UNIT - I

Brief

history y of lean manufacturing g Just in time Toyota systems Pioneers Pi of fl lean manufacturing f i - Ohno Oh and d Shi Shingo Benefits of lean manufacturing Theory of constraints Reduction of wastes

BRIEF HISTORY OF LEAN MANUFACTURING

Henry y Ford was the first p person to truly y integrate an entire production process. In 1913, he integrated consistently interchangeable parts with standard work and moving conveyance to create what he called flow production. Ford lined up fabrication steps in process order wherever possible possible. This was a revolutionary break from shop practices of the American system, that usually consisted of generalgeneralpurpose machines grouped by process. process Fords problem is that he could not provide the variety needed.
2

JUST IN TIME

The American Production and Inventory Control Society (APICS) defines JIT as A philosophy of manufacturing based on

A system for highhigh-volume production with minimal inventory (raw materials, WIP, finished goods). involves i l timed arrivals @ workstation reduced buffer stocks no waste in production system a Pull system thru the plant

planned elimination of waste and continuous improvement of productivity.

A management philosophy Expose problems & bottlenecks Take away security blanket production Streamlined p factory & warehouse networks
3

JIT Synonyms
IBM - Continuous Flow Manufacturing HP - Stockless Production R Repetitive titi Manufacturing M f t i System S t GE - Management by Sight Boeing - Lean Manufacturing Motorola - Short Cycle Manufacturing Japanese - The Toyota System

4

Objective of JIT
Produce only the products the customer wants. Produce P d products d t only l at t th the rate t th that t the customer wants them. Produce with perfect quality Produce with minimum lead time. Produce products with only those features the customer wants.

5

Contd

Produce with no waste of labor, material or equipment -- every movement must have a purpose so that there is zero idle inventory inventory. Produce with methods that allow for the development of people have only the required inventory when needed, improve quality to zero defects, reduce lead times by reducing setup times, queue lengths, and lot sizes, incrementally revise the operations themselves themselves, and accomplish these things at minimum cost.
6

JIT Principles

Create flow production One piece flow Machines M hi in i order d of f processes Small and inexpensive equipment U cell layout, counter clockwise Multi Multi-p process handling g workers Easy moving/standing operations Standard operations defined
7

Contd Contd

Establish TAKT TAKT time rate at which the customer buys a product Build Pull Product use of kanban system

Successful JIT Applications

Most successful JIT applications have been in repetitive manufacturing, manufacturing, where batches of standard products are produced at high speeds and in high volumes. Successful use of JIT is rare in large, highly complex job shops where production planning and control is extremely complicated. S ll Smaller, less l complex l job b shops h have h used d JIT, but operations have been changed so that they behave somewhat like repetitive manufacturing manufacturing.
9

Changes Required for JIT

JIT requires certain changes to the factory and the way it is managed:
Stabilize production schedules Make the factories more focused Increase work center capacities Improve product quality Cross C Cross-train t i workers k Reduce equipment breakdowns Develop D l longlong l -term supplier li relations l i
10

Elements of JIT Manufacturing

Eliminating waste Enforced problem solving and continuous improvement People make JIT work Total Quality Management (TQM) Parallel processing Kanban production control JIT purchasing Reducing inventories Working toward repetitive manufacturing

11

Benefits of JIT

Inventory levels are drastically reduced:

frees up working capital for other projects less space is needed customer responsiveness increases

T t l product Total d t cycle l time ti drops d Product quality is improved Scrap and rework costs go down Forces managers to fix problems and eliminate waste .... or it wont work!

12

contd

Increased c eased equ equipment p e t ut utilization at o Reduced scrap and rework P Pressure f for good d vendor d relationships l ti hi Reduced need for indirect labor

13

Advantages of JIT Manufacturing f

Materials Cost Savings Manufacturing Cost Savings Sales Cost Savings

14

TOYOTA SYSTEMS

The first step of the manufacturing revolution began in Japan, p , with Toyoda y family, y, when they y shifted from textile equipment manufacturing to Automobile manufacturing. manufacturing . By y late 1940 1940s s Japan p industry y was collapsed p and economy was badly affected by the World War II II. . In addition, Japanese manufacturers faced many problems. problems .

