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Chapter 5
Logistics and Operations of Supply Chain Management Ch 5
51
Business
Graduate
01/01/2015

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Term
Lean/JIT concept
Definition
aims to enable short delivery lead time by reducing waste through different methods and techniques

used for all kinds of products (all variety possibilities) and for for job shop prod, single-item line prod or high vol line prod (as facility feature)
Term
kanban techniques
Definition
simple system to track manufacturing process
applicable to standard products or product family with few variants.
simple system such as kanban is used for production with frequent order repetition
Term
The toyota prod system (TPS)
Definition
framework for concepts and methods for increasing productivity & quality.
increased productivity achieved by eliminating waste (muda)

JIT & jidoka (immediate halt system if abnormality occurs) are 2 pillars of TPS
Term
jidoka
Definition
approaches & techniques for immediate halting prod when abnormal condition occurs
Term
lean in production & enterprise
Definition
lean production: min of required resources (incl time) for the various activities of the company. Identify waste and eliminate it.

lean enterprise: applies lean production principles throughout entire firm (all org areas)
Term
2 alternative views of inventory
Definition
conventional view - higher, buffer

japanese view - lower, no buffer
Term
advantage of conventional inventory
Definition
inventory makes possible to...

...bridge of disturbances
... high load in production
... have economical batch sizes (larger for min setup costs)
... protect against scrap (enable high fill rate)
... high service level (fill rate)
... friction-free prod
Term
advantage of japanese view of inventory
Definition
reduced inventory reveals (avslöjar)...

... processes in risk of disturbances
... unbalanced load
... lack of flexibility
... waste/scrap
... unreliable suppliers
... lack of delivery reliability
Term
planning techniques in materials mgmt
Definition
page 12-14 chapter 5 slides (3 graphs)
Term
formula operation time (OT = ST+LOTSIZE*RT)
Definition
operation time= setup time + lot size * runtime/unit
Term
Steps for lead time reduction through setup time reduction batch size reduction and
Definition
1. Setup-friendly production facilities (programmable systems, special devices for setup)
2. cyclic planning: sequence of products to be produced by a machine s.t. TOTAL setup time kept at min (several cycles of smaller lots can be produced, leveling production)
3. Harmonizing the product range:
-->reduce nr of different components & process variants
--> reduce prod range itself
--> introduce a modular product concept
4. reduce downtime of production facilities
Term
lead time reduction through other concepts (than setup and run time reduction)
Definition
1. production/manufacturing segmentation: org units formated according to product families instead of job shop production
2. cellular manufacturing: change from job shop prod to cellular manufacturing. this means that required workstations for successive operations are placed one after the other. (L or U). this gives one-piece flow between operations (no need to wage for entire batch). overlapping production.

+ (better flow).
- need more machines for this strategy, take old used ones. + most probably facility area can be reduced.

3. standardizing prod infra, which increase the flexible capability of capacity and thequntitatively flexible capacity

4. Structuring the assembly processes: staggered supply of components reduces lead time in the assembly process

5. complete processing: executing several different operations at once (fewer stations to run through, no interoperation times, reduce lead times)

6. org supply and buffer storage to support the flow of goods (point of use story/delivery).
Term
formula lead time with sequence of operations
Definition
LTI= sum1<=i<=n OT(i) = sum 1<=i<=n {ST(i) + lotsize * runtime(i)}
Term
formula for lead time with cellular manufacturing
Definition
max 1<=i<=n {ST(i) + lotsize * runtime(i)} <=LTI <= max 1<=i<=n {ST(i) + lotsize * runtime(i)} + sum1<=i<=n {ST(i) + runtime(i)}

lead time for longest operation time defines the min lead time. then, lead time increases at most by the setup time and one run time per unit of all other operations.
Term
harmonizing content of work
Definition
tasks of the same duration at each production level --- > results in rhythmic flow of goods.
Term
procedure to harmonize content of work
Definition
1. determination of the duration of one unit of harmonized content of work

