Lean and Six Sigma: The Toyota Production System

There are 6 questions, choose four questions to write( first question is necessary and other 3 questions can choose any 3 out of all questions:

This exam should be done by you and you alone. You are not to discuss any questions or answers with anyone else, whether they are in the course or not.  You may discuss material of a more general nature with the instructor.  If the instructor finds evidence that you received or provided inadmissible assistance, you will receive a grade of zero for the exam. (You may use published materials to strengthen your answers; in fact, I encourage it, but use of published materials should be completely cited. Inadmissible assistance includes oral or written assistance from others, including current or former students, is strictly prohibited.)  You really should not need anyone else’s help on this exam; just give the questions some thought and have confidence in your answers.

There are five questions. You are to:

(1) Answer question number one; then

(2) Answer THREE of the remaining five questions (3-6)

for a total of 50 points. (In other words, you should answer a total of FOUR questions, such as 1, 3, 4, and 6.) You are to answer the questions clearly and precisely. Use examples to illustrate your answers, where appropriate.  Clearly label the question number and part at the beginning of each answer (or retype the question from the exam), so I know which question you are answering. All answers should be typed, and double-spaced, with one-inch margins.  I would expect answers to be 1-2 pages long; no answer for any part may be more than two pages long. Your answers for any question, all parts combined, may not exceed three pages. It is important that your answers be concise, complete, well-organized, and well-written; readability will be considered in grading.

1. (14 pts) Suppose you were asked to make a presentation about lean production to a group of executives from several companies (not necessarily manufacturers). The executives are familiar with business and production/operations, but they know nothing about lean production.

(a) (8 pts) Clearly explain what lean production is, and why a company should adopt it. Your explanation is intended for the executives, and should be understandable by them; so, do not use terminology that you do not define or explain. (For example, do not say, “You should use SMED and kanban scheduling to help your company.” The executives will not know what you are talking about.)

(b) (6 pts) After hearing/reading your presentation from part (a), suppose some of the executives are interested in adopting lean production, but they want to know which aspects of their operations are “most lean” and “least lean,” so they can identify which areas deserve highest priority in implementing lean production. They would also like a way to track their company’s overall progress as they adopt lean methods.  Clearly explain to them a way to measure or characterize how lean their company’s operations are, how to prioritize their lean efforts, and how they could track the progress of the company’s improvement efforts over time.

2. (12 pts) Each part is independent.

(a) (7 pts) Lean production does not stop at a company’s door. To have a completely lean system, lean companies must have good operational relationships with their suppliers. Describe in detail the key features in the supplier-customer relationship for lean producers. Explain how you would go about getting suppliers to cooperate in creating a lean supply chain - what specific things would you do to get supplier cooperation. Why are these relationships necessary to achieve a lean production system, and how do they benefit both parties?

(b) (5 pts) Events in recent years, such as Covid, earthquakes, wars, have disrupted many supply chains, and companies that were not well-prepared suffered considerably. Lean supply chains are known to operate with minimal inventory, and so they appear to be especially vulnerable to disruptions. Explain how lean businesses should construct their supply chains in order to be resilient and reliable, without creating excessive inventories (waste).

3. (12 pts) The top management of your organization does not believe it needs to devote more effort to improving the organization’s product quality.  Based on budget numbers, top management claims that quality management efforts already make up 5% of the company’s total costs (mainly on inspectors and testing), and it does not want to change its quality management system and spend more money. You know that the organization’s product quality is poor, and it is hurting the company with current customers, and will be a very serious problem long term. How can you convince them to change what they are doing with respect to quality? Specifically, prepare a write-up that will: (1) Convince management that the organization has a quality problem; (2) Explain why and how this problem is occurring; (3) Describe what types of general changes should be made to their approach to quality; and (4) Explain how your recommended changes will actually reduce costs and improve quality.

4. (12 pts) Each part is independent.

(a) (7 pts) Unlike traditional operations management, lean organizations devote considerable attention, resources, and effort to the design of their products. Explain why product design is so important in creating a lean organization and production system. What characteristics would constitute a well-designed product, and how would well-designed products help to create and operate a lean production process.

(b) (5 pts) It has been argued that 5 S is the most important lean production tool, and that it is the first tool one should use when implementing lean production. Explain why this statement might be true. Specifically, explain the general purpose(s) and approach underlying 5 S, why it makes sense to begin lean implementation with 5S, and how 5S “fits” as a lean production tool. Also explain precisely how it creates synergies with other lean production tools and enhances them - be specific and explain clearly.  (DO NOT give a detailed step-by-step description of what the 5 S’s mean.)

5. (12 pts) Each part is independent.

(a) (6 pts) Suppose the president of your company/organization has heard about lean production and would like to implement lean in the organization. She has heard that you took a course in lean and know something about it, so she wants you to lead the effort. She wants you to prepare an action plan for the implementation. The plan should lay out what you would do during the first 6-12 months, how you would do it and why you would do it, what goals and milestones you would set (what you hope to achieve by the actions), and how you would measure progress. Prepare that action plan so it would be understandable to the president, and so it would instill confidence in her that the implementation would be successful (or at least start off well during the first year.)

(b) (6 pts) Suppose the President of a chemical manufacturing company has read a number of articles about global warming, environmental pollution, and many other articles about the environmental damage that is occurring, and the public’s desire for companies to act more responsibly.  The President of the company has decided that her company should undertake an environmental improvement program.  To show her commitment to the program, the President identified two workers who have shown an interest in the environment, and she has decided to assign them full-time to the program, and she has given them a $100,000 annual budget for any expenses required. The President has suggested that the workers institute an extensive recycling program at the company.  What do you think of the President’s plan? Explain in detail why it is or is not a good way to start the program.  If it is a good approach, explain why it is a good approach; if it is not a good approach, explain what should be done instead and why.

6. (12 pts) Each part is independent.

(a) (5 pts) Why have so few organizations been as successful at implementing and using lean production/thinking as Toyota has? Other than for the fact that Toyota has been doing it longer, what is it that makes Toyota’s lean system more successful than other organizations? What advice would you give an organization to improve its chances or implementing lean successfully, and sustaining lean over the long term?

(b) (7 pts) A key principle of lean production, and process improvement more generally, is that you need to know what is really happening in your operations now and be able to track changes in performance as you make changes/improvements in your operations. Describe and explain how this can and should be done. Specifically, describe lean production tools and methodologies that help us understand the current process; explain how they work together and complement each other; and explain how they help us with continuous/process improvement.