Lean Inventory Management Practices - Contrasts, Stockholding, and Throughput Time
Explore the principles of lean inventory management through contrasts between conventional and JIT control, warehouse stockholding insights, and throughput time analysis. Understand the attributes essential for just-in-time operations in an ideal scenario.
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Presentation Transcript
Best practice in Inventory Management Chapter 6 Lean Supply Dr Tony Wild www.inventory-management.co.uk www.inventory-management.co.uk 1
Figure 6.1 Contrasts between conventional and JIT inventory control CONVENTIONAL JUST IN TIME Continuous improvement Satisfied with the status quo Lead time is fixed Reducing lead time is a continuing challenge Product range reduction is an inventory issue Product range is a sales issue Management provide methods Stock in case of customer demand Convenient purchase batch size Operators are responsible for practices Purchased to meet demand rate Buy singly or small quantities www.inventory-management.co.uk 2
Figure 6.2 Warehouse stockholding Stock Cover Inventory Value 52 weeks 2500 10.4 weeks 500 6 weeks 288 4.2 weeks 202 1 week 48 1 day 10 1 hour 1.3 www.inventory-management.co.uk 3
Figure 6.3 Throughput time & manufacturing inventory Throughput Time (weeks) 43.34 weeks Inventory Investment ( ) 2500 Number of Jobs in Progress 2167 8.66 weeks 416 433 6 weeks 288 300 4.2 weeks 202 210 1 week 48 50 1 day 10 10 1 hour 1.3 1.35 www.inventory-management.co.uk 4
Figure 6. 4 Ideal situation for just in time operations Attribute Product range High Volume Stable Market Influential Position Prouct Quality Quality Management Consistant & accurate information Local, Reliable Suppliers Daily pull supply Dependent Suppliers Significant customer for suppliers Fast Cycle Processes Fast efficient despatch Distributor Manufacturer Only one process route Continuous not batch processes Accurate master schedule Regular daily demand Mix and match products Consistent demand Good forecasting Many customers Product assured by supplierBuilt in process quality Accreditation & Pokeyoka use one get one approach Controls supply chain Synchronise process speeds www.inventory-management.co.uk 5
Figure 6.5 Continuous supply cycle times Item Throughput Per Week 2,000 Throughput Per Day 400 Cycle Time (Secs) 68 A11 B22 3,000 600 45 C33 4,000 800 34 D44 2,500 500 54 E55 1,000 200 135 Total 12,500 2,500 11 www.inventory-management.co.uk 6
Figure 6.6 Cyclic production Line Throughput per Min. 0.9 Number per Cycle 4 Item A Item B 1.3 6 Item C 1.8 8 Item D 1.1 5 Item E 0.4 2 Total 5.6 25 Times per complete cycle = 4.5 mins www.inventory-management.co.uk 7
