# 6.2.1 Setup-Friendly Production Facilities — Lead Time Reduction through Setup Time Reduction and Batch Size Reduction

### Intended learning outcomes: Identify the simplest formula for operation time. Produce an overview on setup-friendly production facilities.

Most simply reckoned, lead time is the sum of operation times and inter­operation times plus administration time. In job shop production, operation time determines in part queue time at a work center, which makes up a significant portion of inter­operation time. Reducing opera­tion time, therefore, has both a direct and indirect effect. The simplest definition of operation time can be expressed as the formula in Figure 6.2.1.1. This definition appeared in Figure 1.2.3.1, but here the figure shows commonly used abbreviations that will be useful later on.

Fig. 6.2.1.1        The simplest formula for operation time. [note 605]

The simplest way to reduce operation time is through reduction of batch or lot size. A company can even aim at batch sizes that fulfill only the demand of a day or a few days. Then, the same order is repeated at short intervals, which leads to processes that can be better automated.[note 606] Smaller batch size, however, does result in more setup (if producing the same overall quantity) and thus greater capacity utilization. In case of high utilization, this increases lead time (here see Section 10.2.3). Increased setup also causes higher costs. Conversely, a significant reduction in setup time allows — with keeping utilization constant — to reduce lot size, thus operation time and finally also lead time.

The following exercise helps to illustrate the need to find a balance - for any operation - between short lead time and

1. low cost.These two factors are determined by setup time and batch size. Find the effect of setup time and batch size on the operation time, which is a measure ot the lead time of the order
2. the time per unit (that is run time plus the setup time divided equally to each unit), which is a measure of the cost of the operation, and therefore of the cost of the production or procurement order.

The following shows how setup-time reduction can be achieved.

1. Setup-friendly production facilities:

The construction of specific devices (such as gauges or dies) for setup sometimes allows drastic reduction in setup time even where there are existing specialized machines. Another possibility is to use the machines by means of programmable systems such as computer numerical control (CNC) machines, industrial robots, or flexible manufacturing systems (FMS).

Continuation in next subsection (6.2.1b).

## Course section 6.2: Subsections and their intended learning outcomes

• ##### 6.2 The Lean Concept / Just-in-Time Concept

Intended learning outcomes: Explain lead time reduction through setup time reduction and batch size reduction as well as further concepts. Describe line balancing through harmonizing the content of work. Disclose Just-in-Time Logistics. Present generally valid advantages of the lean / Just-in-Time concept for materials management and for capacity management.

• ##### 6.2.1 Setup-Friendly Production Facilities — Lead Time Reduction through Setup Time Reduction and Batch Size Reduction

Intended learning outcomes: Identify the simplest formula for operation time. Produce an overview on setup-friendly production facilities.

• ##### 6.2.1b Cyclic Planning and “Heijunka” — Lead Time Reduction through Setup Time Reduction and Batch Size Reduction

Intended learning outcomes: Present in detail cyclic production planning and leveling of the production (“heijunka”).

• ##### 6.2.1c Reduction of Variants, Modular Product Concept, Single-Minute Exchange of Dies (SMED) — Lead Time Reduction through Setup Time Reduction and Batch Size Reduction

Intended learning outcomes: Describe harmonizing the product range through reduction of variants and a modular product concept. Explain single-minute exchange of dies (SMED).

• ##### 6.2.2 Production Segmentation, or Manufacturing Segmentation — Lead Time Reduction Through Adaptation of the Production Infrastructure

Intended learning outcomes: Produce an overview on production or manufacturing segmentation.

• ##### 6.2.2b Cellular Manufacturing and One-Piece Flow — Lead Time Reduction Through Adaptation of the Production Infrastructure

Intended learning outcomes: Explain cellular manufacturing, one-piece flow, and the formula for lead-time calculation with cellular manufacturing.

• ##### 6.2.3 Standardizing the Production Infrastructure, Flexible Capacities, Structuring Assembly Processes, Complete Processing, Point-of-Use Inventory, Point-of-Use Delivery — Further Concepts of Lead Time Reduction

Intended learning outcomes: Disclose the effect of standardizing the production infrastructure and of flexible capacity. Describe structuring assembly processes and complete processing. Identify point-of-use inventory and point-of-use delivery.

• ##### 6.2.4 Line Balancing — Harmonizing the Content of Work

Intended learning outcomes: Identify how tasks of the same duration at each production structure level result in a rhythmic flow of goods. Explain why the various operations at a workstation (for all the products) as well as the various operations for a single product should be of the same approximate duration.

• ##### 6.2.4b Line Balancing — Changing Lead Time of Operations

Intended learning outcomes: Produce an overview on measures for changing lead time of operations.

• ##### 6.2.5 Just-in-Time Logistics: Quality Circles, TQM, Genchi Genbutsu, Kaizen, Poka-Yokero, Andon, 5S, and Others

Intended learning outcomes: Produce an overview on measures for motivation, qualification, and empowerment of employees as well as employee involvement (EI and quality circles. Describe concepts such as genchi genbutsu, kaizen, poka-yokero, Andon, 5S.

• ##### 6.2.6 Generally Valid Advantages of the Lean / Just-in-Time Concept for Materials Management

Intended learning outcomes: Describe the effect of forecast errors through the combining of requirements in batches across many production structure levels. Explain the effect of longer and shorter lead time on the (customer) order penetration point.

• ##### 6.2.7 Generally Valid Advantages of the Lean / Just-in-Time Concept for Capacity Management

Intended learning outcomes: Explain how the lean /JIT concept reduces queue time. Describe how the lean /JIT concept allows for simpler control techniques.