CBA 390 - Supply Chain Mgmt - Chapter 8

CBA 390 - Supply Chain Mgmt

1- Waiting (Idle Time)
2- Overproduction
3- Inventory
4- Transport
5- Overprocessing / Incorrect Processing
6- Rework
7- Unnecessary motions/movements

What are the seven types of waste:

Taiichi Ochno

Pioneered Toyota System built around waste

value added percentage

the percentage of flow time used for value added work

pull system

the resource furthest downstream (closest to the market) is paced by market demand

Detect stop alert

The philosophy of halting production when a quality problem is discovered

Andon

a system consisting of a visible board and a cord running adjacent to the assembly line. Any employee detecting a problem can pull the cord to stop the line.

Single-unit flow (or continuous flow)

operate at a flow of one unit at a time from one resource to the next instead of operating based on transfer batches.

waste of time of a flow unit

the waste of time from the perspective of a flow unit, which makes the flow time of that flow unit longer than what is needed from the customer’s perspective

waste of time of a resource

the waste of time from the perspective of a resource, which reduces the capacity of the resource

Financial and Reputation

An example about Cost of Late Quality Issues are:

James Womack

An MIT professor who founded the International Motor Vehicle Program and later the Lean Enterprise Institute.

Toyota Production Systems (TPS)

A framework used to run operations with the goal of reducing both the waste of capacity and the waste of flow time, thereby making sure supply and demand are matched just in time.

Waste of time at a resource

The waste of time from the perspective of a resource, which reduces the capacity of the resource.

Waste of time at a flow unit

The waste of time from the perspective of a flow unit, which makes the flow time of that flow unit longer than what is needed in the eyes of the customer.

Frederick Winslow Taylor

An engineer who pioneered the concept of scientific management at the end of the 19th century.

Taiichi Ohno

An engineer who pioneered the Toyota Production System, built around the principles of waste reduction.

waste (muda)

The consumption of inputs and resources that do not add value to the customer.

non-value added work

Those operations that do not add value in the eyes of the customer but must be done under the current conditions of the process in order to complete a unit.

value added work

Those operations valued by the customer because they are absolutely required to transform the flow unit from its inputs to being the output the customer wants.

Total available time

The amount of time a resource has available to fulfill demand.

Overall equipment effectiveness (OEE)

The percentage of total available time that is used in a way that adds value to the customer.

Value added time / Total available time

The formula for OEE is:

Seven sources of production waste

Seven ways in which, in the eyes of Ohno, a resource can waste its capacity: waiting (idle time), overproduction, inventory, transport, overprocessing, rework, and unnecessary motions.

Value-added percentage

The percentage of flow time used for value-added work

TPS house

A representation of the Toyota Production System in the shape of a house with the roof capturing the main goal of the TPS, which is waste reduction; the pillars being just-in-time flow and built-in-quality; and the foundation being process improvement.

Run like the tortoise, not the hare

An ancient fable used by Ohno to illustrate that steady work, even when slow, is better than bursts of speed followed by periods of no movement.

takt time

The ratio between the time available and the quantity that has to be produced to serve demand.

Single-unit flow

Operate at a flow of one unit at a time from one resource to the next instead of operating based on transfer batches.

pull system

The resource furthest downstream (i.e., closest to the market) is paced by market demand. In addition to its own production, it also relays the demand information to the next station upstream, thus ensuring that the upstream resource also is paced by demand. That is, it is an operating system in which the production or replenishment of a unit is only initiated when a demand occurs.

push system

A production system in which flow units are allowed to enter the process independent of the current amount of inventory in the process.

Kanban

Production and inventory control system in which production instructions and parts delivery instructions are triggered by the consumption of parts downstream.

Make to order

A production system in which an item’s production begins after the customer for the item is known. In a make-to-order system, units are generally delivered to a customer immediately after production is completed, thereby not spending time in inventory.

Process Layout

The spatial location of resources in a process that drives the needs for transportation.

U-Shaped Lines

Locating resources in a way that they create a “U,” which increases the flexibility of workers to perform multiple tasks.

Multitask job assignment

A technique to reduce idle time by avoiding a worker watching a machine do work

target manpower

the number of workers required based on the takt time and the labor content.

Available time / Demand Rate

What is the formula for takt time?

Labor Content / Takt Time

What is the formula for target manpower?

Demand leveling

A way to sequence flow units so that the workflow causes a stable workload for all workers involved in the process.

Mura

Unevenness in flow.

Muri

An unreasonable amount of work, overburdening a machine or operator.

Heijunka / Production Leveling

Leveling production by reducing variation in the work schedule that arises from either demand variation or the desire to run production or transports in large batches. This is a principle of the Toyota Production System that strives to have production match the true rate of demand.

Automation

Automation with a human touch; use machines, but combine them with the intelligence of the workers.

Detect Stop Alert

The philosophy of halting production when a quality problem is discovered.

Andon

A system consisting of a visible board and a cord running adjacent to the assembly line. An employee who detects a problem can pull the cord to stop the line. This will be indicated on the board.

Information turnaround time (ITAT)

The time between creating a defect and receiving the feedback about the defect.

Kaizen

The process of making small changes to the process with the goal of eliminating waste

Genchi genbutsu

Gather firsthand information from the situation by going and observing the situation yourself, collecting data, and analyzing the data.