JIT, TPS, and Le oP Oi eis ) CHAPTER GLOBAL COMPANY PROFILE: Toyota Motor Corporation OUTLINE Just-in-Time, the Toyota Production Toyota Production System (TPS) 636 System, and Lean Operations 626 ‘Lean Operations 640 sjst-in-Time (JT) 628 Lean Operations in Services. 629 Design of Goads and Services Managing Quality Process Strategy Location Strategies Layout Strategies Seneduling seuraey, freer Maintenance pleat ‘Supply-Chain Managemen 623PUTMAN: Tae with Lean Operations at Toyota Motor Ce uel GLOBAL COMPANY PROFILE Toyota Motor Corporation ‘ta Motor Corporation, wih $220 bilan in» Genta 10 JIT I @ philosophy of contrived rival sls of over Sriton cars and tucks, rable soling. In pactoe, JT mans mak Isthelagest rice manvacturerintte wold, ing nw wht need, when is need, ‘wo tecriques, justine (JT) end the Toyota JT provides an excelent vehicle for feng Froducton Siem (TPS), have bean ishurertal and elnating prablems because problems In ispost ww geawh. Toyota, win wide range ae easy to na eystm that has no atc atic, competes hasd-o-need wth euccess- When excess inventory is elirinelod, auch ‘long etbisred compares in Europe end the iy, layout, scheduling, and eupalia esues US. Taleh Onno, afonmervespresdon ofTayols, bosome immedately evident~as does cated the bic Famwaesk or the wore mst oxoes prauctin, decunsed sates for moving productvy, IT» Cental to TPS sempioyeslesringanda co: ari TPS. These wo concepts provide muchofthe thulng et to create and preclues procs ‘eundation fora cperatons: under lice cancion, ase cantons exist ‘an Ieeeng neat Tuning um manasa) ToL Sn cis {Tejeda se Ero ueracseaety — Minpaticetadnae sae ferent karat serwreemayaeayeeiy” tant ‘So aetered men aH = — wv Ottrie seers Onaipcirnncn @ oto Ogmnmers Ctmacermus Ohm Oxmeemmarante. Oar (ute: Toy as 8 2000-4 at wi 4 oe 2 ona eae, adacr al ios, neat bin. The se [oes ono pcs bat Taya ae ilar aid pbs sy anion es asa 624“oj an Atrio prthas abo? mie era ovina aan ule tb 21a Tagine anaes So penn ets Sutrow rosy Toya parr ewes Ts roan ‘SPlrfnd gt sper oan sare, whore! cont won tis, mactines, nd poole are ‘brought together, aking value without waste. Waste undermines productivty by ver ing resources To excess iventry, umneces sary prooossing, and poor qualy. Respect for people, extensive traning, oross-raring, and standard work practices of empowered ermpoyees focusing on diving cut wast aro fundamental to TP. Toyota's latest implementation of TPS and LIT is present ats San Antonio plant the bee est Toyo lan st eran automobile assembiy Plant ithe US. Iirestny, despite ts annual procton canabity of 200,000 Tundra pickup ete ng too soe of hw sat in the uty. Madan autoables hve 20000 pats bt Toa, penser lar co bio many ese pata sues Taryn thee supers ons a San fin ecard enter compro te scent neon a. ba Operon sha thes tng ce te ew San rola ae wy Tota cose topo er ne op pata ain bolomestozarho erty rein ee 9, TPS, al oan operations wee end ther soie a cnpetive ate a oy ot Cortn 625LEARNING. $2: OBJECTIVES. tos Los Los Los ol LO Define justin, PS, and lean operations Ganan rd et ton ‘ing atte Toy rain Sytem ws ‘ra vate ro cen sa oi 626 Det sini, TS, ean opratns 626 Def e seven waste te Ss 627 Explain JT paresis 630 Detering gta sup tine 659 Define tart 628 Compute cago rant ot tanbans 638 plain princi of he Toyota ofucton System 629 ust-in-Time, the Toyota Production System, and Lean Operations As shown inthe Global Company Prof, he Toyota Production Sytem (TPS) contributes toa work-lass opecaton at Toyota Motor Corporation. In this chap, we discuss JIT, TPS, and Jean operations as approaches co continuing improvement that lad to word-lass operations Sistine] #8 an appreac of eoatinuous and freed proWem solving va focus on ‘throughput and reduced inventory: The Toys fasion Sym P'S, with it emphaseom con tinuous improvement, respect for people, and siandacd work practic, i patcalary suited for asembly lines is oan: supp the customer with exact what the customer wants ‘ten theeastomer wants, without waste threugh continuous imgrovement. Lean operations are driven by workfow initiated by the “pul” ofthe customers order When implemented as ‘comprehensive operations strategy JTT, TPS, an lean syste sustain competitive advan and result in ineeased overall earns there is any distinction between JT, TPS, and lean operations its that » ITT emphasizes forced problem solving » TPS emphasizes employee learning and eepowerment in an assembly-lne enviroment. » Lean operations emphasize understanding the custome However, in practice, thee i ite diference, and the terms ae clten wsed interchangeably [Leading organizations use he approaches and techniques that me ene for her. In thischap- ‘er, we use the term lean operation to encompass all ofthe eat approaches and techniques Reganiless of the approach and label, OM managers address foe issues that are Funda ‘stental to operations improvement: eliminate ust, remove varlblsy, and improe trough ‘We now intoduce these thre issus ad then ciscase the major stibates of ITT. TPS, and Jean. Finally, we look at lean appli 10 services. Eliminate Waste Lean producers set thet sights on perfection: no bad pars, no inventory, only value-added activites, and no waste. Any activity that does not add value in the eyes ofthe customer is & waste. The customer defines product vale, I the customer doesnot want to pay fori itis ‘waste. Taichi Ohne, noted for his work on the Toyota Produeticn Systm, Meni Seven categories of waste. These categories have beoome popular in lan organizations and cover ‘many of the ways organization waste or loke money. Ohno’ seen a a » Oveyprdicrion:Produeing more than the eustomer orders or producing early (before itis demanded) is waste Inventory of any kind is usually a waste » Queer Tete, storage and waiting are wastes (they add 0 vale), vo Moving material between plants or between work centers and handling more than ances waste > Ineniory-Unnesessary raw material, worksn-process (WIP), fnthed goods, and ees operating supplies add no value and ae wastes » Notion, Movement of equipment or people thar adds no value waste,CHAPTER 16. JIT.TPS, AND LEAN OPERATIONS 627 wing: Work peeformed on the produc that add no values waste prods: Returns warranty claiss stork, and sean area waste. [A broader perspective one that goes boyond immediate poduction—suggests that other resources, suc us energy, war and al are often Wasted but shoul not be. Ein, sista ble production minimizes inputs and maximizes outputs, wasting nothing, or aver a centr, managers have pursued “housekeeping” fr nest, onder, nd eit workplace and snes of redoing waste. Operations manager have embelised "housckeep- Jingo inlude a chucklit-now kaon asthe S58! The Japanas developed the initial SSs Not ‘only ae the SS. good chock for lean operations doy aso provide an easy vehicle with which ‘oss the culture change that is ofen necessary to bring about kan operations The 5s follow: » Sorfeyrete: Keep what is needed and remove everything ck fom the work ares; when in doa, throw it out. [demi aon-yaluc items and remove tem. Getting id ofthese items makes space available and usualy improves work fo. » Sinjiisrighvon: Arrange and use methods analysis tools (ee Chapter 7 and Chapter 10) to improve work Now and reduce wased motion, Consider long-run and short-run ergo- homie issues Label and islay fr easy se ons whats needed inthe immediate work fre. (Forexample of visu display se Chapter 10, Figure 108) > Sine eo Clean diy eiminate al forms of dir, contamation, and etter fom the wor age. » Stunde Remove variations from the process by developing standard operating proce. dures and checklist: poo standards maak the abnormal obsious. Standardize equipmeat ‘and fooling so that cros-raning time and costar reduced. Train nd retrain the work team so tht when deviations occur, they are realy parent al > Sisione!