Just in Time 130904055049

JUST-IN-TIME MANUFACTURING
Just-In-Time Manufacturing
JUST-IN-TIME MANUFACTURING TaBLe Of COntents

I. JUST-IN-TIME MANUFACTURING.......................................................................1 A. INTRODUCTION.........................................................................................1 B. JIT PHILOSOPHY. .......................................................................................1 1. History of Just-In-Time......................................................................2 From Supermarket to Shop Floor.....................................................2 2. What to Expect. .................................................................................3 C. VALUE-ADDED ANALYSIS.........................................................................4 Figure 1-1 Value-Added Analysis. ....................................................5 Figure 1-2 Value-Added Analysis. ....................................................6 1. Don't Forget The Office.....................................................................7 D. UNDERSTANDING WASTE........................................................................7 1. Evils of Inventory. ..............................................................................8 Figure 1-3 High and Low Levels of WIP...........................................9 E. JIT AND QUALITY.....................................................................................11 1. The Chicken or the Egg..................................................................11 2. What If ?. .........................................................................................12 3. What is Quality ?.............................................................................13 4. Preventing Quality Problems..........................................................13 Defining the Requirements.............................................................13 The Root Cause of The Problem....................................................14 Figure 1-4 Getting to The Root Cause. .........................................15 Keeping Control of The Process.....................................................16 Figure 1-5 Poka-Yoke - Speaker Box Assembly. ...........................17 Figure 1-6 Poka-Yoke - Drilling Holes in a Side Plate....................18 F. UNIFORM PLANT LOAD. ..........................................................................19 1. Cycle Time......................................................................................19 Workforce. .......................................................................................20 2. Level Loading. .................................................................................21 Figure 1-7 Level Loading...............................................................22 3. Learning Curve Improvements. .......................................................23 G. SETUP TIME REDUCTION.......................................................................24 1. Getting Started................................................................................24 2. Setup Reduction Teams..................................................................25 3. Videotaping.....................................................................................26 4. The SMED System. .........................................................................27 The Four Conceptual Stages of SMED. ..........................................27 5. Clamping.........................................................................................28 6. Adjusting.........................................................................................28
AIDT - Just-In-Time Manufacturing - September 11, 2006
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CELLULAR MANUFACTURING................................................................29 Figure 1-8 Traditional Manufacturing System................................29 Figure 1-9 U-Shaped Work Cell.....................................................30 1. U-Shaped Work Cells. .....................................................................31 Figure 1-10 U-Shaped Work Cells.................................................32 U-Shaped Cells versus Assembly Line Manufacturing...................33 Comparison of Assembly Line and U-Shaped Work Cell. ...............33 Figure 1-11 Cellular Manufacturing System................................... 34 PULL SYSTEMS. ......................................................................................35 1. The Push System. ........................................................................... 35 Figure 1-12 Push System..............................................................36 2. From Supermarket to Factory Floor - The Pull System. ..................37 Figure 1-13 Kanban Card.............................................................. 37 Figure 1-14 Production Control by Pull System............................. 39 JIT PURCHASING..................................................................................... 41 Figure 1-15 Typical Manufacturing Costs. ...................................... 41 1. Partnerships....................................................................................42 2. Eliminating Procurement Wastes....................................................43 3. A Day's Worth Every Day................................................................44 JIT IN CONJUNCTION WITH MANUFACTURING RESOURCE PLANNING. ................................................................................................45 1. Which System ?..............................................................................45 MANAGEMENT'S RESPONSIBILITY.......................................................47 1. Motivation. .......................................................................................48 2. Training...........................................................................................48 3. Leadership......................................................................................49 IMPLEMENTING JIT. .................................................................................49 1. Forming Teams...............................................................................50 2. Developing a JIT Startegy. ..............................................................50 GLOSSARY...............................................................................................52 REFERENCES AND RECOMMENDED READINGS................................56
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I.
JUST-IN-TIME MANUFACTURING
A. INTRODUCTION
Why Just-In-Time manufacturing when there are dozens of other manufacturing philosophies from which a company may choose? Just-InTime (JIT) manufacturing distances itself from the competition because no large capital outlays are required. Other methods promote complexity, large overheads, automation, and other "state-of-the-art" technologies, while JIT advocates simplifying and streamlining the existing manufacturing process. Since World War II, traditional American companies have developed a way of doing business that entails top management planning, re-planning, and more planning. Although some planning is good, it ultimately adds no value to the end product. Customers want quality products at competitive prices - they couldn't care less how much planning was required to get that product to them. By implementing JIT, much of the planning disappears and a large portion of the remaining planning is entrusted to the shop floor personnel. The purpose of this text is to introduce basic JIT concepts and assure you that JIT can work in your company. The transition to JIT often is not easy, but it is almost always rewarding. All employees in the company - from top management to direct labor - must have a clear understanding of the benefits that JIT offers to them and to their company. JIT is not a cure-all for every manufacturing problem. But, if implemented properly, JIT is a no-cost or low-cost method for improving your manufacturing process.
B.
JIT PHILOSOPHY
The basis of Just-In-Time (JIT) is the concept of ideal production. It centers on the elimination of waste in the whole manufacturing environment, from raw materials through shipping. Just-In-Time is defined as "the production of the minimum number of different units, in the smallest possible quantities, at the latest possible time, thereby eliminating the need for inventory. Remember, JIT does not mean to produce on time, but to produce just in time.
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History Of Just-In-Time
JIT is sometimes said to have been invented by Henry Ford because of his one-at-a-time assembly line, circa 1913. This is an incorrect conclusion since Ford's system could handle no variety and was designed for large volumes and large batch sizes of the same parts. JIT was invented by Taiichi Ohno of Toyota shortly after World War II. Ohno's system was designed to handle large or small volumes of a variety of parts. Many people are intimidated by JIT because of its association with Japan. If these people take a broader look at JIT, they will see that it is nothing more than good, common sense manufacturing. Ohno and his associates came to America to study our manufacturing processes. They determined that our system was much like the system that Japanese companies were using, but Japanese companies could not afford waste in their systems due to the devastation to their economy caused by World War II. While in America, Ohno learned much about America's culture. One of his discoveries has transformed the world's perspective on manufacturing.
From Supermarket To Shop Floor
Legend has it that Ohno got the idea for his manufacturing system from America's supermarket system. Ohno learned the kanban (pull) system from our supermarket system in which customers pulled items from the shelves to fill their shopping carts, thereby creating an empty space on the shelf. The empty space is a signal for the stocker to replace that item. If an item was not bought that day, there was no need to replace it. When item quantities become low, that is the signal for the stockers to order more goods from their suppliers. Customers are content to take just what they need, because they know that the goods will be there the next time they need them. To apply this concept to manufacturing, Ohno devised a system whereby the usage of parts is determined by production rates. Materials are pulled through the plant by usage or consumption of the parts in final

assembly. To obtain maximum results, Ohno decided to move the machines closer together and form manufacturing cells. The JIT system continued to evolve, with the central thrust being the elimination of waste. Ohno's system has become a totally flexible system in which production rates are determined by the end user rather than the producer.
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What To Expect
While the prevailing view of JIT is that of an inventory control system, it is much more. JIT is an operational philosophy which incorporates an improved inventory control system in conjunction with other systems, such as: A set-up time improvement system. A maintenance improvement system. A quality improvement system. A productivity improvement system.
A properly implemented JIT system should: Produce products customers want. Produce products only at the rate that customers want them. Produce with perfect quality. Produce instantly with zero unnecessary lead time. Produce with no waste of labor, material, or equipment. Every move has a purpose and there is no idle inventory.
An overview of JIT literature suggests that the steps or elements of the implementation process generally (though not always) include the following: Reductions in set-up time. Utilization of a formal preventive maintenance program. Utilization of quality circles. Utilization of cellular manufacturing techniques. Cross-training of employees.
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Quality certification of suppliers. Reductions in vendor lead time. Reductions in lot sizes. Sole sourcing. Presence of one who "championed the cause of JIT within the firm.
Benefits touted as results of JIT implementation include: Reductions in down time. Reductions in inventory. Reductions in scrap and re-work. Reductions in workspace. Increased inventory turns. Increased labor utilization. Increased equipment utilization. Improved service to customers.
C. VaLue-added AnaLysis
Maybe you believe that your company is efficient enough and that the benefits of JIT are not worth the frustration and stress associated with change. At this point you have a decision to makeyou can adopt a new company motto such as Were no worse than anybody else, or you can take positive steps toward improving the process. To strengthen the incentive for change, companies should identify the inefficiencies (wastes) in their present manufacturing processes. To identify waste in your company, a value-added analysis should be performed. We must always be aware that any activity that does not add value to a product is waste. There are specific methods for performing a value-added analysis but we will use a simplified approach for our purposes. Take a pad and pencil and go out on the shop floor. Pick a product and follow it through the entire manufacturing process from raw materials to shipping. Note every activity performed on the product. Do not get a routing slip to see how the process is supposed to go, but accurately record the process including delays, transportation, inspection, storage, etc. Figure 1-1 on the following page is a value-added analysis for a machined part.
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FIGURE 1-1 Value-added Analysis

