Lean Manufacturing (JIT)

Lean Manufacturing (Just-in-time system)
Just-in-time (JIT) is a production and inventory control system in which materials are purchased
and units are produced only as needed to meet actual customer demand. It is a part of Lean thinking
model, a five-step management approach that organizes resources around the flow of business processes
and that pulls units through these processes in response to customer orders.
In a JIT system, parts are delivered from suppliers just in time and in just the correct quantity to fi
ll customer orders. There are no parts stockpiles. If a defective part is received from a supplier, the part
cannot be used and the order for the ultimate customer cannot be fi lled on time. Hence, every part
received from a supplier must be free of defects. Consequently, companies that use JIT often require that
their suppliers use sophisticated quality control programs such as statistical process control and that their
suppliers certify that they will deliver parts and materials that are free of defects.
Reducing Inventory
Lean manufacturing views inventory as wasteful and unnecessary, and thus emphasizes
reducing or eliminating inventory. Under traditional manufacturing, inventory often hides
underlying production problems. For example, if machine breakdowns occur, work in process
inventories can be used to keep production running in other departments while the machines are
being repaired. Likewise, inventories can be used to hide problems caused by a shortage of trained
employees, unreliable suppliers, or poor product quality.
In contrast, lean manufacturing solves and removes production problems. In this way, raw
materials, work in process, and inished goods inventories are reduced or eliminated.
Reducing Lead Times
Lead time, sometimes called throughput time, measures the time interval between when a
product enters production (started) and when it is completed ( inished). That is, lead time
measures how long it takes to manufacture a product. To illustrate, if a product enters production
at 1:00 p.m. and is completed at 5:00 p.m., the lead time is four hours.
The lead time can be classi ied as one of the following:

1. Value-added lead time, which is the time spent in converting raw materials into a inished
unit of product
2. Non-value-added lead time, which is the time spent while the unit of product is waiting to
enter the next production process or is moved from one process to another.
Below is an illustration of value-added and non-value-added lead time. The time spent drilling
and packing the unit of product is value-added time. The time spent waiting to enter the next
process or the time spent moving the unit of product from one process to another is non-value
added time.
A low value-added ratio indicates a poor manufacturing process. A good manufacturing

process will reduce non-value-added lead time to a minimum and thus have a high value-added
ratio. Lean manufacturing reduces or eliminates non-value-added time. In contrast, traditional
manufacturing processes may have a value-added ratio as small as 5%.
Reducing Setup Time

A setup is the effort spent preparing an operation or process for production. A batch size is the
amount of production in units of product that is produced after a setup. If setups are long and
costly, the batch size for the related production run is normally large. Large batch sizes allow setup
costs to be spread over more units and, thus, reduce the cost per unit. However, large batch sizes
increase inventory and lead time.
To help understand the relationship of batch sizes to lead time, consider a group of 10
friends purchasing a ticket at a single-window ticket counter. The friends are traveling together, so
they are like a “batch” of production. If each friend takes 1 minute to purchase a ticket, the other
nine friends are either waiting in line, or waiting for the remaining friends to inish. Thus, it takes
10 minutes for all of the friends to receive tickets as a group, but it took only 1 minute for any one
friend to actually buy a ticket.
Emphasizing Product-Oriented Layout

Manufacturing processes can be organized around a product, which is called a product-
oriented layout (or product cells). Alternatively, manufacturing processes can be organized around
a process, which is called a process-oriented layout. Lean manufacturing normally organizes
manufacturing around products rather than processes. Organizing work around products reduces:
1. Moving materials and products between processes
2. Work in process inventory
3. Lead time
4. Production costs
In addition, a product-oriented layout improves coordination among the various work
activities,
or operations, of the facility.
Emphasizing Employee Involvement

