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A manufacturing process with a different flavor: JIT and the ice cream industry.

During the last several years, the industrial world has shown meant interest in the Japanese management philosophy called Just In Time (JIT). This system has been successfully applied in Japan in mass-production industries. In the U.S., many companies have recognized the need to improve their production procedures and some have been convinced to use these same principles. The automobile industry has adopted this philosophy and many others have followed.

Although the JIT system focuses on big industries, at least some of its principles can be applied as well in small industries. The success of the application in mass-production results, probably, from the ability to easily balance the workload in a plant of this kind. If the production load of another kind could be balanced, the application of JIT would become a success.

To test the application of JIT principles and the conditions that have to be fulfilled for a successful application in small industries in the western world, a small ice cream manufacturer will be illustrated here. Manufacturing problems will be shown for which the system provides solutions.

The JIT philosophy

JIT focuses on three principles: reduction of manufacturing costs, quality improvement and the recognition of the worker's ability. A production system of this kind tries to reduce the stock in process by manufacturing the minimum number of parts. The system is called "pull as per demand" instead of "push as per timing." This description is based on the pulling operations of the Kanban system, which is a production control system to ensure that the right quantity of items will be produced at the right time. The Kanban system states that parts and other elements will not be produced until requested by the production center at the bottom of the production line. The demand for parts and their components are actually set at the final assembling line and brought up the lines to the whole production system.

The goals leading this system are:

* Reducing stock in process to a minimum;

* Reducing stock in process oscillation to a minimum in order to simplify the stock control;

* Balancing production by preventing the demand oscillations;

* Supplying better control by spreading controlling authorities on the production floor;

* Reducing defects to a minimum; and

* Reducing production costs as a result of accomplishing the above-listed goals.

A survey of JIT application in various plants shows that eight elements can be characterized that build this system:

* A focused plant;

* Reduced set-up times;

* Group technology;

* Total preventure maintenance;

* Trained workers for all jobs;

* Unified working loads;

* Immediate supply of purchased items; and

* Kanban system.

The concept of a focused plant plans the production system for a limited number of production lines. This dispenses with the differences of opinions about the production needs of various products and allows a group of defined goals to be set. Reducing set-up times is critical for JIT. This, in turn, facilitates a large number of set-ups in order to achieve the unified working load. Only reduced set-up times guarantee a rentability in a small batch production.

Group technology is the philosophy of production engineering that describes the identity of parts, equipment or processes. The machines are grouped according to the necessary routing of the parts-family and not according to the functions of machines. The production of the parts can be simplified by treating a group of machines as one production center to reduce the number of such centers and simplify the routing of the parts. Delivery time (moving and waiting times) will be reduced significantly and the use of the production center will increase.

This system does not have interim stocks between the production centers and each failure might cause a line stop. Preventive maintenance is therefore essential. Japanese workers are knowledgeable about the maintenance needs of the machines under thier responsibility and they make a lot of the repairs themselves. They are also trained to recognize maintenance problems while these are small to prevent them from becoming bigger. As JIT allows only the needed parts to be produced, machines or workers might be idle. Workers in Japan are trained to operate various machines, so that idle workers are transferred to other lines to increase efficiency.

A unified working load results from the daily production planning of the product mix that gives a balanced and equal load of the machines. The product and its components must be manufactured according to the market rate. This is necessary in order to balance the capacity needed by the production centers in the manufacturing system. Purchased components as well as manufactured ones must arrive at the site just in time when needed for assembling the finished product. In order to minimize the requested stock, more frequent arrivals of raw materials and components are necessary. As a result, the storing space becomes smaller and the production flexibility increases. This requires a good relationship with the suppliers and strong communication between both clients and suppliers. This system is controlled by the Kanban cards. They control the production and the components transferred between the production centers. The Kanban starts at one production center that needs parts and acts as a sign for the previous production center to produce the right quantity of components. This attitude established the expression "pulling system" -- where the production is based no the real need of the item and the stock is held to a minimum.

Applying JIT in small industries

Minimizing stock levels, improving quality, reducing space, increasing equipment capacity and maximizing labor efficiency will improve both small and big industries. In order to test these improvements in small industries by applying JIT, we divided the eight elements in two groups: elements that do not depends on the size of the industry (some of them are possibly applied in certain small business that may not know anything about JIT principles) and elements that do depends on the size of the industry and for which their application in small industries will be extremely difficult.

