CHAPTER 12
Introduction in JIT and Lean Operations
As business organizations strive to maintain competitiveness in
an ever-changing global economy, they are increasingly
seeking new and better ways of operating. For some, this
means changing from the traditional ways of operating to what
is now referred to as lean operation.
A lean operation is a flexible system of operation that uses
considerably fewer resources (i.e., activities, people, inventory,
and floor space) than a traditional system.
Lean systems are sometimes referred to as just-in-time
(JIT) systems owing to their highly coordinated activities and
delivery of goods that occur just as they are needed. The lean
approach was pioneered by Toyota’s founder, Taiichi Ohno,
and Shigeo Shingo as a much faster and less costly way of
producing automobiles. Following its success, today the lean
approach is being applied in a wide range of manufacturing
and service operations
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. You can get a sense of that approach from
some of the terms commonly associated with lean operations:
 Muda: Waste and inefficiency. Perhaps the driving
philosophy. Waste and inefficiency can be minimized by
using the following tactics.
 Pull system: Replacing material or parts based on
demand; produce only what is needed.
 Kanban: A manual system used for controlling the
movement of parts and materials that responds to signals
of the need (i.e., demand) for delivery of parts or
materials. This applies both to delivery to the factory and
delivery to each workstation. The result is the delivery of a
steady stream of containers of parts throughout the
workday. Each container holds a small supply of parts or
materials. New containers are delivered to replace empty
containers.
 Heijunka: Variations in production volume lead to waste.
The workload must be leveled; volume and variety must
be averaged to achieve a steady flow of work.
 Kaizen: Continuous improvement of the system. There is
always room for improvement, so this effort must be
ongoing.
 Jidoka: Quality at the source. A machine automatically
stops when it detects a bad part. A worker then stops the
line. Also known as autonomation.
Supporting Goals
The degree to which the overall goal is achieved depends on
how well certain supporting goals are achieved. Those goals
are to:
 Eliminate disruptions.
 Make the system flexible.
 Eliminate waste, especially excess inventory.
A flexible system is one that is robust enough to handle a mix
of products, often on a daily basis, and to handle changes in
the level of output while still maintaining balance and
throughput speed. 
Waste represents unproductive resources; eliminating waste
can free up resources and enhance production. Inventory is an
idle resource, taking up space and adding cost to the system. It
should be minimized as much as possible. In the lean
philosophy, there are seven wastes:
 Inventory —beyond minimal quantities, an idle resource,
takes up floor space, and adds to cost.
 Overproduction —involves excessive use of
manufacturing resources.
 Waiting time —requires space, adds no value.
 Unnecessary transporting —increases handling,
increases work-in-process inventory.
 Processing waste —makes unnecessary production steps,
scrap.
 Inefficient work methods —reduce productivity, increase
scrap, increase work-in-process inventory.
 Product defects —require rework costs and possible lost
sales due to customer dissatisfaction.
The existence of these wastes is an indication that
improvement is possible. The list of wastes also can identify
potential targets for continuous improvement efforts.
The kaizen philosophy for eliminating waste is based on the
following tenets:
 Waste is the enemy, and to eliminate waste it is necessary
to get the hands dirty.
 Improvement should be done gradually and continuously;
the goal is not big improvements done intermittently.
 Everyone should be involved: top managers, middle
managers, and workers.
 Kaizen is built on a cheap strategy, and it does not require
spending great sums on technology or consultants.
 It can be applied anywhere.
 It is supported by a visual system: a total transparency of
procedures, processes, and values, making problems and
wastes visible to all.
 It focuses attention where value is created.
 It is process oriented.
 It stresses that the main effort of improvement should
come from new thinking and a new work style.
 The essence of organizational learning is to learn while
doing.
Building Blocks
The design and operation of a lean system provide the
foundation for accomplishing the aforementioned goals. As
shown in figure below , the building blocks are:
 Production kanban (p-kanban): signals the need to
produce parts.
 Conveyance kanban (c-kanban): signals the need to
deliver parts to the next work center.

 Product design.
 Process design. Value Stream Mapping
 Personnel/organizational elements.
 Manufacturing planning and control. Value stream mapping is a visual tool to systematically
examine the flow of materials and information involved in
Four elements of product design are important for a lean bringing a product or service to a consumer. The technique
production system: originated at Toyota, where it is referred to as “Material and
Information Flow Mapping.” The systematic attack on waste
1. Standard parts. can lead to uncovering factors related to poor quality and
2. Modular design. management problems.
3. Highly capable production systems with quality built in.
4. Concurrent engineering. Once a value stream map is completed, data analysis can
uncover improvement opportunities by asking key questions,
such as:
Eight aspects of process design are particularly important for
lean production systems:
 Where are the process bottlenecks?
 Where do errors occur?
1. Small lot sizes.
 Which processes have to deal with the most variation?
2. Setup time reduction.
 Where does waste occur?
3. Manufacturing cells.
4. Quality improvement.
5. Production flexibility. Process Improvement Using the 5W2H Approach
6. A balanced system. 5W2H approach-A method of asking questions about a
7. Little inventory storage. process that includes what, why, where, when, who, how, and
8. Fail-safe methods. how much.

