Question

Critical Thinking

The global marketplace has witnessed an increased pressure from customers and competitors in manufacturing as well as service sector (Basu, 2001; George, 2002). Due to the rapidly changing global marketplace only those companies will be able to survive that will deliver products of good quality at cheaper rate and to achieve their goal companies try to improve performance by focusing on cost cutting, increasing productivity levels, quality and guaranteeing deliveries in order to satisfy customers (Raouf, 1994).

Increased global competition leads the industry to increasing efficiency by means of economies of scale and internal specialization so as to meet market conditions in terms of flexibility, delivery performance and quality (Yamashina, 1995). The changes in the present competitive business environment are characterized by profound competition on the supply side and keen indecisive in customer requirements on the demand side. These changes have left their distinctive marks on the different aspect of the manufacturing organizations (Gomes et al., 2006). With this increasing global economy, cost effective manufacturing has become a requirement to remain competitive.

To meet all the challenges organizations try to introduce different manufacturing and supply techniques. Management of organizations devotes its efforts to reduce the manufacturing costs and to improve the quality of product. To achieve this goal, different manufacturing and supply techniques have been employed. The last quarter of the 20th century witnessed the adoption of world-class, lean and integrated manufacturing strategies that have drastically changed the way manufacturing firm’s leads to improvement of manufacturing performance (Fullerton and McWatters, 2002).

Consult chapter 7 of your text book or secondary available data on internet and answer the following questions.

Question:

1. Why Companies adopted Lean Thinking and JIT model?
2. Discuss major types of Waste, companies has to keep in mind during production.
3. Assess the reasons for using lean thinking (suitable examples), what are the benefits from Suppliers to end users?
4. Due to COVID 19 emergency do you think agile supply chain is the right concept in this kind of situation? Give reason with example.

The Answer should be within 4- 5 pages.

Answer 1

1. Why Companies adopted Lean Thinking and JIT model?

Answer:

Lean Thinking is a term that is used to describe an innovative way to organize activities that delivers benefits to the organization and the society, while at the same time eliminates waste. It is based on the principles adopted in Toyota. On the other hand, Just In Time (JIT) model is an inventory management model that reduces inventory and increases operational efficiency. It reduces time in the production system and response time along the value chain, from the suppliers to the customers. While JIT manufacturing focusses on improving efficiency, Lean Thinking manufacturing emphasises using efficiency to add value to the customer. Many companies are increasingly using Lean Thinking and JIT models because of the following reasons:

· The models gives the manufacturing company better control over its manufacturing process

· They increase operational efficiency

· They reduce inventory costs as raw materials are ordered only when they are needed

· The wastage associated with over production, excess inventory, etc can be minimized

· Adoption of the models can enable the employees to focus on more productive things such as, customer interaction, focus on research and development, devise marketing plans, etc.

· Companies can respond quickly to changes in customer demand

2. Discuss major types of waste, which companies have to keep in mind during production.

Answer:

Waste creates neither any value to the company nor it is of any importance to the customer. However, waste does have significant costs associated with it. For a manufacturing company, waste can take many forms. It may include unwanted products due to overproduction, inventory, defects, inefficient transportation, employee idle time, etc.

3. Assess the reasons for using lean thinking (suitable examples), what are the benefits from Suppliers to end users?

Answer:

Some of the reasons and benefits for the adoption of lean thinking by companies are:

· Higher productivity

· Elimination of defects and improved product quality

· Reduced lead times: Business can respond to changes in customer demand quickly leading to improved lead times.

· Meet sustainable goals due to reduction in wastage

· Reduction in employee idle time and overtime

Mercedes Benz has adopted the principles of lean thinking in its automotive production systems, which has mainly resulted in improved productivity and reduced lead times. McDonald’s has also adopted lean thinking in its operations. As a result, the fast food giant is able to generate high output with a lower cost per unit.

4. Due to COVID 19 emergency do you think agile supply chain is the right concept in this kind of situation? Give reason with example.

Answer:

The current COVID 19 pandemic has raised questions about the viability of an agile supply chain. The pandemic has disrupted complex global supply chains. As a result, major companies around the world are reporting stoppages and slowdowns. For instance, many diverse companies such as Apple, Microsoft, Nissan, etc have reported interruptions in their global operations as many of their suppliers and factories in China have closed or operating at reduced capacity.