Unit 10: Commercial Production (HL)

• Just in time (JIT)


  A situation where a company does not allocate space to the storage of components or completed items, but instead orders or manufactures them when required. Large storage areas are not needed and items that are not ordered by customers are not made.
• Just in case (JIC)


  A situation where a company keeps a small stock of components or products or ones that take a long time to make, just in case of a rush order.
• Advantages of JIT


  • Production to order with materials being supplied JIT cuts down on storage space
  • Reduced capital investment as capital is not tied up in unused raw materials or unsold products
  • Reduced work in progress
  • Increased efficiency
  • Improved stock control
• Disadvantages of JIT


  • If any of the stock is faulty then more has to be ordered from a supplier which could slow down the lead time and production process
  • Companies may not benefit for economies of scale if they are purchasing smaller quantities
• Advantages of JIC


  • Prevention of waste and overproduction
  • Overheads are lower as warehouse space and inventories are less
  • Every customer becomes a sale
  • The manufacturer has a "buffer' of goods in stock in case of unforeseen circumstances; e.g. non delivery of supplies
  • The manufacturer can respond quickly to a demand for a product
  • The manufacturer can produce a steady flow of product and have a stable workforce
  • Less capital costs than JIT e.g. information and communication technology systems, stock control systems
  • Able to stock pile supplies or finished products
• Disadvantages of JIC


  • Shop owners have to hold a lot of inventory
  • A large investment at the start of business
  • It occupies a lot of space, which can be expensive
  • These products might spoil leading to waste
  • If trends change you could be left with a lot of unsellable products
• Lean production


  Considers product and process design as an ongoing activity and not a one-off task. It should be viewed as a long-term strategy that focuses on continual feedback and incremental improvement.
• Characteristics of lean production


  • JIT supplies: Getting the right amount of material to the production line Just In Time
  • Highly trained multi-skilled workforce: Having experts in place to ensure that no time is wasted
  • Quality control and continuous improvement: Checks are made at every stage of production to quickly identify and fix any problems that arise. Improvements to the system are actively sought
  • Zero defects: Ensure that time, material and energy are not wasting producing a sub-standard product
  • Zero inventory: Products are manufactured Just In Time to be sold
• 10 principles of lean production

  • Eliminating waste
  • Minimizing inventory
  • Maximizing flow
  • Pulling production from customer demand
  • Meeting customer requirements
  • Doing it right first time
  • Empowering workers
  • Designing for rapid changeover
  • Partnering with suppliers
  • Creating a culture of continuous improvement (Kaizen)
• Kaizen


  A culture of continuous improvement originating in Japan and considered an important aspect of an organization's long-term strategy. It is a philosophy and commitment to continuous process and product improvement.
• Value stream mapping


  A visual aid to map relationship between materials, processes, information and time. It allows company managers to plan the manufacture of a product from start (purchase of raw materials) to manufacture (processes and systems) to distribution (export, to warehouse) and finally to the end (sale to customer). It is used to identify potential problems in the system.
• Workflow analysis


  Supports value stream mapping as it classifies all tasks in a manufacturing process. It is the review by production managers of processes in a workflow, in order to identify potential improvements. Workflow analysis considers the sequence, tools and even worker movement to ensure the highest possible efficiency in the system.
• Where value stream mapping provides a 'big picture' of the manufacturing process


  Workflow analysis is concerned with the details of the production line
• Role of the workforce in lean production


  • Training
  • Devolution in power relating to process improvement
  • Kaizen
• Kanban


  A way of managing knowledge (and or in this case stock, orders and quality). One way in which Kanban is used if for parts bins. When the parts bin reaches a low level (for example 20 left) the Kanban label is submitted to the accounts department to automatically order and deliver another batch of parts just in time.
• Product family


  In terms of lean production, a group of products using similar processing methods. E.g. CNC machining for Apple laptop and iMac screen and keyboards all from aluminium.
• Advantages of a product family


  • Increased modularity
  • Reduced design effort
  • Reduced time to market for products
  • Less manufacturing processes
  • Reduction of the number of suppliers needed
  • Less diversity of stock material
  • Waste from one product can be used to manufacture a different product
  • Easily adapt production to meet demand for a particular family member
• Lead time


