Modern Value Chain and Lean Production

These flashcards cover key concepts and definitions from the lecture on Lean production and the modern value chain, focusing on its goals and methodologies.

What is the primary goal of Lean production?

To increase value to the customer while preserving quality and reducing costs by minimizing waste.

Define 'cost' in the context of Lean production.

Cost refers to the funds required for an organization to conduct its business.

What is the difference between 'cost' and 'price'?

Cost is the money spent to produce a product, while price is the amount charged to customers for that product.

How does Lean production define profit differently than traditional methods?

Lean defines profit as Price (fixed) - Cost = Profit, whereas traditional methods define it as Price = Cost + Profit.

What does TIMWOOD stand for in Lean production?

Transportation, Inventory, Motion, Waiting, Overproduction, Overprocessing, Defects.

What is the purpose of reducing waste in Lean production?

Reducing waste decreases costs, increases flow, and improves quality within the production process.

Why is waiting considered a waste in Lean production?

Waiting represents a non-value-added activity where no transformation is occurring, leading to inefficiencies.

Describe the concept of Just in Time (JIT) inventory.

JIT inventory minimizes on-hand inventory and delivers materials precisely when production is about to begin, improving efficiency.

How does the Lean method address overproduction?

Lean promotes quick setup times and ideally aims for production of one item at a time to avoid unnecessary overproduction.

What are the five steps in the 5S methodology?

Sort, Set in Order, Shine, Standardize, Sustain.