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Case Answer

Just-in-time at Jimmy's
1. List the elements in St. James's new approach which could be seen as
deriving from JIT principles of manufacturing.
At the more philosophical level of JIT, the case describes the concept of waste
identification and elimination. Waste is seen as a wide range of non-added value
activities and costs. In this case students should be able to spot most of the following:
excess inventory
use of expensive items in lieu of low-cost ones
duplicated inventory
purchasing administration (too many suppliers)
too many buyers
excess materials in standard packs
cancelled appointments in Urology surgery
process complexity in Urology administration

The first six of these are typical of wastes that can be identified in manufacturing
operations, as they involve material management. The last two concern process
management in administration systems, and as the textbook points out 'some processes
are themselves waste(ful)'.

a) The main emphasis in the case is on elimination of waste in the purchasing system.
Referring to Chapter 13, on supply chain planning and control, we see that Jimmy's
relationship with suppliers is changing from a medium-term trading commitment
towards a more stable long-term relationship with fewer suppliers. Some
characteristics of these relationships appear to correspond to Lamming's lean
supply concept particularly with respect to delivery practices. However, it is worth
discussing the conditions that make this possible and the risks involved.
In this case, the main problem appears to be the medical staff's preferences for a
wide range of different types of materials. To reduce input variety means
standardisation, and this can be achieved by negotiation/persuasion, or by
imposition/conflict. Jimmy's Supplies Manager seems to have used the former
approach using cross-functional task forces. Suppliers must be assessed for their
capability and interest, in order to ensure that they are likely never to fail to deliver
as promised. The risks, then, are around the actual dependability and quality of the
suppliers. As is emphasized in the case, low cost (of the purchased items) is no
longer the predominant issue: long-term value for money in the overall
purchasing/inventory processes is more critical. But it may be more difficult to
measure! So perhaps there is an element of faith (or hope) involved here.

b) Another element of improvement allied to JIT principles is the use of cellular


operations. The case describes the complexity of the existing system for Urology
admissions, which involved 59 handovers of information. One approach in class
would be to ask the students what sort of information might have been involved, and
which departments would have been responsible for providing it. Most people have
some idea of the main functional areas in a hospital, and so you should be able to
derive a list of around 20 pieces of information, and a variety of departments. You
could then ask why the traditional large organisation, such as a hospital, divides up
in this way. Arguments for functional organisation include:

economies of scale
faster learning of narrow work content tasks (specialisation)
safety (e.g. in X-Ray and pharmacy)
security of information
convenient position, near inputs to the operation
clear boundaries of responsibility
concentration of expertise and training.

The application of cellular principles involved making just four people responsible for
a dedicated, self-contained admissions system. While the case does not give
details, we can surmise that this must have involved devising a new process which
cut across the functional boundaries, and gave much broader responsibilities to the
employees. Some safeguards would have been made to ensure that neither the
patient nor the employee was exposed to the risk of mistakes, such as the failure to
notice that clinical tests had not been completed before admission. Most problems
would have been 'political' since the redesigned system was faster and simpler.
Opposition would be expected from managers of existing functions who might have
seen this as undermining their department and expertise. These problems are
common in manufacturing where production cells are first established in a
batch/process layout environment.
c) Another example was the use of kanban systems for some inventory management.
This development was clearly in its infancy, but the case illustrates the simplicity of
this approach. You should remind yourself that some students who have not seen
the bureaucracy of a conventional purchasing system might not appreciate the
radical changes suggested here! What is described is really a two-bin system for
consumable independent items. Developments described in the case indicate that
the empty carton will become the kanban communication direct with purchasing,
eliminating the waste effort of the Ward Sister. It is useful to discuss the applicability
of such systems for other items, and compare this case with the approaches used in
the Temple University Hospital boxed example in this chapter.