/-liciline Review priically to recognize efforts and to motivate to sus progress Use visuals wherever posubl o communicate and stan progress. US. managers often ald two adtional Ss tha contribute © establishing and maintaining Jean workplace: Build good safety practises into the above ie activi Reduce variability, unplanned dowatine nd costs Integrate daily shin tasks with provenive maintenance “The Ss provide a vehicle for continuous improvement with wich all employees can identi ‘Operations managers need think only ofthe examples st bya wolran hospital emergency room or the spit-and-poish ofa fire department fora beachnark. Offices and retail toes, aswell as manufacturers, have successfully used the 35s in the: spective efforts to eliminate ‘waste and move to lean operations. A pace for everyting and everything i its place does ‘ake 4 difeence ina wollrun offic. And fetal stores succesfully use the $s to reduce mis- placed merchandise and improve customer service. An ordery workplace reduces waste 80 that assets ar released Fr other more produetive, purposes Remove Variability “Managers seek to remove variability caused by both internal and external factors. Yrbiy isany deviation fom the optimum prowess that delivers pefet product on time, every time. ‘Variability a polite word fr problems, The less variability in syste, theless waste inthe system, Most variably is cuused by tolerating Waste or by poor management. Among the many sourees o variability are: » Poor production process tht allow employees and suplitrsto produce improper quanites orlate or non-conforming units » Unknown customer demands > Incomplete or inaccurate drawings, specications and bills f materia "the tom coms fom hag wot 0 claret son spn an contigo (Gerber lem ps ees rnin sno nd sais an woos) ands (Geen and randerazaton f ese Pee) 1.02 Dana he seven wees and ie SSe Py Sie Stren Vasibity ayn te tn Sree a en628 PART 3 MANAGING OPERATIONS aati ps, aang ped an srupewr nr 2 ga se ie nian a ‘ava Inventory reduction vi IT isan effective ool for tentiying cates of variability. Te precise ‘iming of JIT makes variability evident, jut as reducing inventory exposes variability. The removal of variability allows managers to move good materialsor schedule, add val at exch ‘Hep of the production proces, dive down costs and win order Improve Throughput Tromp the rate at which units move through a production process. Each minute products remain on the Books, costs accumulate snd competitive advantage is lot. Tie Is one. ‘The time that an order isin the shop is called mnocbirng oc nn Thi the time between the arsval of raw materials and the shipping of Finished product, For example, phone-system ‘manufacture Northern Telecom now has materials pled diretl from qualified suppliers fo ‘the assembly fine. This effort has reduced a segment of Noribers manufacturing eyle ine from 3 weeks to just 4 hous, the incoming inspection sta from 8 to 2, and problems the shop floor caused by defective materials by 97% Driving dowa manufacturing evele time can ‘makes major improvement in throughput. ‘A teenique for increasing throughput isa pull system. Aion pull unitto wher Js meeded just as it is needed. Pull systems ae a standard tool of lan Pll systems use signals {o request production and delivery fiom supplying stations to stations that have production capacity available. The pall concept is used bath within the immed production proces and with suppliers By puling material through the system in very sma lts-—just ite needed waste and invenfory are removed. As inventory is emoved, lute ie reduced, problems be ‘come evident, and continous improvement is emphasized. Removng the cushion of inventory also educes both investment inventory and manufacturing yc ine. A pus system dumps ‘orders on the next downstream workstation, regardless of timeliness and resource evi. Pash systems are th anihesis of lan, Pulling material through s production process sis needed cater than in & “push” modo typically lowers cost and improves schedule performance, enhancing customer satisfaction, Just-in-Time (JI) ‘With its foroed problem solving va «focus on rap throughput and reduced inventory, JIT provides powerful strategy for improving operations. With IT, materi ative where they ae needed only whor they are needed. When good wnits do not arive just as aeded,w problen” hasbeen identified. This is the reason JIT i so powerful it focus attention on problems. By Many carvics have adopod NT tocrique 6 ol pat of tha busines. Reterant he lve Garcon and Red Lobeie trp6c and rece IT dveros. Soh buyer a super ‘spect fresh, Righty produce calves who fl at ‘when xis osdod The jam dosen't work ary tar ay, ! |CHAPTER 16 JIT TPS, AND LEAN OPERATIONS 629 give 16.1 {cans anpete have Few vender: suppome suppor stone ‘ay delves nm, Peay ome eas orca: op eon xb macnn epi ‘ove oan cpace reno imal ot 9s: aap te pecazadoars Ds Zao dodo rom eco: sees, ‘pters med sche aren cee ‘Snel ete operator ones ‘Sate roses cont uty Super: sy wine fon Enpauered ant oat tad elon: ang super ‘euabcasttcsore bare ny orelyecs ‘Sipe et management aroyeo5, a pes Arving out waste end delay, JIT reduess inventory, cuts variability and waste, and improves throughput. Every moment material shel, an activity that adds value should be oocuering, Consequnty, as Figure 161 suzaet, IT often yeks a compeitine advantage. Elfectve IT requires a meaningl buyer-supplier partnership. JIT Partnerships [A patvesp existe when a supplier and a purchaser work tgether with open communica- 1 pee tion anda goal of removing waste and diving down cost. Cs relationships and trust are Pts sand tsa othe suecess of JIT, Figure 162 shows the characteristics oF JIT partnerships Some puss fitisro= was ‘pectic goals of parterships are esses aa > Removal of snneceesery actives, such as recivng, incoming inspection, andl paperwork related to bidding, invoicing, and payment. » Removal of plant mentary by delivery in salts ciety the sing departnent as needed, > Removal of -ransi inventory by encouraging supplies oleate neatby and provide ‘requent sal shipments. The shore the Now of material in the resoure pipeline, the {es inventory. Inventory ean also be edued through a technique known as consignment. [invignt tts Gee the OM in