With that perspective, I often find opportunities to level a great deal of the process, and isolate the truly parts of the flow so they do not disrupt the main line.

Excellent information regarding heijunka; I’ve implemented heijunka in a Build to stock environment (much easier to do it…); what’s your suggestion about how to apply heijunka in a high mix, high volume, Customized orders operation?; in my new job, we handle up to 16,000 different product types, our daily avg. demand is 5K units and a minimal change of components between orders impacts forecast big time.

over a 4 month period would replenish what was consumed from the inventory

should say “over a 4 week period”

For example, if you have a 4 week horizon you would have a 4 week finished goods inventory that would absorb fluctuations in daily demand and product mix. The customers would get what they want on a daily basis but the production line will produce a mixed model fixed sequence that over a 4 month period would replenish what was consumed from the inventory. Before the 4 weeks is up you would evaluate the latest trends or projections and recalculate your finished goods level, your daily level production rate, and your mixed model fixed sequence.

Ideally, and this is very sophisticated in practice, the fixed sequence at the top level would be in some proportion equal to the average consumption rates that the component level kanbans were sized for. What this does is maximize the efficiency of the kanban replenishment system by regulating your re-ordering process. If this propagates backward through your supply chain, every stage of production and distribution will be leveled, which will enable efficiencies to be gained and costs to be reduced from beginning to end.

The flip side of this is if your finished goods kanban is actually a kanban from a customer, you should work with them to make sure their production is levelled. If they are lean enough to set up kanbans they should be enlightened enough to work collaboratively on this.

Some lean companies, like mine, keep almost no finished goods inventory. The only way to do that is to be very aware of your capacities and have a way to keep track of your current cell loading. Then you slot in the orders as they come in with the first available date and get agreement with the customer before the order is even entered into the system. Then the kanban signal will fit into a level production model.

Other companies, who find that their fluctuation problems come from a “bullwhip effect” can use the opposite of the first method. Instead of building inventory to level upstream production, they work collaboratively with their customers in evaluating downstream data all the way through the point of sale as a reality check against bad ordering practices. Demand at the end user level is often far more smooth to begin with than from your immediate customer.

Thanks a lot!

In general, where there is a lot of demand fluctuation, and no room to maneuver with either backlog or inventory, then something to try is to look at the value stream(s) and try to tease out whatever underlying portion of the demand is stable, isolate that from the variation (either physically or with scheduling), and work to optimize that with heavy, continuous kaizen.

Doing so will eventually reduce the resources required for the stable part of the load, giving more time and capacity for the true variable component; and it will give the leadership more mental bandwidth to better manage the variation that is left.

If anyone else reading this has thoughts or suggestions, feel free to post them here!

I am struggling wth how I might apply heijunka in my environment? We produce highly perishable items so inventory is not an option. And we produce products that are sold in supermarkets where the daily demand fluctuates. Customers may buy more on Sat. then on Mon or they may buy more of item when it is on sale (no matter what the day). We can’t produce Mondays order until Sunday (one day before, 2 days maximum) and we can’t produce the same quantity on Sunday that will be required on Friday (for Saturdays sales) or the product will spoil in the store while waiting to be purchased. Perhaps heijunka is not useful in this type of environment? Any help you could provide would be greatly appreciated.

The automobile industry, of course, has all of the operations – stamping, painting – that are inherently batch. Once they had a level demand from assembly, they started progressively attacking the reasons for running batches.

In stamping, it was mainly to attack changeovers for dies – SMED – so that they can run progressively smaller batches. In paint, for a long time, they batched colors, then re-sequenced the bodies through the assembly line – recognizing that the inventory between paint and assembly was because of unsolved problems.

Recently they developed a cartridge based paint technology that allows them to switch colors on a unit-by-unit basis, so that is gone… but that isn’t the point. The point is that they did not use assembly batching as a “reason” why they could not level paint.

As for utilization, it is a very poor measurement as, typically, optimizing utilization at any operations results in larger batches and more overproduction, higher usage of working capital, more vulnerability to damage, more storage space, greater need to schedule, track, count, re-sequence, etc. I’ll work up a piece about optimizing batch sizes in the cases where the single-part run time is small vs. the takt and vs. the changeover.