JIT and LEAN Operation; Chapter6
Department of Business Administration
FALL 2010-2011
Chapter 6: JIT and LEAN OPERATIONS
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JIT and LEAN Operation; Chapter6
Outline: What You Will Learn . . .
 Explain what is meant by the term lean operations
system.
 List each of the goals of JIT and explain its importance.
 List and briefly describe the building blocks of JIT.
 List the benefits of the JIT system.
 Outline the considerations important in converting a
traditional mode of operations to a JIT system.
 List some of the obstacles that might be encountered
when converting to a JIT system.
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JIT and LEAN Operation; Chapter6
JIT vs. Lean
 Over the past couple of years, Just-in-Time (JIT) is a
system and idea that has gradually seen wide
acceptance within the business and manufacturing
community.
 As the competition heats up between companies, and
the pressures from Asian manufacturers’ continuous
cultural improvements take their toll on manufacturers,
many firms are forced to seek more innovative methods
to reduce costs and cope with the competition.
3
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JIT and LEAN Operation; Chapter6
JIT vs. Lean
 The two could also ‘play’ perfectly well together, and there are
many advantages of using both methodologies concurrently.
 The aim of JIT at this point, is to explicitly highlight all the
problems in the process. Lean will focus on eliminating the
problems pertaining to the process (system) in order to increase
production.
 The fundamental component of JIT, is the elimination of waste
while adding value.
 JIT’s role is to explicitly highlight process problems, while Lean
aims at eliminating the problems.
 Lean can be used to achieve JIT, as the two employ almost the
same set of tools, for example, kanban and error proofing.
 Although both methodologies can be used to eliminate waste, JIT
alone cannot achieve this, hence the transformation to Lean.
4
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JIT and LEAN Operation; Chapter6
JIT/Lean Production
 Just-in-time (JIT): The term JIT (a highly coordinated processing




system) is used to refer to an operations system in which goods are
moved through the system, and services are delivered with precise timing
so that they are performed at each step of the process just as they are
needed.
Initially, the term JIT referred to the movement of materials, parts and
semifinished goods within a production system. Over time, the scope of
JIT broadened and the term became associated with lean productions.
JIT is a disciplined approach to improving overall productivity and
eliminating waste. It provides for the cost-effective production and
delivery of only the necessary quantity of parts at the right quality, at the
rigth time and place while using a minimum amount of facilities,
equipment, materials and human resources.
JIT is dependent on the balance between the supplier’s flexibility and the
user’s flexibility. It is accomplished through the application of elements
which require total employee involvement and teamwork.
A key philosophy of JIT is simplification.
5
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JIT and LEAN Operation; Chapter6
JIT/Lean Production
 Lean: A highly coordinated system that uses minimal
resources and procedures high-quality goods or services.
Lean operation depends on having high-quality processes in
place. Quality is an integral part of lean operation, without
high process quality, lean operation cannot exist.
 Lean productions began as lean manufacturing in the mid1990. It was developed by the Japanese automobile
manufacturer-Toyota. The development in Japan was
influenced by the limited resources available at the time.
 Not surprisingly, the Japanese were very sensitive to waste
and inefficiency. Widespread interest in lean manufacturing
occurred after the book about automobile production, The
Machine That Changed the World by Womack, Jones and
Roos was published in 1991.
6
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JIT and LEAN Operation; Chapter6
JIT/Lean Production
 In the famous book, Toyata’s focus was on the
elimination of all waste from every aspect of the
process. Waste was defined as anything that
interfered with or did not add value to the process of
producing automobiles.
 In the mid 1980s GM operated a plant using lean
manufacturing concept and they adopted lean method
succesfully. However GM closed the plant in 1982
because of its low productivity and high absenteeism.
 A few year later the plant was reopened as a joint
venture of Toyota and GM. In 1985, they improved
quality and productivity by negliging absenteeism.
7
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JIT and LEAN Operation; Chapter6
JIT/Lean Production
 As other North American companies attempted to
adopt the lean approach, they began to realize that in
order to be successful, they need to make major
organizational and caltural changes.