2. What further ideas from JIT manufacturing do you think could be applied in a
hospital setting such as St. James's?

There are many issues which could be discussed here. Those that have experienced
outpatient treatment in a general hospital might refer to the obvious 'wastes' involved
with patient waiting (WIP). These can be reduced or eliminated by better scheduling.
However, the complexity of the product range offered by a conventional clinic and its
supporting centralised functions makes smooth scheduling virtually impossible, and WIP
is used to buffer out the fluctuations in arrival and processing times. Perhaps the best
approach here could be to separate high volume repetitive 'products' and create
treatment cells or plant-within-plant operations. These types of operation, with more
focused product ranges, allow more levelled schedules and much lower WIP, often with
reduced overheads and less WIP storage space (waiting rooms). If you wish to pursue
this argument with the class a good case to use is Shouldice Hospital (from the Case
Clearing House) which describes the flow process of a focused hernia hospital in
Toronto.
Other areas of waste reduction that could be identified by students are:
Motion reduction: Better layout can be designed into new hospitals to reduce the
amount of patient and material transport required (portering). In existing hospitals this
may be difficult to achieve because of old buildings and a history of incremental, ad-hoc
developments.
Defective goods reduction: Inspection-based approaches to quality still prevail in many
hospitals. Prevention-oriented quality should reduce quality costs in the long term. It is
interesting to note that surgery generally adheres to these principles anyway: good
outcomes are achieved by attention to the quality conformance of inputs and processes
(purchased items, training of surgeons and nurses, attention to tidiness, obsession with
cleanliness and sterility, use of standardised procedures, etc.). This approach, applied
to all areas of a hospital, should bring dividends in reduction in failure costs including
rework.
The involvement of everyone: Many aspects of this (as described in this chapter) are
being introduced in the more progressive hospitals. It could be argued that JIT is only
made possible by first establishing TQM principles and practices at every level in the
hospital. Some hospitals have successfully introduced cross-functional teams for (waste
reduction) problem resolution and improvement activities. In some cases, functional
teams have developed service performance standards for their own work (e.g. porters,
intensive care nursing).
Other JIT Techniques:
Most of the ten techniques outlined in the chapter have, at first sight, little relevance to a
hospital. However, some ideas which might come out of a discussion, or from assessed
work, include:

Total Productive Maintenance: A particularly important technique in areas where


critical pieces of expensive machinery are involved (e.g. scanners, X-Ray, intensive
care). Improved up-time not only improves clinical safety, but also reduces the costs
of rescheduling and lost utilisation.

Set-up reduction: This approach could be important for activities such as bed
linen changing, operating theatre set-ups, and clinic changeovers.
Visibility: Increasingly seen around wards, clinics, etc., to show utilisation, waiting
times, problem analysis, etc.
Kanbans: Could (perhaps) be applied to moving of patients as well as materials!

3.

Shifting from a traditional operations system to a lean manufacturing


system requires the change of mind set on the part of the managers
implementing this change. JIT/Lean systems will require smaller
batch sizes, quick changeovers, reduction of work-in-process
inventories, quick and flexible response time in deliveries from
suppliers and fairly predictable demand for the end product. If the
demand for the end product is highly variable or difficult to predict,
then it becomes much more difficult to implement a truly lean system.
The variability of demand will make the system much more
unpredictable, which in turn may require the utilization of inventories
to balance the supply demand mismatch. In addition, the lean system
expects the operations on the factory floor to take place smoothly
without machine breakdowns. Of course, in order to achieve smooth
production, we not only need to invest in a strong maintenance and
repair program, but also need to consider upgrading our machines
and equipment. The machinery and equipment may also need to be
adjusted or upgraded for the purposes of doing quick changeovers so
that we can reduce the setup cost and ultimately reduce the batch
sizes to achieve a smooth, flexible flow of material through the
production operations and reduce the work-in-process inventory. In
addition, reorganization of the facility to configure the system to
better achieve a smooth flow of material.
The same concepts we have discussed in the above paragraph for
manufacturing firms will also apply to service firms. However, for the
service firms, the need for developing strong supplier networks with a
lean system becomes a high priority. Revising equipment and
process technology to process efficiently with high quality will also
be an important consideration for a lean system. The downside of
upgrading equipment and process technology is the cost. For
example, the hospital may concentrate on reducing the operation
room setup time to improve the operation room availability. In the
process of evaluating the operation room availability, better
scheduling, utilization of up-to-date equipment and more efficient use

of personnel could enable to reduce both the operation setup and the
actual operation time.

2. Consider the following problem of assembly line balancing:


Task

Immediate predecessor

Task time (min)

0.9

0.4

0.6

0.2

0.3

0.4

0.7

1.1

Total task time (min)

4.6

Assuming that 55 minutes per hour are productive, compute the cycle time needed to obtain 50 units per hour as the
output.

Determine the minimum number of workstations required and assign tasks based on longest task time rule.

Compute line utilization

Answer 7.4
ICycle time = Productive time per hour/Demand per hour = 55 minute/hour/50 units/hour = 1.1 minutes per product.
Minimum number of workstations =( sum of all task times x demand/hour)/Productive time per hour= (4.6 x 50)/55
= 4.2 workstations
Assigning tasks to workstations using the Longest-task-time rule:
Workstation

Candidates list

Task

Task Time Sum of Task times

Unassigned Task time of

workstation
(1)

(2)

(3)

(4)

(5)

(6)= 1.1 - (5)

(I)

0.9

0.9

0.2

0.4

0.4

0.7

0.6

1.0

0.1

D,E**

0.3

0.3

0.8

0.2

0.5

0.6

0.4

0.9

0.2

(IV)

0.7

0.7

0.4

(V)

1.1

1.1

(II)(II)

(III)(III)(III)

** here Task E is chosen since it takes longer time than task D


The assignment is as follows
Tasks

B,C

E,D,F

Workstation No

(I)

(II)

(III)

(IV)

(V)

Utilization

=( Minimum number of workstations/Actual workstations) x 100


= (4.2/5) x 100 = 84 %