Heijunka Product & Production Leveling

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HeijunkaProduct & Production LevelingModule 9.3Amy Reyner, Kweku FlemingMark Graban, LFM Class of ’99, Internal Lean Consultant, HoneywellPresentation for:ESD.60 – Lean/Six Sigma SystemsMIT Leaders for Manufacturing Program (LFM)Summer 2004These materials were developed as part of MIT's ESD.60 course on "Lean/Six Sigma Systems." In some cases,the materials were produced by the lead instructor, Joel Cutcher-Gershenfeld, and in some cases by student teamsworking with LFM alumni/ae. Where the materials were developed by student teams, additional inputs from thefaculty and from the technical instructor, Chris Musso, are reflected in some of the text or in an appendix

Overview¾ Learning Objectives¾ Introduce and demonstratethe concept of Heijunka –¾ Understand the benefits ofHeijunka¾ Understand how to applyHeijunka in a typicalmanufacturing process¾ Identify how Heijunkainteracts with other Leantools.¾ Session Design (20-30 min.)¾ Part I: Introductions (1-2min.)¾ Part II: Definition of Heijunkaand identification of its role inLean manufacturing. (3-5min.)¾ Part III: Study models ofHeijunka in use. Stepthrough an example ofHeijunka (7-13 min.)¾ Part IV: Benefits and Tradeoffs associated with Heijunka& Common “Disconnects,” (57 min.)¾ Part V: Re-Cap andConcluding Comments (2-3min.) [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: Application6/9/04 -- 2Part IV: DisconnectsPart V: Conclusion

HeijunkaKey Concepts¾ Heijunka is defined as “The distribution of productionvolume and mix evenly over time1”¾ Heijunka converts uneven Customer Pull into even andpredictable manufacturing process¾ Heijunka is generally used in combination with other key Leanprinciples to stabilize value flow¾ Heijunka is a core concept that helps bring stability to amanufacturing process1Lean Production Simplified, Pascal DennisAdapted from MIT LFM thesis by Sean Hilbert [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: Application6/9/04 -- 3Part IV: DisconnectsPart V: Conclusion

The Need for Heijunka¾ There are a number of reasons for implementing Heijunka:¾ Product Leveling¾ large batches of the same product may reduce set-up times andchangeovers, but usually result in:¾¾¾¾long lead times,swelling inventoriesgreater opportunities for defects.excessive idle time and/or overtime.¾ An even mix of products is critical to avoiding these impacts¾ Production Leveling¾ Remember the “Beer Game”? Fluctuations in demand ( Boller or “Bullwhip”Effect) are often highly amplified and delayed throughout the supply chain.¾ Responding to fluctuating customer demand can result in increased overtimeor idle time.¾ Variable production schedules can be stressful Unhappy workers.¾ A more level production volume eases these complications [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MIT6/9/04 -- 4

Chasing Demand – The “Bullwhip” EffectSupplier produces4500 based onlast year’s avg.demand.Supplier sees sharpdecline in demand.Has extra inventory,so produces far less.Our workers begin torevolt due todemanding andunpredictable work.Start taking longlunches at Chotchsky’sSupplier seesincrease in demand.Excited to sell moreproduct, significantlyincreases production [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MITSupplier goes out ofbusiness due to inventoryand workforce managementcosts. Workers for ourcompany quit to becomeconstruction workers.Supplier noticessteady decrease indemand. Lowersproduction to get ridof inventory.6/9/04 -- 5

What is Production Leveling?A Simple Example17,316 4 4,32916,866 4 4,21716,326 4 4,082 [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: Application6/9/04 -- 6Part IV: DisconnectsPart V: Conclusion

JITvs.Production Leveling¾ Meet customer demand uponrequest (“just in time”)¾ Meet customer demand in total over agiven period of level production.¾ Reduced Finished Goods Inventory¾ Finished Goods Inventory to make upfor short periods of higher demand*¾ Unpredictable work schedules¾ Predictable work schedules¾ High variability for Supplier Cascadevarying customer demand backupstreams¾ Stability transmitted to SupplierReduces Inventory over the entireSupply Chain.¾ Overtime occasionally¾ Bullwhip Effect [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MIT¾ Overtime savings¾ Happy people Upstream6/9/04 -- 7

