Does Lean manufacturing work in job shops and machine shops?

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In short, no, Lean manufacturing and lean scheduling for high mix low volume doesn’t work.  Not for scheduling a custom job shop or machine shop.

Job Shop Production

Why?  Lean manufacturing was developed most notably in Toyota.  In Toyota’s environment lots of the same car are produced for several years until the model changes.  Lean was developed for repetitive manufacturing. (More information on this analysis -> lean manufacturing in Toyota.)

The Toyota Production System (TPS) is an integrated socio-technical system, developed by Toyota, that comprises its management philosophy and practices. The TPS organizes manufacturing and logistics for the automobile manufacturer, including interaction with suppliers and customers. The system is a major precursor of the more generic “lean manufacturing.” Taiichi Ohno and Eiji Toyoda, Japanese industrial engineers, developed the system between 1948 and 1975.[1]

In high mix low volume job shops, we don’t make the same things on routine schedules.  So not only is scheduling difficult in these custom environments, lean was not developed for these shops.  (Check out this list of problems and challenges many job shops and machine shops deal with -> high mix low volume.)

Why are so many people spending so much time trying to make it work, trying to force it to work?

Using Lean Scheduling in your Job Shop — doesn’t make sense!

How do you establish a takt time when a job may or may not repeat?  And even if it does repeat, there will be many jobs in between.  Lean defines takt time as the “heartbeat” of a lean production system because it paces production to demand and is calculated by dividing available production time by customer demand.

But what’s the demand of your high mix low volume jobs?  This can be difficult if not impossible to determine.

And cellular layouts often don’t make sense for high mix low volume job shops.  The idea behind cells is to set aside resources that will continually produce a family of products.  Ideally the raw material enters the cell and a finished product comes out.  In this scenario takt times can be developed and the distance raw material travels can be reduced.  But, setting up a cell only makes sense if you can use close to 100% of the dedicated resources in this cell for a customer or range of items.

In many if not most job shops, there is not enough demand of a product or family of products (enough repetitive manufacturing) to justify segmenting these resources.  When job shops have tried to do this they usually have end up having to go outside the cell to complete the product.

Yes, some lean consultants have developed work-arounds for situations where there are repeat orders.  But in shops where orders do not repeat or there is a low proportion of repeat orders, it’s best to use a system that was developed for custom jobs shops and machine shops, as opposed to reinventing lean for an environment it was never intended for.

“Ninety percent of ‘lean’ is useless to us,” says Tricia Gerak, CEO of Canton, Ohio-based Precision Component Industries. [from a Modern Machine Shop article]

Now that being said, there are some lean concepts that we can use in low mix high volume job shops and machine shops.  The 10% that is useful has been incorporated into Velocity Scheduling System.  For example, ordering raw materials in line with when they are needed reduces the amount of cash tied up and just makes good sense.  As does reducing setups and making what you need to do the job easier and quicker to find  – lean manufacturing 5S principles.

If asked to summarize lean, most lean manufacturing consultants would say something like:  “The objective of lean is to reduce waste.”  But where?  Everywhere it seems.  This makes no sense.  When you have manufacturing bottlenecks or constraints, not all places are equal.  If you direct the lean waste reduction concepts to the right places, you can improve high mix low volume jobs shops and machine shops.  Instead of focusing on reducing waste, focus on balancing FLOW.  Takt time is too much detail for this environment.

There is also data to support  Lean’s ineffectiveness.  According to the  Lean Comes up SHORT on Reducing Costs article:

According to the survey, 36% of respondents indicated that their cost savings due to productivity efforts (from Lean) were 3-4% of total manufacturing costs, while 18% said their savings were less than a paltry 2%. Fully 14% of manufacturing executives said they didn’t even know how much they were saving through their productivity-improvement efforts. Yet, illustrating a gap between industry perception and reality, 91% of the respondents described their improvement efforts as “very effective” or “somewhat effective.”…

Most shops try to improve their job shop production scheduling by adding more detail.  They spend a bunch more time trying to predict when every job will be on every machine only to have the printout outdated shortly after being printed.  More detail does NOT work.  Job shop scheduling software suffers from the same issue and after months or years of getting it set up, the improvements are very small.

Job Shop Scheduling using Velocity Scheduling System

Velocity Scheduling System is a true pull system.  When work is completed, then and only then is new work released.  This is in contrast to a Kanban system which is really a don’t push system.  If the space is full, do not produce something new.  If there is space open, produce something new to fill it.

If you want to get on time and reduce lead-times in your high mix low volume job shop or machine shop, then check out Velocity Scheduling System for job shop scheduling.  VSS is a visual, manual scheduling board system.  Watch the webinar for a quick overview.

By Dr Lisa Lang

This article is copyrighted by Science of Business, Inc.

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{ 3 comments… read them below or add one }

Cheryl HIll

I totally agree and enjoy that their is someone else that thinks too much detail slows thing down.

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Bob Wotherspoon

Actually Job Shops really sell capacity. Job shops only make money when their machines are working. Job Shop work in any week is scattered across different machines depending on the mix that week.
If that high price CNC machine is not making parts, owner is asking Sales to got some work for that machining center.
Lisa is absolutely right in saying FLOW is what we want on the shop floor.

Reply

Lonnie Wilson

Hello, Ohno said, “The TPS…advocating the total elimination of waste, was born in Japan OUT OF NECESSITY. Lean is widely accepted as the generic version of the TPS however, over the last 20 years it has been so warped out of shape as to be almost unrecognizable. Mostly the academics who wrote extensively and we owe them thanks for raising awareness…however there is a flaw in how they described lean. The majority of the material on lean was written by people who did not do any lean at all..they wrote about what they saw as they observed it….from the outside…so imitate them at your peril…because they can write about lean, does not…in any way….say that they can do any of it.
Back to TPS, Ohno and Toyota. Soon enough i learned that the definition of lean from LEI and a bunch of others, mostly academics, had wandered a long way from the basics of Ohno and Toyota. Using their definitions and materials i developed the following working definition of lean….
Lean is….the creation of a culture of continuous improvement and respect for people and “the means to lean” is to
(1)problem solve your way to the ideal state
(2)through the total elimination of waste
(3)using a fully engaged workforce

Ohno, while he was developing what later became the TPS, he, several times, mentioned he did not want to document it because that would cause a cessation of thinking and people would revert to imitation. Later he wrote several articles and two books so maybe he had a touch of moral flexibility on this issue. Nonetheless, his initial though on imitation causing a cessation of thinking is THE major problem today. People want to copy the things Ohno did, rather than “think the way he thought”. So people come up with ridiculous statements such as “heijunka is the basis of the TPS”, that is no more true than a good ground game is the basis of football or foot speed is basis of soccer. Give me a bunch of track stars who cannot trap and i will show you a very fast soccer team that will lose all its matches. And now the majority of the industrial world wants to copy someone…..who may not know what he is doing….no wonder so many things called lean, in he fullness of time fail….any concept, no matter how solid and robust…can be executed poorly.

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