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Lean Approach

The Toyota Produc t ionSystem

Dwight Apodac

562-593-6813

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A time-based strategy

3 Vital Elements :

The Toyota Production System

Standard Operations

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The New Equat ion

NewView

Sales

Price Mfg.Cost

Profit

SalesPrice

Principle of Cost Reduction: Profit = Sales Price - Cost

Traditional

View

Sales

PriceMfg.

Cost

Profit

Sales

Price

Principle of Cost Plus: Sales Price = Cost + Profit

SALES

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How well we use time is...

the single best indicator

of competitiveness

On a sign seen at Pella Corp.

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Time-Based Strategy Model

Production Lead Time

Sales Define ProduceService

(Customers)

Business

Resources

Time

Sales Define ProduceCustomer

Service

Business

Resources

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RM

WIP

WIP

FG

Time

OP 1

OP 2

OP 3

Total

Cost

Traditional

Manufacturing

(Batch & Queue)

Total costs decrease with lead time reduction!

Cost and Time

RM

O

P1

OP

2

FGOP

3

Total

Cost

Time-Based

Manufacturing

Time

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Typ ical vs . Preferred Approach

% of Lead Time5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100

NVAVA

VA

NVA

NVAVA

Typical Approach Towards Reductions

Preferred Approach Towards Reductions

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Types o f Waste

Overproduction

Defects

Unnecessary inventory

Inappropriate processing

Excessive transportation

Waiting

Unnecessary motion

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Waste Causes

Facility layout

Excessive setup times

Incapable process

Poor preventive maintenance

Uncontrolled work method

Lack of training

Boredom

Production planning/scheduling

Lack of workplace organization

Lack of supplier quality and reliability

Lack of concern (accountability)

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TPS (Toyo ta Product ion System)

5S Work Environment

J

I

T

J

ID

O

K

A

Production Smoothing

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J IT Princ iples

Pace to Takt time

One piece flow operations

Incorporate pull systems

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Tak t Time

The word Takt is of

German origin having its

meaning most closely

associated with musicalrhythm

Like a heartbeat it should

not be arrhythmic

Must have a couple ofknown paces, but these

paces should not change

every day

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Takt Time Calcu lat ion

Example:

8 hour day - 2 (10) -minute breaks(15) minute clean

up period = 445 minutes available

If the customer demand in a peak season averages 800units per day, then 445/800 = .55

We need one unit every .55 minutes or one unit every33 seconds

Available time/Demand = Takt Time

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1-Piece Flow

Batch

Flow

Batch vs. Flow Produc t ion

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JIT Product ion Character ist ics

Machines in the order of processes

Small and inexpensive equipment

U-shaped, counterclockwise work flow

Multi-process (multi-tasking) workers

Ergonomically correct operations

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Jidoka Princip les

Separation of Machine and Operator

Stop the Line Authority

Mistake Proofing or Poka Yoke

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Stop the Line Authority

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Poke Yoke

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Product ion Smooth ing Is...

Customer DemandAverage Daily

Demand =

Target

Production

Time

Adapt ing p roduc t ion to var iable demand:

Quantity

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Model Mix

Day5 10 15 20

ModelA

1600units

ModelB

800units

1 2 3 20

A

B C

A

B C

A

B C

A

B C

Day

80

40 40

80

40 40

80

40 40

80

40 40

Monthly

Schedule

(3200 units)

Daily

Schedule

(160 units)

ModelC

800units

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Produc t ion Leveling Benef its

Maintains a consistent, high quality product

Minimizes finished goods inventory

Reduces the requirements for capital investment

Reduces costs due to rework and scrap

Ensures on-time delivery