CH16-JITLeanProduction lean manufacturing.ppt

lean production

1. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-1
Operations Operations
ManagementManagement
Just-in-Time and Lean Production Just-in-Time and Lean Production
SystemsSystems
Chapter 16Chapter 16

2. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-2
OutlineOutline
JUST-IN-TIME AND LEAN PRODUCTION
GLOBAL COMPANY PROFILE: GREEN GEAR
CYCLING
SUPPLIERS
Goals of JIT Partnerships
Concerns of Suppliers
JIT LAYOUT
Distance Reduction
Increased Flexibility
Impact on Employees
Reduced Space and Inventory

3. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-3
Outline - ContinuedOutline - Continued
INVENTORY
Reduce Variability
Reduce Inventory
Reduce Lot Sizes
Reduce Setup Costs
SCHEDULING
Level Schedules
Kanban
QUALITY
EMPLOYEE EMPOWERMENT
LEAN PRODUCTION
JIT IN SERVICES

4. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-4
Learning ObjectivesLearning Objectives
When you complete this supplement, you should
be able to :
Identify or Define:
Types of waste
Variability
Kanban
Describe or Explain:
Just-in-Time (JIT) philosophy
Pull systems
Push systems
The goals of JIT partnerships
Lean Production

5. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-5
Waste is ‘anything other than the
minimum amount of equipment,
materials, parts, space, and
worker’s time, which are absolutely
essential to add value to the
product.’
— Shoichiro Toyoda
President, Toyota
© 1995 Corel Corp.
Introductory QuotationIntroductory Quotation

6. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-6
Green Gear CyclingGreen Gear Cycling
Designs and manufacturers high performance
travel bicycles (bike-in-a-suitcase!)
Strategy is mass customization with low inventory,
work cells, and elimination of machine setups.
Major focus on JIT and supply-chain
management.
Two lines with seven work cells
One day throughput time
Focus on quality

7. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-7
Supplier – Production – Distribution Supplier – Production – Distribution
SystemSystem
Supplier Distribution
Inventories
Raw material
in-transit
Sub-assembly
parts in-transit
Maintenance,
repair, and ordering
supplies in-transit
Raw Material
Inventory
Work-in-process
Inventory
Factory
Finished
Goods
Inventory
Component
Inventory
MRO
Inventory
Purchasing
Production and
Inventory Control
Shipping and
Traffic
Retailer
Inventory
Orders
Warehouse
Inventory
Productions Inventories
Customer
Distribution
Inventories
Orders

8. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-8
Management philosophy of continuous and forced
problem solving
Supplies and components are ‘pulled’ through
system to arrive where they are needed when they
are needed.
What is Just-in-Time?What is Just-in-Time?

9. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-9
Lean ProductionLean Production
Lean Production supplies customers with exactly
what the customer wants, when the customer
wants, without waste, through continuous
improvement.

10. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-10
Attacks waste
Anything not adding value to the product
From the customer’s perspective
Exposes problems and bottlenecks caused by
variability
Deviation from optimum
Achieves streamlined production
By reducing inventory
What Does Just-in-Time Do?What Does Just-in-Time Do?

11. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-11
Overproduction
Waiting
Transportation
Inefficient processing
Inventory
Unnecessary motion
Product defects
© 1995
Corel
Corp.
Types of WasteTypes of Waste

12. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-12
Waste Reduction (%)
82%
50%
50%
30%
30%
20%
40%
0% 20% 40% 60% 80% 100%
Work-in-Process
Inventory
Raw Material
Inventory
Lead Time
Space
Finished Goods
Inventory
Scrap
Setup Time
JIT Reduced WasteJIT Reduced Waste
at Hewlett-Packardat Hewlett-Packard

13. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-13
Variability Occurs BecauseVariability Occurs Because
Employees, machines, and suppliers produce
units that do not conform to standards, are late, or
are not the proper quantity
Engineering drawings or specifications are
inaccurate
Production personnel try to produce before
drawings or specifications are complete
Customer demands are unknown

14. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-14
Push versus PullPush versus Pull
Push system: material is pushed into
downstream workstations regardless of whether
resources are available
Pull system: material is pulled to a workstation
just as it is needed

15. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-15
Suppliers
reduced number of vendors
supportive supplier relationships
quality deliveries on time
 Layout
work-cell layouts with testing at each step of the process
group technology
movable, changeable, flexible machinery
high level of workplace organization and neatness
reduced space for inventory
delivery direct to work areas
JIT Contribution to Competitive JIT Contribution to Competitive
AdvantageAdvantage

16. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-16
Inventory
small lot sizes
low setup times
specialized bins for holding set number of parts
Scheduling
zero deviation from schedules
level schedules
suppliers informed of schedules
Kanban techniques
JIT Contribution to Competitive JIT Contribution to Competitive
Advantage - ContinuedAdvantage - Continued

17. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-17
JIT Contribution to Competitive JIT Contribution to Competitive
Advantage - ContinuedAdvantage - Continued
Preventive Maintenance
scheduled
daily routine
operator involvement
Quality Production
statistical process control
quality by suppliers
quality within firm

18. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-18
JIT Contribution to Competitive JIT Contribution to Competitive
Advantage - ContinuedAdvantage - Continued
Employee Empowerment
empowered and cross-trained employees
few job classifications to ensure flexibility of employees
training support
Commitment
support of management, employees, and suppliers

19. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-19
ResultsResults
Queue and delay reduction, speedier throughput, freed
assets, and winning orders
Quality improvement, reduces waste and wins orders
Cost reduction increases margin or reduces selling
price
Variability reductions in the workplace reduces waste
and wins orders
Rework reduction, reduces waste and wins orders

20. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-20
YieldingYielding
Faster response to the customer at lower cost and
higher quality
A competitive advantage!

21. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-21
Suppliers
Preventive
Maintenance
Layout
Inventory
Scheduling
Quality
Employee
Empowerment
JIT
Just-in-TimeJust-in-Time
Success FactorsSuccess Factors

22. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-22
Incoming material and finished goods involve waste
Buyer and supplier form JIT partnerships
JIT partnerships eliminate
Unnecessary activities
In-plant inventory
In-transit inventory
Poor suppliers
SuppliersSuppliers

23. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-23
Few
Nearby
Repeat business
Analysis and support to enable desirable suppliers to
become or stay price competitive
Competitive bidding mostly limited to new purchases
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 PartnershipsCharacteristics of JIT Partnerships
Suppliers

24. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-24
Characteristics of JIT Partnerships Characteristics of JIT Partnerships
Quantities
Steady output rate
Frequent deliveries in small-lot quantities
Long-term contract agreements
Minimal or no paperwork (use EDI or internet)
Delivery quantities fixed for whole contract term
Little or no permissible overage or underage
Suppliers package in exact quantities
Suppliers reduce their production lot sizes

25. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-25
Minimal product specifications imposed on
suppliers
Help suppliers meet quality requirements
Close relationship between buyers’ and
suppliers quality assurance people
Suppliers use poka-yoke and process control
charts instead of lot-sampling techniques
Characteristics of JIT Partnerships Characteristics of JIT Partnerships
Quality

26. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-26
Characteristics of JIT Partnerships Characteristics of JIT Partnerships
Shipping
Scheduling of inbound freight
Gain control by use of company-owned or
contract shipping and warehousing
Use of Advanced Shipping Notice (ASN)

27. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-27
Goals of JIT partnershipsGoals of JIT partnerships
Elimination of unnecessary activities
Elimination of in-plant inventory
Elimination of in-transit inventory
Elimination of poor suppliers

28. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-28
Diversification
Poor customer scheduling
Frequent engineering changes
Quality assurance
Small lot sizes
Physical proximity
Concerns of SuppliersConcerns of Suppliers

29. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-29
Streamlined ProductionStreamlined Production
Flow with JIT
Traditional Flow
Customers
Suppliers
Customers
Suppliers
Production Process
(stream of water)
Inventory (stagnant
ponds)
Material
(water in
stream)

30. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-30
JIT objective: Reduce movement of people and
material
Movement is waste!
JIT requires
Work cells for product families
Moveable or changeable machines
Short distances
Little space for inventory
Delivery directly to work areas
LayoutLayout

31. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-31
Process Layout Work Cell
Saw
Lathe
Grinder
Heat
Treat
Lathe
Lathe
Lathe Saw
Heat
Treat
Grinder
Grinder
Press
Press
1
1
2
3
45
2
6
Saw
Press
Work Cell versusWork Cell versus
Process Layout Process Layout

32. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-32
Layout TacticsLayout Tactics
Build work cells for families of products
Minimize distance
Design little space for inventory
Improve employee communication
Use poka-yoke devices
Build flexible or movable equipment
Cross train workers to add flexibility

33. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-33
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 to keep system
running
InventoryInventory

34. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-34
JIT Inventory TacticsJIT Inventory Tactics
Use a pull system to move inventory
Reduce lot size
Reduce setup time
Develop Just-in-Time delivery systems with
suppliers
Deliver directly to point of use
Perform-to-schedule
Reduce setup time
Use group technology

35. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-35
Inventory Hides Problems Just as Inventory Hides Problems Just as
Water in a Lake Hides RocksWater in a Lake Hides Rocks
Scrap
Setup
time
Late
deliveries
Quality
problems
Process
downtime
Scrap
Setup
time
Late
deliveries
Quality
problems
Process
downtime
Inventory level
Inventory level

36. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-36
Scrap
Work in process inventory level
(hides problems)
Unreliable
Vendors
Capacity
Imbalances
Lowering InventoryLowering Inventory
Reduces Waste Reduces Waste

37. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-37
Scrap
Reducing inventory reveals
problems so they can be solved.
Unreliable
Vendors
Capacity
Imbalances
WIP
Lowering InventoryLowering Inventory
Reduces Waste Reduces Waste

38. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-38
Scrap
Reducing inventory reveals
problems so they can be solved.
Unreliable
Vendors
Capacity
Imbalances
WIP
Lowering InventoryLowering Inventory
Reduces Waste Reduces Waste

39. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-40
Customer
orders 10
Lot size = 5
Lot 1 Lot 2
Lot size = 2
Lot 1Lot 2Lot 3Lot 4Lot 5
Reducing Lot Sizes Increases the Reducing Lot Sizes Increases the
Number of LotsNumber of Lots

40. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-41
……Which IncreasesWhich Increases
Inventory Costs Inventory Costs
Lot Size
Cost
Holding Cost
Total Cost
Setup Cost
Optimal
Lot Size
Smaller
Lot Size

41. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-42
Unless Setup Costs are ReducedUnless Setup Costs are Reduced
Lot Size
Cost
Holding CostTotal Cost
Setup Cost
Original
optimal
lot size
New optimal
lot size

42. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-43
Frequent Orders can Reduce Frequent Orders can Reduce
Average InventoryAverage Inventory
Time
In
v
e
n
to
r
y
1
0
0
2
0
0
Q
1 When average order size = 200,
average inventory is 100
Q
2
When average order size = 100,
average inventory is 50

43. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-44
Lower Total Cost Requires Small Lower Total Cost Requires Small
Lot Sizes Lot Sizes andand Lower Setup Costs Lower Setup Costs
Lot size
Sum of ordering
and holding cost
T
1
T
2
S
2
S
1
C
o
s
t

44. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-45
Steps to Reduce Setup TimeSteps to Reduce Setup Time
Initial Setup Time
Separate setup into preparation, and actual setup,
doing as much as possible while the machine/process
is running (save 30 minutes)
Move material closer and improve
material handling (save 20 minutes)
Standardize and
improve tooling (save
15 minutes)
90 min
60 min
45 min
25 min
15 min
Use one-touch system to
eliminate adjustments (save
10 minutes)
Training operators and
standardizing work
procedures (save 2
minutes)
Step 1
Step 2
Step 3
Step 5
13 min
Step 4

45. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-46
Involves timing of operations
JIT requires
Communicating schedules to suppliers
Level schedules
Freezing part of schedule nearest due date
Small lots
Kanban techniques
SchedulingScheduling

46. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-47
JIT Scheduling TacticsJIT Scheduling Tactics
Communicate the schedule to suppliers
Make level schedules
Freeze part of the schedule
Perform to schedule
Seek one-piece-make and one-piece-move
Eliminate waste
Produce in small lots
Use kanbans
Make each operation produce a perfect part

47. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-48
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
ItemMonthly QuantityDaily Quantity
A 40 2
B 60 3
Level SchedulesLevel Schedules

48. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-49
A
AABBBC
JIT Small Lots
Large-Lot Approach
Time
Time
AABBBC
AAABBBBBBCC
JIT produces same amount
in same time if setup times
are lowered
Small versus Large LotsSmall versus Large Lots
Small lots also increase flexibility to meet
customer demands

49. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-50
Comparison of Level and Large Comparison of Level and Large
Lot Material-use ApproachesLot Material-use Approaches

50. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-51
Japanese word for card
Pronounced ‘kahn-bahn’ (not ‘can-ban’)
Authorizes production from downstream operations
‘Pulls’ material through plant
May be a card, flag, verbal signal etc.
Used often with fixed-size containers
Add or remove containers to change production rate
KanbanKanban

51. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-52
Diagram of Outbound Stockpoint Diagram of Outbound Stockpoint
with Warning-Signal Markerwith Warning-Signal Marker

52. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-53
Kanban Signals “Pull” Material Kanban Signals “Pull” Material
Through the ProcessThrough the Process

53. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-54
Kanban: Additional PointsKanban: Additional Points
When producer and user are not in visual contact, a card
may be used; otherwise, a light, flag, or empty spot on the
floor may work.
Because a pull station may require several resupply
components, several kanban pull techniques can be used
at the same station.
Usually, each card controls a specific quantity of parts,
although multiple card systems can be used if the
producing cell produces several components or the lot size
is different from the move size.
In an MRP system, the schedule can be thought of as a
“build” authorization and the kanban as a type of “pull”
system that initiates the actual production.

54. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-55
Kanban: Additional Points - Kanban: Additional Points -
ContinuedContinued
The kanban cards provide direct control (limit) on
the amount of work-in-process between cells.
If there is an intermediate storage area, a two-
card system may be used; one card circulates
between user and storage area, and the other
circulates between the storage area and the
producing area.

55. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-56
All activities involved in keeping equipment in
working order
Done to prevent failure
JIT requires
Scheduled & daily PM
Operator performs PM
Knows machines
Responsible for product quality
Preventive Maintenance (PM)Preventive Maintenance (PM)

56. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-57
JIT exposes quality problems by reducing
inventory
JIT limits number defects with small lots
JIT requires TQM
Statistical process control
Worker involvement
Inspect own work
Quality circles
Immediate feedback
QualityQuality

57. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-58
JIT Quality TacticsJIT Quality Tactics
Use statistical process control
Empower employees
Build failsafe methods (poka-yoke, checklists,
etc.)
Provide immediate feedback

58. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-59
Get employees involved in product & process
improvements
Employees know job best!
JIT requires
Empowerment
Cross-training
Training support
Few job classifications
© 1995 Corel Corp.
Employee EmpowermentEmployee Empowerment

59. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-60
JIT in ServicesJIT in Services
All the techniques
used in
manufacturing are
used in services
SuppliersSuppliers
LayoutsLayouts
InventoryInventory
SchedulingScheduling

60. Transparency Masters to accompany Heizer/Render –
Principles of Operations Management, 5e, and Operations
Management, 7e
© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458
16-61
Attributes of Lean Producers - TheyAttributes of Lean Producers - They
use JIT to eliminate virtually all inventory
build systems to help employees product a perfect part
every time
reduce space requirements
develop close relationships with suppliers
educate suppliers
eliminate all but value-added activities
develop the workforce
make jobs more challenging
reduce the number of job classes and build worker flexibility