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Lecture 11

GMS 401 Lecture Notes - Lecture 11: Takt Time, Inventory Control, Continual Improvement Process

Global Management Studies
Course Code
GMS 401
Wally Whistance- Smith

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April 6, 2017 Lecture 11 GMS401
Just-in-Time Systems & Lean Operations
Repetitive production system in which processing and movement of materials and
goods occur just as they are needed, usually in small batches
Characteristic of lean production systems
Traditionally they have lower processing costs, fewer defects, greater flexibility, and are
able to bring new or improved products to the markets more quickly
Just-in-time (JIT): A highly coordinated processing system in which goods move through the
system, and services are performed, just as they are needed
Usually small batches (IDEAL SIZE = 1)
Pull (demand) system
Big JIT = philosophy of waste reduction and continuous improvement = lean production
JIT/lea operates ith ery little fat
The ultimate goal is a balanced system
Smooth, rapid flow of materials through the system
Eliminate disruptions
Eliminate waste
Make system flexible
Continuous improvement (Kaizen)
Sources of Waste
Over processing
Product defects
Unnecessary transportation
Unnecessary inventory
Inefficient work methods
Waiting time
Employee underutilization
Key Elements of JIT System
High quality levels
Production smoothing
Low inventories
Small lot sizes
Quick low-cost setups
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April 6, 2017 Lecture 11 GMS401
Preventive maintenance
Multifunctional workers
Cooperative spirit
Few, reliable suppliers
Pull System of moving goods
Problem solving
Continual improvement
High Quality Levels
JIT systems require high quality levels, the systems are geared to a smooth flow of work,
the appearance of problems due to poor quality creates disruption in this flow
Becomes imperative to avoid shutdowns, and quickly resole problems when the occur
Involves 3 part approach:
1. Designing quality into the product and process
2. Insist vendors provide high-quality materials
3. Make workers responsible for producing goods of high quality
Production Smoothing
JIT production requires a smooth flow of goods through the system to achieve a
meshing of different operations and the movement of goods and materials from the
supplier to the final output
Activity must be carefully coordinated because there is very little slack
Low Inventories
JIT systems known for low inventories-of purhases parts ad ra aterials et…
3 important aspects of low inventories:
Saving space -warehouse space and space in work areas
Inventories are buffers that tend to cover up recurring problems that are never resolved
Major problems must have already been resolved, it is necessary to be able to deal
quickly with problems when they do occur
Small Lot Sizes
Small lots moving through the system, in-process inventory is considerably less than
with large lots
When problems with quality occur, inspection and rework costs are less because there
are fewer items in a lot to inspect and rework
Small lots also permit greater flexibility in scheduling
This flexibility enables JIT systems to respond more quickly to demand for output
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April 6, 2017 Lecture 11 GMS401
Quick, Low-Cost Setups
Small lots and changing product mixes require frequent setups
Workers are trained to do their own setups
Setup tools and equipment and setup procedures must be simple and standardized
JIT systems use layouts based on product requirements
Equipment is arranged to handle streams of similar products with similar processing or
assembly requirements
This avoids having to move large lots of parts around the work area; parts pass in small
lots from one work center to the next with little or no waiting
Preventative Maintenance
To minimize breakdowns, companies use preventative maintenance, which emphasize
maintaining equipment in good operating condition and replacing parts that have a
tendency to fail before they actually fail
Maintaining critical spare parts, and making provisions
Multifunctional Workers
Workers are trained to operate machinery, handle setups, and perform maintenance
and minor repairs
Workers are responsible for checking the quality of their own work and monitoring the
quality of work they receive as input to their stations
Workers expected to participate in problem solving
Training costs and time increase
Cooperative Spirit
JIT systems require a cooperative spirit among workers, managers and vendors
The Japanese have been very successful in this regard
Requires an appreciation of the importance of cooperation and a tenacious effort by
management to instill and maintain that spirit
Few, Reliable Suppliers
Poor quality goods cause a disruption in the smooth flow of work
Having to inspect incoming goods is inefficient, does not add value to the product
Burden of ensuring quality is shifted to the vendor
Suppliers must be willing and able to ship in small lots on a regular basis
JIT purchasing is enhanced by long term relationships between buyers and vendors
How realistic is this?
What aout opay saotage? Et…
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