 They also recognized that mass production which
emphasizes the efficency of individual operations
and leads to unbalanced system and large inventories,
was outmoded.
 Instead, they discovered that lean methods involve
demand based operations, flexible operations with
rapid changeover capability, effective worker
behaviours, and continous improvement efforts.
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JIT and LEAN Operation; Chapter6
The Toyota Approach
 Many of the methods that are common to lean operations were
developed as part of Japanese car maker Toyota’s approach to
manufacturing. Some of the term used by the company are as
follows:
 Muda: Waste and inefficiency
 Keban: A manual system that signals the need for parts or materials.
This applies both to delivery to the factory as well as delivery to each
workstation.
 Pull system: Replacing materials or parts based on demand, produce
only what is needed.
 Heijunka: variations in production volume lead to waste. The
workload must be leveled-workload leveling.
 Kaizen: Continious improvement of the system.
 Jidoka: Quality at the source and to make workers aware of quality.
 Poka-yoke: Safeguard built into a process to reduce the possibility of
errors.
 Team concept: Use small teams of workers for process improvement.
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JIT and LEAN Operation; Chapter6
JIT Philosophy
 The JIT Philosophy was pioneered by the Japanees engineers
Ohno and Shingo at Toyata Motor company in the mid 1970s as a
response to the world wide oil crisis in the dacade.
 Japan is a small country with minimal resources and large
population as well as the destruction of second world war. They
only use their own human capital.
 This brings the cornerstones of the Toyota Production System.
 Their intention was to develop a process that could economically
produce a wide variety of automobiles in small volumes.
 The Toyota company has also achieved both concepts economies
of scale and economies of scope.
 The company can easily compete on service as well as cost,
quality, dependability, flexibility and time
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JIT and LEAN Operation; Chapter6
Goal of JIT
 The goal of JIT is to produce only the necessary item
in the necessary quantity at the necessary time.
 Achieving such goal can radically increase the
responsiveness of a company to the demands of its
customers and improve its ability to compete on cost,
quality, dependability, flexibility and time
 The ultimate goal of JIT is a balanced system.
 This is one that achieves a smooth, rapid flow of
materials through the system.
 The idea is to make the process time as short as
possible by using resources in the best possible way
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JIT and LEAN Operation; Chapter6
Goal of JIT
 The degree to which the overall goal is achieved
depends on how well certain supporting goals are
achieved. Those are as follows:
 Eliminate disruptions
 Make the system flexible
 Eliminate waste, especially excess inventory
 Reduce setup time and lead time
 Minimize inventory
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JIT and LEAN Operation; Chapter6
Sources of Waste
 On the JIT philosophy, wastes include the following
concepts:
 Overproduction
 Waiting time
 Unnecessary transporting
 Inventory storage
 Scrap
 Inefficient work methods
 Product defects
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JIT and LEAN Operation; Chapter6
The Goals and Building Blocks of Lean System
Ultimate
A
Goal balanced
rapid flow
Supporting
Goals
Eliminate disruptions
Make the system flexible
Product
Design
Process
Design
Eliminate waste
Personnel
Elements
Manufacturing Planning
Building
Blocks
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JIT and LEAN Operation; Chapter6
Kaizen Philosophy









Waste is the enemy
Improvement should be done gradually and continuously
Everyone should be involved
Built on a cheap strategy
Can be applied anywhere
Supported by a visual system
Focuses attention where value is created
Process oriented
Stresses main effort of improvement should come from new
thinking and work style
 The essence of organizational learning is to learn while doing
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JIT and LEAN Operation; Chapter6
Big vs. Little JIT
 Big JIT – broad focus
Vendor relations
Human relations
Technology management
Materials and inventory management
 Little JIT – narrow focus
Scheduling materials
Scheduling services of production
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JIT and LEAN Operation; Chapter6
JIT Building Blocks
 Product design
 Process design
 Personnel/organizational
elements
 Manufacturing
planning and control
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JIT and LEAN Operation; Chapter6
Product Design
 Standard parts
 Workers have fewer parts to deal with and traning times and cost
are reduced
 Modular design
 This greatly reduce the number of parts to deal with, simplifying
assembly, purchasing, handling, training so on.
