5.3 Lean production and quality management Flashcards
Lean production
A philosophy or organizational culture about streamlining production process in order to increase efficiency and reduce waste.
Features of lean production
- less waste
- greater efficiency
Less waste
Requires getting things done correctly the first time around, and using fewer resources or using them more effectively to achieve the same output.
Sources of waste
- Waiting times
- Overproduction
- Motion
- Defects
- Over-processing
- Transportation
- Stockpiling
Greater efficiency
Using resources more productively in order to generate output, if an organization can produce more goods and/or services by using the same or fewer resources.
Greater efficiency can be achieved by:
- improved level of motivation
- improved technologies and capital equipment
- improved provision of training and development for all employees
Methods of lean production
- continuous improvement (kaizen)
- just-in-time (JIT)
- kanban
- andon
Continuous improvement (Kaizen)
The process of making continuous small, incremental improvements to various production processes in order to achieve greater efficiency.
Conditions necessary for kaizen to operate
- Management culture must be directed towards involving staff and giving their views and ideas importance
- Team-working
- Empowerment
- All employees must be involved
Limitations to kaizen
- some changes cannot be introduced gradually and may need an expensive and radical solution
- resistance from senior management
Just-In-Time (JIT)
Lean method of stock control whereby materials and components re scheduled to arrive precisely when they are needed in the process of production.
Advantages of JIT
- buffer stocks are not required, so this reduces the cost of stock management and waste
- it avoids the opportunity costs of stockpiling
- can improve firm’s cash position
Disadvantages of JIT
- administrative and implementation costs of JIT can be relatively high
- stock control does not enable firms to use economies of scale
- risk of running out of stock if demand is higher than expected
- total reliance on third party suppliers to deliver the right products, at the right time
Kanban
A method of lean production used to ensure that inventory is based on actual customer orders using a card system with an inventory number attached to each component in the production process.
Advantages of kanban
- Reduce wastage
- Flexibility in production
- Improves flow