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MANAGEMENT 520
CHAPTER 11
Chapter 11
JUST IN TIME
Just-in-Time and Lean
AND LEAN SYSTEMS
Systems
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LESSON OBJECTIVES
• JIT Defined
• The Toyota Production System
• JIT Implementation Requirements
• JIT in Services
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Just-In-Time (JIT)
Defined
• JIT can be defined as an integrated set
of activities designed to achieve highvolume production using minimal
inventories (raw materials, work in
process, and finished goods)
• JIT also involves the elimination of
waste in production effort
• JIT also involves the timing of
production resources (i.e., parts arrive
at the next workstation “just in time”)
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JIT and Lean Management
• JIT can be divided into two terms: “Big JIT”
and “Little JIT”
• Big JIT (also called Lean Management) is a
philosophy of operations management that
seeks to eliminate waste in all aspects of a
firm’s production activities: human
relations, vendor relations, technology, and
the management of materials and inventory
• Little JIT focuses more narrowly on
scheduling goods inventory and providing
service resources where and when needed
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Here the customer starts
the process, pulling an
inventory item from
Final Assembly…
Then subassembly work is
pulled forward by
that demand…
Customers
JIT Demand-Pull
Logic
Fab
Vendor
Fab
Vendor
Fab
Vendor
Fab
Vendor
5
Sub
Final
Assembly
The process continues
throughout the entire
production process and
supply chain
Sub
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The Toyota Production System
• Based on two
philosophies:
• 1. Elimination of
waste
• 2. Respect for
people
Toyota’s run smoother
than this!
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Waste in Operations
1. Waste from overproduction
2. Waste of waiting time
3. Transportation waste
4. Inventory waste
5. Processing waste
6. Waste of motion
7. Waste from product defects
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Minimizing Waste:
Focused Factory
Networks
Coordination
System Integration
These are small specialized
plants that limit the range
of products produced
(sometimes only one type of
product for an entire
facility)
Some plants in
Japan have as
few as 30 and as
many as 1000
employees
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Minimizing Waste: Group Technology (Part 1)
Note how the flow lines are going back and forth
• Using Departmental Specialization for plant layout can cause a
lot of unnecessary material movement
Saw
Saw
Saw
Grinder
Grinder
Heat Treat
Lathe
Lathe
Lathe
Press
Press
Press
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Minimizing Waste:
Group Technology (Part 2)
• Revising by using Group Technology Cells can reduce movement
and improve product flow
Grinder
Saw
1
2
Lathe
Lathe
Press
Lathe
Press
Heat Treat
Grinder
Saw
Lathe
A
B
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Minimizing Waste:
Uniform Plant Loading (heijunka)
Suppose we operate a production plant that produces a single
product. The schedule of production for this product could be
accomplished using either of the two plant loading schedules
below.
Not uniform
Jan. Units
Feb. Units
Mar. Units
Total
1,200
3,500
4,300
9,000
or
Uniform
Jan. Units
Feb. Units
Mar. Units
Total
3,000
3,000
3,000
9,000
How does the uniform loading help save labor costs?
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Minimizing Waste: Just-In-Time
Production
WHAT IT IS
• Management philosophy
• “Pull” system though the plant
• Hydraulic Push Systems
WHAT IT REQUIRES
• Employee participation
•
•
•
•
Industrial engineering/basics
Continuing improvement
Total quality control
Small lot sizes
WHAT IT DOES
• Attacks waste
• Exposes problems and bottlenecks
• Achieves streamlined production
WHAT IT ASSUMES
• Stable environment
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Minimizing Waste: Inventory
Hides Problems
Machine
downtime
Scrap
Work in
process
queues
(banks)
Paperwork
backlog
Vendor
delinquencies Change
orders
Engineering design
redundancies
Inspection
backlogs
Example: By
identifying defective
items from a vendor
early in the
production process
the downstream work
is saved
Design
backlogs
Decision
backlogs
Example: By
identifying defective
work by employees
upstream, the
downstream work is
saved
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Minimizing Waste: Kanban
Production Control Systems
Once the Production kanban is
received, the Machine Center
produces a unit to replace the
one taken by the Assembly Line
people in the first place
Machine
Center
Withdrawal
kanban
Storage
Part A
Production kanban
The process begins by the Assembly Line
people pulling Part A from Storage
Storage
Part A
This puts the
system back
were it was
before the item
was pulled
Assembly
Line
Material Flow
Card (signal) Flow
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Determining the Number of Kanbans
Needed
• Setting up a kanban system requires determining the
number of kanbans cards (or containers) needed
• Each container represents the minimum production lot
size
• An accurate estimate of the lead time required to
produce a container is key to determining how many
kanbans are required
• Side Bar – In Japan space is a very important
consideration since there is so little of it. This process
saves on space requirements. May explain why
concept NIH.