What is Product Leveling?We make A’s, B’s, and C’s:ABCAWeek12Batching345Extended downtime formachine conversions.Workers go home early.Product LevelingConversion times arereduced and machines areflexibly tooled. [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MIT67Customer waiting forproduct A is tired ofwaiting. Goes to anothersupplier.Customers are happy withsteady and predictable flowof product. Workers arehappy with even work flow6/9/04 -- 88

Challenges for HeijunkaTechnical FactorsSocial Factors¾ Tools needed for large-scaleHeijunka Leveling are oftenlacking.¾ With Heijunka, there is a needfor larger Finished GoodsInventory. This can be seen asantithetical to Lean mission.¾ Obsolescence of finished parts¾ Can not immediately beimplemented– requirespredictable environment,customer data.¾ Predicting demand isimperfect. Bad data can ruinprocess.¾ Heijunka depends on Directcustomer contact and accurateinformation about projected(future) events.¾ Explaining why it’s importantto do standardized workbefore implementing HJ.¾ Reduces operator flexibilitywhich can draw resistance¾ Requires discipline and muchmore planning [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: Application6/9/04 -- 9Part IV: DisconnectsPart V: Conclusion

Concluding Comments¾ If Takt time is described as the heart beat of Lean implementation,then Heijunka is the deep breathing exercise of Lean that bringsstability (calm) to the manufacturing process, spreading it upstream tointernal and external suppliers.¾ “ Heijunka, You won’t be HAPPY without it!”22The Toyota Production System: Leaner Manufacturing for a Greener Planet. Published 1998, [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: Application6/9/04 -- 10Part IV: DisconnectsPart V: Conclusion

Appendix: Instructor’s Comments and ClassDiscussion for 9.3¾ Heijunka reveals the limits of the label “lean” and points to aknowledge-driven process for ensuring stability, flow and pull¾ It is still about ensuring the customer has what they want, whenthey want it at the price they are willing to pay¾ Consider the level at which Heijunka expertise needs to beestablished – plant-wide, departments, individual work areas?¾ Most lean operations strike a balance between product levelingand production leveling¾ “Good not to have inventory, good to meet demand, but therereally is some balance between the two”¾ Worker happiness is an important measure of heijunka success¾ Heijunka requires a lot of data, and can be tough to deal with¾ Heijunka is not necessarily useful for businesses with level anddependable demand. [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MIT6/9/04 -- 11

Appendix: Instructor’s GuideSlideTimeTopicAdditional Talking Points1-22-3 minIntroduction, overview andlearning objectives Heijunka is Production Leveling Distributingproduction volume or production mix evenly overtime.33-5 minKey Concepts Heijunka converts uneven customer pull intopredictable value flow. Converts inefficientbatching processes into coordinated multi-tasking4-77-13 minThe Need for Heijunka Heijunka levels production, JIT results in levelinventory. Safety stock is a key to Heijunka. Heijunka is not implemented in a vacuum. It iseffective when integrated with other lean tools,reduced set-ups, Takt time, Kanban planning etc.What is Production Leveling?JIT vs. Heijunka Leveling82-4 minWhat is Product Leveling? Product Leveling: Long Lead times, largeunfinished inventories Heijunka Product leveling seeks to break downbatches into smaller interspersed runs92-3 minChallenges for Heijunka Imperfect Data, Large Safety Inventory, IncreasedPlanning Required,011-2 minConclusion Heijunka is the Deep Breathing Exercise for theManufacturing Process You won’t be “happy” without Heijunka [LFM Students] – ESD.60 Lean/Six Sigma Systems, LFM, MITPart I: IntroductionPart II: ConceptsPart III: Application6/9/04 -- 12Part IV: DisconnectsPart V: Conclusion

These materials were developed as part of MIT's ESD.60 course on "Lean/Six Sigma Systems." In some cases, the materials were produced by the lead instructor, Joel Cutcher-Gershenfeld, and in some cases by student teams working with LFM alumni/ae. Where the materials were devel

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