Lean Production Principles

2. Principles of Lean Production

TPS Handbook (www.artoflean.com) considers two main pillars of its system:

• Just-in-time that means "Making only what is needed, only when it is needed, and only in the amount that is needed".

• Jidoka that means: "Building Quality into the production process".

This system decreases inventory, and strives to overcome both early and over production. The approach just-in-time (JIT) demands new mechanism of logistic. Process approach helps company to identify violations of the early level.

Toyota Production System (TPS) is the precursor to the Toyota Way which considers two other pillars (Craig Larman and Bas Vodde 2009; HRD):

• Continuous improvement.

Continuous improvement defines Toyota’s basic approach

Value: Specify what creates value from the customer’s perspective. This must be defined by the end consumer, typically in terms of the requirements of a service, product or experience, a channel or method of delivery, a schedule or an ideal lead time, a price and the benefits the consumer expects to achieve. By clearly defining value for a specific product or service from the customers perspective, all the non value activities – or waste – can be targeted for removal.

2. The Value Stream: Identify all steps across the whole value stream. The value stream is the entire flow of a product’s life-cycle from the origin of the raw materials used to make the product through to the customer’s cost of using and ultimately disposing of the product. The value stream can include the complete supply chain.

3. Flow: Make those actions that create value flow. One very significant key to the elimination of waste is flow. If the value chain stops moving forward for any reason, then waste will be occurring. Eliminating this waste ensures that your product or service “flows” to the customer without any interruption, detour or

Perfection: Strive for perfection by continually removing successive layers of waste. The process continues towards the theoretical end point of perfection, where every asset and every action adds value for the end customer. This relentless pursuit of the perfection is key attitude of an organization that is “going for lean”.

As was mentioned above lean production is directed on eliminating any waste what leads to cost reduction. Continuous improvement focuses on the elimination of next major types of waste (TPS; James P. Womack and Daniel T. Jones 2003; Liker, Jeffrey K. 1997):

1. Over-production. Producing items for which there are no orders, which generates overstaffing and storage and transportation costs because of excess inventory.

2. Waiting (time on hand). Workers having to stand around waiting for the next processing step, tool, supply, part, etc., or having no work because of stock outs, lot processing delays, equipment downtime, and capacity bottlenecks.

3. Unnecessary transport or conveyance. Carrying work in process (WIP) long distances, creating inefficient transport, or moving materials, parts, or finished goods into or out of storage or between