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Example of Kanban Card
Determination: Problem Data
• A switch assembly is assembled in batches of 4 units
from an “upstream” assembly area and delivered in a
special container to a “downstream” control-panel
assembly operation
• The control-panel assembly area requires 5 switch
assemblies per hour
• The switch assembly area can produce a container of
switch assemblies in 2 hours
• Safety stock has been set at 10% of needed inventory
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Example of Kanban Card
Determination: Calculations
Expected demand during lead time Safety stock
k 
Size of the container
DL(1 S ) 5(2)(1.1)


 2.75, or 3
C
4
Always round up!
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Respect for People
• Level payrolls
• Cooperative employee unions
• Reliable Subcontractor networks
• Bottom-round management style (i.e.,
consensus management)
• Quality circles (Small Group Involvement
Activities or SGIA’s)
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Toyota Production System’s Four Rules
1. All work shall be highly specified as to content, sequence,
timing, and outcome
2. Every customer-supplier connection must be direct, and
there must be an unambiguous yes-or-no way to send
requests and receive responses
3. The pathway for every product and service must be simple
and direct
4. Any improvement must be made in accordance with the
scientific method, under the guidance of a teacher, at the
lowest possible level in the organization
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JIT Implementation Requirements:
Design Flow Process
• Link operations
• Balance workstation capacities
• Redesign layout for optimum flow
• Emphasize preventive maintenance
• Reduce lot sizes
• Reduce setup/changeover time
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JIT Implementation Requirements: Total
Quality Control
• Worker responsibility
• SQC in place
• Enforce compliance
• Fail-safe methods (poka-yokes)
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JIT Implementation Requirements:
Stabilize Schedule
• Level schedule
• Underutilize capacity
* Freeze Window (schedule is fixed an no
changes permitted)
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JIT Implementation Requirements:
Kanban-Pull
• Demand pull
• Backflush (periodically explode a BOM
to determine what items went into the
product
• Reduce lot sizes
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JIT Implementation Requirements:
Work with Vendors
• Reduce lead times
• Frequent deliveries
• Project usage requirements
• Clear Quality expectations
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JIT Implementation Requirements:
Reduce Inventory More
• Look for other areas to reduced materials
• Minimize Stores
• Minimize Transit
• Carousels
• Conveyors
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JIT Implementation Requirements:
Improve Product Design
• Standard product configuration
• Standardize and reduce number of parts
• Align Process design with product design
• Quality expectations
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JIT Implementation Requirements:
Concurrently Solve Problems
• Root cause
• Solve problems permanently
• Team approach
• Line and specialist responsibility
• Continual education
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JIT Implementation Requirements:
Measure Performance
• Emphasize improvement
• Track trends
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JIT in Services (Examples)
• Organize Problem-Solving Groups
• Upgrade Housekeeping
• Upgrade Quality
• Clarify Process Flows
• Revise Equipment and Process Technologies
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JIT in Services (Examples)
• Level the Facility Load
• Eliminate Unnecessary Activities
• Reorganize Physical Configuration
• Introduce Demand-Pull Scheduling
• Develop Supplier Networks
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Question Bowl
Just-In-Time seeks to achieve high volume
production using what three
approaches: (5 points each item)
a. Minimal inventory of r-- m-------b. Minimal inventory of w--- i- p-----c. Minimal inventory of f------- g----
Answer: raw materials, work in process,
finished goods.
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Question Bowl
Lean Management is closely associated
with which of the following? (5 points)
a. Big JIT
b. Little JIT
c. Honda Motor Company
d. McDonald’s low carb menu item
e. The Atkins Diet
Answer: a. Big JIT
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Question Bowl
In the Toyota Production System, the
“elimination of waste” involves: (5
points for each item):
1. O------------a. W------ T--b. T------------Answer: overproduction, wasting time,
transportation
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Question Bowl
In the JIT Pull System the partner that
begins the process of “pulling” is
which of the following? (5 points)
a. Customers
b. Vendors
c. Fabrication personnel
d. CEO
e. All of the above
Answer: a. Customer
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Question Bowl
A JIT Production program requires: (5
points each item)
1.
a.
b.
c.
E------- P----------T----- Q------ C-----S----- l– s---C--------- i----------
Answer: Employee participation, Total
Quality Control, Small lot sizes, continuous
improvement
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Question Bowl
Inventory has been known to hide the
following production problems? (5
points each item)
a. S---b. V----- d-----------c. D------- b--------
Answer: Scrap, Vendor delinquencies, decision
backlogs
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Question Bowl
You want to determine how many kanban card sets you
need for an operation. You find that average number
of units demanded is 1,000 per hour, the lead time to
replenish the order for this item is 10 hours, the
container size is 10 units, and the safety stock is
estimated to be 5% of the expected demand. Which
of the following is the desired number of kanban
card sets? (15 points)
a. 1050
b. 1000
c. 605
d. 500
e. None of the above
Answer: a. 1050 ([1000x10](1+0.05)/10=1050)
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Question Bowl
When trying to implement JIT a “stabilized
schedule” includes which of the
following? (5 points)
Answer: e. None of
a. Demand pull
the above (These
b. Backflush
include: level
schedule,
c. Fail-safe methods
underutilization
d. All of the above
capacity, and
e. None of the above establish freeze
windows.)
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