Provided by James R. Martin, Ph.D., CMA
Professor Emeritus, University of South Florida
3. Explain the difference between a value system, a value chain, and a value stream. Also explain the difference between a lean company and a lean enterprise. (See Chapter 8 discussion, Figure 8-1, Figure 8-2 and the Donelan & Kaplan and Carr, Lawler & Shank summaries). (See the Baggaley & Maskell summaries for the value stream concept, and Womack and Jones for a definition of a lean enterprise). (Also, compare the Business Flow chart with the value chain concept.)
4. How does the value chain concept differ from the traditional value added concept? (See Chapter 8 discussion).
5. Discuss the value chain in terms of the concepts of cooperation and teamwork. (See Chapter 8 discussion).
6. What do we mean by the term "quality at the source"? (See Jidohka).
8. Compare the concepts of Just-In-Time (JIT) and Just-In-Case (JIC) in terms of the acquisition and utilization of resources. (See Figure 8-3).
11. Describe several statistical tools used to achieve continuous improvement. (See Figure 8-5, Figure 8-6, Figure 8-7, Figure 8-8 and Figure 8-9 and Imai 86 Kaizen summary. See the McNair 94 summary for another Fishbone illustration).
13. Why would a company want to reduce the number of it’s vendors or suppliers? Think about the two types of improvement. (See Chapter 3).
14. How does the relationship between a company and it’s suppliers change when the companies convert from a traditional relationship to a JIT relationship? (See, the Carr & Ittner, Dyer, and Saturn tour summaries).
16. What is a focused factory? (See Chapter 8).
17. What does the term "cellular manufacturing" mean? (See Figure 8-10, Figure 8-11 and the O'brien & Sivaramakrishnan and Womack & Jones summaries. Womack & Jones Batch & Queue and Cellular graphics).
24. Discuss the difference between traditional performance measurements and JIT measurements. (See Chapter 8, the Comparison of Traditional Costing, ABC & JIT Systems, the summaries of Schonberger, Lessner, Vollman, and the CAM-I Chapter 6 summary).
27. If a company changed from a traditional plant layout and production system to a just-in-time plant layout and production system, there would be no need for activity based costing? Comment. Think about when ABC is needed and if this situation is present in a JIT system. (See Chapter 7 and the summaries of Cooper 96 and the comparison of ABC and JIT).
28. Is a JIT production system more like job order costing or process costing? Explain. (See Chapter 2 to review the cost accumulation methods).
29. How does converting from a traditional purchasing system to a JIT purchasing system reduce purchasing and receiving costs? (See, the Carr & Ittner summary).
30. How does converting from a traditional production system to a JIT production system reduce costs? (See, the Carr & Ittner summary).
31. Switching from a traditional system to a JIT system involves several changes including a physical change in the plant layout, a change in the relationships with suppliers and customers (internal and external), and a mental change on the part of management and workers? Briefly discuss the mental changes needed. Which type of change (physical or mental) do you think would be the most difficult to achieve? Why?
32. What is the key to the successful implementation of JIT?
33. When is cooperation needed?
34. What is empowerment?
36. What will happen to people who don’t want to be empowered?
37. What happens to materials and materials related costs in a JIT system? (See the Carr & Ittner 92 summary).
38. What does the term flexibility mean in terms of JIT systems? Are JIT systems more flexible than traditional systems? How? (See the Crusoe, Schmelzle & Buttross summary).
42. Based on the two previous questions, what happens to product cost when production volume increases?
43. What creates the need for work in process inventory? (See Figure 8-3).
44. What is the relationship between cycle time and the level of work in process inventory?
45. How does an accounting system based on the value chain concept differ from an accounting system based on the value added concept?
46. When is ABC needed? Does this occur in a JIT environment? (See Exhibit 7-1).
47. Is standard cost variance analysis compatible with JIT? Explain. (See the Foster & Horngren, Carr & Ittner, Lee, Jacob & Ulinski, Martin 98 and O'Brien & Sivaramakrishnan summaries. See also the CAM-I Chapter 6 summary and the Comparison of Traditional Costing, ABC & JIT Systems).
48. What are the five whys? Example. Why 5? (See DeLuzio 93).
49. Crusoe, Schmelzle & Buttross discuss the hidden costs of JIT including labor union leverage, problems with flexible manufacturing systems (FMS), problems developing a flexible workforce, difficulties with supplying commodities using JIT, increased expenses for suppliers, and increased space needed for JIT machinery. What do they mean by labor union leverage?
50. DeLuzio discusses JIT in two papers. In one paper he refers to a concept called "make it ugly." What is this concept and how is it used? (See DeLuzio 93).
51. What does Michael Dell mean by the term virtual integration? (See the Magretta summary).
54. Discuss how the key differences between a traditional push system and a JIT demand pull system are illustrated in Lee's Flo-Toy demonstration. (See Flo-Toy).
The section on Lean Accounting provides some additional information related to the questions above. Also see the following paper: Goodson, R. E. 2002. Read a plant - fast. Harvard Business Review (May): 105-113. (How the rapid plant assessment (RPA) process can tell you if a factory is truly lean in as little as 30 minutes. The process includes two tools: The RPA rating sheet includes 11 categories for assessing leanness, and the RPA questionnaire includes 20 yes or no questions). (Summary).
There are several umbrella terms used to describe lean concepts. Some use Just-in-Time as I did in Chapter 8. Imai used Kaizen in his book Imai 86 Kaizen. Other umbrella terms include the Toyota Production System, Japanese Management Methods, Lean Principles and Lean Production.