ACTIVITY 1 VALUE ADDING NON-VALUE ADDING
2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32
Receive aluminum from vendor To storage rack via forktruck Store aluminum To shear via forktruck Wait for shear Set up shear Shear aluminum Stack part on pallet Wait till have correct batch size Wait for forktruck To storage via forktruck Store part To CNC mill via forktruck Set up CNC mill Clamp part in vise Mill inside recess Change tool Drill pilot holes Change tool Drill finished holes Change tool Tap holes Remove part from vise De-burr part Stack part on pallet Wait till have correct batch size Wait for forktruck To storage via forktruck Store part Sell part To shipping dock via forktruck Ship part TOTALS
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Figure 1-1 showed us that 32 total activities take place before the customer receives the part. Only eight of these activities add value, therefore all other activities must be considered waste. Even though some of these wasteful activities are absolutely necessary, they are still waste and should be viewed as such. We will now streamline the manufacturing process, using JIT techniques that will be discussed in-depth later. Figure 1-2 shows that non-value-added activities have been reduced to nine instances.
FIGURE 1-2
Value-added Analysis
VALUE ADDING NON-VALUE ADDING
ACTIVITY 1
2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
Receive aluminum from vendor To shear via forktruck Set up shear Shear aluminum Set up CNC mill Clamp part in vise Mill inside recess Change tool Drill pilot holes Change tool Drill finish holes Change tool Tap holes Remove part from vise De-burr part Sell part Ship part TOTALS
Perhaps nonvalue-added activities can be reduced further and perhaps they cannot. The concept is to keep an open mind as to how you can continuously improve the process. All remaining steps are now optimized to produce the part as efficiently as possible.
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Don't Forget The Office

Evaluating a process using a value-added analysis should not be limited to the shop floor. All processes in an organization can benefit from eliminating waste. Everything from purchase orders to typing memos should be streamlined. How long does a purchase order sit on someones desk awaiting a signature, only to be changed, retyped, and submitted again? It may then stall at a higher level in the organization and so on up the ladder. Not only will the techniques of JIT manufacturing help eliminate some of the nonvalue-added steps in your process, but in doing so they will reduce lead time, improve throughput time and increase quality.
D. UNDERSTANDING WASTE
Ask almost any shop floor employee the definition of inventory and the likely answer will be you know all this stuff stacked up around here and all that stuff in the warehouse. Many employees (and some supervisors and managers) do not understand that Work-In-Process (WIP) is also inventory. Pure and simple inventory is waste. Another way to describe inventory is money loaned out of a companys pocket that has yet to be repaid. JIT is much more than a plan for decreasing inventory, it is a manufacturing philosophy for eliminating waste. For our purposes, waste can be defined as something other than the essential resources of people, machines, and material needed to add value to the product. Anything else, such as inventory, scheduling, meetings, warehousing goods, management, and moving stock can be considered wasteful because these actions do not directly add value to the product. All waste cannot be purged from the system, however, we must strive toward that ideal goal. Above all it must be ever present in the attitudes of our manufacturing system that cost without value is waste.
A typical company produces excess inventory with the idea that we can use this stuff when the next order comes in." Routinely these parts are forgotten when the next order is placed. Other than initial costs of the products, they are also paying for moving the product, warehouse space, fork trucks, warehouse personnel, tracking the products, and moving the products again, etc. One company that we visited was constantly plagued with the problem of misplaced inventory. They had numerous storage bins, plus inventory was sometimes temporarily placed on the shop floor in different places. More often than not, new parts would be made when the internal customer needed the parts, because nobody knew the parts already existed. Another company we visited wastes money on rust preventatives and the time-consuming task of removing rust from parts in storage solely for the benefit of excess inventory.
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Evils Of Inventory
Although inventory has long been accepted as a necessary evil we must remember that it is still an evil. Why is inventory evil? Traditional manufacturing processes build in safety stock at every station throughout the entire system, from extra raw materials to warehouses full of completed products. This superfluous WIP provides manufacturers with a means to endure the problems, rather than solving the problems at the root cause. Figure 1-3 shows how some problems can be disguised by excess inventory. The water shown in the graphic is inventory and the rocks depict manufacturing problems. As the water level drops, more and more rocks begin to surface.
FIGURE 1-3
High and Low Levels of WIP
Lets take a hypothetical look at a company that is reducing inventory. ACME manufacturing produces roller skates for a major toy company. In one process, bearings are pressed into the skate wheels. Frequently a wheel does not run true because the bearings are inserted at an angle. This problem can only be detected after the wheel has been assembled. When such a problem does occur the entire wheel assembly must be discarded. This problem was undetected for years because the manufacturing line never slowed down due to these defects. Extra wheels and bearings were always available to the assembler. After inventory was reduced, the wheel assembler had difficulty meeting demand. He no longer had the inventory cushion to hide the quality problems. There was not enough extra WIP to allow him to continually produce bad parts. Now that the quality problem is evident, a concentrated effort must be made to solve it. Do not make the mistake of raising WIP to allow the line to flow smoothly. We need the problems to surface so that we can solve them. Remember, the WIP is not the solution to the problems it is only a means to wade through them. Inventory must first be reduced, then you can solve the problems. Inventory must be decreased using a systematic approach. A methodical approach is to cut inventory by one half then solve the problems then cut half of that inventory and solve the problems. Continue this process. See Xenos paradox mentioned in Section E.
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E.
JIT AND QUALITY

The single most substantial ingredient of JIT is quality. It is impossible for JIT to be successful until the company has drastically improved its attitude toward quality. In the language of the Malcolm Baldrige National Quality Award, quality is a race with no finish line." The ultimate aspiration is to satisfy all customers (internal and external) all the time. The Wallace Company, a past winner of the Baldrige Award, installed a buzzer on the shop floor that sounded anytime a customer called their customer service hot line. Instantly all workers knew they had a dissatisfied customer. Can you imagine installing such a device in a traditional manufacturing company?
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The Chicken Or The Egg

Analogous to the familiar chicken or the egg question, it is often asked, Which comes first, quality or JIT? Quality is a two way street; JIT is impossible without quality, but quality is directly enhanced by JIT. Although quality is possible without JIT, it requires the use of wasteful procedures such as inspection and rework. JIT proposes the idea of do it right the first time rather than inspecting in quality. In a JIT environment, each internal customer (the next operator down the line) must be completely satisfied by the previous operation. Any problems in quality are resolved immediately, rather than allowing them to contaminate the system further. To produce quality you must install quality. Quality must evolve from both sides at the same time. To allow operators to satisfy their internal customers, quality procedures, materials, machines, and mindset must be present. JIT is not possible without quality, but JIT is a means by which quality is achieved. A mathematics riddle known as the Xenos paradox asks if a person walks toward a wall, each step being one half as large as the previous one, when will that person reach the wall? The answer is "never", but that person is continuously getting closer and closer to his or her goal. Continuous improvement in quality must be viewed in the same way. If you set a standard at 95 percent, people figure that they are doing fine as long as they are at or near that objective. Companies have to
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be motivated to advance quality to increasingly higher and higher standards. Ultimately the goal should be perfection.
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What If?
The alternative to setting standards at the highest possible level becomes clearer when you look at the consequences of almost, but not quite. If 99.9 percent is good enough, then... Two million documents will be lost by the IRS this year. 22,000 checks will be deducted from the wrong bank accounts in the next 60 minutes. 1,314 phone calls will be misplaced by telecommunication services every minute. 12 babies will be given to the wrong parents each day. 291 pacemaker operations will be performed incorrectly this year. 315 entries in Websters Third New International Dictionary of the English Language (unabridged) will turn out to be misspelled.
Incidentally, 99.9 percent accuracy would be a remarkable improvement in the context of current performance levels in most of todays traditional manufacturing companies. Employees should be producing by the following code: Defect-free output is more important that output itself. Defects, errors, and breakdowns can be prevented. Prevention is cheaper than rework.
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3.
What is Quality?
One of the great gurus of quality, Phil Crosby, says that companies often have a misconception of quality. He says that the true definition of quality is meeting requirementsnot an intuition for aesthetics, roundness, or perfectionbut something that can be truly measured. If a Yugo (economy car of the the early 1970s) meets its customer's requirements as well as a Rolls Royce meets its customer's requirements, then it can be argued that the Yugo is as much a quality car as a Rolls Royce. Now that we understand what quality is and what it can do for us, how do we get quality? The key is to obtain quality at the source. The sources for quality are the manufacturers and vendors processes, machines, and operators. Contrary to traditional beliefs, the source of quality is not the inspection bench.
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Preventing Quality Problems