Pioneers of lean mfg.

Limited sources of raw materials, labor movements, and limited capital availability are few of them. them. Meanwhile, automobile manufacturers faced another problem. problem. They could not compete with the already existing (Although declining) forces of west. west. Especially players like Ford simply out performed small manufacturers like Ford, Toyota. Toyota .
15

Contd

Therefore they could not compete on the overseas markets markets. k . This made Japanese manufacturers to produce for their local markets. markets.

Challenged by these demands Toyota gave the task of making a system which will stand in these conditions to Taichii Ohno Ohno. . Ohno with his colleague Shingo created a manufacturing system for next three decades, decades which is known as Toyota Production System (TPS) (TPS). .

16

Contd

Today, y, Toyota y is the worlds number one car maker. maker . Toyotas reputation for producing quality cars remains strong strong. . A key reason behind this and the carmakers success, is its Toyota Production System (TPS) (TPS). . This has as its central philosophy the aim of the complete elimination of all waste, whether that waste is in the form of excess stock, an unnecessary process step or defective products products. . The TPS is based on a number of key principles
17

TPS Principles:
The Toyota Production System is based on a number of key principles:

Just in time: The production process delivers what is needed for the next process when it is needed, needed rather than simply aiming for mass production to achieve economies of scale. Jidoka : Embodies the idea that machines will stop production as soon as any problem or defect is identified. Kaizen: Continuous improvement to eliminate waste, i improve efficiency ffi i and d product d t quality. Genchi genbutsu: If a problem arises, assessing the problem bl directly d l is more effective ff than h hearing h about b it through a third party.
18

Contd

Challenge: g Challenge g the status quo. q For example, p , to try y and improve service levels or create more efficient budgets. Teamwork: The causes of problems can arise in areas beyond an individuals domain. MultiMulti -skilling enables personnel to help colleagues in other teams at busy periods periods. Respect: TPS recognizes the intelligence and ability of all staff and gives them responsibility. Respect also extends t th to the external t l environment i ti in which hi h the th company operates.

19

Contd

Andon Board: Board: The andon board is a simple p but highly g y visible electronic sign displaying the status of production lines. lines . It notifies management immediately if a worker has identified a fault, fault precisely identifying its location location. . Standardization: Another key element for quality Standardization: assurance is a focus on standardisation. standardisation. Developing and relying on standardised work tasks not only ensures consistently high levels of quality, quality but also maintains production pace and provides a benchmark for implementing continuous improvement. improvement.
20

The Toyota Production System (TPS) and L Lean P Production d ti

Toyota invented Lean Production in the 1940s and 50s. The company focused on eliminating wasted time and material from every step of the production process. The result was a fast and flexible process Customers got what they want, when they want it They got it at highest quality and most affordable cost.
21

Contd

Toyota improved production by:

Eliminating wasted time and resources. Building quality into workplace systems Finding low low-cost and yet reliable alternatives to expensive new technology technology. Perfecting business processes. Building a learning culture for continuous improvement.

22

Contd

The Heart of the Toyota Production System: Eliminating Waste The h point of f the h TPS is to minimize time spent on nonnon-value adding activities by Positioning the materials and tools as close as p possible to the point of assembly. The Major types of nonnon-value adding waste in business or production process are:
1. 2. 3 3. 4. 5. 6. 7. 8. Overproduction. Waiting or time on hand. Unnecessary transport or conveyance conveyance. Over processing or incorrect processing. Excess inventory. Unnecessary y movement. Defects. Unused employee creativity.