 Highly capable production systems
 Quality must be embedded in goods and processes, otherwise
poor quality can create major disruptions.
 Concurrent engineering
 Engineering changes can be very disruptive to smooth operation.
Practices can subtantially reduce these disruptions.
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JIT and LEAN Operation; Chapter6
Process Design
 Small lot sizes
 Setup time reduction
 Manufacturing cells
 Limited work in process
 Quality improvement
 Production flexibility
 Balanced system
 Little inventory storage
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JIT and LEAN Operation; Chapter6
Process Design
 Small lot sizes
 Small lot size in both production process and deliveries from
suppliers yield a number of benefits that enable JIT system to
operate effectively. Benefits of Small Lot Sizes are as follows:
Reduces inventory
Less rework
Less storage space
Problems are more apparent
Increases product flexibility
Easier to balance operations
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Process Design
JIT and LEAN Operation; Chapter6
 Setup time reduction
 In JIT system, it is a necessary step to have a smooth proceess and
quality product. Worker are trained to da their own setups.
 Manufacturing cells
 The cell are highly specialized and efficient production center. The
important benefits of this cell are reduced changeover times, highly
utilization of equipment.
 Limited work in process
 Quality improvement
 Production flexibility
 Balanced system
 Distributing the workload evenly among the workstations or achieve a
rapid flow of work through the system. The time needed for work
assigned to each workstations. This also is refered as takt time (it is for
work shift).
 Little inventory storage
MGMT 405, POM, 2010/11. Lec Notes
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JIT and LEAN Operation; Chapter6
Setup time-Example
 A furniture’s production analyst determined that a 2
hour production cycles would be acceptable between
two departments. Further, he concluded that a set-up
time that would accommodate the 2-hour cycles time
should be achieved. Finally, he developed the
following data and procedure to determine optimum
set-up time analytically; annual demand is 400000
units, number of work days/year is 250 days, daily
production rate is 4000 units/day, quantity order is
desired as 400 unit, holding cost is 20 MU, daily
demand is 1600 day per hour, and the cost on hourly
basis of setting up equipment is 30 MU.
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JIT and LEAN Operation; Chapter6
Setup time-Answer
Q
2 DS

H (1  ( d DP))
Q 2 ( H (1  ( d DP))
S 
2D
( 4002 )(20)(1  (1600/ 4000))
S 
2( 400000)
S  2.40MU  2.40 / 30  0.08 hours or 4.8 min s
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JIT and LEAN Operation; Chapter6
Takt time-Example
 Takt time is the cycle time needed to match
customer demand for final product.
 Question: Given the following information: total
time per shift is 480 minutes per day and there are
two shifts per day. There are also two 20 minute
rest breaks and a 30 minutes lunch break per shift.
Daily demand are reported as 80 units.
 Required: compute the takt time.
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JIT and LEAN Operation; Chapter6
Takt time-Answer
 First, let us compute net time available per shift:
-Total time is 480 mins
Rest breaks -40 mins
Lunch
-30 mins
total is 410 mins per shift
 Second, let us compute net time available per day:
- 410 mins per shift x 2 shifts/day=820 mins per day
 Third, let us compute the takt time:
- Takt time= (net time available per day)/Daily demand
= 820/80
= 10.25 minutes per cycle
MGMT 405, POM, 2010/11. Lec Notes
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JIT and LEAN Operation; Chapter6
Single-Minute Exchange
 Shigeo Shingo made a very significant contribution to lean
operation with the development of the system called SMED.
 Single-minute exchange of die (SMED): A system for reducing
changeover time.
 Categorize changeover activities
 Internal – activities that can only be done while machine is stopped
 External – activities that do not require stopping the machine
 A simple approach to achieve quick changeover is to convert as
many internal acctivities as possible to external activities then
streamline the remaining internal activities.
 The principles of the SMED system can be applied to any
changeover operation.