To dismantle the inspection bench mentality, we must take positive steps in prevention of quality problems. Specific guidelines and rigorous procedures must be established. The steps toward attaining a quality product are to first define the requirements, get the process under control, and then keep the process under control.
Defining the Requirements
Many manufacturing companies do an inadequate job of defining quality requirements. If you are looking at a part or a process, and say thats good enough then you have not sufficiently defined your requirements. The real definition of quality is meeting both internal and external customer requirements. Employees and vendors should have strict guidelines that distinguish good parts (quality) from rework or rejected parts so 100 percent customer satisfaction can be reached. Let us look back at our ACME manufacturing example. The assembler had no specific requirements for pressing the bearings into the wheel. He was told that the wheel must run true. What is true? How much
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leeway does he have? Can the bearings be somewhat angled or must they be exactly straight? The assembler should be supplied with strict criteria for quality such as each bearing should be pressed into the wheel at a perpendicular angle plus or minus one degree. He now knows what is expected and what is considered good enough.
The Root Cause of the Problem
To get the process under control, you must first find the root cause of the problem. This can be accomplished by running the gamut from simple methods such as pareto and matrix analysis to complicated design experiments. A common problem is to attack the symptom and not the problem. For example, if a breaker tripped at your house, you could reset the breaker and hope for the best, replace the breaker box, or you could check for an overloaded plug (too many appliances plugged into one outlet). In your manufacturing process, dont make the mistake of rewiring the whole house before the actual problem is diagnosed. Everyone has worked on a problem that magically went away, although you were not exactly sure why. It could be any one of the solutions you tried or a combination of any two. In this case, you do not know if you have gotten to the root cause or not. You must be able to turn the problem on and off to ultimately conclude that the problem has been solved. If you can not turn the problem on and off it is likely that you have solved a symptom rather than a problem. At this point you should ask why and continue to ask why until you find the root cause. Figure 1-4, shown on the following page, illustrates the problem of bad service at a restaurant.
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Getting To The Root Cause
FIGURE 1-4
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Obviously you cannot turn the problem of the owners offspring on and off, but asking why did get you to the root cause. Disciplining the waitress will not solve the real problem. The root cause of this problem is a bad promotion policy. The long-term solution is a change in that policy. If you ask why enough times you will get to the root cause.
Keeping Control of the Process
Once you have found the solution, keeping the process under control is an easier task. Statistical Process Control (SPC) is a method of managing a process by gathering information about it and using that information to adjust the process to prevent problems from occurring. Using SPC is one way to keep your process under control. Poka-yoke, a Japanese word for fail-safing, should also be applied. In the Pokayoke theory, parts and processes are designed so that doing the job right is easier than doing it wrong. An example of this is to design a part that is asymmetrical so that it fits only one way, thus eliminating misinstallation. Machines can be fitted with limit switches that will not allow it to cycle if all processes are not completed in the correct order. These methods should not only be used by your company but by your vendors as well. The following are such examples (Hirano, 131):
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FIGURE 1-5
Poka-Yoke - Speaker Box Assembly Description of Process: Front plates were attached to speaker boxes. Before Improvement: It was difficult to determine the correct orientation of the speaker boxes because the mounting holes were symmetrical at the top and bottom. Correct mounting depended exclusively on the worker's vigilance, with the result that the speaker boxes were sometimes mounted to the front plates upside down. After Improvement: The positions of the mounting holes were made asymmetrical on the top so that incorrect mounting is impossible. Upside down mounting is completely eliminated.
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FIGURE 1-6
Poka-Yoke - Drilling Holes in a Side Plate Description of the Process: A workpiece, a side plate, is set into position on a drill press and dowel holes are drilled. The workpiece is essentially symmetrical, and back and front are difficult to distinguish at a glance, although two edges are grooved along their length. Before Improvement: The workers, when setting the workpiece into position, checked to see whether the top and bottom of the plate were in the correct position. They then drilled the dowel holes. Inexperienced workers sometimes confused top for bottom and drilled the holes in the wrong places. Even veteran workers sometimes mounted the part backwards. These defects were discovered only at assembly. After Improvement: The grooved edges of two sides of the workpieces are used as guides for setting up the plates correctly. A limit switch is mounted on the jig and interlocked with the start switch so it is impossible to start the drill press if the side plate is set in the wrong position. Defects due to defective holes are completely eliminated.
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F.
UNIFORM PLANT LOAD

The diversion between traditional manufacturing philosophy and JIT becomes apparent when discussing the concept of Uniform Plant Load. Everyone will agree that we need to eliminate waste and strive for quality to receive the most benefit from our manufacturing systems, but there are two views on how to go about this. The traditional system calls for production at the machine rate while JIT advocates production at the customer requirement rate. The JIT concept of Uniform Plant Load states that balance between operations is more important than speed, and ideally we should never produce faster than the customer requirement rate. The concept of Uniform Plant Load incorporates two radically different facets of production. They are rate of production (cycle time) and frequency of production (level loading). It must be remembered that neither of these concepts will achieve maximum results until the process is under control and quality has been improved to world-class or near world-class standards.
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Cycle Time
Traditional definitions of cycle time include the time it takes a machine to cycle through its process or the time from start to completion of a product (throughput time). Under JIT, cycle time is the total time required for a worker to complete one cycle of operations, including walking, load/unload, inspect, etc. Cycle time should equal the customer requirement rate, or better stated the sales rate. We should view the last step in the manufacturing process as when the product gets sold, not when the product is completed. This rate is also expressed in terms of takt time. Takt time is the total daily operating time divided by the total daily requirement. Takt time tells you how many hours, minutes, or seconds are required for each part. Takt is a German word for baton. In comparing a manufacturing process to an orchestra, the rate at which the orchestra leader moves the baton is the rate at which the orchestra plays, just as the rate of customer requirement is the rate of company production.
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Companies that have produced as fast as possible (machine rate) for many years often struggle with the concept of slowing down individual machines so as to achieve perfect balance between operations. If your customer requirement rate is 20 parts per month, then why would you want to produce 30 parts per month? This would lead to the evils of inventorythe consumption of space, waste in motion, and materials that hide problems. Conceptually, each machine should run as if a rheostat were attached. The rheostat could be dialed up or down as needed to produce at the exact rate required. If the requirement rate changed from month to month then the production rate could be altered to meet these requirements. If you set the last operation to the sales rate then each preceding operation should feed the last operation at that rate. This system can then be exploded backwards throughout the plant until the first operation (usually raw materials) is reached.
Workforce
If ten people are producing 20 parts per month in August, but only ten parts are needed in September, five people should then be capable of producing the needed ten parts so that labor costs remain constant. This reduction can only be accomplished with a good physical plant layout (to be discussed later) and a well-trained, flexible workforce. The logical questions at this point are: Where do the five people go?, and Where do they come from when production goes back to 20? It must be made abundantly clear that the purpose of implementing JIT is not to reduce the workforce. You can now use this idle time to cross-train employees for even more flexibility. When not on the production line employees can perform other tasks, attend team meetings, do preventative maintenance, make plans to further improve the process and so forth. Rather than producing extra parts and dealing with inventory, you are now optimizing employee time. That leads us to the golden rule of JIT: Machines can be idle but people cannot. We should not make the mistake of trying to find the perfect balance between parts produced and manpower required. There is no perfect balance. We must decide how many parts the line should produce that month, week, or day and balance to that number. Remember, the answer is not to run the line as fast as possible, but to produce to the customer
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requirement rate by deciding how fast the line must run to meet the particular deadline and how many people are needed for this rate.
2. Level Loading
The second facet of Uniform Plant Load is level loading. Level loading suggests that if you sell a product every month, then make the product every month. Ideally, if you sell a product every day, then make the product every day. You must make your products as frequently as your customers require them. Let us assume that your company produces three productsalphas, betas, and deltasfrom the same line. Cycle time has been implemented, therefore, your equipment is running at the right speed. For example, we will say that in the month of March we will need 25 percent alphas, 50 percent betas, and 25 percent deltas. In a traditional manufacturing environment alphas would be produced for 25 percent of the month. We would then change over (setup) and run betas for 50 percent of the month; change over again and run deltas for the remaining 25 percent of the month. Do your customers buy alphas the first week, betas the next two weeks, and deltas the last week? The next logical step may be to produce a weeks worth every week. You have instantly gone from setting up 3 times a month to 12 times a month. Traditional manufacturing will be quick to note that valuable time will be spent setting up with no time to produce. Increased number of changeovers can be accomplished only after setup time has been reduced to allow this. We will address the subject of setup time in the next chapter. In a nutshell, if we are to change over four times more often, then we must reduce setup time to 25 percent of its original time. To meet these goals you must take a structured step-by-step approach. A lofty goal may be to produce a days worth every day. It is true this is a very high standard but Toyota is currently producing two hours worth every two hours.
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FIGURE 1-7 Level Loading
Setup reduction has a direct correlation to batch size. If setups are reduced by 50 percent then batch sizes can be reduced by 50 percent. Additional direct benefits of level loading are learning curve improvements, increased mix flexibility, reduced inventory, shorter lead times, and quality improvements.
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Let us look at our original process of producing alphas for one week, betas for two weeks and deltas for the remaining week. If a customer calls in a change order for more alphas the third week of the month; a three-week delay occurs before alphas are being produced again. If you are on a daily or even weekly production schedule, reaction to changes in mix can be almost immediate. Production of alphas can begin the next day or you could change over the same day if requirement rate of betas and deltas would allow. As the system begins to produce at the customer requirement rate and reduced setup times are translated into smaller batch sizes, lead times are also reduced. When a product is being manufactured monthly, lead times are expressed in months. Weekly manufactured parts require lead time in terms of weeks and daily parts in terms of days. There is now no need for extravagant scheduling and tracking systems. If the requirement rate changes, parts can be put into the queue at the next changeover period. As stated earlier there is a direct correlation between setup reduction and batch sizes. The same can be said for batch sizes and potential cost of failure. If a batch size is cut in half, the potential cost of rework or scrap is cut in half. A streamlined manufacturing process dictates that quality problems will be less likely and if they occur will be much easier to detect and correct. Smoother production runs need fewer adjustments, therefore quality becomes more predictable.
3. Learning Curve Improvements

