Lean Manufacturing Principles: Inventory and Quality Control

Reorder Point System

A stock control system where an order is placed whenever inventory reaches a predefined level to ensure availability.

Innovation Process

The process includes: research, initial development, product development, and launch.

Opportunity Calculation

Opportunity = (Importance + (Importance – Current satisfaction))

SMED: Single-Minute Exchange of Die

SMED aims to minimize changeover time between SKUs by converting internal setup (machine stopped) to external setup (done in advance).

4 Principles of SMED

• Separate internal and external tasks
• Convert internal to external
• Streamline setup
• Parallelize or eliminate steps

Result: Lower setup costs lead to smaller batches, with the ultimate goal of single-unit batches. This links to Heijunka, where small batches enable mixed planning, lower inventory, faster response, and product availability.

Component Commonality

Commonality is the degree to which a component (SKU) is shared across different finished products. The goal is to maximize this metric and introduce diversity as late as possible.

Benefits of Commonality

• Cost ↓: Fewer components mean simpler purchasing and less inventory.
• Quality ↑: Shared components are better known and easier to control.
• Time ↓: Less complexity leads to faster throughput and reliable deliveries.
• Flexibility ↑: Improved mix and volume flexibility.
• Innovation: Frees resources to innovate elsewhere.
• Sustainability ↑: Fewer part types result in less waste and a simpler supply chain.

Product Specification and Quality

A specification is a formal statement describing how a product or service should perform. During the design phase, specific levels for attributes are established.

Key Quality Concepts

• Specifications: Often set by governments (e.g., emission standards). They are expressed numerically as a nominal value ± tolerances (e.g., 25±1 mm).
• Limits: Upper Specification Limit (USL) and Lower Specification Limit (LSL).
• Conformance Quality: The degree to which a product meets design specifications. Low conformance leads to defects.
• Deming’s PDCA Model: Plan (identify problem), Do (test plan), Check (evaluate results), Act (standardize).

Just in Time (JIT)

JIT means making only what is needed, when it is needed, and in the amount needed. It eliminates waste by cutting unnecessary capacity and non-value-added activities, positively impacting flexibility, delivery speed, cost, and quality.

The Eight Wastes

1. Overproduction
2. Inventory
3. Waiting times
4. Transportation
5. Overprocessing
6. Movements
7. Product/service defects
8. Under-using employee capabilities