Smartville: Extras (8)

Non-Specific Causes of Lead Time Extension

  • Suppliers are not supplied at the same frequency.
  • Components are not of uniform complexity: hence individual components will have unique lead times.
  • Sequential interdependence of assembly stages means knock-on effects of delays are felt downstream.
  • MRP – a “closed loop” system – is not a truly “blind” lean thinking approach.
  • The presence of multiple active suppliers prevents full automation. Short lead times of individual modules do not necessarily translate to system-wide time efficiency (Chopra, 2007) – the whole is greater (slower) than the sum of the parts (the sum of the lead times for each separate module).
  • Data errors will occur.
  • Human errors will occur.
  • Customer cancellations of orders/modifications to orders prevent a very lean system.
  • The manufacturing system is dependent on small lot sizes and high flow, which means low stockholding costs at Smartville but high reordering costs and strain on Tier 2 suppliers.
  • Defective suppliers cannot be easily replaced, due to their embeddedness.
  • Failings that cannot be resolved are locked into the system.
  • The open loop system is not tolerant of order change, so speedy assembly might limit the possibility of ad hoc modification.