2. take measures to change lead times of operations
Term
possible measures for changing lead time of operations
Definition
1. combine operations through automation: split an operation
2. change the process by changing the production techniques
3. reduce setup times in order to reduce batch sizes; if capacity is not being utilised, batch size can also be reduced directly
4. purchase different components that allow for a different process
5. purchase semi-finished items in order to avoid operations that do not allow harmonization
6. assign operations to subcontractors or take over operations from subcontractors
Term
quality assurance
Definition
1. quality circles of employees
2. to achieve the desired level of self-control of quality
3. to develop a feeling of responsibility for the products manufactured
Term
kaizen
Definition
continuous improvement

promote a problem solving orientation based on reality
Term
poka-yokeru
Definition
failsafe techniques: to avoid (yokeru) inadvertent errors (poka)

developing tools to defect defects -->example bigger plus side then minus side for plug.
Term
the japanese way of thinking ( 3 ways to maintain a sense for the whole)
Definition
1. comprehensive quantitative flexibility of employees through the course of time (work on demand)
2. motivation, qualification & empowerment of employees: jobs enrichment, jobs no longer only include direct productive labour but alos planning and control tasks

3. integrated procurement logistics & SCM: measures to reduce purchasing lead times.
Term
example of judoka (immediate halting of prod if abnormality)
Definition
andon: visual control system in a job shop.

shows production plan of the day and the achievement so far and shows in which job shop a prob occurred
Term
affect of which collor workers
Definition
1. order and cleanness improve the moral of workers
2. white work uniforms on shop flor

--> keeps clean environment, makes workers feel important since white is related to higher mgmgt jobs
Term
5S
Definition
seiri = sort
seiton = simplify (not a clean desk policy but an organised one)
seiso = scrub (clean
seiketsu = standardize
shitsuke = sustain (fifth s added so that it becomes a part of you without thinking /part of culture

do the first 3 daily (standardise). Always follow the first 4 s (sustain)
Term
effects of forecast errors through the combination or production requirements across many production levels
Definition
cumulating forecast errors through combining requirements in batches:
separate parts bundled to bigger lots at earlier prod levels. need to pre order and organise parts: you need push into the system and not pull.

planning of dependent demand with no combining of requirements in batches: JIT techniques and only size needed. not bundled. pull system.
Term
order penetration point with longer and shorter lead times
Definition
longer: 2 prod levels before OPP. needs push.

shorter: 1 prod level before OPP since shorter lead times the last 2 prod levels can be done after OPP. good for variants of products. reduce push logistics and reduce safety stock requirements.

from longer to shorter lead-times with JIT techniques.
Term
the kanban feedback loop
Definition
-->preassembly==>
--><==buffer store mgmt for pre-assembly
--> parts production ==>

initialorder to preassembly. order parts from buffer store. buffer store directly delivers the parts that are to be pre-assembled. (here cycle of use kanban, transport kanban). order to refill stock. refill of buffer after parts production completed. (here cycle of manufacturing kanban)
Term
kanban rules
Definition
1. the user operation may never:
1.1 order more than required quantity
1.2 order at point in time earlier than required
2. the supplying/producing operation may never:
2.1 produce more than ordered
2.2 stsrt prod before an order is received
2.3 not produce/produce late what has been order
2.4 deliver insufficient quality
3. the planning operation takes care of:
3.1 medium and long-term balancing of load and capacity
3.2 keeping a suitable nr of kanban cards in the feedback control system (smallest possible) by means of adding and removing cards
Term
nr of kanban cards in the system
Definition
we can show that nr of kanban cards in system (A) must be bigger or equal to 2 --> 2 bin system (empty bin and full bin).
Term
formula kanban cards
Definition
A*k= ULT *(1 +SF) + W*k
Term
kanban long-term and medium-term planning
Definition
develop a long term plan and if required a medium plan for resources using the MRPII concept

1. determine the master plan (independent demand)
2. gross requirements planning
3. develop long-term planing
Term
how to control actual throughput of the kanban system
Definition
1. registering kanbans dispatched from the buffer store (order releases)

2. registering incoming kanbans in the buffer store (incoming storage materials)
Term
Cumulative production figures (CPF) along the manufacturing process
Definition
the cumulative recording of the movement of goods over time:
it counts the number of intermediate products or states in
the flow at certain measurement points and compares this amount to the planned flow of goods. Depending upon the result, the work system can be sped up or slowed down.

raw materials store --> parts production --> parts store --> assembly --> end products store