 In 1982 at Toyota the changeover time for machine was reduced
from 100 minutes to 3 minutes.
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JIT and LEAN Operation; Chapter6
Guidelines for increasing Production Flexibility
 Reduce downtime by reducing changeover time
 Use preventive maintenance to reduce
breakdowns
 Cross-train workers to help clear bottlenecks
 Use many small units of capacity
 Use off-line buffers
 Reserve capacity for important customers
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JIT and LEAN Operation; Chapter6
Quality Improvement
 The occurence of quality defects during the process
can distrup the orderly flow of work. It focuses on
finding and eliminating the causes of problems to
make non-stop processes.
 Autonomation
 Automatic detection of defects during production
 Jidoka
 Japanese term for autonomation. It can be used with
machines or manual operation.
The first mechanism is for detecting defects
The second mechanism for stop production to correct the
cause of the defects.
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JIT and LEAN Operation; Chapter6
Personnel/Organizational Elements
 Workers as assets
 Cross-trained workers
 Continuous
improvement
 Cost accounting
 Leadership/project
management
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JIT and LEAN Operation; Chapter6
Personnel/Organizational Elements
 Workers as assets: A fundamental tenet (or principle) of the JIT
philosophy. Well trained and motivated workers are heart of a JIT
system.
 Cross-trained workers
 To perform several parts of process and operate a variety of machines.
This shows system flexibility cause workers are able to help each other
when bottlenecks occur or a coworker absent.
 Continuous improvement
 JIT workers receive extensive training in statistical process control,
quality improvement and problem solving. Compared to workers in
tradational systems, JIT workers have greater responsibility to keep
quality at the best level for the sake of continuous improvement.
 Problem solving is a cornerstone of any JIT system and when occur
during production must be dealt with quickly. Some companies in Japan
use a light system to signal problems and such a system is called
andon.
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JIT and LEAN Operation; Chapter6
Personnel/Organizational Elements
 Cost accounting
 Another feature of some JIT system is the method of
allocating overhead, however tradational methods
sometimes distort overhead allocation because they allocate
it on the basis of direct labor hours
 One alternative method of allocating overhead is activitybased costing which is designed to more closely reflect the
actual amount of overhead consumed by particular job or
activity.
 Leadership/project management
 Another feature of JIT relates to leadership. Managers are
expected to be leaders and facilitiors, not order givers.
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JIT and LEAN Operation; Chapter6
Manufacturing Planning and Control
 Level loading
 Pull systems
 Visual systems
 Close vendor relationships
 Reduced transaction processing
 Preventive maintenance
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JIT and LEAN Operation; Chapter6
Manufacturing Planning and Control
 Level loading: JIT systems place a strong emphasis on
achieving stable level daily schedules. At the end, the master
production schedule is developed to provide level capacity.
 A level of production schedule requires smooth production.
When a company produces different products or product
model, it is desirable to produce in small lots and spread the
production of different product throughout the day to
achieve smooth production.
 While this approach will allow for maximum smoothness, it
will generally not be practical due to excessive setup cost.
 Under these circumtances, mix-model sequencing approach
is advised.
 This begins with daily production requirements of each
product or model.
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JIT and LEAN Operation; Chapter6
Mix model-Example
 Mixed model: Four issues should be taken into account.




Which sequence to use
How many times (i.e., cycle) the sequence should be repeated daily
How many units of each model to produce in each time
Setup time or cost is important in chosing the sequences ABC-AB or AC
or BC
 Question: Suppose a department produces three models in
the following table: A, B and C with the daily requirements;
10,15 and 5.
 Required: Determine a production plan for these three
models using the sequence A-B-C:
MGMT 405, POM, 2010/11. Lec Notes
Model
Daily Quantity
A
7
B
16
C
5
34
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JIT and LEAN Operation; Chapter6
Mix model-Answer
 Mixed model: Four issues
should be taken into account.