Aetion box "Lean Prodution at Cessna Aieraft”) a Cinspnont nny ‘uration of vendor-managed inventory (Chapter I), mean the supplier maintains the foe be tilt the inventory un used. cent » bain improved quality ard eliably through long-term commitments comamaneation, and cooperation Leading organizations view suppliers extensions of their own organizations and expect suppliers to be filly committed to improvement. Such relationships require a high degree of respect by both supplier and purchaser. Supplier concerns can be significant Concerns of Suppliors Thess concems include 1. Diverfication: Supplies may not want ote therselves to long-term contacts with one “austomer."The supplies’ perception is that they reduce thei risk if Uhey havea varity of630 Parra MANAGING OPERATIONS Seppe Koster ase Een adios ber euptor: etd ackging a ung le Bett Sanat aoa Foo or coe compes uantes [oe eke Price sat paresis. eh ee, Fre 162 urate arereie Batre te owrage an undoage Wet may devaupes qa regent ‘hioring Soa jt asedug a hp lees Coto erty ogee | Us oron pga St) Streeter prasad ees nz roa seatcion and oncarage orton Stevo sper rmoraenana pc coraaiveness icra erm ronabe Faces encore ompatineca' Proce ors Pe paper 2. Schedng: Many suppliers have ite faith inthe purchaser's sity to produce orders to ‘smooth, eordinated schedul 3. Lead tne: Enginering or specication changes can play havos with JIT because of inde ‘equate lead time for supplirs to implement the necessrychanaes 4 Ouatiy: Suppliers’ capital budgets, proceses, o technology tay limit ability to respond tochanges in produet and quality. S. Lor holding costs to suppliers Suppliers may see frequent delivery in smal lots asa way to transfer buyers" PEDEIEEIY oric scncatny nen cas Ata pn a pt nese Kaa ‘taopponty tenth rom cra wn mantieg on, ‘Th tl i eas sr fhe an conc) an raged ner.) ag of noi, sp ay madrigals oe ana bm ath pce, tr sear a th tes za, Csr bear wring ‘nt mt past n. Th a oso Ts dan Tan Daatane Tea Bl Car rps enlist Ss, suet own we, sh gn a on Ts ies ain, Inert, pat nara. wk poll owing mo Duc ‘ed Team Dospan AD xo expe wen ary toe caro compere sv kin et ne amd. Taam nenba ines Inti TD roca ao cas, ‘Su Coaches. Set Coates rove por sua ack nea pre ripe tne te prake Andon ear and perrmance mt rude an cy perros, hase coment en mnuacutg a3 make cero Cera tag he wots get mane sae ng sre‘CHAPTER 16 JIT TPS, AND LEAN OPERATIONS 631 JIT Layout ST layouts reduce another kind of waste—movement The movement of material ona factory foot tr paper in an office) doesnot ad valve. Consequently, managers want Nexile layouts ‘that reduce the moverent of oth people and material. JTT layouts place material diet in the location where needed. For instance, an assembly line shuld be designed with delivery points nest o the in so materia need not be delivered fist a receiving department and then moved again. This is what VF Corporation's Wrangler Division in Greensboro, North (Carolina di denim is now delivered diel tothe Hine. Toyots has zone one step farther and places components in the chasis of each yehicke moving dwr the arerbly line. This snot Daly comenient, but it allows Toyota to save space and opens aes adjacent fo the asambly Tine previously occupied by shelves. When a layout reduces dstane, firms often save labor and space and may have the added bonds ofciminating potential areas for accumulation of “unwanted inventory. Table 16.1 provides a fist of IT layout atc, Distance Reduction Relicing distance is 2 major costibution of work ell, work centers, ad focused factories (see Chapter 9) The days of leng production lines und huge economic lots, with goods passing through meaumental, single operation machines, are pone. "Now firms use work all ofen arranged ina U shape, containing several machines performing different operations, These work cells are often base! on group technology codes (ts discussed in Chapter 8). Group technology codes help identify compan wih similar characteristics ‘so-we ca group them into Families Ones File are identified, work calls are built for them. ‘The result ean be thought of asa small product-oriented facil whore the “product” at ally roup of similar products family of produc. The dls produce one good wait at 8 tie, and ideally they proce the nis nb after a customer eeders them, Increased Flexibility Modern work cal are designed so they can be easily rearranged toadape to changes in volume, produc provements, or ever new designs. Almost nothing in thse new departments is bolted down. This sume concept flyout Nexblty applies to of- fice environments. Not only fs ost office furitare and equipment movable, but so are oie svals, computer connestions and telecommaunications. Equipment is modular. Layout flex. ‘lity side the changos that result from product and process improvements that are inevitable ‘vith philosophy of continuous improvement Impact on Employees JIT layouts allow cros-traned employes to bring feibility andffiieny tothe work cel, Emplajes working together er tell eachother about problems tnd opportnitis for improvement. When layouts provide for sequential operations, feedback ‘in be immediate. Deecs ure wast, When workers prec unis ane at tims they test each product or component at each ubssquent production stage. Machines in work els with se Testing pobo-yufe functions detect defects and stop automaticaly when they oceur. Before JTT, detective products were replaced from inventory Because yur inventory snot kept in JT faci, there are ao such bllers. Getting i right the first ines critical Reduced Space and Inventory Because JIT layouts educe travel distance, they also reduce imentory by removing space fo inventory. When ther is ite space, inventory must ‘be moved in very smal fots of even single units. Units ae alvays moving because there is no storage For instance cach month Security Pacific Corporations focused banking faity sorts 7 million checks, proceses lion statements and rit 190000 customer staernets. With AJIT layout, mil prooesing ie hasbeen reduced by 33% lary costs by tens of thousinds (Of dollars per yea oor spice by SUP and in-process waiting lies by 75% to 90%, Storage, including shelves and drawers, hasbeen removed. JIT Inventory Inventories in production and distribution systems often exis “Justin ease” something goes ‘wrong. That i they are used justin case some variation fam the production pan curs. lor cele frfaene Spots Inde aoe mabe ome tree mn ec ego ge Use puta oe devs us tex or mo ‘rostin wee ta fee Ww sruper Te zante ty ‘ewgnkontne cat632 PARTS MANASING OPERATIONS est ti ety Terman oy esa resion ten ‘seg ‘eon oe ot oe evap ste ery eat wth ope x coe pit ero ocho se go ony “The “extra inventory is then used to cover variation or problems, Effective inventory tc tis require “justin time" not "justin ease Jone vey the minima inventory necessary to ep a perfect system running. With just-in-time inventory, the exact amount of| ‘ods arrives at the moment itis nended, nota minute before or 4 minute ater. Some useel ITT inventory tactics are shown in Table 162 and discussed