MGEC81H3 Lecture Notes - Lecture 11: Taiichi Ohno, Overproduction, Operations Management
17 Oct 2020
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Cost of excessive inventory: warehousing (building, lighting, heating, maintenance, storage equipment (pallets, rack sys, forklifts, additional workers to maintain/manage extra inventory. Cost of overproduction: additional workers to make the parts that were overproduced, other production costs (materials, machinery) used to make parts that are overproduced, interest payments to finance all of above. Causes for over processing : tools & parts randomly organized in work space workers waste time search for tools, not completing a task in an efficient way. Causes for unnecessary movement of people, handling of materials. Departments with single-purpose machines: parts travel around the plant to the different machines. Cellular layout based on group technology: each cell specializes in producing one or a limited number of part families. Group technology defined: a manufacturing philosophy in which similar parts are identified and grouped together to take advantage of their similarities in design and production.