Learning curve improvements are achieved when virtually every day is the same. If you are producing all of your products at the customer requirement rate each day then the days become more complex but each day is the same as the day before. Setups occur every day, therefore there is not time to forget the setup procedure as was the case with infrequent setups. There is no time to fall into a pattern for weeks only to have abrupt changes that require relearning the setup and production process for the next product. Once the employee gets into the rhythm of daily production, the day-to-day learning curve virtually disappears.
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Uniform Plant Load allows us to produce at the exact rate and frequency that the customer requires. Other aspects of JITsetup reduction, machine cells, pull systems, JIT purchasing, and schedulingare methods used in achieving plant balance.
G. SETUP TIME REDUCTION

Setup time is the interval between the production of one good part and the production of another good but dissimilar part. Setup reduction is a prerequisite to implementing many aspects of JIT by directly or indirectly influencing cycle time, level loading, work cells, pull systems, cost, WIP, purchasing, floor space, quality, operator numbers, and batch sizes. Everyone will agree that a two-hour setup reduced to two minutes is a great productivity improvement, but this saved time should not be applied to longer production runs that increase batch sizes. An hour saved that is transferred to the production of parts simply puts those parts in inventory, which is the exact opposite of what we are striving for. Our objective is to apply this hour to more frequent setups, thus giving us more flexibility to better implement JIT.
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Getting Started
Our mission is to reduce setup time by 75 percent on a low-cost or no-cost basis. Some machines will require a little more setup time and some a little less, but 75 percent reduction is our initial goal. This may not be accomplished in a week or a month, but can be achieved through continuous improvement. You must first decide which setup to work on. A good rule of thumb is to select your most complex setup. Typically this is the setup that causes the largest bottleneck (takes the most time), and therefore offers the opportunity for the largest time savings. After a particular setup has been chosen, a Setup Reduction Team must be formed. The next problem that arises is who should be on the Setup Reduction Team.
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2.
Setup Reduction Teams

Traditional management behavior seems to indicate a belief that the managers and the engineering staff have all the solutions. In recent years new management approaches, specifically TQM (Total Quality Management), have disproved the myth that management best knows how to solve all manufacturing problems. The new Setup Reduction Team should consist of the real expertsthe operators and setup people. Contrary to traditional managements beliefs, these people have superior knowledge of their machines and the process. The typical Setup Reduction Team should have three to five shop floor personnela combination of operators and setup people, one to two engineers and possibly a manager. You will notice that the single largest component on the Setup Reduction Team is the shop floor personnel. They probably have all the answers to reduce setup time but until now had no avenue to impart their wisdom. The reason more engineers are not involved with the group is that most setup problems are not engineering problems. Engineers tend to emphasize the mechanics of the setup, but the real reasons time is lost are lack of preparation, lack of organization, and operator error. Such problems may include not knowing what the next job is, setting up for the wrong job, inability to find a forktruck driver or the forktruck is in use, inability to find or not having the right tools, broken tools, not remembering the exact setup procedure, not having the right bolts, or having no nuts for those bolts. The mechanics of the setup may or may not need to be modified or, if so, only after other improvements have been enacted. After the team has been selected, proper training in team concepts must take place. The team should know its mission and act on its findings, not just study and make recommendations. Team training is a separate subject in itself and space does not allow us to pursue the topic here. There are many good texts and seminars offered in this area that will allow you to learn team training concepts.
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3.
Videotaping
If a picture is worth a thousand words, a videotape is worth at least a million. The single best way to document and analyze a setup is with videotape. A verbal description or written account of a setup will not give you the detail of a video. Many nonvalue-added steps can be uncovered that would otherwise remain camouflaged by other means of documentation. Obtaining a credible videotape is often not easy. One major dilemma that occurs is a phenomenon known as the Heisenberg principle. Simply stated this idea is the belief that something that is being observed is changed merely by the fact that it is being observed (Hay, 63). If workers know that they are being taped they will perform the setup with a much greater sense of urgency. Outside preparations may occur that are not normally done. These actions lead to a misrepresentation of the true time and steps involved in a setup, thus defeating the purpose for videotaping. Another problem that may occur is apprehension about being videotaped. Operators may fear that management will use the tape to place blame for productivity problems, or to teach others how to do their job, or that other team members will ridicule their performance. The number of rumors that can surface when a video camera appears is infinite. The best deterrent to these problems is prevention. Operators should be briefed on the reasons for documentation prior to any videotaping with all questions being answered then. It should be abundantly clear that no additional actions should be taken in the documented setup and that safety will never be neglected to gain speed. At no time will any guards be removed, parts fastened less securely, work be done on moving equipment, etc. One method to obtain more true documentation is to do videotaping without announcement. Place the video camera in position just prior to the setup, thus allowing no time for special preparations. The documentation should include the last part from the previous job coming off the machine. The timer should then be set and everything should be taped from that point on. Tape continuously even if no work
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is being done on the machine. When the first good part from the new job is finished, the documentation is complete. Once the videotape is complete, the Setup Reduction Team begins a detailed analysis of the setup procedure. The primary focus of the analysis is to reduce machine downtime. Team members generate a list of problems to solve and possible solutions for the problems.
4.
The SMED System

One proven technique for optimizing setup time is the Single-Minute Exchange of Die (SMED) system. The SMED system was founded by Shigeo Shingo while consulting with Toyota in 1969. No man has revolutionized setup reduction philosophy as much as Shingo. He has won numerous productivity improvement awards in Japan, the United States, and the world over. The basis of SMED is the performance of setup operations in under ten minutes, i.e., in a number of minutes expressed in a single digit.
The Four Conceptual Stages of SMED:
Internal setup and external setup are not distinguished. Internal setup and external setup are distinguished. Internal setup is converted to external setup. Streamline all aspects of the setup.
The concept behind the SMED system is distinguishing internal setup (performed while the machine is off) from external setup (performed while the machine is producing) and converting internal to external setup. This is accomplished by examining the true functions of setups. Once this step has been successfully applied, only internal activities are left. An example of this would be to locate and organize all the bolts needed for the next setup while the previous job is running instead of rushing around looking for bolts after the machine is off. After the activities of the setup have been corrected, the mechanics of the setup need to be addressed. Or as Shingo states, all aspects must be streamlined". Two major categories in this area are clamping and
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adjusting. Numerous texts have been written concerning quick die change, Poka-yoke (fail-safing), fixtures, setup reduction, and similar topics. Although we will deal with setup mechanics in general terms, further study in this area is recommended.
5.
Clamping
Video documentation will often reveal that substantial time is spent loosening and tightening nuts and bolts. Threads are a very inefficient method for speed in a setup, because only the last half turn of a bolt or nut gets the job done. The first fifteen, twenty or twenty-five turns are a useless waste. Another problem with threads is the use of tools. Picking up a wrench if you can find itis also a waste; therefore we must look for alternative methods for clamping. Do not make the mistake of trying to buy the solution. While it is true that hydraulic or pneumatic clamps save much time and wasted motion, they violate our no-cost or low-cost policy. Look for methods that require only one or two motions such as cams, levers, or pins. You can explore purchasing high-tech clamping systems after all other avenues have been exhausted or continuous improvement has stagnated.
6.
Adjusting
The videotape may also show large amounts of time is being spent to get the job to run right. Traditional thoughts have been that adjustments are necessary, therefore no energy has been expended to eradicate the problem. Our aim is to have quality parts produced the first time, every time. Bad parts should never be produced due to setup. The problem with adjustments arises because most machines are infinitely adjustable. For example, something on a machine is measured, or tightened down, then a part is run. Then the machine is adjusted, tightened down, then another part is run. This continues until a good part is produced. After analyzing the videotape you may conclude that the machine needs to be adjusted to a few set positions. At this point the machine should be converted to positive stops for those positions rather than endlessly measured positions or better yet the machine can be designed to be self-positioning.
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Reducing setup is a crucial step toward accomplishing JIT manufacturing goals. Setup reduction is considered a high priority because it affects so many facets of JIT. Setup reduction is much easier than most people think after traditional methods have been purged. It is extremely important to adopt new perspectives that are not bound by old habits.
H. CELLULAR MANUFACTURING
The traditional method of arranging a manufacturing facility is by departmental specialitythat is, each department houses specialized equipment or technology. All the lathes, milling, drilling, grinding and assembly would be done in completely separate departments. Production in large batch sizes is inevitable when factories are laid out in this manner. Figure 1-8 illustrates a traditional manufacturing system. (Black, 34)
FIGURE 1-8
Traditional Manufacturing System
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The JIT philosophy maintains that a manufacturing floor be laid out by product rather than by function. All equipment should be dedicated to a product or family of products and organized logically in the order in which the various processes are performed on that family of products. Two characteristics must be fulfilled before a group of machines can be deemed the optimal JIT work cell. The first is whether the product is flowing one at a time from machine to machine, and, secondly, whether the cell has the flexibility to produce at different rates with varying crew sizes (cycle time). See Figure 1-9.
FIGURE 1-9 U-shaped Work Cell
Many JIT purists argue that one-at-a-time flow is a necessity in a JIT work cell. It is true that batches of one are the optimum size for waste reduction, but we are attempting to implement practical JIT. The end goal is to have operation two start as soon as the part clears operation one (batch size of one). But practical JIT champions the idea of continuous improvement. JIT
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advocates batch size reduction as dictated by the setup time. Your process may not allow for batch sizes of one. If some parts are forced to the next operation then so be it. Continue to practice the doctrine of JIT and the batch sizes will continue to decrease. To dedicate the machines and physically place them together but continue to produce in large batch sizes at the machine rate (maximum output) would make no sense. JIT work cells must be adjustable to be able to produce at the customer requirement rate. After the customer requirement rate has been determined, you must ascertain the number of operators needed in the work cell to produce the exact amount of products required. One common concern about placing machines in cells is whether they lose their flexibility by being dedicated to that cell. Can machines work on parts not dedicated to that particular cell? The answer is yes. Some companies have found that they can produce parts through the work cell part of the time while at other times the machines can be scheduled independently as if they were not in a work cell. Machines can also be placed on casters to form temporary work cells to get the ultimate in flexibility. Work cells can be formed, taken apart, or modified to satisfy customer requirements. If machines are too heavy to be mobile a pull system can be used so each machine can function as if it were in two or three cells. As discussed in the Uniform Plant Load section of this text, the only way to keep labor costs constant is to flex the crew size. Operators must be crosstrained to perform many tasks properly in a work cell thus allowing one operator to run many machines.
1.
U-shaped Work Cells