  The time between the initiation and the execution of a process. The time quoted to customers (usually in days or weeks) between the date of purchase and the date of delivery of final product.
• Lead time


  Sum of all processes + sum of all delays (queue times between processes)
• The 5Ss


  • Sorting
  • Stabilizing
  • Shining
  • Standardizing
  • Sustaining the practice
• The seven wastes


  • Overproduction
  • Waiting
  • Transporting
  • Inappropriate processing
  • Unnecessary inventory
  • Unnecessary motion
  • Defects
• Product family


  • Increased modularity
  • Reduced design effort
  • Reduced time to market for products
  • Less manufacturing processes
  • Reduction of the number of suppliers needed
  • Less diversity of stock material
  • Waste from one product can be used to manufacture a different product
  • Easily adapt production to meet demand for a particular family member
• Lead time


  The time between the initiation and the execution of a process. The time quoted to customers (usually in days or weeks) between the date of purchase and the date of delivery of final product
• The 5Ss


  • Sorting
  • Stabilizing
  • Shining
  • Standardizing
  • Sustaining the practice
• The seven wastes


  • Overproduction
  • Waiting
  • Transporting
  • Inappropriate processing
  • Unnecessary inventory
  • Unnecessary/excess motion
  • Defects
• Advantages of Lean Production


  • Minimises waste (and therefore reduces cost)
  • Less impact on the environment
  • Quickly adaptable to market pushes
  • Little capital is tied up in raw material or unsold stock
  • Increased autonomy for workers - leading to higher moral
• Disadvantages of Lean Production

  • One problem in production stops the whole process
  • Manufacturers rely on suppliers, one mistake by them halts production
  • More suitable for large scale production
  • When a certain level of refinement is met, using lean methods to squeeze more economy from production can discourage workers, reversing positive motivation and undermining your leadership
• Computer-integrated manufacturing (CIM)


  A system of manufacturing that uses computers to integrate the processing of production, business and manufacturing in order to create more efficient production lines
• CIM systems


  • Monitor all operations from raw materials intake to final product marketing
  • Facilitate sharing of data to create a more flexible and efficient manufacturing system
  • Integrate separate manufacturing technologies and combines these with all aspects of a company's operations, not just those that are directly involved in manufacture
  • Use computer networks to integrate the processing of production and business information with manufacturing operations to create cooperative and efficient running production lines
• Tasks performed within CIM


  • Personnel
  • Marketing
  • Product Design (CAD)
  • Computer Management (Materials handling, planning, manufacturing)
  • Machine tools and Equipment (CAM)
  • Purchasing (cost accounting)
  • Distribution (inventory control)
• Advantages of CIM


  • Complex products on large scale production runs are efficiently manufactured
  • Very flexible system as it is easy to set the automation
  • Suitable for batch production where repetitive patterns or operations occur
  • Relatively low maintenance
• Disadvantages of CIM


  • High Investment
  • Smaller plants employing non-repetitive, specialised manufacturing operations have found less use for CIM
• Flexible manufacturing system (FMS)


  • A manufacturing system in which there is some amount of flexibility that allows the system to react in case of changes, whether predicted or unpredicted
  • Increased productivity due to automation
  • Shorter lead times for new products due to flexibility
  • Lower labour costs due to automation
  • Improved production quality due to automation
• Quality management focuses on producing products of consistent required quality
• Quality control (QC)


  Involved in development systems to ensure that products or services are designed and produced to meet or exceed customer requirements and expectations
• Tolerances


  Defined at the design stage of the machinery. Parts not within tolerance need to be reworked or scrapped
• Quality control at the source


  Eliminates waste from defects as workers are responsible for the quality of the work they do
• Statistical process control (SPC)


  A quality control tool that uses statistical methods to ensure that a process operates at its most efficient (within defined fields)
• Quality assurance (QA)


  Covers all activities from design to documentation. It also includes the regulation of quality of raw materials, assemblies, products and components, services related to production, and management and inspection processes
• QA vs QC


  • QA is process oriented while QC is product oriented
  • QA deals in developing processes and systems that align with QMS
  • QC deals with monitoring products
  • QA is the part of QM focussed on providing confidence that quality requirements will be fulfilled
  • QC is the part of QM focussed on fulfilling quality requirements