in rove detail in the following Reduce Inventory and Variability Operations managers move toward JIT by first removing iventory. The idea ito eliminate variability i the production system Aidden by inventory Reducing faventory uncovers the “roc” in Figre 16.0) that, represent the varity end problems cure being tolerated. With redced inventory, tanagement chips avay tthe exposed problems. After the ike is Tere, managers take adiional cus in iventory and continue to chip away the nex level f exposed problems (se Figure 16.4} Ultimately. there will be virally no inventory and no Problems (sili Del estinates thatthe aid changes in echnolony cots 9% t 2% of its nventory’ valve ‘each wee. Shigeo Shing, coneeloper ofthe Toyota JT system, ay, “Inventory ise,” He isnot from the rth inventory isl snot evi it hides evi st great eos. Reduce Lot Sizes Just in-ime has also come 19 mean eimitation of waste by reducing investment in inventory. The key to JIT is producing good productin small lt sizes. Reducing ‘the sizeof batches can be n major help in reducing inventory andinventory costs As wesw in Chapter 12, when inentory usage constant, dhe average invertry level isthe sum of the :maximam inventory plus the minimum inventory divided by 2 Figure 164 shows that lowering ‘the onder size increases the number of erders but drops inventory Evel Ideally, in IT environment, onder size is one and single unt ze being pulled from one adjacent process o another. Moc ealistialy, analysis of the proces, transportation time, and ‘containers used fr transport are considered when determining lot size, Such analysis ypcaly ‘esulsin a smal lot siz but lot sz larger than one. Once lt sve has been determined, the £00 production order quantity mode! can be modified to determine the desired setup time. We sa in Chapter 12 that the production order quantity model ake he frm where = Annualdemand d= Daily demand Setup cost p= Daily production 11> Holding cost Arty eve Inventory = “on @ ® © Figs 16s igh is nvr de protons (9) bes eras voi, ples a eps nt May ata ‘efiig tio an renving pris we hare vet eso, ne ad ona sin (3)CHAPTER 16 JIT, TPS, AND LEAN OPERATIONS 633 2 an ge nee 20 i 16a or chtcta! requ Ors Reus = Covance" Aeargauentr ee ooo chant vero Tine "Example | shows how to determine the desired setup time, Example 1 | perenne oma seTup Tm ‘Cate Faria, nc fim that prods as rite, esis Yo move toward» reduce ot i. ‘Grate Farmturs production als, Aled Roth, determined that a hour production eee wool be fecelabc beeen ne departs, Tut, she conlidd tha setup tne that would accommodate the howr eee Une should be achiev APPRCACH Roth developed the following dats and procedure to determine optim stp ine small: || B= Anal demand = 40300 units |= Day demand = 400 00 per 250 days = 1,60 ants per p= Daly producsiom rte = 4.00 wits per day (,~ 200 desied ~ 40 (which she 2-how emand tht i, L600 pe ay pr four ‘hour peiod) = Hing cost ~ 20 pee wi pe ear 'S= Setpeost to be determine) SOLUTION Roth determines th the cost. on an hourly basis, of tng up equipment i $30. Further, se compute thatthe setup east pr sep should be cs) Setup tine = $240/(hourly borate) $240/¢80 ps hou) O08 Rowe or Anus INSIGHT _Now, ether thin proce component a lags, Crate Furie can produc in “hour eye wih the advantage of an entry tumaver of our per di. NING EXERCISE pf labor es gosto $40 per hout, what shoal be the stp ime [Answer ‘6hour oF 3.6 minutes} RELATED PROBLEMS 168,169, 1610634 parts Fauwe 183 {eS Cats Lower Tallest eet erie foaerpapce eh, ys eg conan 1, ‘oan ona bom het sstuoenr ne 1 cco ase tg sstuoenr rr 1 ‘ene sponge ‘rete ie ato MANAGING OPERATIONS Hota cost ‘umat atring ardbeling cost ‘Only two changes nad to be made for small-lot mera low t work, First, material han When the producer and user are not in visual contact a orflag oF empty spot on the foor may be adequate > Usually, each card controls. specific quantity of parts althougk multiple card systems are used ifthe producing work cel produces several components ori he lot size illerent. From the move size car be used others ight ‘Axanban need not be forma a8 ‘gral ht or empty cast. Te cookin ‘ost food vain! knows et hen ‘Scars aoin ie, aight mat patton ookCHAPTER 16 JIT, TPS, AND LEAN OPERATIONS 637 se Ye eon ar, venga a Sovocrmaren Ser ‘Strat aaron stack of ows. » The kanben cards provide diet cat! (limit) on the amount of work-in-process between cols » Uther is an intermediate storage area, a two-ard system mey be used one card circv- lates between user and storage area, and the over circulates tetween the storage area and the producing area, Determining the Number of Kanban Cards or Containers The number of ‘eanban cards o container ses the amount of authorized ineatory To determine the num- ber of containers moving back and forth between the using aea and the producing areas ‘management Sit sts the size of each con‘iner, This is done by computing the lot size, using a ‘ode such as the production order quantity model [discussed in Chapter 12 ad shown again ‘on page 632 in Equation (16-1) elting the numberof containers involves knowing: (1) ad time needed to produce container of arts and (2) the amount of safety stock needed to c- ‘count for variability oF ucertinty in the system, The aumber of Kanban cards is computed as follows Demand during lead tine + Safety stock Size of comainer ce [Number of kanbans(contsiner) Example? illustrates how to calculate the umber of kanbans needed. Exermpple 2 | even THE HUNGER OF KAWBAN CONTAMERS obs Bakery prodases short rans of ke that a ships to grocery stores, The owe, Ken Hobbs, | om tot redo imentory by clanging to kanbon rem, He has developed he fling data Ind asked ou to is he prot. Daily demand = S00 cakes Production ud ine = Wat tine + Materia handing tine + Processing time = 2 aye Safty sock = {ay ‘Contin sin (termined on a proton order size EOQ bass) = 250 aks APPROACH Having determin athe BOQ sizes 250, we then determine the aunberofkanbans (contin) needed638 PART 3 MANAGING OPERATIONS 1.09 Compute te requred number of svupenr 2 (seat es, Empower employees sual te mats (pnt, chs te) ‘poe pcr ait wh salen SOLUTION ® Demand during ltd tne — Lead ime X Daily demand = 2s Socks = 1.090 $ % Daly demand = 289 Suey stock "Number of anbans containers) needed = Demand during ead tine 4 Salty steck L000 + 30 Contig sie 28 INSIGHT ® nce te reorder point i fie containers shouldbe eas LEARNING EXERCISE > [fend ime drpsto day, Pow many conn are eed? [Answer 3] ELATED PROBLEMS 16,162,163, 164, 165, 166 Advantages of Kanban Conisners are typically very sal, usually @ matter of few hous" worth of production. Such a syste requires iat schedules with small quantities being produced several tesa day. The proess must run smoothly with ile variability in quality oF lead time because any shortage as an aot immer impact on the entire sytem. Kanban plhces added emphasis on meting schedle,redcng Ihe lime ed est reguied by sets, nd economical material handling, Invplant Kanban systems often use standardize, reusable conta nes that protect