Operations Management
MBA
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CHITRAKANT DESHMUKH.
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The 7 wastes explained Waste is the use of any material or resource beyond what the customer requires and is willing to pay for. Lean Manufacturing aims to identify and eliminate waste to improve the performance of the business. Shigeo Shingo identified “Seven” forms of waste (Plus one – The eighth waste, under utilization of people) These 7 forms of waste are shown below
1. Over Production • To produce sooner, sooner, faster or in greater quantities than the absolute customer demand
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• Leads to excessive inventory Caused by: • MRP push rather than kanban pull • Large batch sizes • Looks better to be busy! • Poor people utilisation • Lack of customer focus Why one of the 7 wastes ?: • Costs money • Consumes resource ahead of plan • Creates inventory • Hides inventory/defect problems • Space utilisation 2. Inventory Any raw material, work in progress (WIP) or finished goods which are not having value added to them Caused by: • Production schedule not level • Inaccurate forecasting • Excessive downtime/set up • Push instead of pull • Large batching • Unreliable suppliers
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• Extra storage space required • Extra resource to manage • Hides shortages & defects • Can become damaged • Shelf life expires 3. Motion • Adds cost • Motion is the movement of “man” • Waste motion occurs when individuals move more than is necessary for the process to be completed Caused by: • No standard operating procedure • Poor housekeeping • Badly designed cell • Inadequate training Why one of the 7 Wastes ?: • It interrupts production flow • Increases production time • Can cause injury 4. Waiting People or parts that wait for a work cycle to be completed • Where are the bottlenecks? • What are the major causes of lost machine availability?
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Caused by: • Shortages & unreliable supply chain • Lack of multi-skilling/flexibility • Downtime/Breakdown • Ineffective production planning • Quality,design,engineering Quality,design,engineering Issues • ‘Black art’ processes Why one of the 7 Wastes ?: • Stop/start production • Poor workflow continuity • Causes bottlenecks • Long lead times • Failed delivery dates 5. Transportation Unnecessary movement of parts between processes • Complex material flow paths • Poor close coupling • Wasted floor space • Unnecessary material handling • Potential damage to products Caused by: • Badly designed process/cell
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Why one of the 7 Wastes ?: • Increases production time • It consumes resource & floorspace • Poor communication • Increases work in progress • Potential damage to products 6. Over-Processing Processing beyond the standard required by the customer By improving processing efficiency we ultimately use less resource to achieve the same customer satisfaction Caused by: • Out of date standards • Attitude - ‘Always done it like this’ • Not understanding the process • Lack of innovation & improvement • Lack of standard operation procedures Why one of the 7 Wastes ?: • It consumes resource • It increases production time • It’s work above and beyond specification • Can reduce life of component 7. Non-Right First Time (Scrap, Rework and Defects) A defect is a component which the customer would deem unacceptable to
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• Rectification costs money with regard to ti me effort and materials • Defects in the field will lose customers • Right first time is the key Caused by: • Out of control/Incapable processes • Lack of skill,training & on the job support • Inaccurate design & engineering • Machine inaccuracy • Black art processes
process redesigns. The following "seven wastes" identify resources which are commonly wasted. They were identified by Toyota’s Chief Engineer, Taiichi Ohno as part of the Toyota Production System[4]:
[edit edit]] Overproduction Overproduction happens each time you engage more resources than needed to deliver to your customer. For instance, large batch production, because of long change over time, exceeds the strict quantity ordered by the customer. For productivity improvement, operators are required to produce more than the customer needs. Extra parts will be stored and not sold. Overproduction is the worst muda because it hides or generates g enerates all [citation needed ] others, especially inventory. inventory. Overproduction increases the amount of space needed for storing raw material as well as finished goods. It also requires a preservation
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[edit edit]] Motion As compared to Transportation, Motion refers to the producer, worker or equipment. This has significance to damage, wear and safety. safety. It also includes the fixed assets and expenses incurred in the production process.
[edit edit]] Defects Whenever defects occur, extra costs are incurred reworking the part, rescheduling production, etc.
[edit edit]] Over-processing Over-processing occurs any time more work is done on a piece than what is required by the customer. This also includes using tools that are more precise, complex, or expensive than absolutely required.
[edit edit]] Waiting Whenever goods are not in transport or being processed, they are waiting. In traditional processes, a large part of an individual product's life is spent waiting to be worked on. An easy way to remember the 7 wastes is TIMWOOD.
