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Old Name: The American Production and Inventory Control Society
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APICS offers four internationally recognized professional certification
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2. CFPIM: Certified Fellow in Production and Inventory Management = CPIM +
extensive knowledge sharing with others through presenting, teaching,
publishing, and other APICS educational activities.
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designed for professionals interested in increasing their knowledge of supply
chain management, those currently working in the field of supply chain
management (SCM), and for those individuals working with enterprise
resources planning (ERP) systems.
Why Toyota?
Why Toyota?
Why Toyota?
Why Toyota?
History
History (cont.)
Toyota Production System (TPS) drew wide attention from the industrial
community because Toyota was a profitable car company in Japan during
and after the oil embargo in 1970s.
The MIT researchers found that TPS was so much more effective and
efficient than traditional, mass production that it represented a completely
new paradigm and coined the term lean production to indicate this radically
different approach to production.
The term was coined by John Krafcik, a research assistant at MIT with the
International Motor Vehicle Program in the late 1980s. He then worked for
General Motors and now is a Vice President of Hyundai, U.S.
House of Toyota
Toyotas philosophy
House of Toyota
Attacks waste
Introductory Quotation
Waste (muda in Japanese) is
anything other than the minimum
amount of equipment, materials,
parts, space, and workers time,
which are absolutely essential to add
value to the product.
Shoichiro Toyoda
Founder, Toyota
1995 Corel Corp.
Continuous Flow
Producing and moving one item at a time (or a
small and consistent batch of items) through a
series of processing steps as continuously as
possible, with each step making just what is
requested by the next step.
It is also called the one-piece flow, single-piece
flow, and make one, move one.
Production Process
(stream of water)
Suppliers
Customers
Inventory (stagnant
ponds)
Material
(water in
stream)
Customers
Work
Station 1
WS 2
WS 3
Material
Information (Production Schedule)
Work
Station 1
WS 2
WS 3
Material
Information (via Kanban/Card)
Kanban
Japanese word for card
Pronounced kahn-bahn (not can-ban)
Triangular Kanban
Part #
Part Description
Date Triggered
Location
Lot Size
Tool #
Machine #
Kanban
Figure S12.5
R = Reorder point
Q = Economic order quantity
L = Lead time
Time
L
3. When you reach down to
a level of inventory of R,
you place your next Q
sized order.
Kanban
The function of Kanban
The function of Inventory Reorder Point
(ROP)
Kanban System
Single card
Move only containers
with C (Conveyance)kanban)
e.g.: Kawasaki
Transparency 17.5
Dual card
Move only container
with C- kanban
Produce only when
authorized by P
(Production)- kanban
e.g.: Toyota
Inventory
Traditional: inventory exists in case problems
arise
JIT objective: Eliminate inventory
JIT requires
Small lot sizes
Low setup time
Containers for fixed number of parts
Daily Quantity
2
3
Time
Small lots also increase flexibility to meet
customer demands
Large-Lot Approach
A
Time
Photo S12.4
Product
A
Daily
Requirements
800 20 40
800 20 40
200 20 10
C
Largest integer that divides into all daily requirements evenly is 10
Product
Daily Requirements Divided by 10
A
4010 4
B
C
Mixed-model sequence
A-B-A-B-A-B-A-B-C
Transparency 17.7
4010 4
1010 1
Repeat 10 times per day
Cycle Times
Working time per day = 480 minutes
Daily requirements: A = 40 units; B = 40 units; C = 10 units
The system cycle time = 480/(40+40+10) = 5.33 min/unit
Product
Requirements
40
40
10
Transparency 17.8
Cycle Time
480 4012
480 4012
48010 48
Lowering Inventory
Reduces Waste
Scrap
Capacity Imbalances
Lowering Inventory
Reduces Waste
Reducing inventory reveals
problems so they can be solved.
Unreliable Vendors
Scrap
WIP
Capacity Imbalances
Lowering Inventory
Reduces Waste
Reducing inventory reveals
problems so they can be solved.
Unreliable Vendors
Scrap
Customer
orders 10
Lot size = 5
Lot 2
Lot 1
Lot size = 2
Lot 1 Lot 2 Lot 3 Lot 4 Lot 5
Cost
Which Increases
Inventory Costs
st
o
C
l
Tota
n
i
d
l
Ho
t
s
o
C
Setup Cost
Smaller Optimal
Lot Size Lot Size
Lot Size
Setup Cost
optimal
New optimal lotOriginal
size
lot size
Lot Size
Setup Components
Internal Setup: consists of setup activities that must
be performed while the machine is stopped.
External Setup: consists of setup activities that can
be carried out while the machine is still
operating.
It is desirable to:
1. Convert as much internal setup to external setup
2. Improve the setup procedure
Setup Reduction
Setup Reduction:
Standardizing die holder heights reduces the need to
exchange fastening bolts
House of Toyota
Jidoka
Toyota Production System (TPS) is supported by two pillars: Just-in-Time and Jidoka
Jidoka = Autonomation = Automation with human intelligence.
Sakichi Toyoda, founder of the Toyota group of companies, invented the concept of
Jidoka in the early 20th Century by incorporating a device on his automatic looms that
would stop the loom from operating whenever a thread broke. Dr. Shigeo Shingo then
developed his idea further.
This enabled great improvements in quality and freed people up to do more value
creating work than simply monitoring machines for quality (separating peoples work
and machines work).
