Just-in-Time Systems

Reducing Variance, Waste and Lead Time in the Supply Chain

What is JIT?

a corporate system designed to produce output within the minimum lead time and at the lowest total cost by continuously identifying and eliminating all forms of corporate waste and variance. a corporate strategy a philosophy Focus of JIT: variance & waste

Seven Basic Types of Waste

Transportation waste Process Waste Inventory Waste Waste of motion Waste from product defects Waiting time Overproduction

Common Causes of Waste

Layout (distance) Long setup time Incapable processes Poor maintenance Poor work methods Lack of training

Inconsistent performance measures Ineffective production planning Lack of workplace organization Poor supply quality/reliability

Objective of JIT

Produce only the products the customer wants. Produce products only at the rate that the customer wants them. Produce with perfect quality Produce with minimum lead time. Produce products with only those features the customer wants.

Objectives

Produce with no waste of labor, material or equipment -- every movement must have a purpose so that there is zero idle inventory. Produce with methods that allow for the development of people

JIT Principles

Establish TAKT time rate at which the customer buys a product ex- 5S and Kaizen Build Pull Product use of kanban system

TAKT Time Example

Net Available Operating Time Time per shift 480 (minutes) Breaks (2 @ 10) - 20 Clean-up - 20 Lunch - 30 shift 410 Customer Requirements Monthly 26,000 units/month No. Working Days 20 days/month CR/Day 1,300 units/day TAKT Time 410 x 60 x 3 shifts (73,800 sec) divided by 1,300= 57.769 seconds per part or 57"

Push Vs. Pull Scheduling

Push Scheduling traditional approach move the job on when finished problems - creates excessive inventory Pull scheduling coordinated production driven by demand (pulled through system) extensive use of visual triggers (production/withdrawal kanbans)

Example of Impact of Kaizen Event

Impact of Kaizen Events - Overall Benefits (January 1, 1996 through December 31, 1996
Improvement M________ Floor Space ( ) Operators/Day Distance Traveled Inventory (WIP pieces) Setup Time Reduction Safety Improvements Before Kaizen 56,000 165 91,000 ft. 4,760,000 1,660 _______ Achievement 39,000 125 15,000 ft. 2,570,000 1,660 _________ Improvement 30% 24% 34% 46% 72%

200 improvements implement

The 5-S Program

Seiri segregate and discard get rid of what is not needed Seiton arrange and identify for ease of use a place for everything and everything in its place Seiso Clean Daily clean work place enhances quality

The 5-S Program

Seiketsu Revisit frequently revisit the first 3 steps to maintain workplace safety and effectiveness
Shitsuki Motivate to sustain promote adherence through visual performance measurement tools

Key processes to eliminate waste in JIT Concept

1. 2. 3.

4.
5.

6.

Kanban For Material Flow High quality production Small and uniform workloads Suppliers as partners Flexible working hours and employee training Total Productive maintenance

1.Kanban

Kanban means a visible card and also Signal in Japanese language. Controlling material flow using cards through the manufacturing system implementing JIT is called Kanban. It is used to tell a work station to perform a certain function on materials.

ExampleReliance card in reliance grocery store

Pull Kanban
It controls the flow of resources in a production process when and where a customer order is placed. The system helps to eliminate waste in handling, storing and delivering the product to the customer.
Ex- Dominos, Pizza Hut using this strategy

Advantages of Kanban system

1.

2. 3. 4.

The orders are controlled and triggered from defined locations. Inventory cost and WIP are reduced. The lead time to delivery is reduced The process demand can be visualized

2.High Quality production

As per JIT there must not be any shortage to occur while holding up production therefore it must be taken care all parts are of high quality For JIT to be successful inventories to be kept to the minimum and every component produced must represent highest quality.

It is relevant to Taguchis insistence on achieving target with maintaining quality.--------TQM(Green belt) post 1996 modified as Six sigma This help in realising JIT,Which has economy in focus and provide and provide an additional factor for competitiveness.

3.Small and uniform workloads

To produce a variety of products in small numbers and plan the production schedule in such a way that the production facilities become more adapt in meeting the market demands. A small load on various work centers, both in house facilities and those of sub contractors is the answer.

Example- Mc. Donald Work Culture

4.Suppliers as partners
1.

2.

3.
4.

5.

Treating suppliers as a part of the organizations business and sharing information. Providing technical and financial assistance. Seeking suppliers help in improving process Building up rapport between the employees of the supplier organization Assuring business

5.Flexible work timing and training

1. 2.

3.

Experienced and skilled manpower Organization look for personnels who have an attitude for learning the best from others. Part time and contractual employees also enable the company to overcome manpower demand.

6.Total Productive maintenance

Maintenance of equipment is fundamental requirement to increase the productivity in required quantities with high quality. Break downs generally occur as the symptoms are neglected. In total productivity maintenance the worker is trained to maintain the machine, keep record of the parts to be replaced on periodic basis

Case Study-Philips ---JIT

Philips produce different kinds of electronic products like TVs and tape recorders. Since the world market of electronics was moving towards high variety of products and the delivery of the orders was getting shorter, the top managers of Philips were under tremendous pressure to increase the competitiveness position of the company in the market. one of the executive manager of Philips suggested implementing system called JIT with the hope of inventory levels would be reduced and quality production would increase. The main aspect in introducing JIT is to educate the staff about JIT.All middle level managers from each department were asked to attend a seminar conducted by a company called Elcetrode combination who have already implemented the system. According to their discussion 5 activities were called the 5 JIT principles,

1. 2. 3. 4. 5.

Classify materials on the shop floor based on its usefulness Place the value added materials in handy positions Clean up the non value added material Maintain the factory in a good looking shape Let the employees in the company have good habits and follow the rules

With this activity the working environment in Philips was improved and the safety,quality and productivity were increased.the company stated continious improvement in terms of JIT omplementation.One manager from each department get selected as the head supervisor in this process---specially in the shop floor.All materials have been identified in terms of their names names, places,quantities and so on.

The concept of visual management, which is management simply by eye sight, has been strongly motivated and encouraged Tremendous resistance from supplier and workers was faced during the early stage of developing the JIT system. High level commitments of top managers, determination of pursuing JIT system helped to achieve JIT Material flow. With this Philips laid down a solid foundation for the JIT System.

A major success in the implementation of JIT System showed the reduction in the amount of inventory and workers. Inventory level has reduced by 63%,parts inventory and workers. Number of workers reduced from 1020 to 865 during the past 4 years. The growth rate of company has increased by 5 % every year.

Questions;1.

2.

Do you think implementation of JIT is should be mandatory for every manufacturing organization. Why JIT is specially require for shop floor management?