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Rationalized design of Kanban. Kanban Quantities, Lot Sizes, Containers, Signals, & Stockpoints. Participants use their own plant for class projects

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Strategos Lean Briefing

The Newsletter of Lean Manufacturing & Factory Science

February 28, 2003 www.strategosinc.com

Lot Sizing & Small Lot Production

Small lot production is an important element of Lean Manufacturing. It smoothes production, eases scheduling, improves quality in many ways and makes Kanban feasible. The problem is: What does “small” really mean?

Some experts insist that “small” means one piece. Others assert that lot size is irrelevant. Still others waffle or avoid the question by insisting that setup reduction cures everything. Of course, setup reduction is a good thing (as Martha Stewart would say) but it does not happen instantly. Toyota took many years to achieve SMED. So, what do you do about lot sizing in the meantime?

Most manufacturers take an intuitive approach to lot sizing which frequently misleads. As a result, lot sizes are often much too large and some are much too small.

Economic Lot Sizing (ELS) has been widely discredited. But, used properly, ELS is one of several valid considerations for a rational decision. You can learn more about lot sizing on our website at: www.strategosinc.com/lean_lot_sizing.htm This and subsequent pages discuss:

- How to make rational lot size decisions

- Why lot sizing is different for bottlenecks and non-bottlenecks

- How Setup Reduction impacts the lot size decision

- How benchmarks make the job easy

All The Best-

Quarterman Lee

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