Eventually, this simple concept found its way into every machine, every production
line, and every Toyota operation.
Jidoka Techniques
Exhibit 7.10
Poka-Yoke Example
Visual Management
Andon Lamp
Red - line stoppage
Yellow - call for help
Green - normal
operation
Kaizen
Change for better = continuous
improvement
Kaizen workshop or Kaizen event:
A group of Kaizen activity, commonly lasting
five days, in which a team identifies and
implements a significant improvement in a
process, e.g., creating a manufacturing cell.
GEMBA
GEMBA" is a Japanese word meaning "real place", where
the real action takes place. In business, GEMBA is where
the value-adding activities to satisfy the client are carried
out.
Manufacturing companies have three main activities in
relation to creating money: developing (designing),
producing and selling products. In a broad sense, GEMBA
means the sites of these three major activities.
In a narrower context, however, GEMBA means the place
where the products are made.
The term is often used to stress the that real improvement
can only take place when there is a shop-floor focus on
direct observation of current conditions where work is
done, e.g., not only in the engineering office.
Masaaki Imai promoted Kaizen to people outside Japan through his two highly acclaimed books:
1. Kaizen: The Key To Japan's Competitive Success.
2. Gemba Kaizen: A Commonsense, Low-Cost Approach to Management
He preaches the Five Golden Rules of Gemba, the first of which is 'When a problem
(abnormality) arises, go to gemba first'. So what's gemba? It's the shop floor, or equivalent. Once
there, you apply
Golden Rule Two: check with gembutsu (relevant objects).
Three: take temporary counter-measures on the spot.
Four: find the root cause.
Five: standardize to prevent recurrence.
Standardization is the managing part of getting good gemba. You also need good housekeeping
(Imai is very keen on cleaning machines) and muda, the elimination of waste. But all hinges on
getting away from your desk. Obey the master Imai. GO TO GEMBA!
Why is our client, Hinson Corp., unhappy? Because we did not deliver our services when
we said we would.
Why were we unable to meet the agreed-upon timeline or schedule for delivery? The job
took much longer than we thought it would.
Why did it take so much longer? Because we underestimated the complexity of the job.
Why did we underestimate the complexity of the job? Because we made a quick estimate
of the time needed to complete it, and did not list the individual stages needed to complete
the project.
Why didn't we do this? Because we were running behind on other projects. We clearly
need to review our time estimation and specification procedures.
Plan-Do-Check-Act
(PDCA/Shewart /Deming Cycle)
Plan: Go to the real place/factory flow (gemba), obverse the
real thing/product (gembutsu), get the real fact (genjitsu).
Focus on reducing response time, lead times, exposing
wastes in your process
Do: Conduct Kaizen. Create models of excellence so others
can aspire to. Flow everything: product, information material
replenishment, services.
Check for direction by aligning activities with long-term
business direction
Act: Take actions to sustain and accelerate improvement
activities
Source: www.leanbreakthru.com
5S
5S is simple to begin and gives good benefits.
Each individual in an organization is asked to get
rid of overburdening items.
Red tag attack: A red tag attack is the strategy of
a group of people going through the plant and
putting red tags on everything that has not been
used within the last 30 days. The items that
people feel are necessary to "hold on to" must be
justified to their superior, or the item is taken out
of the plant!
5S in a Factory
5S in Office
Before 5 S
After 5 S
Standard Work
When manpower, equipment, and materials are used in the most efficient
combination, this is called Standard Work.
There are three elements to Standard Work:
1) Takt Time
2) Work Sequence
3) Standard Work-in-Process
From
Raw m
at er i al
Date Reviewed:
Operations
To
Heat Tr eat m
ent
Janary 7, 2000
FG
RM
Quality
Check
Safety
Precaution
Standard Work
in Process
Standard WIP
Quantity
10
TAKT
Time
12.1 min
Cycle
Time
23.4 min
Crew
Size
2
Manufacturing Cell
Cell 2
Worker
1
Worker
2
Worker
3
Cell 3
Figure 11.4
Cell 4
Cell 5
Workload balancing
Aims at maximizing operator utilization
based on the given takt time.
Is the key to adjust JIT lines to demand
fluctuations
Requires flexible operators
SM
What?
Why?
Who?
When?
Where?
On the shop floor, not from your office. You need the real
information, not opinion or old data.
How?
Next page
Spot weld
C/T = 30 sec
ABC
plating
Process
C/O = 10 min
3 shifts
Vendor
2% scrap rate
= 1 day
Data box
Inventory
Finished
goods
Push
Physical pull
Supermarket:
the location of a
predetermined
standard inventory
Mon
and
Wed
Shipment
Comparison of
MRP (Material Requirements Planning),
JIT, and TOC (Theory of Constraints)
MRP
Loading of operations
Batch sizes
Importance of data
accuracy
Speed of scheduled
development
Flexibility
Cost
Goals
Planning focus
Production basis
JIT
TOC
Checked by capacity
requirements
Planning afterward
One week or more
Controlled by kanban
system
Controlled by
bottleneck operation
Small as possible
Critical
Unnecessary
Variable to exploit
constraint
Critical for bottleneck
and feeder operations
Slow
Very fast
Fast
Lowest
Highest
Meet demand
Have doable plan
Master schedule
Plan
Highest
Lowest
Meet demand
Eliminate waste
Final assembly schedule
Need
Moderate
Moderate
Meet demand
Maximize profits
Bottleneck
Need and plan