JUST-in-Time and Lean production System

Just-in-time: inventory system where raw materials are delivered right before they are needed on the
assembly line, and finished goods are manufactured just before they are shipped to customers. Just-intime improves return on investment by substantially reducing overhead cost, limiting quality inspections, and eliminating obsolete inventory. Just-in-time does generate substantial risk, however: under just-intime systems, production stops when parts aren't delivered on schedule, and huge bottlenecks are created when product isn't shipped on schedule. Thus successful just-in-time manufacturing requires both superior management and a highly disciplined workforce. Just-in-time is closely associated with methods introduced and refined by the Toyota Motor Company of Japan and copied by manufacturers throughout the world. In truth, however, just-in-time is simply one element of the comprehensive Toyota Production System, which attempts to eradicate waste of all kind.

Lean production: is a production practice that considers the expenditure of resources for any goal other
than the creation of value for the end customer to be wasteful, and thus a target for elimination. Working from the perspective of the customer who consumes a product or service, "value" is defined as any action or process that a customer would be willing to pay for. Basically, lean is centered on preserving value with less work. Lean manufacturing is a management philosophy derived mostly from the Toyota Production System (TPS) (hence the term Toyotism is also prevalent) and identified as "Lean" only in the 1990s.[1][2] It is renowned for its focus on reduction of the original Toyota seven wastes to improve overall customer value, but there are varying perspectives on how this is best achieved. The steady growth of Toyota, from a small company to the world's largest automaker,[3] has focused attention on how it has achieved this.Lean manufacturing is a variation on the theme of efficiency based on optimizing flow; it is a present-day instance of the recurring theme in human history toward increasing efficiency, decreasing waste, and using empirical methods to decide what matters, rather than uncritically accepting pre-existing ideas. As such, it is a chapter in the larger narrative that also includes such ideas as the folk wisdom of thrift, time and motion study, Taylorism, the Efficiency Movement, and Fordism. Lean manufacturing is often seen as a more refined version of earlier efficiency efforts, building upon the work of earlier leaders such as Taylor or Ford, and learning from their mistakes.

TEN STRATEGIC OM DECISIONS

Differentiation, low cost, and response can be achieved when managers make effective decisions in 10 areas of OM. These are collectively known as operations decisions. The 10 decisions of OM that support missions and implement strategies follow: 1. Goods and Service design. Designing goods and services defines much of the transformation process. Costs, quality, and human resource decisions are often determined by design decisions. Designs usually determine the lower limits of cost and the upper limits of quality. 2. Quality. The customers quality expectations must be determined and policies and procedures established to identify and achieve that quality. 3. Process and capacity design. Process options are available for products and services. Process decisions commit management to specific technology, quality, human resource use, and maintenance. These expenses and capital commitments will determine much of the firms basic cost structure. 4. Location selection. Facility location decisions for both manufacturing and service organizations may determine the firms ultimate success. Errors made at this juncture may overwhelm other efficiencies. 5. Layout design. Material flows, capacity needs, personnel levels, technology decisions, and inventory requirements influence layout. 6. Human resources and job design. People are an integral and expensive part of the total system design. Therefore, the quality of work life provided, the talent and skills required, and their costs must be determined. 7. Supply-chain management. These decisions determine what is to be made and what is to be purchased. Consideration is also given to quality, delivery, and innovation, all at a satisfactory price. Mutual trust between buyer and supplier is necessary for effective purchasing. 8. Inventory. Inventory decisions can be optimized only when customer satisfaction, suppliers, production schedules, and human resource planning are considered. 9. Scheduling. Feasible and efficient schedules of production must be developed; the demands on human resources and facilities must be determined and controlled. 10. Maintenance. Decisions must be made regarding desired levels of reliability and stability, and systems must be established to maintain that reliability and stability.

Varibality:
Any devetation from the optimem process that delevers perfect production on yime every time
The term variability, "the state or characteristic of being variable", describes how spread out or closely clustered a set of data is. This may be applied to many different subjects: 1)Climate variability.2)Genetic

variability.3)Heart rate variability.4)Human variability.5)Spatial variabilitypull system.6)Statistical variability

pull system: is where processes are based on customer demand. The concept is that each process is
manufacturing each component in line with another department to build a final part to the exact expectation of delivery from the customer.Because your production process are designed to produce only what is deliverable your business becomes leaner, as result of not holding excessive stock levels of raw, part-finished, and finished materials.One of main identifier of pull systems comes in the form of having Kanban methods in your production cycle. In essence a Kanban can be described as a visual aid which is used to show that either you have either finished a process, require work/more materials. The aim of having a visual aid is that the person who either feeds work off you or gives you work, becomes apparent of your needs quickly. Kanban is a concept that lends itself to high turnaround industries, but it can be applied to other environments. We shall be discussing Kanban in more detail in other areas of this website.Unfortunately pull systems do not lend themselves to all business types, because of product types, lead times and any stock holding arrangements with customers.However by having pull systems in some of your production processes, you will be able to reduce your lead times, and perhaps associated costs.

Manufacturing cycle efficiency (MCE): ratio resulting from dividing the actual production time by
total lead timereflects the proportion of lead time that is value-added

usiness cycle:
Repetitive cycles of economic expansion and recession.

Capital market efficiency:

Reflects the relative amount of wealth wasted in making transactions. An efficient capital market allows the transfer of assets with little wealth loss. See: efficient market hypothesis.

Push system:
Manufacturing system in which production is based on a projected production plan and where information flows frommanagement to the market, the same direction in which thematerials flow. See also pull system.

Pull System: In a pull system, releases are authorized. That is, there is an endogenous signal based on
system status that determines whether a release is allowed or not. In particular, the system status that triggers releases is based on stock voids, which means that a pull system is controlled by downstream information and is inherently make-to-stock. In our nomenclature, closed lines are pull systems, because buffer spaces act as stock voids to trigger releases.