Principle Demand orientated production Method Customer takt Tool Production smoothing and levelingProduction System Training Materials 11 What is Production smoothing and leveling ?Production smoothing: By using standardized buffers, production is decoupled from customer demands. This avoids that short-term variations in demand have an effect on production. The decoupling will be achieved by defined service classes in connection with a finished products supermarket. Service classes are understood to be standardized supply processes (finished products) from production to customers based on the demands of the customers.Production leveling: Leveling of the production will be achieved if the production orders are scheduled in a planned and preferably standardized and recurrent pattern. Small batches and minimal frozen horizons are required to represent the customer takt over a defined period of time. DateWhat is Production smoothing and leveling used for ? Prevent unnecessarily high variations in production output Shorten lead times, and therefore response times to the customer Reduce WIP (work in progress) inventory Increase productivity by avoiding unplanned changes to production scheduling Reduction and/or elimination of the Bull-Whip-Effect Ensure continuous flow, to support standardized work Increase flexibilityDateSchematic diagram of Production smoothing - ActualTime tQuantity Pcs.tPcs.Production outputQuantity demanded Customers order products at irregular intervals and in varying quantities ( ) Production tries to follow the demands of the customers with the production output ( ) Due to lag time t, the sequence and quantity of production have to be adjusted frequently The system alters ( Pcs.)exampleDate Finished products supermarket after the last process decouples as a defined buffer the production from short-term variations in demand It is simulated that the customer demand is fix over a period of time Within the leveling period all products are produced regularly in defined quantitiesfinal assemblydefined inventory in a finished products supermarket for cushioning of external variations at optimal inventory quantitydecoupled production (assembly)placement of demands in supermarketQuantity demandedProduction outputTime tQuantity Pcs.Leveling periodexampleprefabricationcustomersupplierproduction schedulingdelivery schedulingPlanning period*long-term consideration: Combination with delivery forecast, determination of types, personal planning, procurement planningSchematic diagram of Production smoothing - PlanDate*R RunnerR* A R B R C R D ExoticsMoTuWeThFrMoTuWeThFr2131043changeover optimized production10133421424 days replacement time4 daysLong replenishment timefor all products Sequence of production is not constantHigh inventories in the finished products warehouse to bridge the long replacement timeprefabricationincreasing variationshigh inventoriesfinal assemblyfinished products warehouseproduction schedulingproduction schedulingdelivery schedulingscheduling Traditionally it is tried to level the demand variations by using big batches and few changeover activities (changeover optimization) This is the reason why demands are alternating from manufacturing level to manufacturing level with growing batchesexamplesuppliercustomerSchematic diagram of Production leveling - ActualDateprefabricationfinal assemblyleveled production (assembly)leveling also in pre- fabricationplacement of leveled demandsLeveled productionR AExoticsR B R C R DMoTuWeThFrMoTuWeThFr222224444422222111121111111121111444441 dayExotics: 5 daysConsequent changeover optimization necessary Leveling simulates an ideal customer“, who orders regularly in small quantities Within the period of leveling all products are manufactured regularly in fix quantity By using small batches the quantity demanded is more directly realized, despite constant production program Significantly reduced replenishment timeminimizes the inventories in the finished products warehouseexamplecustomersupplierSchematic diagram of Production leveling - PlanDateInventories represent waste (Muda)Lead timeInventoriesInventories conceal problems and waste.They are not the cause rather symptoms of the problems.Inventories are approximately proportional to lead times.InventoryQuality IssuesProduction Downtime-Waiting Time-Production-Downtime and LossesTransportDown TimeChangeover TimeLong PathsProductionBased on: Regber, Zimmermann: Change Management in der Produktion (2001)water level = inventory leverDateAdaptation of productionquantity to demandDesign of pacemakerControl of up-stream production processesIIIIIIProcedureDividing of products with ABC/XYZ-Analysis (see tool description) in the following production categories: runner products with relative regular (AX, BX, AY, BY) and exotics with alternating demands (CX, CY, CZ)Definition of ord