Developing Lean Operations and Supplier Optimization

Question: Discuss about theDeveloping Lean Operations and Supplier Optimization. Answer: Introduction Over the last decade, most of the Japanese companies have adopted alternative methods of operation strategy, which include Lean thinking and Just In Time (JIT) approach (Bamford Forrester, 2010). Lean is a scheme, which helps to remain competitive through identification and elimination of wasteful steps in processes and products. JIT comes in action when no stock is held by business and it relies on delivery of raw materials and components to arrive (Bamford, 2010). Impact of Lean on Organization Lean strategy was considered as phase changer in the organizations as it brought abrupt changes in the organization (Green, Inman Whitten, 2014). Lean operation had a positive impact on the organizations as it used less work force, area, capital expenditure, materials and time between customers order and shipment (Fullerton, Kennedy Widener, 2014). It focused on getting more with less through lessening inventory at every step of production, reducing cycle time against raw material and finished good and eliminating all type of wastes (Fullerton, 2014). JIT Success and Implementation It is an absolute philosophy of removal of waste continuously towards constructing excellence. It focuses on improvement instead of aiming for optimization (Widener, 2014). It follows the pull system of production that means that real order gives a signal for when the product is built. It enables a firm to produce only the required amount and at specified time (Lyons,Vidamour Sutherland, 2013). The factors which make JIT successful are that it lessens waste and improves the quality, decreases set-up and transition time, trims batch size thus lowering work-in-progress (WIP) and it has indexes in identifiable spaces and starts stock cut (Lyons et al., 2013). JIT needs to be modified in the field of employee training as employees need to learn the proper use of any tool before using it, technology as technology has always something new to deal with, quality and service delivery (Piercy Rich, 2015). Problems with JIT is that a little room exists for mistakes as nominal stock is conserved for re-working on damaged product and production is susceptible on supplier and if the product is not delivered within time limit, it can result in delay of whole production schedule (Piercy, 2015). Implementation of JIT can be beneficial as holding of lower stocks results in reduction of storage space, which saves insurance costs and rent (Lyons et al., 2013). Less working capital is bound with stock and thus stock is obtained only when needed, there is less chance of perishing and getting obsolete of product and less time is spent re-work and checking of others product as the policy focuses on working right for the first time (Widener, 2014). As the organization here, deals with clothes, so lean thinking can be applied in various ways. Through JIT approach, the store can hold low stocks and keep updating the collections frequently so that only the popular products will be produced and less popular will be disregarded (Green et al., 2014). Other factors of lean thinking are agility which involves pulling back the unfinished products and customer value under which capacity material is bought from the suppliers but particular color or print is not committed until the organization gets fair picture of the customer preference (Santos, Wysk Torres, 2014). One-piece-flow is also a major aspect of lean thinking. It involves movement of one piece at a time of the product and removes all type of waste products thus increasing the agility of the company (Aziz Hafez, 2013). Conclusion Hence, from the above discussion, it is concluded that Japanese companies have adopted lean thinking and its various strategies in their industries, as they have enormous benefits. They help a lot to increase production as well as decrement of labor cost and extra cost thus becoming more effective. It also helps to fulfill customer demands as only the required amount is created and thus there are no leftovers. Reference Aziz, R. F., Hafez, S. M. (2013). Applying lean thinking in construction and performance improvement.Alexandria Engineering Journal,52(4), 679-695. Bamford, D.R. Forrester, P.L. (2010) Essential guide to operations management: concepts and case notes. London: Wiley.Chapter 6, Developing lean operations (pp. 103-119) (attached) Fullerton, R.R., Kennedy, F.A., Widener, S.K. (2014) Lean manufacturing and firm performance: the incremental contribution of lean management accounting practices, Journal of Operations Management, 32 (7/8), pp. 414-428. Green, K.W., Jr., Inman, R.A., Birou, L.M. Whitten, D (2014) Total JIT (T-JIT) and its impact on supply chain competency and organizational performance, International Journal of Production Economics, 147 (Part A), pp. 125-135. Lyons, A.C., Vidamour, K., Jain, R. Sutherland, M. (2013) Developing an understanding of lean thinking in process industries, Production Planning Control, 24 (6), pp. 475-494. Piercy, N. Rich, N. (2015) The relationship between lean operations and sustainable operations, International Journal of Operations Production Management, 35 (2), pp. 282-315. Santos, J., Wysk, R. A., Torres, J. M. (2014).Improving production with lean thinking. John Wiley Sons.