Operations management, 9e by krajewski itzman malhotra chapter 08

Number of Containers Two determinations  Number of units to be held by each container  Determines lot size... Number of Containers Formula for the number of containers k = Average de

Lean Systems

 Lean systems affect a firm’s internal linkages

between its core and supporting processes and its external linkages with its customers and suppliers.

 One of the most popular systems that incorporate the generic elements of lean systems is the just- in-time (JIT) system.

 The Japanese term for this approach is Kaizen

The key to kaizen is the understanding that excess capacity or inventory hides process problems.

 The goal is to eliminate the eight types of waste.

Processing Using expensive high precision equipment when simpler machines would suffice

3 Waiting Wasteful time incurred when product is not being moved or

processed

4 Transportation Excessive movement and material handling of product between

processes.

5 Motion Unnecessary effort related to the ergonomics of bending,

stretching, reaching, lifting, and walking.

1 Inventory Excess inventory hides problems on the shop floor, consumes

space, increases lead times, and inhibits communication.

1 Defects Quality defects result in rework and scrap, and add wasteful

costs to the system in the form of lost capacity, rescheduling effort, increased inspection, and loss of customer good will.

1 Underutilization of

Employees Failure of the firm to learn from and capitalize on its employees’ knowledge and creativity impedes long term efforts to eliminate

waste.

Continuous Improvement

Figure 8.1 – Continuous Improvement with Lean Systems

Supply Chain Considerations

 Close supplier ties

 Low levels of capacity slack or inventory

 Look for ways to improve efficiency and reduce inventories throughout the supply chain

 JIT II

 In-plant representative

 Benefits to both buyers and suppliers

 Small lot sizes

 Reduces the average level of inventory

 Pass through system faster

 Uniform workload and prevents overproduction

 Increases setup frequency

Five S Method

TABLE 8.2 | 5S DEFINED

5S Term 5S Defined

1 Sort Separate needed from unneeded items (including tools, parts,

materials, and paperwork), and discard the unneeded.

2 Straighten Neatly arrange what is left, with a place for everything and everything

in its place Organize the work area so that it is easy to find what is needed.

3 Shine Clean and wash the work area and make it shine.

4 Standardize Establish schedules and methods of performing the cleaning and

sorting Formalize the cleanliness that results from regularly doing the first three S practices so that perpetual cleanliness and a state of readiness are maintained.

5 Sustain Create discipline to perform the first four S practices, whereby

everyone understands, obeys, and practices the rules when in the plant Implement mechanisms to sustain the gains by involving people and recognizing them via a performance measurement system.

Designing Lean System Layouts

 Line flows recommended

Group Technology

Figure 8.2 – One-Worker, Multiple-Machines (OWMM) Cell

L L

L L

L L L

(a) Jumbled flows in a job shop without GT cells

Figure 8.3 – Process Flows Before and After the Use of GT Cells

Group Technology

(b) Line flows in a job shop with three GT cells

Cell 3

L M G G Cell 1 Cell 2

Assembly area

The Kanban System

The Kanban System

Storage area

The Kanban System

Storage area

The Kanban System

Storage area

The Kanban System

Storage area

The Kanban System

Storage area

The Kanban System

Storage area

The Kanban System

fabrication (pull system)

kanban

number of parts

authorization

Number of Containers

 Two determinations

 Number of units to be held by each container

 Determines lot size

Number of Containers

WIP = (average demand rate)

 (average time a container spends in the manufacturing process) + safety stock

d = expected daily demand for the part

w = average waiting time

p = average processing time

c = number of units in each container

α = policy variable

Number of Containers

 Formula for the number of containers

k = Average demand during lead time + Safety stock Number of units per container

WIP = (average demand rate)(average time a container

spends in the manufacturing process) + safety stock

Determining the Appropriate

 Daily demand for the part is 2,000 units

 Safety stock equivalent of 10 percent of inventory

a If each container contains 22 parts, how many containers

should be authorized?

b Suppose that a proposal to revise the plant layout would

cut materials handling and waiting time per container to 0.06 day How many containers would be needed?

Determining the Appropriate

Number of Containers

SOLUTION a.

containers drops to 8.

Figure 8.5 – OM Explorer Solver for

Number of Containers

Application 8.1

Item B52R has an average daily demand of 1000 units The

average waiting time per container of parts (which holds 100

units) is 0.5 day The processing time per container is 0.1 day If the policy variable is set at 10 percent, how many containers

are required?

k = d (w + p )(1 + α) c

= 6.6, or 7 containers

= 1,000(0.05 + 0.01)(1 + 0.1) 100

Other Kanban Signals

 Cards are not the only way to signal need

 Container system

 Containerless system

Value Stream Mapping (VSM)

 Value stream mapping

is a qualitative lean tool for eliminating waste

 Creates a visual “map”

of every process involved in the flow of materials and

information in a product’s value chain

Work plan and implementation

Work plan and implementation

Future state drawing

Future state drawing

Current state drawing

Current state drawing

Product family

Figure 8.6 – Value Stream Mapping Steps

Value Stream Mapping

Figure 8.7 – Selected Set of Value Stream Mapping Icons

Value Stream Mapping

Figure 8.8 – A Representative Current State Map for a Family of

House of Toyota

 A key challenge is to bring underlying

philosophy of lean to employees in an easy-to-understand fashion

 The house conveys stability

 The roof represents the primary goals of

high quality, low cost, waste elimination, and short lead-times

 The twin pillars, which supports the roof,

represents JIT and jidoka

House of Toyota

Highest quality, lowest cost, shortest lead time by eliminating wasted time and activity

Just in Time (JIT)

 Takt time

 One-piece flow

 Pull system

Culture of Continuous Improvement

Jidoka

 Manual or automatic line stop

 Separate operator and machine activities

 Error-proofing

 Visual control

Operational Stability

Figure 8.9 – House of Toyota

Operational Benefits and

Implementation Issues

 Organizational considerations

 Human costs of lean systems

 Cooperation and trust

 Reward systems and labor classifications

Solved Problem

A company using a kanban system has an inefficient machine group For example, the daily demand for part L105A is 3,000

units The average waiting time for a container of parts is 0.8

day The processing time for a container of L105A is 0.2 day,

and a container holds 270 units Currently, 20 containers are

used for this item.

a What is the value of the policy variable, α?

b What is the total planned inventory (work-in-process and

finished goods) for item L105A?

c Suppose that the policy variable, α, was 0 How many

containers would be needed now? What is the effect of the policy variable in this example?

Solved Problem

b With 20 containers in the system and each container holding

270 units, the total planned inventory is 20(270) = 5,400 units

The policy variable adjusts the number of containers In this

case, the difference is quite dramatic because w + p is fairly

large and the number of units per container is small relative to daily demand.