BA341 9th Edition Lecture 9 Outline of Last Lecture I Layout Strategies II Fixed Position project Layout III Process oriented Job Shop Layout IV Cellular Layout Work Cell V Repetitive and Product oriented layout VI Continuous Process Layout VII Product Process Matrix Outline of Current Lecture VIII History IX The cost of variety X The lean enterprise XI Lean Production XII Process Flow XIII Systems for Managing Flow XIV Process Performance Metrics XV Little s Law Current Lecture Principles of Lean Operations Starting with some history In 1955 Japan produced less than 70 000 vehicles U S made 9 2 million that year In 1980 Japan s production exceeded 11 millions while U S achieved just over 8 million These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute The development of the lean JIT manufacturing techniques had an important role in Japan s development The Toyota Production System TPS was inspired by Henry Ford s assembly line Henry Ford s system created flow from ore to final product o One company o One location o One product o Long life cycles o Unlimited demand Ford did not use forecasting and only had one model In the 1920 s General Motors replace Ford as the worlds largest automobile manufacturer by giving the customer a choice Different product lines Chevrolet Pontiac Oldsmobile Buick and Cadillac Different colors body styles and options Yearly model changes GM was able to accommodate this variety The cost of variety Think of how General Motor s differed from Ford in terms of o Scheduling o Factory Layout o Organization o Accounting Batch production sacrifices flow For example an aluminum cola can from ore to customer o passes through eight firms fourteen storage points o is picked up and put down 30 times o 24 of raw material is scrapped somewhere along the way o requires 319 days to do 3 hours of work Next step in history The Lean Enterprise Taiichi Ohno the father of TPS and lean production principles combined Ford s assembly line idea and supermarket operations The goal is to eliminate waste and to produce only what s needed on any given day rather than in anticipation of demand o Produce the right part in the right place at the right time in other words Just in Time JIT Lean Production is A set of integrated activities designed to o Achieve high volume production while o Minimizing waste in the production process e g Reduce inventories of raw materials WIP and finished products overproduction Reduce defects and rework due to poor quality Reduce waiting due to resource or part unavailability Reduce unnecessary transportation and motion when working on a unit only do the needed movement no more Reduce overprocessing work that doesn t add value Process Flow Represents the logical sequence of steps transform inputs into outputs needed to deliver the product service to the customer It may include the passing of information or materials from one step to the next Triangles are the waiting line squares are the steps in production arrows is the moving unit Systems for Managing Flow Make to Stock Push output is pushed to the next station as it is completed based on Demand Forecast Make to Order Pull a workstation pulls output from the preceding station as needed based on Demand fixed inventory Drum Buffer Rope DBR in the Book the Goal the boy scout hike went to the beat of the drum TOC s approach to controlling flow o Drum represents the system bottleneck gives the beat for the whole system o Buffer a protection for the drum measured in time all resources that feed the bottleneck must be given enough time to overcome any delays o Rope release materials only when needed Prevents early release of materials Prevents accumulation of WIP Process Performance Metrics Throughput Time THt or Turn Around Time TAT or Lead Time or Cycle Time o Total time required to complete one unit of a product or service The longer an article is in the process of manufacture and the more it is moved about the greater its ultimate cost Henry Ford 1926 Shorter THt Less Cost More Profit What Is considered WIP Work in Process Items Parts in process Items Parts waiting to be processed Little s Law WIP THt x THr where o WIP represents amount of work in process o THt is the throughput time i e time in system o THr is the throughput rate Defines the output rate that a process is expected to produce over a period of time units time Represents a measure of process capacity Equals the inverse of the process time of a station