Traditional manufacturing often values direct labor employees only for their manual labor,
whereas lean manufacturing values labor for contributions beyond labor tasks, using employee
involvement. Employee involvement is a management approach that grants employees the
responsibility and authority to make decisions about operations. Employee involvement is often
applied in lean manufacturing by organizing employees into product cells. Within each product cell,
employees are organized as teams where the employees are cross-trained to perform any operation
within the product cell.
To illustrate, employees learn how to operate several different machines within their
product cell. In addition, team members are trained to perform functions traditionally performed
by centralized service departments. For example, product cell employees may perform their own
equipment maintenance, quality control, housekeeping, and improvement studies.
Emphasizing Pull Manufacturing
Pull manufacturing (or make to order) is an important lean practice. In pull manufacturing,
products are manufactured only as they are needed by the customer. Products can be thought of as
being pulled through the manufacturing process. In other words, the status of the next operation
determines when products are moved or produced. If the next operation is busy, production stops
so that work in process does not pile up in front of the busy operation. When the next operation is
ready, the product is moved to that operation.
A system used in pull manufacturing is kanban, which is Japanese for “cards.” Electronic
cards or containers signal production quantities to be illed by the preceding operation. The cards
link the customer’s order for a product back through each stage of production. In other words,
when a consumer orders a product, a kanban card triggers the manufacture of the product.
In contrast, the traditional approach to manufacturing is based on estimated customer
demand. This principle is called push manufacturing (or make to stock). In push manufacturing,
products are manufactured according to a production schedule that is based upon estimated sales.
The schedule “pushes” product into inventory before customer orders are received. As a result,
push manufacturers normally have more inventory than pull manufacturers.
Emphasizing Zero Defects

Lean manufacturing attempts to eliminate poor quality. Poor quality creates:
▪ Scrap
▪ Rework, which is ixing product made wrong the irst time
▪ Disruption in the production process
▪ Dissatis ied customers
▪ Warranty costs and expenses
One way to improve product quality and manufacturing processes is Six Sigma. Six Sigma
was developed by Motorola Corporation [now Motorola Solutions, Inc. (MSI)] and consists of ive
steps: de ine, measure, analyze, improve, and control (DMAIC). 1 Since its development, Six Sigma
has been adopted by thousands of organizations worldwide.
Emphasizing Supply Chain Management

Supply chain management coordinates and controls the low of materials, services,
information, and inances with suppliers, manufacturers, and customers. Supply chain management
partners with suppliers using long-term agreements. These agreements ensure that products are
delivered with the right quality, at the right cost, at the right time.
To enhance the interchange of information between suppliers and customers, supply chain
management often uses:
1. Electronic data interchange (EDI), which uses computers to electronically communicate
orders, relay information, and make or receive payments from one organization to
another
2. Radio frequency identi ication devices (RFID), which are electronic tags (chips) placed
on or embedded within products that can be read by radio waves that allow instant
monitoring of product location
3. Enterprise resource planning (ERP) systems, which are used to plan and control
internal and supply chain operations.
Classroom Activity
Lead Time Analysis
The Helping Hands Company manufactures designer gloves. Gloves are manufactured in 50-glove batch
sizes, and cut and assembled by the company’s workforce. The cutting time is 4 minutes per glove. The
assembly time is 6 minutes per glove. It takes 12 minutes to move a batch of gloves from cutting to
assembly.
a. For this process, compute (1) the value-added lead time, (2) the non-value-added lead time, and (3) the
total lead time.
b. Compute the value-added ratio. Round to one decimal place.

Lean Manufacturing (JIT)

Uploaded by

Copyright:

Available Formats

Lean Manufacturing (JIT)

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Lean Manufacturing (JIT)

Uploaded by

Copyright:

Available Formats

Lean Manufacturing (Just-in-time system)

The lead time can be classi ied as one of the following:

A low value-added ratio indicates a poor manufacturing process. A good manufacturing

Reducing Setup Time

Emphasizing Product-Oriented Layout

Emphasizing Employee Involvement

Emphasizing Zero Defects

Emphasizing Supply Chain Management

You might also like