The most flexible work cell is the U-shaped layout. The U-shaped work cell should be large enough to allow operators to work side by side, back to back, but not so close as to inconvenience each other. Shown on the following page is an example of a U-shaped work cell staffed with six operators and another with three operators.
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FIGURE 1-10 U-shaped Work Cells
All the work to be done in this cell can be accomplished from a central area inside the U-shaped cell. Every production period can have varying numbers of operators. Six operators may be needed to produce 100 parts in March, but if 50 parts are required in April a staff of three can theoretically produce those parts. When the operator does not have a full work load, the traditionalists have the operator go up or down the assembly line to the adjacent operation. In a U-shaped work cell, the operator has a full 360 degrees of mobility, therefore, he or she can perform all or part of tasks within the cell. In our example with three workers we show steps 1 and 6 to have a single operator, steps 2 and 5 have a single operator as do steps 3 and 4. Another advantage of a U-shaped work cell is instantaneous quality
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control. Since parts are exiting one operation and migrating directly to the next operation (if batch sizes are one), any deficiencies in quality show up immediately. If a quality problem does occur it can be resolved promptly. There are no large quantities of bad parts to sort through and the need for separate inspection is eliminated.
U-shaped Cells Versus Assembly Line Manufacturing
Traditional manufacturing operations are laid out in long, straight assembly lines. The operators are spread along the line, thus, spreading out the work. Since it takes longer for the product to travel from one operation to the next, more parts must be put in the queue to keep everyone busy. Unlike the U-shaped work cell, people are separated from each other by the assembly line, inventory, work benches, etc. Studies have also shown that physiological and psychological disadvantages can occur from separating people in the work place. Crew size is not flexible on an assembly line because the line has been divided into an established number of separate areas. If an area is missing an operator, the line will not run. Operators do not have the flexibility to perform more than one task.
Comparisons of Assembly Line and U-shaped Work Cell
Shown in Figure 1-11 (Black, 34) is the metalworking facility that we discussed earlier in this manual. The departmental specialities have been dropped in favor of cellular manufacturing. A much more logical, organized approach to manufacturing is the result of this transformation.
Assembly Line Uses Much Floor Space Operators Separated Large Batch Sizes Work Spread Out Non-flexible Crew Size Delayed Quality Control Work Cell
Optimizes Use of Floor Space Operators Together Small Batch Sizes Work Condensed Flexible Crew Size Instantaneous Quality Control
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FIGURE 1-11
Cellular Manufacturing System
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I.
PULL SYSTEMS
We are now ready to address pull systems, sometimes known as kanban systems or supermarket systems. The United States is in the process of phasing out the use of the word kanban due to its association with Japan. Kanban is not even a universally accepted Japanese term since some plants in Japan that compete with Toyota view it as a Toyota-coined word. For our purposes, we will use the term pull system. As mentioned earlier, Toyota sent representatives to the United States shortly after World War II to analyze our production techniques. They concluded that Americans ran their factories much the same way the Japanese ran their factories. Every operation in the factory works independently, then forces its parts onto the next operation. The Japanese termed this process a push system.
1.
The Push System

A push system originates with a forecast schedule. This forecast is forced upon the previous step (assembly) in the manufacturing process, all the while adjusting for lead times to predict which subassemblies are needed and by when. The subassembly forecasts are then forced upon the various component levels still maintaining lead time, thus completing the cycle through the total manufacturing system down to raw materials. Paperwork accompanies this system informing operators what is needed and by when. Each operation then begins to manufacture parts and push them on to the next operator. That operator receives the parts, does his work and pushes them along the line. Operator 1 continues to work even if operator 2 stops or is producing slower than operator 1. This extra inventory creates buffers that hide manufacturing problems. (See Figure 1-12). The expectation is that all this inventory will be pushed along and will reach the predetermined places at the right time so as to be shipped on schedule. Schedules are then analyzed to see what was not on time and future schedules are adjusted accordingly.
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FIGURE 1-12 Push System
OPERATOR 1 (50 PARTS PER HOUR)
OPERATOR 2 (30 PARTS PER HOUR)

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2.
From Supermarket To Factory Floor - The Pull System

