality Traditional Traditional inspect goods at critical points inspect goods at critical points scrap rates tracked scrap rates tracked JIT JIT goal is zero defects goal is zero defects workers themselves inspect parts workers themselves inspect parts

Maintenance Traditional Traditional corrective maintenance, repairing a machine when it breaks down corrective maintenance, repairing a machine when it breaks down done by experts who do nothing but repair broken equipment done by experts who do nothing but repair broken equipment equipment run fast equipment run fast JIT JIT preventive maintenance, conducting maintenance before the machine is expected to fail, or at regular intervals. preventive maintenance, conducting maintenance before the machine is expected to fail, or at regular intervals. done by equipment operators done by equipment operators equipment run slow (minimizes their chance of breakdown while maximizing their output) equipment run slow (minimizes their chance of breakdown while maximizing their output)

Value Stream Mapping A qualitative lean tool for eliminating waste that involves a current state drawing, a future state drawing, and an implementation plan. A qualitative lean tool for eliminating waste that involves a current state drawing, a future state drawing, and an implementation plan.

Typical Benefits of JIT Cost savings: inventory reductions, reduced scrap, fewer defects, fewer changes due to both customers and engineering, less space, decreased labor hours, les rework. Cost savings: inventory reductions, reduced scrap, fewer defects, fewer changes due to both customers and engineering, less space, decreased labor hours, les rework. Revenue increases: better service and quality to the customer. Revenue increases: better service and quality to the customer. Investment savings: less space, reduced inventory, increased the volume of work produced in the same facility. Investment savings: less space, reduced inventory, increased the volume of work produced in the same facility. Workforce improvements: more satisfied, better trained employees. Workforce improvements: more satisfied, better trained employees. Uncovering problems: greater visibility to problems that JIT allows, if management is willing to capitalize on the opportunity to fix these problems. Uncovering problems: greater visibility to problems that JIT allows, if management is willing to capitalize on the opportunity to fix these problems.

Potential Problems Implementing JIT Applicable primarily to repetitive operations Applicable primarily to repetitive operations Requires discipline Requires discipline Based on cooperation and trust Based on cooperation and trust Requires change of philosophy Requires change of philosophy

Interaction of JIT Elements