The term ‘maintenance’ means to keep the equipment in operational co ndition or repair it to its operational mode. Main objective of the maintenance is to have increased availability of production systems, with increased safety and optimized cost. Maintenance management involves managing the functions of maintenance. Maintaining equipment in the field has been a challenging task since the beginning of industrial revolution. Since then, a significant of progress has been made to maintain equipment effectively in the field. As the engineering equipment becomes sophisticated and expensive to produce and
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• • •
Management of inventory Supervision of manpower Keeping records
MAINTENANCE ORGANIZATION ORGANIZATION
It concerns in achieving an optimum balance between plant availability and maintenance resource utilization. The two organization structures that are common are: Centralized and Decentralized. A decentralized decentralized structure would probably experience a lower utilization than centralized one but would be able to respond quickly to breakdowns and would achieve higher plant availability. In practice, one may have a mix of these two. A maintenance organization can be considered as being made up three necessary and interdependent components. 1. Resources: men, spares and tools 2. Administration : a hierarchy of authority and responsibility for deciding what, when and how work should be carried out. 3. Work Planning and Control System : a mechanism for planning and scheduling the work and feeding back the information that is needed for correctly directing the maintenance effort towards defined objective. It may be mentioned that maintenance / production system is a continuously evolving organism in which the maintenance organization will need continuous modifications in response to changing requirements. Moreover, it is required to match the resources to workload. Maintenance activities – be it preventive or condition monitoring, involve use of resources- men and materials including documents. This requires coordination amongst the involved personnel so that these are timely undertaken. Work Work planning and control system under maintenance management in the plant ensures this and provides planning and control of activities ac tivities associated with maintenance. This means application of general management principles of planning, organizing, directing and controlling to the maintenance functions, e.g. to the establishment of procedures for development of maintenance strategy and to models for describing the flow of work through maintenance
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• •
Data recording system Performance measurement measures or indices
Maintenance performance for a plant or an organization can be assessed through analysis of Reliability, Availability and Maintainability (RAM) plant data. Relevant parameters, measures or indices for specific plants can be identified [5]. The performance over a period of time will show if it is improving, going down or being sustained. This will also help in knowing how well the objectives are being met. In addition, it will guide the areas which are strong and which need to be strengthened. Use of computers and dedicated softwa software re will will certai certainly nly help help in implem implementi enting ng this this and the mainte maintenanc nancee managem management ent system in general.
6.0 SAFETY Several definitions exist.
ICAO Doc 9735, Safety Oversight Manual” has this definition: A condition in which the risk of harm and damage is limited to an acceptable level.
The Air Navigation Commission (ANC) has adopted the following definition of Aviation Aviation Safety: The state of freedom from unacceptable risk of injury to persons or damage to aircraft and property. Another way of saying basically the same is to say that acceptable SAFETY means that all risk levels are kept below the risk limits, reference the ALARP figure, or that all hazard scenarios are kept in the acceptable region of the Tolerability matrix.
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Method Method study study is the system systemati aticc recor recordin ding g and critic critical al examin examinati ation on of existi existing ng and proposed ways of doing work, as a means of developing and applying easier and more effective methods and reducing costs. Method Method study is an organized approach approach and its investigation investigation rests on the following six basic steps outlined in the block diagram: • • • • • •
Select Reco Record rd Examin Examine e Develo Develop p Inst Instal alll Main Ma inta tain in
the work to be analyzed. all fact facts s rela relati ting ng to the the exis existi ting ng meth method od.. the recor recorded ded facts facts critic criticall ally y but impart impartiall ially y. the most most eco econom nomica icall metho method d comme commensu nsura rate te with with plant plant Requi Require remen ments ts the the new new meth method od as stan standa dard rd prac practi tice ce.. the the new metho ethod d.
Selection of the job Selections of the jobs to be studied for methods improvement by the method study practioner is a managerial responsibility and it (selection) may be based on economic technical or human consideration. Economic consideration consideration justifies selection based based on the economic economic worth (i.e. money saving potential) of the job. Technical echnical consider consideration ation identifies identifies jobs, jobs, which require require studies studies to overcom overcome e manufactur manufacturing ing difficulties (excessive rejection, relaxation in prefixed performance standards, inability if the shops to stick to specified machining parameters such as speeds, feeds, depth of cut etc., inconsistent quality etc.) Human consideration in job selection is usually given weight-age while introducing method study practices for the first ti me. Recording of facts Systemat Systematic ic recording recording is the most crucial step in method improvem improvement. ent. Since Since recording recording by long hand (or by descriptive method) has its limitations, it is not recommended for use in method study. study. Instead, five symbols and eight eight charting conventions are are used to record facts relating to the job under study. study. Five typical symbols symbols are O, ||, , D and V and eight charting conventio conventions ns concern concern composit composition ion of the chart, chart, reject, reject, rework, rework, repletion, repletion, change change of state, state, introducin introducing g of new material, material, combined combined events and numbering numbering of events. events. The document document on which details of the process are recorded by the above referred symbols and conventions is called chart. There are four basic basic types of chart: (i) operation operation process chart chart (ii) Flow process chart (iii) multiple activity charts and (iv) two handed process chart.
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sequence, the person person and the means. These five aspects in critical examination are referred referred to as five governing considerations. considerations. Development and selection: Developme Development nt and selection stage concerns short listing of ideas generated generated at the critical examination stage, testing each short listed idea for its technical and economic feasibility, and making selection selection among the alternative alternatives s wherever wherever choice choice exists. To develop ideas and to ascertain ascertain their technical and economica economicall feasibility feasibility,, the method method study practioner practioner needs needs to solicit solicit the cooperat cooperation ion of personne personnell from different different departments departments of the company company. Various Various techniques available for the development and selection purpose are: cost benefit analysis, break-even break-even analysis, investment analysis and critical path analysis. Installation Installation (or implementation) of the proposed method involves preparation of project report on recommendations making oral presentation to the top management, securing approval of the decision maker, assisting line management during implementation, arranging training of workmen, and getting jobs (operations) retime after implementation, arranging training of workmen, and getting jobs (operations) retimed after implementation. Maintenance Maintenance phase is the follow up phase after implementation, which serves as a monitoring and control mechanism. It helps to ensure that the revised methods methods are set into concrete concrete and workmen do not revert revert back to old methods. methods. It also provides an opportunity opportunity to the practitioner to assess the effectiveness of the approach followed by him and makes changes in the methodology (if required).