While in America assessing our manufacturing processes, the Japanese visited some of our supermarkets in their spare time. What they learned and took back to Japan has revolutionized manufacturing. A supermarket is managed very differently from a factory. Shoppers come to a supermarket knowing that there will always be a small stock of needed inventory. Customers feel no pressure to buy large quantities because they know that the goods will be available when they need them. Every night a stocker replenishes the inventory that has been removed. Empty spaces on the shelves are the stockers signal to produce more goods (restock). Exactly what has been taken is what is replaced. The customers have directly told the store what to replace by what has been purchased. The Japanese converted this supermarket system for use in their factories. No operation can produce goods until it has received a signal from its customers. When the operator gets a signal from the customer, he then has authorization to produce a certain number of parts in a specific time period. The most effective pull (kanban) signals are visual indicators such as empty containers or empty floor space. If you have an empty container, fill it up; if you have no container then do not produce that part. Other types of signals are limited only by the imagination. They may include such things as color-coded golf balls, washers, different shaped cards, flashing lights, or kanban cards. A red golf ball may signal an operation to produce 10 alphas while 2 blue golf balls may indicate 20 betas are needed. The most used signal is a kanban card:
FIGURE 1-13 Kanban Card Part number 29AJ 087 Container 3 x 2 x 6 Box 20 Pieces per container Location Cell 2 Card 3 of 5
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The card tells what type of part to build, what to put the parts in, how many parts to build, where to send the parts and how many cards of these parts are required to maintain a smooth flow. Paper work is limited in a pull system. Imagine a company that makes a product line of alphas, betas, and gammas. Every day this company ships 20 percent alphas, 60 percent betas, and 20 percent gammas. Suppose the market (customer) demands more alphas and fewer betas on any given day. The only paperwork that needs to be changed is the shipping schedule. Shipping sends a signal to assembly to produce more alphas, while assembly sends a signal to subassembly for more alpha components, and on through the system to more alpha raw materials. No paperwork needs to be revisedit did not exist in the first place. Each previous operation is waiting to find out what parts to produce depending on customer needs.
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In an ideal JIT system, a pull signal is a compromise. If a true, one-ata-time flow has been implemented, no signal is needed. Figure 1-14 is what a model JIT pull system could look like.
FIGURE 1-14
Production Control by Pull System
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In the illustration, parts are flowing one at a time from the outside supplier (vendor) to the work cells. In these work cells there is no need for pull signals since the parts move one at a time from machine to machine. In an ideal JIT system the machines would be producing at the exact customer requirement rate (cycle time) and could change over as often as needed (level loading) for this rate. Parts would be pulled from cell to cell and then pulled to the subassembly cell. Subassembly would then have its parts pulled to assembly then to shipping and on to the final customer. This is a completely integrated manufacturing system where all parts are moving one at a time. Theoretically, this should be your end goal. But, while implementing JIT you will have a definite need for pull signals. When pull signals are needed, the key to making them work is making sure that the inventory is replenished frequently and quickly. This can only be accomplished after smaller batch sizes have been implemented through the use of Uniform Plant Loading. We must also remember that the smaller the batch sizes, the faster the setup must be. Just as in a supermarket, customers will be satisfied with taking small amounts if they know that there will be ample quantities available on the next shopping trip. Up to this point we have been talking about pull systems for repetitive manufacturing systems. Invariably the question comes up, What about job shops? To run a pull system in a job shop, where a completely different product is produced daily, monthly or yearly, the system must be managed differently. If a pull system is broken down to its purest form, the signal is an authorization to produce whatever is next in the queue. In a job shop the signal may stand for an hours worth of work. In effect, cell workers are saying, An hours worth of work has been used upso I am authorizing you to give me another hours worth of work. Regardless of how you express it, the customer is telling the supplier what to do next.
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J.
JIT PURCHASING
FIGURE 1-15
Typical Manufacturing Costs
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Purchasing cost is a critical factor for a JIT manufacturing system, but it lags behind quality and delivery lead time in importance. Vendors must deliver quality products on time (just in time) before a JIT system can work, regardless of cost. JIT purchasing offers a framework for a true partnership between vendors and companies that helps to solve the problems of cost, quality and lead time.
1.
Partnerships
Traditional relationships between companies and vendors do not allow for partnerships to be formed. Companies send out bids for purchased materials with the contract going to the lowest bidder. Six months down the road another bid is let with the lowest bidder getting that contract. If the current vendor is not the lowest bidder that vendor may lose six months of business. Companies want vendors to cut their profits, but vendors need to be assured of a good profit now because they may not be here six months from now. The new JIT partnership that we are striving for is a long-term, mutually beneficial relationship with fewer but better vendors. Mutual trust must be developed between companies and vendors. This cannot be accomplished if vendors change every time new bids are sent out. For this reason a company should have few suppliers (preferably one) for each purchased material or component. This idea of single sourcing is as troublesome to traditional purchasing people as slower run speeds and smaller batch sizes are to traditional manufacturing people. Traditional purchasing people question whether the company is getting the best price possible by using only one supplier. As a company is reducing its vendors, it is obtaining the best price due to traditional competition. Vendors embrace the idea of a long-term relationship because it allows their sales to remain more constant. Strict criteria concerning dependability (quality and lead time) should be placed upon vendors by companies. When this criteria is satisfactorily met, the vendor will become certified. Ideally certified vendors deliver products just in time, every time, with 100 percent quality. A partnership is then formed between the company and the vendor so that they can actively work together to continually lower the cost of purchased
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material. It would be impossible to form such relationships with several, ever changing vendors.
2.
Eliminating Procurement Wastes

Three areas of waste need to be recognized before a company can successfully implement JIT. First is the waste in a companys own manufacturing process : the moving, counting, rework, storing, scheduling, setup times, and inspection. Secondly, waste within the purchasing process itself should be eliminated. A third area that is often overlooked is the manufacturing philosophy of a companys vendors. Since an average of 70 percent of a companys costs come from purchased materials, every company should aid its vendors in eliminating waste in the vendors manufacturing process. However, it should be stressed that a company must first get its own house in order (eliminate waste) before the company can help its vendors to improve their processes. Lets look at a few nonvalue-added steps (waste) in a typical component before a value-adding process happens. A purchase order does not add value, an amendment to a purchase order does not add value, reports and invoices do not add value, taking something off a truck and putting it in a holding area does not add value, inspecting it does not add value, moving it to a stockroom does not add value, taking it from a large container and placing it in a small container does not add value, and moving it to where it is going to be used does not add value. The way to eliminate waste is to eliminate all steps that do not add value to the product. The initial phase should be to delete inspection of all incoming raw materials, parts, and components. This can be accomplished by working with vendors to make sure they understand the process and how to solve problems in the process. They should have a thorough understanding of the standards that you require and have competent inspection procedures so they can deliver 100 percent quality materials and components. The eventual goal is for vendors to monitor rather than inspect, with all operations done right the first time.
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3.
A Days Worth Every Day

In a repetitive manufacturing environment, the same amounts of inventory should be used up every day. Ideally materials and components will be delivered in the afternoon, used the next production day, and shipped the day after in the form of finished products. Packaging in this process does not add value, therefore reusable containers should be used to ship goods if possible. The vendor delivers goods to the production line and picks up empty containers for the next days shipment. These containers are the pull signal that tells the vendor to produce more, thus eliminating the need for purchase orders. Eliminating packaging cuts cost for the vendor and the company, causing the partnership between the two to be strengthened. Since these vendors are certified, there is no need for incoming inspection. A central holding dock or receiving area is not needed. There is no need for a stockroom or an inventory tracking system. There is no need for picking up and transporting. Purchase orders have been deleted. There are no corrugated boxes or excess paper to be ripped open and thrown away. And finally, no incoming invoices to be processed. Traditional purchasing personnel are probably yelling What! No incoming invoice? How do we know what to pay and how do we know that we received everything? Although a partnership must be built on trust, there is often no trust pertaining to money matters. The main proof of goods received is the shipping records. If two vendor components are needed for each product manufactured, you must deduce that if you shipped 100 products, you owe the vendor for 200 components. If the product was shipped, the components must have been in it. Of course, eliminating incoming invoices only works for a repetitive manufacturing facility, but all companies should question the way business is being conducted now. Every process in the purchasing department should be optimized through the use of JIT/TQM principles (teams, value-adding analysis, cross-training, etc.). Companies must strive to form a long-term, mutually beneficial partnership with vendors that is built on trust. Traditional methods of purchasing will no longer apply in the new JIT environment.
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K. JIT IN CONJUNCTION WITH MANUFACTURING RESOURCE PLANNING