23

OHNO AND SHINGO

24

BENEFITS OF LEAN MANUFACTURING

Financial benefits of Lean Manufacturing:

Reduction of circulating assets (stock and ininprocess materials) Reduction of capital used Increase in cashcash-in in-hand, improved return on investment. Work on productivity and profitability Improving the bottom line by reducing production costs. p
25

Industrial benefits of Lean Manufacturing:

Less investment for same level of production. I Increased d production d ti at t constant t ti investment. t t Ecological production, more compact plants. Improved quality.

Commercial benefits of Lean Manufacturing:

Production in phase with customer demand Reduction of delivery times Greater customer satisfaction.
26

As a company reduces the wastes and strives for Single piece flow, many other benefits follow. Some of these benefits include (1) improved quality and fewer defects, (2) reduced inventory inventory, (3) less space required, (4) ( ) enhancement of overall manufacturing g flexibility, y, (5) makes the identification of future kaizens simpler, (6) ensures a safer work environment, (7) improves i employee l morale. l

27

THEORY OF CONSTRAINTS

The Theory y of Constraints (TOC) ( ) is a philosophy p p y of management and improvement originally developed by Eliyahu M. Goldratt . It is based on the fact that, like a chain with its weakest link, in any complex system at any point in time, there is most often only one aspect of that system that is limiting its ability to achieve more of its goal. For that system to attain any significant improvement that constraint must be identified and the whole system must be managed g with it in mind.
28

The Theory of Constraints provides a practical framework for managing enterprises with a holistic and focused approach. TOC does a away a with ith conflicts between bet een local operating ope ating level decisions and global company objectives and goals. A constraint is anything in an organization that limits it from moving toward or achieving its goal. TOC recognizes i two t types t of f constraints t i t th that t can exist i ti in any business physical h l constraints - Eg. Machine h capacity Non Non-physical constraints eg. Product demand

29

Five focusing step' methodology to identify the constraint

The e steps in app applying y g TOC OC a are e as follows: o o s
1. Identify the system's constraints. 2. Decide how to exploit the system's constraints.
O Once it is i decided d id d how h to t manage the th constraints t i t within ithi the th system t Find out What about the majority of the resources that are not constraints? The answer is to manage them so that they just provide what is needed to match the output of the constrained resources.

3. Subordinate everything else to the above decision in Step 2. Since the constraints are keeping us from moving toward our goal goal, all the resources are applied that can assist in breaking them.
30

4.

Elevate the system's system s constraints.

If we continue to work toward breaking a constraint (also called elevating a constraint) at some point i the h constraint i will ill no longer l be b a constraint. The constraint will be broken.

5.

If the constraint is broken, return to Step 1.

When that happens, there will be another constraint, somewhere else in the system that is limiting progress to the goal.

31

Do you have any one or more of the following issues in your organization?

Severe Cash Shortage Vendors not delivering material on time Not meeting customer schedules Falling Sales Shrinking Profits

32

would you like to

Understand the root cause for all these issues? Significantly improve cash availability Improve Vendor reliability Improve On Time delivery Increase sales significantly I Increase profits fit

Theory y of Constraints brings g in the p powerful methodology to identify the constraint in the company and systematically attack the associated problems problems. .

33

Benefits of TOC
Industry derives a host of advantages while implementing TOC. Besides creating an excellent work environment and motivating employees, It also l f focuses th the company's ' i investment t t in initiatives such as TQM, TPM, ERP, SCM and d CRM. CRM

34

REDUCTION OF WASTES

Waste is defined as anything that does not add value to the final product. Following g are the waste categories. g
1. 2 2. 3. 4. 5 5. 6. 7. 8. Over production W iti Waiting Work In Progress (WIP) Transportation I Inappropriate i t processing i Excess motion or ergonomic problems Defective products Underutilization of employees
35

All the wastes in the organization will fall in to the one of the following two categories.
wastes that are avoidable wastes that are unavoidable

Deciding what are the avoidable and what are unavoidable will require some good decision making. Lot of learning, experimenting and thinking g has to go g into this process p

36

37

38

END OF UNIT UNIT-1

39