 Which sequence to use
 How many times (i.e., cycle) the
sequence should be repeated daily
 How many units of each model to
produce in each time
 Setup time or cost is important in
chosing the sequences ABC-AB or
AC or BC
Units per cycle
Model
Daily Quantity
A
7
7/5=1.4
B
16
16/5=3.2
C
5
5/5=1
Cycle
1
2
3
4
5
Pattern
AB(3)C
A(2)B(3)C
AB(4)C
A(2)B(3)C
AB(3)C
A
B
A
Extra Unit(s)
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JIT and LEAN Operation; Chapter6
Mix model-Answer
 If requirement for model A had been 8 units a day instead
of 7, the manager might decide to use the following
pattern:
Cycle
1
2
3
4
5
Pattern
A(2)B(3)C
AB(3)C
A(2)B(4) C
AB(3)C
A(2)B(3)C
Extra Unit(s)
A
AB
A
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JIT and LEAN Operation; Chapter6
Mix model-Example2





Mixed model: Four issues should be taken into account.
Which sequence to use
How many times (i.e., cycle) the sequence should be repeated daily
How many units of each model to produce in each time
Setup time or cost is important in chosing the sequences ABC-AB or AC
or BC
 Question: Suppose a department produces four models as
can be seen in the following table. The department operates
five days a week.
 Required: Determine the number of per day and the
production quantity per cycle for this set of products.
MGMT 405, POM, 2010/11. Lec Notes
Product
Weekly Quantity
A
20
B
40
C
30
D
15
37
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JIT and LEAN Operation; Chapter6
Mix model-Answer2
Product
Weekly
Quantity
Daily Unit per
cycle
Units Short (3
cycles)
A
20
20/5=4
1
B
40
40/5=8
2
C
30
30/5=6
-
D
15
15/5=3
-
Cycle
1
2
3
Pattern
A B(3) C (2) D
A B(3)C (2) D
A(2)B(2) C(2) D
Extra Unit(s)
B
B
A
 There are several posibilities in producing all four products in the
three cycles. One possible way is dispalyed above.
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JIT and LEAN Operation; Chapter6
Pull/Push Systems
The the terms pull and push are used to describe two
different systems for moving work through a
production process.
 Pull system: System for moving work where a workstation
pulls output from the preceding station as needed. (e.g.
Kanban). When it is needed, the output is pulled by customer
demand or the master schedule.
 Push system: In tradational production environments, this one
is used. When work is finished at a workstation, the output is
pushed to the next station (System for moving work where
output is pushed to the next station as it is completed).
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JIT and LEAN Operation; Chapter6
Kanban Production Control System-Visual system
 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”
 When a worker needs materials work from the proceeding
station, s/he uses a Kanban card.
 Paperless production control system
 Authority to pull, or produce comes from a downstream
process.
 Production Kanban (p-kanban):Signal the needs to produce parts
 Conveyance Kanban (C-kanban):signal the needs to deliver parts
to next work center.
MGMT 405, POM, 2010/11. Lec Notes
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JIT and LEAN Operation; Chapter6
How to use such card-Kanban Formula
N
=
DT(1+X)
C
N = Total number of containers
D = Planned usage rate of using work center
T = Average waiting time for replenishment of parts
plus average production time for a
container of parts
X = Policy variable set by management
- possible inefficiency in the system
C = Capacity of a standard container
41
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Kanban-Example 1
 Question: Usage at a work center is 300 parts per
day and a standard container holds 25 parts. It
takes an average of 0.12 day for a container to
complete a circuit from time a kanban card is
received until the container is returned empty.
 Required: Compute the number of Kanban cards
(containers) needed if X=0.20.
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MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Kanban-Answer 1
N = Total number of containers=?
D = Planned usage rate of using work center=300 parts/day
T = Average waiting time for replenishment of parts
plus average production time for a
container of parts=0.12 day
X = Policy variable set by management
- possible inefficiency in the system=0.20
C = Capacity of a standard container=25 parts/container
N
DT (1  X ) (300 ) (0.12) (1  0.20)

 1.728
C
25
almost two containers
 Rounding up will cause the system to be looser and rounding down will cause the
system to be tighter. Usually rounding up is preferable.