JIT and MRPfriends or foes? Many have debated the comparative benefits of JIT and MRP. To put this controversy to rest, we must have a better understanding of what MRP is and how it can be used with JIT to achieve greater results than if either technique were used alone. MRP I (Material Requirement Planning) and MRP II (Manufacturing Resource Planning) evolved in the United States in the early 1960s. MRP II is the combination of various manufacturing tools collected to form the most sophisticated planning and scheduling strategy developed to date. These tools are Reorder Point (ROP), Economical Order Quantity (EOQ), Material Requirement Planning (MRP I), Distribution Requirement Planning (DRP), Capacity Requirement Planning (CRP), Shop Floor Control (SFC), and others. For the purpose of this manual, MRP will refer to Manufacturing Resource Planning (MRP II). Many MRP software companies fail to comprehend the overall picture, resulting in the misconception that JIT will cut into their market share. The MRP gurus tend to view only parts of the whole so that they fail to address the manufacturing process and master the usefulness of both systems. JIT and MRP can and do work well together, but we must be conscious of the fact that MRP wants to work with the scheduling system while JIT wants to radically alter the manufacturing process.
1.
Which System?
Many companies question whether to use JIT or MRP or both and if they use both, which strategy should they implement first. If your company has deteriorated greatly, it may be easier to implement a MRP system. The MRP system will allow you to get your process under control without radically changing your manufacturing process. If the company is fundamentally sound, a JIT system should be implemented first. If after JIT is in place it is decided to have a more formal scheduling system, less time and money are required to implement a simplified MRP system. This hybrid system can then be used to form an enhanced manufacturing system.
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Under a traditional MRP system there are three levels of scheduling (Hay, 155): Master Schedule quantity and date for completion of end items. Material Requirements Planning scheduling the completion and start dates of the components and raw materials dependent on the master schedule. Shop Floor Control scheduling the operations performed on a component between MRP start and finish dates; often called priority sequencing.
The hybrid system where JIT and MRP are working together eliminates the need for Shop Floor Control since parts flow from start to finish without being warehoused. MRP I becomes more basic since parts go directly to the next user without traveling in and out of stock. Also, remember that batch sizes are smaller or nonexistent, safety stock has been eliminated, throughput has been speeded up and production rate equals the customer requirement rate via the JIT segment of this hybrid system. No matter how complex the manufacturing process, as lead time diminishes, the need for MRP reduces. MRP becomes increasingly simplified and acts as the transition tool until its scheduling function disappears as linking operations become feasible. In some job shop situations implementing JIT fully may be impossible, thus opening the door for this hybrid system. Even in an ideal JIT system, the benefits of MRP cannot be ignored.
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L.
MANAGEMENT'S RESPONSIBILITY
The predominant reason for JIT failure is lack of commitment by top management. JIT must be launched where there is absolutely no skepticism about managements long-term commitment to JIT success. Employees recall managements past track record on flavor of the month plans that died quietly with little or no fanfare. The first time management compromises quality in favor of quantity it will devastate the morale of the shop floor personnel. They sense that managements main emphasis is money for products shipped, not customer satisfaction, thus relegating JIT to a quiet death. JIT must have a champion for its cause within every organization. Ideally, this advocate would be the highest ranking person who applies to your situation, i.e., the CEO at the corporate level, the division manager at the division level or the plant manager at the plant level. Typically, the consciousness of JIT penetrates the organization somewhere below this top level of management. For the greatest chance of success, JIT should be presented to the top manager as soon as possible. By initially teaming up with the top manager, he or she will perceive ownership of the JIT concept, thus he or she will have a stronger commitment to JIT. If the top management does not embrace the concept of JIT, but rather it develops at the middle management level, the chance for failure increases. There are two key elements that are management's responsibility: motivation and education. Management must use these elements to overcome the reluctance to change by the employees and the natural fear that accompanies change. Each level of the organization has different fears about JIT so each level requires a different motivational approach. Management must understand the apprehensions of people at every level and what actions can be taken to gain their trust and commitment to join the JIT venture.
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1.
Motivation
Top managers should already be motivated by what they see as JITs ability to produce more efficiently. Upper and middle managers often feel they are caught between a rock and a hard place. Top management is angry because JIT is not progressing fast enough and the shop floor employees are mad because they cannot perform the JIT miracles that middle management expects of them. Middle managers have worked hard to gain the status that they now have and feel threatened by the new JIT style. The means to conquer these fears is trust. Middle management can be motivated by knowing that top management is 100 percent dedicated to JIT, and that top management is aware of the problems and will help solve these problems. Finding these solutions often is not easy, but can be accomplished by a motivated management staff working closely with top management. Why is motivating the shop floor personnel so difficult? Isnt JIT involving them more in the decision making process and making their jobs much easier? Until now shop floor personnel have made no decisions, therefore have taken no risk of making the wrong decision. Management must motivate these people by assuring them that making a wrong decision is permissible as long as they learn from it. Shop floor personnel also have major concerns about job security. If operators are doing their own setups, where do the setup people go? If top management says that everyone is responsible for quality, do the quality control people lose their jobs? Top management should calm these fears through a no-layoff guarantee. Management should also form a partnership with all employees to earn their trust and motivate them by communicating to them that the whole organization must change, not just the shop floor personnel.
2.
Training
Management must convey to all employees why the organization is being restructured. If the company is in trouble, management should be honest with the employees. All employees should be trained in
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the reasons for and methods of JIT. Employees are more receptive to JIT if they understand how pull systems, setup reduction, reduced inventory, plant loading, shorter lead times, better quality, etc., can lead to a larger market share, higher sales, and increased customer satisfaction. Management should devise a structured approach for training all employees in the principles of JIT. An employee in purchasing may not need to know how to reduce setup time on a particular machine but must know why this time must be reduced. Management must also participate in training. Other than a complete understanding of JIT principles, managers will need training in modern management techniques, such as Total Quality Management (TQM). Managers must develop the total quality mindset that will allow them to lead the organization into JIT.
3. Leadership
Management must realize that actions speak louder than words. Any conflict between managements words and managements actions will be noticed by employees. If management feels that training is important but misses a training session in favor of a higher priority, it has sent a negative message to the employees. Top management must demonstrate its commitment to JIT through long hours and hard work. Managements actions should build employee trust, and trust is the most important element of any plan.
M. IMPLEMENTING JIT
JIT implementation must start by creating a suitable environment for JIT to flourish. A structure must be established whereby responsibility for problem solving is appropriated to all levels of the organization. Shop floor personnel will be asked to find solutions for shop floor problems and so on throughout the organization. This reversal from traditional management style to a Total Quality Management (TQM) style can only be accomplished through Total Employee Involvement (TEI) and employee teams. TQM is a prerequisite to JIT.
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1.
Forming Teams
The first team that should be established is the quality team sometimes called the Executive Council or Quality Steering Committee. No matter what you call it, the objectives of the top team will be the same. The Steering Committee will address the issues with TQM implementation (you are not ready for JIT yet) while attending to everyday organizational issues as well. If possible, Steering Committee members should be removed from the interruptions of everyday organizational decisions. It is a proven fact that companies that allow their Steering Committees to dedicate all their time to solving TQM/JIT implementation problems have higher success rates and shorter implementation times. The Steering Committee will be made up of high ranking officials within the organization. They will assign teams from the workforce to solve various implementation problems. The employees that constitute these teams now have the power to make decisions that directly affect productivity at their level. Team logistics will not be discussed in this manual.
2.
Developing A JIT Strategy

Now that you understand the basics of JIT, a specific implementation strategy must be developed. There are no cookbook solutions for JIT implementation. Each Steering Committee has a different vision and each company goes about implementation differently. Below are examples of how JIT has been successfully applied in various types of organizations. Company 1 concentrated on finding the bottleneck in its manufacturing process and worked to eliminate it through reducing setup times, forming machine cells, removing nonvalue-added steps, or whatever means required. After each bottleneck had been eliminated, the company found the next largest bottleneck and eliminated it, and so on, throughout the entire organization. Employees are still finding bottlenecks (albeit much smaller ones), and will continue to do so through the process of continuous improvement.
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Company 2 implemented JIT at its final operation and progressed in reverse order throughout the plant until reaching incoming raw materials. The idea behind this strategy is that as you implement JIT, you eliminate the need for excess inventory for the succeeding process or processes down the line. Suppose a plant has nine operations to perform before a part is shipped. If you optimize step nine first, parts can be pulled from step eight to step nine after eight has been optimized. When you reach step five, parts will flow from five to nine in a true JIT fashion. Company 3 started by removing as many nonvalue-adding steps from the manufacturing process as possible without moving any machines. Employee teams solved as many problems as they could while leaving machines in the traditional configuration. Machines were then relocated into cells and the teams went back to work to eliminate waste in the new configuration. The teams will now continually move machines and optimize the process. Opposite to company 3, company 4s Steering Committee moved machines into cells to improve product flow. Employee teams were then tasked with removing as much waste from the process in the current configuration. When teams recommended, machines were moved again. Company 4 moved machines frequently while company 3 rarely moved machines. Company 5 used what we will call the shotgun approach. Teams were tasked with implementing JIT as fast as possible with no visible structured approach. Machines were moved and inventory reduced and then it was up to the teams to implement JIT. Problems were solved on a priority basis as determined by the Steering Committee. A word of warning: this approach cannot happen if quality will not allow smaller inventories. On the positive side, employees were assured of managements commitment because the conversion to JIT happened fast.
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Similar to company 2, company 6 initiated JIT one cell at a time, but not at the last operation. Pilot projects were selected by the Steering Committee on the basis of success probability. Since the pilot project set the tone for the entire JIT effort, a project was chosen that would get the best results. Company 6 continued to add projects until the entire organization was converted to JIT.
These six companies used six comparable but different approaches to achieve the same results. You may choose a method similar to one of these, a combination of these, or a completely different method to implement JIT. How you accomplish JIT is not as important as when you do it.
N. GLOSSARY
Batch Size The number of duplicate parts, components or finished goods produced before a process is changed to produce different parts. Also known as Lot Size. Changeover Time The time it takes to go from production of one product to production of a different product with acceptable quality, i.e., Setup Time. Cross-training Educating employees to perform more than one job, therefore, increasing flexibility in the workforce. CRP Capacity Requirement Planning Cycle Time The total time for a worker to complete one cycle of operations, including walking, loading/unloading, inspecting, etc. EOQ Economical Order Quantity External Customer A person who has purchased a product from a company; usually the end user of a product. External Setup Setup steps done while the machine or system is producing.
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Flexible Changeover The capability to manufacture what you want, when you want, in whatever batch size you require. Heisenberg Principle The idea that a phenomenon that is observed is changed merely by the fact that it is being observed. Internal Setup Setup steps done only when the machine or system is idle. Internal Customer The next person or process that receives product from a preceding process within an organization, i.e., the next person down the line. JIT (Just-In-Time) Producing the minimum number of units in the smallest possible quantities at the latest possible time, which in turn eliminates the need for inventory. Such production reduces waste and improves quality. Job Shop An organization that produces short runs of similar parts and specialized one-of-a-kind parts. Kanban Any visual device that strictly limits length of a waiting line (inventory) and authorizes work. An example of this is a kanban card. Level Loading The production of products at the proper frequency. Products are made at the customer requirement rate. In theory, if a product is sold every day, it should be made every day. Machine Cell Machines grouped together for the purpose of producing a product one at a time from machine to machine while having the flexibility to produce different products and operate at different output rates and with different crew sizes (cycle time). Also known as work cells. Malcolm Baldrige National Quality Award Annual award recognizing U.S. companies that excel in quality achievement/management. Founded in 1987 and administered by Department of Commerces Technology Administration.
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MRP I (Material Requirement Planning) Scheduling the completion and start dates of components and raw materials. MRP II (Manufacturing Resource Planning) Arranging material requirements while maintaining the due date for each component supply order so that each order will arrive just in time for the next process. Nonvalue-adding Operation A function that adds cost to a product, not value; such as inspecting or moving. Pareto Chart A bar chart that arranges data in order of importance. The bar representing the item that occurs or costs most is placed on the left-hand side the horizontal axis. The remaining items are placed on the axis in descending order. Typically a few causes account for most of the output; hence the phrase vital few and trivial many. Poka-yoke Devices used to prevent defects from occurring in the manufacturing process. Also known as fail-safing or fool-proofing. Process Any set of conditions or causes working toward an outcome. Pull System The manufacturing process whereby each operation uses parts as needed, therefore releasing a production authorization signal to the preceding operation. No parts are produced until needed and no extra parts are produced. Also called the supermarket system or kanban system. Push System The manufacturing process by which each operation works independently and pushes its parts on to the next operation by a certain date. Quality Fitness for use. Product performance resulting in customer satisfaction. Freedom from product deficiencies which avoids customer dissatisfaction. Repetitive manufacturing The process in which large numbers of the same parts or family of parts are made. ROP Reorder Point
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Setup Time The interval between the production of one good part and the production of another good but dissimilar part. SFC (Shop Floor Control) Scheduling the operations performed on a component between MRP II and finish dates; often called priority sequencing. SMED Single-Minute Exchange of Die A procedure for performing setup operations in less than 10 minutes, i.e., in a single-digit number of minutes. Not all setups can be completed in single-digit minutes, but this is the goal. SPC (Statistical Process Control) A method of managing a process by gathering information about it and using that information to correct the process to prevent the same problem from happening again. System Any organizational method, procedure or function for accomplishing work. Takt Time The total daily operating time divided by the total daily requirement, usually expressed in hours, minutes or seconds per part. TEI (Total Employee Involvement) 100% of workforce is placed on teams formed to continuously improve quality in all aspects of an organization. TQM Organized, continuous process improvement activities involving an entire organization, managers and workers, in a totally integrated effort to improve performance at every level focusing on customer satisfaction (quality). Value-adding Operation A function that adds value to a product, such as milling and assembling. Value Analysis A process for evaluating the interrelationships among the functions performed by the product features and the associated costs. Vendor Certification The procedure by which a partnership is formed between the buyer and seller of a product. Strict criteria are established for the seller and when these criteria are met the seller becomes certified.
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Waste Anything other than the minimum amount of equipment, materials, parts, space and worker time, which are absolutely essential to production. WIP Work-In-Process Xenos Paradox A mathematical paradox which states that if a person walks toward a wall, each step being half as large as the previous one, that person will never reach the wall. Zero Defects (Zero Quality Control) The objective of defect-free production where zero defects is defined as meeting product specifications.
O. REFERENCES AND RECOMMENDED READINGS