There are five elements of personnel and organization that are

particularly important for lean systems:
CHAPTER 14
1. Workers as assets.
Introduction to Scheduling
2. Cross-trained workers.
3. Continuous improvement. Within an organization, scheduling pertains to establishing the
4. Cost accounting. timing of the use of specific resources of that organization. It
5. Leadership/project management. relates to the use of equipment, facilities, and human activities.
Scheduling occurs in every organization, regardless of the
Seven elements of manufacturing planning and control are nature of its activities.
particularly important for lean systems:
Scheduling is establishing the timing of the use of equipment,
1. Level loading. facilities, and human activities in an organization.
2. Pull systems. Scheduling in High-Volume Systems
3. Visual systems.
4. Limited work-in-process (WIP). High-volume systems, where jobs follow the same sequence,
5. Close vendor relationships. are often referred to as flow systems; scheduling in these
6. Reduced transaction processing. systems is referred to as flow-shop scheduling.
7. Preventive maintenance and housekeeping.
High-volume systems usually require automated or specialized
Kanban is a Japanese word meaning “signal” or “visible equipment for processing and handling. Moreover, they
record.” When a worker needs materials or work from the perform best with a high, uniform output. Shutdowns and
preceding station, he or she uses a kanban card. In effect, the startups are generally costly, and especially costly in process
kanban card is the authorization to move or work on parts. industries. Consequently, the following factors often determine
the success of such a system:
There are two main types of kanbans:
 Process and product design. Here, cost and
manufacturability are important, as is achieving a smooth
flow through the system.
 Preventive maintenance. Keeping equipment in good
operating order can minimize
breakdowns that would disrupt the flow of work.
 Rapid repair when breakdowns occur. This can require
specialists as well as stocks of critical spare parts.
 Optimal product mixes. Techniques such as linear
programming can be used to determine optimal blends of
inputs to achieve desired outputs at minimal costs. This is
particularly true in the manufacture of fertilizers, animal
feeds, and diet foods.
 Minimization of quality problems. Quality problems can
be extremely disruptive, requiring shutdowns while
problems are resolved. Moreover, when output fails to
meet quality standards, not only is there the loss of output
but also a waste of the labor, material, time, and other
resources that went into it.
 Reliability and timing of supplies. Shortages of supplies
are an obvious source of disruption and must be avoided.
On the other hand, if the solution is to stockpile supplies,
that can lead to high carrying costs. Shortening supply
lead times, developing reliable supply schedules, and
carefully projecting needs are all useful.
Scheduling in Low Volume Systems
The characteristics of low-volume systems (job shops) are
considerably different from those of high- and intermediate-
volume systems. Products are made to order, and orders
usually differ considerably in terms of processing
requirements, materials needed, processing time, and
processing sequence and setups.
Job-shop scheduling - scheduling for low-volume systems
with many variations in requirements.
Loading refers to the assignment of jobs to processing (work)
centers. Loading decisions involve assigning specific jobs to
work centers and to various machines in the work centers.
Visual aids called Gantt charts are used for a variety of
purposes related to loading and scheduling. They derive their
name from Henry Gantt, who pioneered the use of charts for
industrial scheduling in the early 1900s. Gantt charts can be
used in a number of different ways, two of which are
illustrated in figure below , which shows scheduling
classrooms for a university and scheduling hospital operating
rooms for a day. The purpose of Gantt charts is to organize and
visually display the actual or intended use of resources in a
time framework.
There are a number of different types of Gantt charts. Two of
the most commonly used are:
 A load chart depicts the loading and idle times for a
group of machines or a list of departments figure below
illustrates a typical load chart.
 A manager often uses a schedule chart to monitor the
progress of jobs. The vertical axis on this type of Gantt
chart shows the orders or jobs in progress, and the
horizontal axis shows time. The chart indicates which jobs
are on schedule and which are behind or ahead. A typical
schedule chart is illustrated in the figure below.
Two different approaches are used to load work centers:
 Infinite loading -jobs are assigned to work centers
without regard to the capacity of the work center.
 Finite loading-jobs are assigned to work centers taking
into account the work center capacity and job processing
times.
There are two general approaches to scheduling:
 Forward scheduling-scheduling ahead from a point in
time.
 Backward scheduling-scheduling backward from a due
date.
Input/output (I/O) control refers to monitoring the work flow
and queue lengths at work centers. The purpose of I/O control
is to manage work flow so that queues and waiting times are
kept under control. Without I/O control, demand may exceed
processing capacity, causing an overload at a center.
Assignment model-A linear programming model for optimal
assignment of tasks and resources.
Hungarian method Method of assigning jobs by a one-for one
matching to identify the lowest cost solution.
Sequencing
Sequencing is concerned with determining job processing
order. Sequencing decisions determine both the order in which
jobs are processed at various work centers and the order in
which jobs are processed at individual workstations within the
work centers.
Priority rules are simple heuristics used to select the order in
which the jobs will be processed.
Job time usually includes setup and processing times.
The effectiveness of any given sequence is frequently judged
in terms of one or more performance measures. The most
frequently used performance measures follow:
 Job flow time is the amount of time it takes from when a
job arrives until it is complete. It includes not only actual
processing time but also any time waiting to be processed,
transportation time between operations, and any waiting
time related to equipment breakdowns, unavailable parts,
quality problems, and so on. The average flow time for a
group of jobs is equal to the total flow time for the jobs
divided by the number of jobs.
 Job lateness is the amount of time the job completion date
is expected to exceed the date the job was due or promised
to a customer. It is the difference between the actual
completion time and the due date. If only differences for
jobs with completion times that exceed due dates are
recorded, and zeros are assigned to jobs that are early, the
term used is job tardiness.
 Makespan is the total time needed to complete a group of
jobs. It is the length of time between the start of the first
job in the group and the completion of the last job in the
group. If processing involves only one work center,
makespan will be the same regardless of the priority rule
being used.
 Average number of jobs. Jobs that are in a shop are
considered to be work-in-process inventory. The average
work-in-process for a group of jobs can be computed using
the following formula:
Average number of jobs =Total flow time / Makespan

If the jobs represent equal amounts of inventory, the average

number of jobs will also reflect the average work-in-process
inventory.