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Just-In-Time principles

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Lean manufacturing has its roots in the Toyota Automobile of Japan where waste was to be avoided at all cost: the waste in time caused by having to repair defective products, the waste of investment in keeping high inventories, and the waste of having idle workers. Lean manufacturing is now a major components of the Supply Chain management.

A key element of lean production is just-in-time (JIT) conceived by the late Taiichi Ohno, the former president of Toyota Motor Co of Japan in the 1970s. Other Japanese manufacturing and service companies later perfected JIT, and it is now a philosophy adopted by firms worldwide.
The Japanese manufacturing success with increased productivity, low product cost, and often superior quality products can be attributed to just-in-time manufacturing methods.

JIT (Just-In-Time) means:

  • Producing the quantity of units that is needed, no more, no less
  • Producing them at the date and time required, not before and not after
  • A supplier delivers the exact quantity demanded, at the schedule time and date


JIT approaches

Three main approaches are possible:
1.    Reducing manufacturing and administrative cycle times
2.    Reducing all waste
3.    Reducing the pulled flow breakdowns

Cycle time reduction

The cycle time represents the time between the customer demand and its final delivery:
1.    Manufacturing cycle time includes the machining, transportation, inspection and warehousing. Classical tools are used to reduce these cycle times such as SMED, TPM, 5S…
2.    Administrative cycles are less visible since they more occur in the background. They include order entries, purchase entries & follow-up, payments, credit notes…
Depending on industries, there can be up to 90% waiting time and 10% value added time!

Waste reduction

The wastes encompass all operations not having any value added on a given product. Shigeo Shingo from Toyota has classified them among 7 root causes:
1.    Over-production: to be sure to get the right component quantity, we produce more!
2.    Queues or Waiting time: Products don’t move as produced to early
3.    Transports: No value added and can be expensive (e.g. factory transfer,…)
4.    Processes: If not well adapted to the operation to perform, there can be a waste of time
5.    Movements: Useless movements in a shopfloor or around a line.
6.    Non-Quality: Defective products are pure financial loss!
7.    Inventory: Overstocking is usually seen when disruptions occurred during the manufacturing cycle, when a machine is down too often for instance or when absenteeism is always over predicted.
Japanese people use to say that the inventories are made to tackle unsolved problems in order to maintain the throughput rate.

So the method consists in reducing slowly the inventories in order to continuously solve the issues causing problems:



Flow breakdowns

This approach consists in identifying all the flow breakdown causes in order to eliminate them.
The main objective is to maintain a high throughputs rate in order to quickly assemble or produce the products to get faster sales revenues.

The causes could be classified as following:

  • Random breakdowns:
    • Waiting times
    • Missing part or component
    • Machine breakdown
    • Absenteeism
    • Rework
    • Waiting for decision (after inspection)



  • Operation breakdowns:
    • Inspection
    • Transit (between shopfloors or to warehouse)
    • Handling / Warehousing



JIT change management scope


The JIT is a full process that impacting all factory main functions, from sales to purchasing troughout the supply chain:

 

  • Sales: From maximizing turnover at all cost to maximizing margins. Sales people should change their habits to avoid big ordering waves disturbing the manufacturing line, by smoothing orders through the year and get yearly discount instead of individual order discounts. New metrics for sales performance are hence required.

  • Suppliers:  There are fewer suppliers but they are considered as partners with long term contracts in order to get a stable supply plan and reduce the shortage. Hence long term forecasts are issued so that they can plan accordingly. Supplier Schedules are used, replacing traditional purchase orders, and reception inspection is skipped or simplified for selected suppliers allowing direct delivery to the manufacturing line.

  • Distribution: It can represent up to 40% of the cost paid by the customer. Distribution is optimized by increasing delivery frequencies to reduce inventory levels and reducing the number of warehouses.

  • Engineering: Products are standardized in order to reduce the number of components and lower the safety stocks. Then products are simplified as much as possible: less bill of material levels, simpler routings, fewer operations but productivity should increase by reducing the value added times.

  • Manufacturing lines: Machines are grouped by products family not by their functions anymore. The raw material and components are stored on the line itself, replacing a central warehouse (and high inventory). Preventive maintenance is done to reduce the number of machine breakdowns, flexibility and reduced exchange die are searched, non-quality is avoided and machining setup is simplified.
  • Human Resources: The workforce is back in the middle of the production process. Continuous improvement is performed at all levels every day. The work environment is optimized, less noisy, clean and safety is improved. Workers are taking decisions over the lines in order to improve the manufacturing layout and the line efficiency. Performance is now measured accordingly: team performance instead of individual, manufacturing schedule adherence per product rather than total quantity produced of all items,…

The JIT is rather a philosophy or a concept than a simple method. All departments are involved to change from traditional manufacturing to lean production. It is a long process that needs to be followed over a decade to get fruitful results.

Last modified on Wednesday, 29 August 2012 15:00
More in this category: « The Kanban approach
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