The Design of a Factory with a Future by J.T. Black Director of Advanced Manufacturing/Technology Center Auburn University Copies are available from the publisher (or by calling 1-800-334-7344): McGraw Hill Book Company P.O. Box 18122 Newark, N.J. 07191 Library of Congress Catalog Number: 90-19991 ISBN: 0-07-005551-3 (hard cover) 0-07-005550-5 (soft cover) Introduction to TPM: Total Productive Maintenance by Seiichi Nakajima Copies are available from the publisher (or by calling 1-800-274-9911): Productivity Press, Inc. P.O. Box 3007 Cambridge, MA 02140 (617) 497-5146 Library of Congress Catalog Card Number: 88-61394 ISBN: 0-915299-23-2
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Jurans Quality Control Handbook by J.M. Juran Copies are available from the publisher (or by calling 1-800-952-6587): American Society for Quality Control (ASQC) Customer Service Department P.O. Box 3066 Milwaukee, WI 53201 Library of Congress Catalog Card Number: 86-18762 ISBN: 0-13-1983441-1 The Just-In-Time Breakthrough Implementing the New Manufacturing Basics by Edward J. Hay Copies are available from the publisher (or by calling (212)850-6354): John Wiley and Sons Business/Law/General Books Division 605 Third Avenue New York, N.Y. 10158-0012 Library of Congress Catalog Card Number: 87-25315 ISBN: 0-471-85413-1 Just-In-Time: Alive and Well in the South by Dr. Anthony Inman Article published in Southern Business and Economic Journal, April 1991, Vol. 14, No, 3, 155-167. Out of the Crisis by Edward Deming Copies are available from the publisher (or by calling 1-800-952-6587): American Society for Quality Control (ASQC) Customer Service Department P.O. Box 3066 Milwaulkee, WI 53201 Library of Congress Catalog Card Number: 86-18762 ISBN: 0-13-198441-1
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Poka-yoke: Improving Product Quality By Preventing Defects by Hiroyuki Hirano Copies are available from the publisher (or by calling 1-800-274-9911): Productivity Press, Inc. P.O. Box 3007 Cambridge, MA 02140 (617) 497-5146 Library of Congress Catalog Card Number: 88-62593 ISBN: 0-915299-31-3 Quality Without Tears by Phillip Crosby Copies are available from the publisher (or by calling 1-800-952-6587): American Society for Quality Control (ASQC) Customer Service Department P.O. Box 3066 Milwaulkee, WI 53201 Library of Congress Catalog Card Number: 86-18762 ISBN: 0-13-198441-1 Reinventing the Factory: Productivity Breakthroughs in Manufacturing by Roy L. Harmon and Leroy D. Peterson Copies are available from the publisher (or by calling 1-800-274-9911): Productivity Press, Inc. P.O. Box 3007 Cambridge, MA 02140, (617) 497-5146 Library of Congress Catalog Card Number: 88-62593 ISBN: 0-915299-31-3
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A Revolution In Manufacturing: The SMED System by Shigeo Shingo Copies are available from the publisher (or by calling 1-800-274-9911): Productivity Press, Inc. P.O. Box 3007 Cambridge, MA 02140, (617) 497-5146 Library of Congress Catalog Card Number: 84-61450 ISBN: 0-915299-03-8 Statistical Process Control Methods by Gary K. Griffith Copies are available from the publisher (or by calling 1-800-952-6587): American Society for Quality Control (ASQC) Customer Service Department P.O. Box 3066 Milwaukee, WI 53201 Library of Congress Catalog Card Number: 86-18762 ISBN: 0-13-198441-1 The Team Handbook by Peter Scholtes Copies are available from the publisher (or by calling 1-80-952-6587): American Society for Quality Control (ASQC) Customer Service Department P.O. Box 3066 Milwaukee, WI 53201 Library of Congress Catalog Card Number: 86:18762 ISBN: 0-13-198441-1 Training: Quality Supplement. "Is 99.9% Good Enough" by Natalie Gabel March, 1991. 40-41.
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World Class Manufacturing: The Lessons Of Simplicity Applied by Richard J. Schonberger Copies available from the publisher (or by calling 1-800-274-9911): Productivity Press, Inc. P.O. Box 3007 Cambridge, MA 02140, (617) 49705146 Library of Congress Catalog Card Number: 85-24719 ISBN: 0-02-929270-0 World-Class Manufacturing Casebook: Implementing JIT and TQC by Richard J. Schonberger Copies available from the publisher (or by calling 1-800-274-9911): Productivity Press, Inc. P.O. Box 3007 Cambridge, MA 02140 (617) 49705146 Library of Congress Catalogue Card Number: 86-25822 ISBN: 0-02-920340-5 JIT Factory Revolution: A Pictorial Guide to Factory Design of the Future by Hiroyuki Hirano Copies available from the publisher (or by calling 1-800-274-9911): Productivity Press, Inc. P.O. Box 3007 Cambridge, MA 02140, (617) 49705146 Library of Congress 88-29007 ISBN: 0-915299-44-5
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JUST-IN-TIME MANUFACTURING

JUST-IN-TIME MANUFACTURING TaBLe Of COntents

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

FIGURE 1-1 Value-added Analysis

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

Don't Forget The Office

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

JIT AND QUALITY

The Chicken Or The Egg

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

Preventing Quality Problems

AIDT - Just-In-Time Manufacturing - September 11, 2006

Getting To The Root Cause

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

UNIFORM PLANT LOAD

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

FIGURE 1-7 Level Loading

3. Learning Curve Improvements

AIDT - Just-In-Time Manufacturing - September 11, 2006

G. SETUP TIME REDUCTION

AIDT - Just-In-Time Manufacturing - September 11, 2006

Setup Reduction Teams

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

The SMED System

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

FIGURE 1-9 U-shaped Work Cell

U-shaped Work Cells

AIDT - Just-In-Time Manufacturing - September 11, 2006

FIGURE 1-10 U-shaped Work Cells

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

The Push System

AIDT - Just-In-Time Manufacturing - September 11, 2006

FIGURE 1-12 Push System

OPERATOR 1 (50 PARTS PER HOUR)

OPERATOR 2 (30 PARTS PER HOUR)

From Supermarket To Factory Floor - The Pull System

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006

Eliminating Procurement Wastes

AIDT - Just-In-Time Manufacturing - September 11, 2006

A Days Worth Every Day

AIDT - Just-In-Time Manufacturing - September 11, 2006

K. JIT IN CONJUNCTION WITH MANUFACTURING RESOURCE PLANNING

AIDT - Just-In-Time Manufacturing - September 11, 2006

AIDT - Just-In-Time Manufacturing - September 11, 2006