the specific ‘quantities to be moved. Such containers are also desirable n he supply chai. Standardized ontainors reduce weight and disposal cost, generate less wasted space, an require ss ahor te pack, unpack, and prepare toms. UIT Quality JIT od gut are rented i hoe ways Fit JT cts he cat of obtaining god gu ity. This song eur sae sera, ror inventory invent, nl Saeco ar Duin iventoy 7 Tres down inventors heer fever a nt te pode a fewer nits mun Be reworked In shor, wheres inventory ie bad quali, mmeditly "?Stcond, TT improves quay: As JT shiks uous nea ing ic aps eine of crores and its th uber OF potenti sours of ero Tec TT crete an ely ‘enn en fer gay poke ht oy ta igre pbc ed enc = Tiedt Thangs cn osro both wt tina and wk ode rece fom ouside vendors ins beter quality mens fvcr bles ae ase and, fr, ete ese employ Itsy ean exis Menthe prose of keeping ine fo poet ssn tebe gua It eonssent us exis, Tallow rms to roel eon anced Sentry. Table To sagt some requemnets for gui aT evronmer Toyota Production System (TPS) ‘Toyota Motors Eiji Toyoda and Tatichi Ohno ate given credit for the Toyota Proton System (TPS) sce the Global Company Prie that opens his chap er). Thee core companetis OF TPS ae coatinuous improvement, respect for people, and stantard work pritce, Continuous improvement Continuous improvement under TPS means bulding un orzanizational culture andintlin itspeople value system sessing hat proceses ca be improved-ined, that improvementKEELE te te ct te veer ve fee, mak oi on es tn. anata mavtsicacolenp As ee ond na sn ‘een hats ors acura Bl Toy, xs sd lin ae peck root, mater ote po ac- Tt, ach cee Dak te 16S AT ae TS, cg ‘hos bake nas maar ows dco esoMENE Feravayntaan al rata docs tgs ny an spy, ‘hearse aerial Wt srw saan 18 es ots eles enre pin tpl ees. aay elamegitspdin prors a antr ay > Theat neha cs tg yar tan va ‘tuo, rege gh a nay 3% and ue sty > ns hag cess angng om ta car, ‘herp nae ares, ing tng asin cous 4. cnarren LIT TPS, AND LEAN OPERATIONS 639 eng ems fate carpe long bx a ot ns sfoampren, egies > Theatres ck mm ost yes aeeere an cree oa eI ‘eral okt PSerote r raaton wh srait, "aid danse ae ode haba tes hl ose fray. Suc Re Wa Set ar Now 5, 201) nob 7.21 1h isan integral pare of every employee's job. This process i formalized in TPS by te, the Yalan Japanese word for change forthe good, or what is more generally known as continuous bose Improvement. In application, it means making a multitude of snall or incremental changes as ‘one secks clase perfection. (See the OM in Action box “Toyot's New Challeng”). nsling the mantra of continvous improvement begins at rerutiag and continues through extensive and continuing training. One of the eeasons continuous improvement works at Toyota, We ‘should noe, s because of anther core vale at Toyota, Toyote's respect or people Respect for People At Toyota, people are eruted, rane, and treated as knowledge workers. Aided by aggressive ‘roe-trtning and fe ob casifications, TPS engagos the men aswell as pysical capacities ‘of employees in the challeegng task of impeoving operations. Employees ure empowered. They fare empomered to make impeovernents. They ae empowered 1 stop machines aod processes ‘when quality problems ens. Inde, empowered employees arc a nebesary pat of TPS. This fr STUDENT Tip ‘means that those asks that have caditionaly been assigned to staff are moved fo employes. THStage tesa “Toyota recognizes that employees know more abou her jobs han anyone eke. TPS respcts wou “anployees by giving them the opportunity to enrich both thei bs and hee ive. Standard Work Practice andaed work practice at Toyota includes those undecying principles LOT expen tne Standard work practice at Toyota includes those undecying prnipes 407 citi » Work s completely specified as to content, sequence, timing, and ovtoome, Frscton Saar » Inernal and extemal customer-suppler connections ae dire, specifying personnel, meth- ‘ds, iming, and quantity » Product and service fs are 10 be simple snd dest, Goods and serves are directed toa specie person or mache. » Improvements inthe system must be made in accordance wits the “siatiti method” at the lowest possible evel inthe organization * 2 Ade rr Steven. Spe, “Leaning o Lea a Toye” Hara Bsns Review 82.00. § (hy 2000 18-46 and Stn Spears, Kent Bowen, "Desoing he DNA ofthe Toot rodution Sten” Harard Busnes Review 77 no, 5 (Sepeaet-Octber 19) 97-108640 PART 3 MANAGING OPERATIONS srvoenr 1 2 aarrseees ‘Tis Poreche ene, tke most ter IT actin, “powers ampiyese soy ea stop the aire ps ‘Susuon na what he Japarec cal joka, any gusty ‘problems ste spot. ‘TPS requires that activities, connections and flows include builtin tests to signal problems. ‘The Japanese call the practice of stopping production when a defect occurs jdoka. The edu- cation and traning of Toyoa’s employees andthe responsivenes of the stem to problems rake the sacmingly rigid system flexible and adaptable o changitg citeumstances. The resul, isongoing improvements in reliability, exibiliy safety, and efcency Lean Operations Lean production can be thought of ae end result oa well-run OM function, which under- ‘stands what the customer wants aad ensures customer input and feedback. Lean operations meat identi customer value by analyzing al the activities required to produce the prod uct and then optimizing the entire process frm the customer's penposive, Building a Lean Organization Buildingan organizational cltrewherelearning, empowerment and continuous improvement are the norm isa challenge. However, organizations tht focus on JIT, quality, and employee {empowerment are often lean producers. Suck fas drive out ates that do not add valve in the eyes ofthe customer they include leaders ike United Parcel Service, Harley-Davidson, and, of course, Toyots. Even rationally era-oriented organizations such as Lous Vuitton (Goethe OA in Action box) Find improved productivity with lean operations. Lean operations adopt philosophy of minimizing waste by striving for perfection through continuous learning. ‘reatvty, and tarwork. They tend to share the following atibues > Use JET techniques to eliminate vetually all inventory > Build systoms tha help employees produce a perfect product every ime > Reace space requirements by minimizing travel Wstanee. > Develop partnerships with supplies, helping them to understand he needs of the ulimate > Buucate.uppiers to accept responsibility for satisfying end customer needs > Bliinae albu value-added acvdes. Material handling inspestion, inventory, and rework ae the ely targets beens these do noted valet the prot. » Develop employees by constantly improving job design, taining, employee commitment, teamwork, and empowerment. > Make jobs challenging, pushing responsibility to the lowest evel posible. > Bul work flesibty through exos-raining and reducing jab dasications ‘Sucoess requires the fll onmitment and involvement of managers, employees, and supe The rewards that lan producers reap are spectacular Leen proguces often become bench smark performers.CHAPTER 16 JIT. TPS, AND LEAN OPERATIONS 641 TOE citar stsisie Lithiste ves getioygaticonpay Las tin wit, atthe Yom wer reget eae corps rt rales ey tetas and owe. tapysareh nag react $7 Te earninesrent sto alos sss ect Corl ac bene mccain aac ewan tid ‘oth as ae clerk row peau ho righation tutes semwasamnetes af [sale pnt me i obadens emzcwotul vas ney. Ear mans Chresentelaanyfiorwveley tected Thad Kune oe ois cence rercsrgat ais ieee sta poke cain, Me etna yer ‘rokeg ay ceca, pore ecko! suchas poet ana, Ra abs ‘tinting sve, savant, Cee bee Ct sm-Anened Laas Wuespe Oe forage ewan cok 201950 ata dys tonwion rata wc aeadg hang, cle wee ean np lao typ. aso owe hey, ‘Gasca ares to ru tis nol stp rcs Fachueealven con 012 Obstet S To Mad re ume, 209) (ee, 208, ne ‘ning acer ones Gna woe photon tewis SAMS ST Lean Sustainability ‘Lean and sustainability are two sides of the same coin, Both seek to maximize resource ‘and economic efficiency. But if lean is foeused on only the immediate process und sy3- tem, ten managers may miss the sustainability issues beyond the firm. As we discussed in Supplement 5, sustainability requires examining the systems in which the firm and is sakeholders operate, When this is done, both lean and sustainability achieve higher level of peeformance ean dries out waste because waste adds nothing forthe custome. Sustainability drives cout wast because waste has adverse lfc on the environmert. Driving out wastes the com- ‘mon ground of lean sustaiabiits. Lean Operations in Services “The features of ean operations apply to services jst as they doin other sectors. Her are SOM ty srypen TP ‘examples applied 1 sbppir, lout, inventory, and scheduling inthe service sector. Peieisk ‘te te or aco Suppliers As we have noted, virtually every restaurant deals with it supplies on a mT St basis Those that do not are usally unsuooestul. The waste too evident—food spoils and $yaa" customers complain or get sick, Layouts Lean layoutsare required in resturant kitchens, where cold food must be served ‘old snd hot food hot. MeDonal’s for example, has reconfigured its hitchen layout a reat Expense to drive seconds out ofthe production process, they speeding delivery to eus- tomers With ihe new process, MeDonald’s can produce made-to-order hamburgers in 45, seconds Layouts aso make a dllerence in aivine bagsage claim, where customers expect their bags justin-kime, Inventory Stockbrokers drive inventory down to nearly zr every day: Mos sell and buy ‘tders occur on an immediate bass because an unexecutd lor buy order isnot acceptable {othe cleat. A broker may bein serous trouble i let holding an unexecuted trade. Simi levy, MeDonald's reduces inventory waste by mainaining a tme-stamped fnshed-goods inventory of ealy few antes after that, 1s Uhown avay. Hospitals, such as Arnold 7 Palmer (eseribed in thischapters Video Cave Stay), manage JIT inventory and Tow sfety eae ot642 PART 3 MANAGING OPERATIONS Leon operate tak on an unusual fomin a open ‘om Neesoon Gene Sater teratorl ane my ‘ter hospital suppor prove euro suppl fr oa pls on 8 bis They der preoactaged sugcal upptes based on hospital poratingechedu, ad (2) tha ‘irplpacagos themes eo proper on apples ae ‘atl to enquance in hich yw be ead ung stocks for many items. Even critical suppis such a pharmaceticalsmay be held to low kel by developing community network as backup stems In this manner, Tone pharmacy runs out of ‘anowded drug, another member of dhe network can suppl unl theme day's shipment cites ‘Scheduling At asin ticket counters the focus ison adjusting to customer demand, But rather than being accommodated by inventory avaabity, dematd is satished by personnel salibty. Through borat seheduting, personnel show up justi ime to over pe in cus tomer demand. In other words, rather hin “thing being inventoried, personnel ate schedule. ‘Atsaon, the focusis cay sight cilferentboth the customer and oe sal are chal tos ‘sure prompt service. At McDonald's Walmac,chedaling of perionnelis down o IS-ninute increments based on precise forecasting of demand, Inston, both personnel and production ae ‘scheduled to mect specific demand. Nosic that in these len orgeizations scheduling i Key Ingredient Excelent forecasts rive thse schaduls. Those foroisismay be very eaborat, with ‘seasonal, daily, and even hourly components in the eae of the ane ticket counter (holiday ‘ales gt time ef), seasonal and wekly component the salon holidays and Friday rele spseit problems), and down to afew minutes (respond othe dis meal eel) at MeDonal's ‘To delver goods and services to customers under continuously changing demand, supp cers need tobe elible, inventories lean, eyce times short, and schdules nimble lean foes engages and empowers employees to crete and deliver the castmer'spereption of value climinating whatever doesnot contribute to this goal. Lean techniques are widely used in both goods producing and serice-prodacing firms [hey jas look dierent. ITT, TPS, and lean operations are philosophies of con- tinuous improvement, Leas operations focus on customer desires, TPS foeuses on respect for people and standard Work practices, end JIT fuses on driving out waste by reducing inventory. But all ree approaches reduce wast in the production process. And because waste is found i Key Terms Satine IT) (p26 “oyeta Production System (1S) (p26) Lean epeations p69) Seven water 9) sSipean asa i. 27) ‘Througipatin Summary Maoufhturing yee ine 2) AIT puters (69) anything that does not ad valu, organizations that inple- ment thee techniques are adding value more efficiently than other ems. The expectation ofthese systems is Cat empowered employers work wit commited management to build systems that respond tocuetomers with ever lower cost and higher quai, Consigentinventory (p29) atin ventory (2) Lael sched i.63). Kenan 8)CHAPTER 16. JIT.TPS, AND LEAN OFERATIONS 643 Ethical Dilemma In this lean operations word nan effort to lower handing (Gots sped delivery, and recs ventory, eters ae forcing {hel supplies to do more and more te ay of prepering thel mechani forthe cron docking warhouses, shipment tospectc ores andshel presentation Your company, small manufacturer of aquarium decorations, sn 2 tough postion. Fist Moga Mart arte you to develop barcode fecnology, ‘hen spoil packaging then smal invidulshipments bet ode for eth soe. Ths way won the rarchanae Mts the warehouse coe docked mmately to the covec ugk Sind store andl ready for shit placement} And now Mega ‘Mart wants you to develop RFD-immedioely. Mega-Mar. Discussion Questions 1 WhatieatT? 2 What ican prdcee? 3. What TPS? 44 Whats vel shedtng? '. IT atempis orev dys, which do pot ad vale. How then dows cope wth weather ands pt om sro a test and transportation tines? {6 Wht aretives wan wich JT and quality aerated? 7. How dees TPS conbue to competitive advanage? 1a made it lear that rps that cannot keep up with he teennaogy wil be eroppes. ker, when you dt have the experi for barcodes, fou has to borow money ana hie an ouside frm to do the ‘evelopment, purchase th tecmalegy, and tain your sping ‘Bert Then meeting the speoal packaging requirement drove You ino ou for several month, reeling n ass fr lst er Now ft appre thatthe RFD request impose. Your [anes under the ber of conkers, & marginally profiad, tthe bane may not be wing to ball you out again. Over the eats, Magn Mars slowly bec your major customer and tito them jou are probably out of busines What re the ‘thea ins what do you do? A. What are the charac of just reps 1 supple? 9, css how the Ipansse word for card hus aplication in thestudy of IT. to, Standard, abe contsnes hae ly obvious enor ‘Siping, What he purpose of xe dees wai the pt? 1, Does an production work in the servis sector? Provide an atraton 12, Which lean tchsigues Wok in both he manufacturing ond time pains with Solved Problem vinsicncsturshepis aust a wr. nonia cr, Krupp Refigeation, nc trying fo reduc instar and wants yu t intl a Nanban system for compresiors on one oft {Sse nes, Deen thir of te ba and the ero eanbans (cots) node Setup cost = $10 “Anna oldng cos per upresor = $100, Daily progetion = 200 cemprosers ‘Anna mage 25,000 (S wks 5 dap ach daly usage of 100 compressors) Leadtie = 3daye Sale stock ~ day's protuction of compressors Fi, we mus dteinekanbon contin si, To otis, We termine the production oder quantity te dicusion in Chapter 12 fr Equation (1) nich determines the kana si: 5 225. 00410) Vt Fp rapene ote etc Vina = “Then me eter the umber o kanbase ‘Demand ding lad time = 300 Safty stock = 100 [amber of kanbans ~ x0 2) Vg 5° (san more sean the sz the kana contains = Says x daly wage of 100) (= |X daly production 200 emi during end Hime + Safety stock ‘Ses of one +109 _ 200 0 gone644 PART 3 MANAGING OPERATIONS Problems _ not, mens ne prcien mtn soma wth POM or Wrsons ance acd OM + 46.4 Leblane Electronics, In, im Nash, produces ‘ort rans of esto sree sotner Tor the defen industry. ‘You have been asked bythe owner, Lary Leblane, to reduce inventory by introducing 2 canban system, After several hours anal, you develop thefollowing data for canner cannes tory sein one work cll How many Kens Joyo need for thiscometor? a deat omc tei 2 18.2 Te Dik’ company wants to etch anbans to ‘ee a newly exablsod wor cll The folowing data hve Boe ‘rode, How many inure arena ue se in ete hay 46.3 Pauline Found Manufacturing, Ine. is moving Lanbuns to sepport ts teepbnne switehingoard ase ns, Deterine the se of the kann for sbasemis the ‘ero anne need Saupeast = $30 Annual olig ost = $128 persuhasembiy Dally production = 20 stbasemblies ‘Annual wage = 250) (50 weeks x S days each aly usage of 10 subasemisin) Lead time = 16.93 Salty sock ~ 4d production ofsubasembis. *=184 Maggie Moylan Motorcyle Corp, es kunbans Support its transmsion asenbly ine Determine the i the eben forthe mains sembly and the umber of kbar eed. Seupcost ot maiattsebly 20 20 pe nit Dally peoducon ~ 30 sina Annual sage = 200 x dally usage of 40 maioshats) Lied ime = Sys Safty tock = | y's production of mansate™ weeks % 5 day exch + 188 Dixoonar scree on or qaty (ee Chap 1 or EQ cm foe tage nt eet oy al lope ap tom Speci ing Matte yA, Anta Aeon. ln eg tors 90 ade ‘ipo orlanp int owe cog" 8) What rete tap costings ong im Sp het” «Hw may need Darn Mar ls with psy pha pert sea Door Man es Pelm 165) 5 pu of it ae TT prog, assed Tonge cote Sah Spesly Ligand pt nde eral forges ams ring sl dy 08 90rd ut Doane at Tamora 2 Whats tens eosontc re gen 5) How may oe wri ow be pt 2) Wr tel eneal co angina wih ? this policy? x 7 How do yourarswerso Problems 16 Sand 166 pr ‘desi into JT pres sate? 488 Carl Cagle as a epettive manulatuing plant po cng alr htees in Avingor, eas. The plat has ae aero inveotory trove efony Iams fryer Sets thereere de "ae tha he wl ede he component ot sins Shs bis dv ‘pede folowing dt oroneomponent the sy ein if Annualdemand = 31,200 nts Daily production (in Bhours) ~ 96 nite Desire Jot size! hour of prolution) ~ 120 is olin cost per unitper year = S12 Setup bor cost er iour = $20,Hom many ine of setp tie shoud she have he lant mane sperm fraps this component *:48.8 Given he oionng information about a prodct at “Mics Giteon's fm, whats the oppoprinte setup ene? ‘Annual demand 3,000 uns ily demand = 150 wis Daily production = 1,000 units Desir tie = 10 ants Holding oe pe nit pr year = $10 ‘Setup abr cost perhour ~ $40 40.40 Rick Wing has rpetiive manufacturing plant producing stoma resing nds. Use the flowing dit CHAPTER 16. JIT.TPS, AND LEAN OPERATIONS 645 1 pope flora rte lot se The firm uses a work yea of Dias ua em seg ae ase te a aly px 8 0 cen ea ata) 20 ekg ps ie ye 0 a) What sth setup cov, based on he diel ot sat 1 What isthe setup tie ted on AD per our setup abo?! fer y;OMLab for thee dona homevork probes 16 1, CASE STUDIES ‘2 Mutual Insurance Company of lowa Maa Inne Campy of fons (ICT has 2 major insur {ice fag eae nes Mois, own, The Der Maes ofee Ie respomile fr pocesig alo ICT tase his fo the ie an, The companys sles have expect pl growth ‘ering he tt yea, anda eget, record Levels in cams fa Teed Over 2309 ims fr lm ay re Dg int the tice tx pocesng Unfrnaty, ever thn 2.00 Tors = {te flowing ou. The tl ine procs ai fon he ine ver ttc tine chee mai hasnt rm ys 0 10 ttle. Asse some catanes re tenening lel ston. Sally ook the manager Chins Proceso. parila dstesc. as ‘he ku a ch selon requis oe tha 3 fy wt ‘eek Under the urea admire proces, han ears Timon sn ity conan, oe appear oben as es forthe role Bt cle someting st be doe, 8 he Work lend at cele te ene 9s MICK nanaement wants steve, bt economia, tion taken tte poem. Me Coo as deed ry JT preach totam pocesing, With spat om er ves, nd ep ry fe Cok bs tough in rte personnel os MIC ales tdvsnns sera the court Yo Hp They ae wo work dwn the ‘Shins tckg whe new JT essa. Mesnil, Clains roesing manages and employees te to beta in IT pices With TT piles fem mind, ‘manus wil dg ob to move espns For tly cam Tol asiiles to ech employee, holdem espns for qty Srork a ny ose execs. Cook will itt werker- Urlsing programe tat explain he core chim pocsing ow, as tell as rove compere taining on enc sep Se poss. ‘aie ile wah eh to fth employers and mages ina fo a fc eons fords say 0 he poesor ‘ethno at ny clerks Anal, rosea Wil be ‘Sosa to emle woke witha departs 0 poes a (Sy ofcaner lim apes he ene ‘Cook an her roperises se also examining the insurance and claim forms eee in ue They wt to ae Sanaa ton of fons wie pocesing tine, ace trey ine, and ok ‘ork rs "Tey he the changes wil lo save wang tne, Making changer in werk hs apd werter sleds oly 2 ne {arcange nthe laos fhe Clits Processing Deprtnest. Tis ena cange erst a ajr nove om the department {Scot h pasta willbe acon ep. Tobel ena ses ‘plementation of itp fe csngsver, Conk eased 3 tina yp of vperz employes, an an ete ofc yt ‘cla She abe anv he Kaa mares a SS inoln, Nebr, oes a in of wae cll aT. "Te ca sonst a chonge i he oie cies Wes vecesay to scceuly pent and inert IT eo at Site The tan bbeves sald revs te nyt fe operation {tweed ing bem i ine with “ou technogy el” yess An example of te curentSepurtonl et anf im rosa fw ptr x presented a Figure 16.9 (on Fup 46 OGce be sen inh pa, cater clams