43
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Kanban-Example 2
 Question: Usage at a workstation is 100 parts per
hour and a standard container holds 84 parts. It
takes an average of 90 minutes for a container to
complete a cycle (move, wait, empty, return, fill)
from time a kanban card is received. An
inefficiency factor of 0.10 is being currently used.
 Required: Determine the number of containers
needed if the scenario is abovementioned.
44
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Kanban-Answer 2
N = Total number of containers=?
D = Planned usage rate of using work center=100 parts/day
T = Average waiting time for replenishment of parts
plus average production time for a
container of parts=90mins or 1.5 hours
X = Policy variable set by management
- possible inefficiency in the system=0.10
C = Capacity of a standard container=84 parts/container
N
DT (1  X ) (100 ) (1.5) (1  0.10)

 1.96
C
84
almost two containers
 Rounding up will cause the system to be looser and rounding down will cause the
system to be tighter. Usually rounding up is preferable.
45
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Limited Work in Process-WIP=Cycle x Arrival Rate
 Benefits in controling the amount of work in progress in a
production system
 Lower carrying costs
 Increased flexibility
 Aids scheduling
 Saves cost of rework and scrap
 Two general approaches to conrol WIP
 Kanban – focuses on individual work stations
 Constant work in process (CONWIP) – focuses on the system
as a whole
 Close Vendor relationship
 JIT system typically have close relationship with vendors who are expected to
provide frequent small deliveries of high-quality goods.
MGMT 405, POM, 2010/11. Lec Notes
46
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Reduced Transaction Processing
 Tradational manufacturing system often have many built in
transactions that do not add value. It is also well known as ‘the
hidden factory’
 JIT system cut transaction costs by reducing the number and
frequency of transactions (i.e., production floor-storeroom).
 The transactions can be classified: (bar coding system reduce
transactions and increase accuracy).
1. logistical
2. Balancing
3. Quality
4. Change
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MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Preventive Maintenance and Housekeeping
 Preventative maintenance: Maintaining equipment in good
condition and replacing parts that have a tendency to fail
before they actually fail.
 Housekeeping: Maintaining a workplace that is clean and free
of unnecessary materials.
 Housekeeping Five S’s to make the workplace effective:
1. Sort
2. Straighten
3. Sweep
4. Standardize
5. Self-discipline
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MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Comparison of JIT and Traditional
Factor
Traditional
JIT
Inventory
Much to offset forecast errors,
late deliveries
Minimal necessary to operate
Deliveries
Few, large
Many, small
Lot sizes
Large
Small
Setup; runs
Few, long runs
Many, short runs
Vendors
Long-term relationships are
unusual
Partners
Workers
Necessary to do the work
Assets
49
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Transitioning to a JIT System
Planing a successful Conversion
 Get top management commitment
 Decide which parts need most effort
 Obtain support of workers
 Start by trying to reduce setup times
 Gradually convert operations
 Convert suppliers to JIT
 Prepare for obstacles
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MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Obstacles to Conversion
 Management may not be
committed
 Workers/management may not
be cooperative
 Difficult to change company
culture
 Suppliers may resist
 Why?
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MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Suppliers May Resist JIT
 Unwilling to commit resources
 Uneasy about long-term commitments
 Frequent, small deliveries may be difficult
 Burden of quality control shifts to supplier
 Frequent engineering changes may cause JIT changes
52
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
JIT in Services
 The basic goal of the demand flow technology in the
service organization is to provide optimum response
to the customer with the highest quality service
and lowest possible cost.
 Eliminate disruptions
 Make system flexible
 Reduce setup and lead times
 Eliminate waste
 Minimize WIP
 Simplify the process
53
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
JIT II
 JIT II: a supplier representative works right in the
company’s plant, making sure there is an
appropriate supply on hand.
54
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.
JIT and LEAN Operation; Chapter6
Thanks
55
MGMT 405, POM, 2010/11. Lec Notes
© Stevenson, McGraw Hill, 2007- Assoc. Prof. Sami Fethi, EMU, All Right Reserved.