The attitude of a focused industry can be easily applied in small industries. Many manufacturers produce one product or a few similar products, so that the first element already exists in these industries. The second element, reducing set-up times, is critical with JIT. This is a familiar element in big industries but can be attained, with reasonable effort, in a small industry. Group technology cells naturally exist in many small industries. Some of them have organized their production area according to the similarity of the items produced and not according to the functions of the equipment. Factories not organized in that way will not find it difficult to make the changes. Total preventive maintenance can be applied in both small and big factories; when priority is given to maintenance, breakdowns of equipment will be prevented. The fifth element, training the personnel, is already done in most small factories. The workers are trained to operate a variety of machines, as many of the small manufacturers do not have enough personnel to absorb production losses caused by a worker's absence and change, thus making it necessary for workers to be able to switch from one machine to another to answer to a changed demand or to the absence of a fellow worker.

Those elements of JIT are basic changes that can be performed in most factories, without regard to their size. However, applying the other elements in a small factory might be more difficult. A small manufacturer has trouble reaching a unified working load as he cannot control the demand's behavior. The demand is often based on orders from several bigger factories, who might order big quantities, though not in equal intervals. This problem could be solved if more factories would switch to the JIT system and then they too will order in smaller batches. Raw material deliveries might cause a problem to the small producer. Suppliers may not agree to small but frequent deliveries. Small quantities may put the producer in a bad negotiations position and cause difficulty achieving cooperation from the suppliers.

Some claim that JIT must be applied as a whole concept and just part of it will not succeed. An intensive look at several companies' experiences shows that applying elements of JIT is fruitful whether all elements will be applied or just some of them. A small manufacturer must have a realistic attitude to try and achieve each one of the demands separately. After the benefits from each element have been achieved, the plant can move to the application of the whole concept.

The concept of "everything or nothing" is wrong for a small factory. The single elements of the system are beneficial and one should not discredit them even if implementing an entire JIT system might not be feasible.

The following is an example of a ice cream manufacturer--"Dr. Leck" in Jaffa, Israel -- who produces ice cream for his own factory shop as well as other shops.

Manufacturing ice cream

Ice cream -- that frozen mixture of dairy products, sugar, solid materials and flavors as we know it today -- goes back to the 14th century in Italy. The first stage was adding milk and cream to a sorbet of ice flakes and fruit, thus creating a new dessert. It took 200 years more till the ice cream of today was first concocted by a Sicilian chef and sold in France. And it took 100 years more until ice cream came to the U.S.

To manufacture ice cream, raw materials from four groups are assembled: dairy products (milk, condensed milk, milk powder, cream and yogurt); sugar (sugar, glucose, sugar substitutes and artificial sweeteners); fats and butter (vegetable fats, butter and cocoa, egg yolks and nuts which also contain fat); and flavoring materials (fruits, fruit concentrates and flavors).

Using those groups of raw materials ice cream can be produced in different ways:

In Italy (homeland of ice cream), there are three kinds of ice cream manufacturers:

* Gelateria: production and sales of ice cream at the same location.

* Laboratorial: one production site supplying to several near by sales points.

* Industrial: production lines, production of big quantities marketed to a wide area.

The industrial production of ice cream is spread equally throughout the year, so that the production peaks in the summer are solved by winter production and long term storage. This kind of production demands the use of preserving materials and big storage areas.

The laboratorial production, however, meets daily the demands of one day or, at the most, of a few days. Production volumes are therefore much smaller and as a result, the quantity needed to be stored at any time is minimal. Laboratorial ice cream commonly uses a lot of natural materials and therefore the taste of the ice cream might change throughout the seasons, as the fruits changes (e.g. the fruit tastes differently in the beginning of a season that at the season's end; and fruit grown different locations tastes differently). Usually the ice cream is produced according to family recipes, which are often changed by adding new ingredients and flavors. This is why they are called "artistic" ice creams.

The big ice cream manufacturers usually prefer to work with ready-to-use ingredients, which eliminates processing and its related equipment, storage requirements and equipment to reduce the bacteria and other contaminants level.

Israel's ice cream industry

In Israel a few dozen companies produce ice cream, mostly for local supply. About 80 percent of the total Israel ice cream market is concentrated in the hands of the big dairy concerns Tenuva (Snowcrest and Tenne Moga) and Strauss (Strauss and Witmann). Strauss has the biggest sales volume, next is Snowcrest followed by Tenne Noga and Witmann. Several smaller ice cream manufacturers can be found such as Feldmann, Rio Ice Cream, Tel Chanan Ice Cream and others. These enterprises sell either through their own shops or through supermarket chains and shops.

The next category of producers in Israel is the artistic ice cream. This group makes up about three percent of the total ice cream market in the country. Its importance is, however, much bigger. Dr. