Unsourced material may be challenged and removed. The goal is to produce intermediate goods at a constant rate so that further processing may also be carried out line balancing techniques pdf a constant and predictable rate. To prevent fluctuations in production, even in outside affiliates, it is important to minimize fluctuation in the final assembly line. Toyota’s final assembly line never assembles the same automobile model in a batch.
Production leveling can refer to leveling by volume, or leveling by product type or mix, although the two are closely related. If for a family of products that use the same production process there is a demand that varies between 800 and 1,200 units then it might seem a good idea to produce the amount ordered. So their approach is to manufacture at the long-term average demand and carry an inventory proportional to the variability of demand, stability of the production process and the frequency of shipments. 200 at the start of the week and 1,200 at the point of shipment. The advantage of carrying this inventory is that it can smooth production throughout the plant and therefore reduce process inventories and simplify operations which reduces costs.
Most value streams produce a mix of products and therefore face a choice of production mix and sequence. Toyota’s approach resulted in a different discussion where it reduced the time and cost of changeovers so that smaller and smaller batches were not prohibitive and lost production time and quality costs were not significant. This meant that the demand for components could be leveled for the upstream sub-processes and therefore lead time and total inventories reduced along the entire value stream. Green stream products are those with predictable demand, Red stream products are high value unpredictable demand products. This will allow the shortening of the EPEC cycle so that the plant is now producing every product every 2 weeks instead of month and then later on repeating every week. This may require support services to speed up as well. This affects inbound componentry as well as support services.
EPEC, can now be gradually flexed but move to small fixed batch sizes to make this more manageable. Demand levelling does not include influencing activities designed to clear existing stock. The first approach to demand levelling involves careful management of the sales pipeline. For this method of demand management it is instructive to look at Toyota in its home market, Japan. Toyota sales teams sell cars door-to-door whereby they build customer profiles and relationships.
The sales process is low intensity but includes test drives, financing, insurance and trade-in deals. The sale itself is by special order placed with their representative. This means that orders can be predicted reasonably accurately in terms of vehicle numbers some way in advance. Finer specific vehicle details may only become known with the order. However, the order is often for delivery in the future so these details can usually be planned before build.