In: Operations Management
The chapter discusses tool, techniques, and the advantages in adopting philosophies such as JIT or Lean. What are some of the disadvantages and challengeswith these philosophies (if any)?
Answer:
Lean drive out non value added activities & eliminate the eight kind of waste in system. These eight wastes include: Transport – Moving materials and product needlessly, Inventory – Keeping more products than needed on-site, Motion – Workers make unneeded movements in the production process, Waiting – A product that sits idle while no value is added, Over Processing – Doing more work than the customer requires, Over Production – Creating more product than the customer currently demands, Defects – Production errors that impact the customer, Undeveloped Talent – Falling short of using employees talents, abilities and skills
There are five inbuilt principles comprised with the implementation of lean methods like Identifying value, Value-stream mapping, and Creating flow, establishing pull and seeking perfection.
JIT, decrease waste by receiving goods only as they are needed in the manufacturing process, thereby reducing the cost of inventor
JIT avoids the waste associated with overproduction, waiting for material and holding excess inventory. Manufacturers must forecast their requirements accurately. Just-in-time inventory model lets manufacturers reduce their overhead expenses while always ensuring that parts are available to manufacture their products. JIT model, a manufacturer has a better level of control over its entire manufacturing process. The problem that smaller orders will be needed for JIT. Therefore, new negotiations may be needed because of minimum order requirements
Just-in-time manufacturing is focused on efficiency, while lean manufacturing is centred on using efficiency to add value for the customer. Lean manufacturing takes the idea of JIT and looks at it from the perspective of customer value. The most important benefit of JIT is the elimination of raw material, inventory and product storage costs. Improved Lead Times; Business able to respond quicker, quicker set ups, fewer delays.
There are possible challenges like expense & money required to acquire the right equipment or update the production line, and these costs have to be covered before your company can begin seeing the benefits of Lean. It takes time to payback the investment.
There will be more expenditure on labour because of making the changes dictated by Lean. This increases labour costs briefly while improvements are being put into place, but ultimately, labour cost reductions will follow.
The opposition or resistance from the people in the organisation. People fear innovation, even the ones that bring improvement. So proper training and education is required for the people in the organisation.