CPF 5: incoming goods
CPF 4: starts of parts prod
CPF 3: end of parts prod
CPF 2: starts of assembly
CPF 1: end of assembly
CPF 0: delivery to customer
Term
CPFP
Definition
The cumulative production figures principle (CPFP) is the planning & control of the manufacture of a product by means of comparing the target cumulative production figures diagram to the actual cumulative production figures diagram.

it is possible to bring the actual diagram closer to the target diagram through speeding up or braking the manufacturing process
Term
cumulative production figures curve
Definition
a graph of the measurement of a cumulative production figure along the dimensions of amount and time
Term
cumulative production figures diagram
Definition
a summary of cumulative production figures curves throughout the manufacturing process for a particular product.
Term
target cumulative production figures diagram
Definition
target cumulative production figures diagram describes the planning based on demand forecast or blanket order and the subsequent resource requirements planning on the time axis. Batch size need not be taken into account, so that between two points in time a cumulative production figure will take a linear course
Term
actual cumulative production figures diagram
Definition
actual cumulative production figures diagram describes the measurement of the actual manufacturing process. The diagram shows the actual, current progress in production, lead times, and inventory in work-in-process and in buffers. Jumps in the lines are caused by batch sizes.
Term
4 Techniques of Materials Management
Definition
the kanban technique
the cumulative production figures principle
the order point technique
the MRP technique
Term
comparison of Techniques of Materials Management
Definition
for push logistics: MRP handles orders having contents that are very specific and
difficult to plan, usually where there is no continuous demand

for pull logistics: The kanban technique leads - as does the order point technique - to pull logistics
Term
Strategy in Choosing Techniques and Implementing
Procedures
Definition
slide 57 chap 5
Term
procedure to implement effective logistics
Definition
first by JIT concept....

1. introduce measure to raise the level of quality
2. examine the nr of processes and their frequency. Layouts! (segmented or cellular manu)
3. reduce setup time and other batch size independent production costs (implement modern setup tech)
4. consider the implementation of CNC machines, industrial robots and flexible manufacturing systems (FMS) (These allow several operations to be combined into one (complete processing)).
5. achieve realisation of rhythmic and harmonious production: lead times for the various levels are identical or multiples of one another
6. determine batch size (as small as possible, kanban says to cover one or few days)
Term
how to determine batch size (by JIT)
Definition
per definition of LTI it is 1 in theory but in practise probably larger.
as small as possible. do cost and time comparison.
depends on...
1. production facility
2. product family
3. the types of orders received
Term
how to determine batch size (by choosing materials management techniques)
Definition
7. For inexpensive items or items with continuous or regular demand:
a. Install the cumulative production figures principle if number of successive levels were designed at point 5, through which large batches of relatively few products are manufactured according to forecast or blanket orders and for which capacity can be adapted to actual load despite mild fluctuations.
b. Set up a chain of kanban loops if a number of successive levels were arranged at point 5, which can ó if, at the same time, demand is sufficiently regular ó all be controlled according to use and for which capacity can be adapted to actual load.
c. Otherwise, use the order point technique, together with the various techniques of scheduling and capacity management.
8. For items where demand is unique or for expensive items with no regular demand ó even after having implemented points 1ñ6:
a. If the article can be produced at a rate above the stocking level for a number of levels, planning & control should be deterministic, and as based on the customer order using a configuration of the customer production order over various levels with the MRP technique (material requirements planning).
b. If the item lies at or below the stocking level and demand is independent, a procedure that makes intuitive sense should be followed. c. Otherwise, the MRP technique can (must) be used in the quasi-deterministic case. The calculation should be updated daily or as often as several times per day (ìonlineì).
Term
standard product or product with options produced in a job shop or in single-item oriented line production
Definition
For what product variety and what facility layouts is kanban ideally suited
Term
transporting, overproducing, unnecessary motion, waiting, unnecessary inventory, inappropriate processing, defects
Definition
7 types of waste, or "muda" are...
Term
heijunka
Definition
Japanese word for reducing long setup times to even production (sometimes using cyclic planning)
Term
- reduce product range
- introduce modular concepts
- reduce process variants
Definition
What are the different ways to harmonize the product range?
Term
process oriented layout
Definition
layout where work stations are separated by task
Term
product oriented layout
Definition
layout where work stations are separated according to the workflow of a product
Term
cellular manufacturing
Definition
process oriented layout, in an L or U, with one-piece flow
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