ave for presi fie fait an ow though sors of fee ed eparent evenly compe he cla proses ARough the arene {i fies ad werk in Fgie 163 peat ete fa iy tetaly operat 20 ational Rows eck consisting of tb sme tre Spates: However neal of he 20 flows ae oni the same. The aber of employees for expe wares epensing ‘cli om eins ree cs ve tobe prove ‘re pope) So weal fn spe teh ese ee Apress (Customer Claim ny, Accounting, and Customer iuim Approval) the umber of works fr each cla my Way ‘on too foe, Fer thi eso, the MICK fy eae ral ‘ins lf of over 180 office wokars jot wo process an eat ‘hi Al ie pple wor fre Covk Discussion Questions 1. Keo the antes you woul expt he Cats Procsing Deparment at MICI 1 have one the new JT system pe 2 Wn wil de restructured cll you for chim resin in gue 169 ok? ree 2. Wha sumone you ming about personel neue Ine now gop tecolegy cou? 4 Hon wlth ne IT oneness bse tbe MIC operon? spi, [Nongennt 28-285 ypomion 9 Peron Ean,646 PART 3 MANAcIN oFsnAnIoNs a 169 caer eg os Se so TRESS sees cn ac nite we em aerercin core aioe eran tn mtr owing Routing . a ‘Accounting tin ce pret sive for processing ever ‘end note or check sont vos tojes Ba et et = a 2 JIT at Amold Palmer Hospital (etnd's Amol Palmer Hostal, is 198, species in eaten! of women and chin ad ec oe sy ankings top 10 of 2000 nck bose br and einer volume nore han 100 bit pr er oat ies cae wt (one hes vial rs nent), Ba qalty mesial atcs an igh patient station sgt costy invent —some S30 milion pyar an hasan of SKU With ese on ede to manage aed reac Aro Paer Hospital ised od craig ts nen nh sti (OF ectniguee ‘Within te hospi, fo example, gs ae now dtd suing worstons vis dpang machine an ke vending ‘machine hat coal ck pent ge and os he mt argo cack patent The dgensing state efile cach gh basen ae demand and eseriptn writen by dtr “To abies JT ise xen, Arlt Pe Hol tam toa moe distiaion put Heke General Mes fies ovis he sp! wi abot ce ur fl meal very. Meese spies pes, tn ‘dk, Mayo stand cover, ngs al dd of ter eda an ‘lems. To enure ein daly dey a etary che Tron MeKeson a scm neti ht et ged te pi «ha fine bas, wll sinners wesc Timer sec and roe Thee hss» Ca ‘Sippy neta dl etry om $4000 $114,008 IT secs halo be ved in he re of ao ‘tacks. Coston sui pct asthe tere cover sone oti tays, paz, and he, speed wen spe fsa [ocedure Arvid Palmer Hopi wes 10 dfret cst packs for varios tga proce “Over 30.00 pack re wed each eat, fr 4 wal ext fst $1.3 malo,” aye George DeLong feat of Sopp-Chain asa, ‘The pcs ate nt unlysvered in JT mans at pasted hn way wel. Tha thy packed nthe evr ced y ar tse cach ie comss ot fe pack nthe eqns i edd sek pin a * Adaiional Case Sty: Vist www myomlab.com ce www pearsnbigheredconizer fortis fee eases Viteo Case Comm “The packs ae aly, expense and ms remsnetie,Redeiog the near nanan ue manga ced stl ap Ply oracle agers presets chang to oss Tes ths spy chin vr: Cato pk te aes ‘ay pking company With empnet oepid pimayfh manufrs sek by he bsp an deere by NeKewon roms oa ware, Ar Plo spl work wis ‘rial staph the Mel Fas Once Comin) {enya sande he eston yk rele ember astm pick SKUs. With thi epost, pk fy ck Insets oe a tee “The procedure eve the eit sn pk HT system ‘eine wih aul fon he ected supa shel Then, Are Palmer Hospital ntnes a elec oder to MK between Mand 200 daily At 40, ene dy, MeKosn Setiver the pucks: Hop prom amie at 7.0. and tock the ter ort wg, Nek thn deen he eck company whch nfm pl nserver othe {Nonfat nete om he aces "Aro Pane Hospital’ JT ster ees inventory ive met expensive tonal ring ly ore spot aly witha tne deve Discussion Questions 1. Wa do so ommend edn when neni fomdin a pack stipend for anor 2. How mite proce oc cnt suis pack deeb ete ‘When dcusing FT in seins he txt sth pis, y= ‘ou nvenysndscndling eal ated Provide an eagle of ‘ch et Aro Pie Hi 4 When a dcr popes aw sgl proce, aw do yo recomend te SKU or ow stm ack he ee ne pia ssapl-chan Ste? ‘Tater Catastrophe: Ho Cael responded afer tama tes spat Ot platChapter 16 Rapid Review Main Heading Review Matertal MyOMLab ST-RETME, THE tine OTT) —Cot nd ae bl ang TovorA MObUCTION —”Heeogg ad eae en. SYSTE A LER Tete rednton System (1S)—Foca ncaa ioe pet ‘penarions fer anand wk prices (one. 1 Lea operates was ough coins provement md fs Sexy wt caste a When ipl ac campredenrie manfcorn soe JT, TS. and an ‘eS Cometic arog aren ress oe eer 1 Seven maser Overpodi.ghes rnporsio, iene on, ‘rowcenng ta detec po. SpA ean rnc or py, ig, tad a sus US. manage fin ao loa Sa he cial ne fey an por * Vaiaity—Any vation am een process tha delves pert tte tine, tne aT lite an i fr eying cae ity 1 ThrenghpatTi neat eich mite ough podon rose. 1 Manufactrng yl ime The ine betwen ea of ow mel oie peo ued pra Pulser conspire sierra aly whee ovat and moved hoe k nnd jux at mee ‘lyse esl tes pasion so dle fom upg tons {beat ne peduton cual TST WTNE Gi) J parterslpe—Parmetip af ppd praca ame wa paren, {Ind done wc ral ot Same eit oT presi rnc of mecca att, Femail en one fas ety a ebtn prove (polyandry Cigar argc he reins ite ‘concen spn pent cla 1) ern) sched {Shea te uty nt [rotates ik eign col aii os nang arg= ‘nr of nisin sal semi ste, desing ie ee Tmnino bpewne ene conus ang poke ere baling ec ormmane spend cg Wh a8 ‘ stin-ine entry The icin very near keep pect Probleme 165-1610 ‘Ne etetnd Tn cine en tie yaya Sra a in ate a a im dela atin eras age eng di rite pereting whole eng apd wy gop io. = 6 oO Vaan ae ng Et 161 a edt, wecaste t pin sowpc aetia 5 = San se usa Tt ceding nae amu eno wen ae Cosi sscaie pmo ekoneceeate,—ProBene16 1-166 {teecpesme ne we pce tl os ans she ‘Schepens a *LaneachdterSheang podc 50 dt xh y's ration mec te ‘on et. 1 Kanbar—The gue wo car wichita mean ia ‘ania yan es sh eval on Sp Doman dering ad ine + SxS Sock Vl fice Hous for ‘Se of cota ‘Sse robin 6) Number of katans (conteChapter 16 Rapid Review coninued Main Heading Review Materia MyOMLab Ts Ws ny Kal ae, ap Tg es nce ing stat ce intl pores employes aig atte mated gts yoke, chat, epg pre ey a ‘Sl Ts rong nein otc TOYOTA PRODUCTION —= Kale Tonio conan rveme SYSTEM Ps) {Toye ple we ed el eid aoe wore. Tey ae oo ‘Spore THS employe appesate cotinine olen a top. ceae) ‘yal inven; ul see a ep empleo ec pa ee {Se ec space egurenn by mina al tamer: clo por s ‘itp lpg thom nena te th ce onc ate prac pani aig dss el | ‘eae cer dee np coastal ng jb Sep, nina cape commit amor sn enpsemont nak jb chat tne srg ens oth mes evel pon nd ud ware eon losis rela ab cst TER OPERATIONS The ees Ten opto apy ova pata do wie aes —— VIB TT sences Frente inservice ay be en boa wet dalyeboeereea fet ra Palmer none ‘emer enya Hoa Self Test = bing et rs Barges be gee apolar neal cd co +01, Costino inproemnt an od pon hig i oon, OS Kanan te apc word ‘ntbvouppa sed eiedenay Novem inte) ee BS enon, 2 Se 8) Stott, 3) Simon ingrome nice 3 etna 8) Moya itn rem 106 Ta re ur on ets LOR The Sean pedo, 3) Bema winged in cage asm grt ieee 2 Spe ieee teresa en = Lenten cs i —— ioc = 1p) » Vem = dinien, ©) om ~win/e0, © Oma ~ inven, om ~ain) Anwers LO, : 102.0 emp sin stand, eis LOR, LO. SLO. LOG LOT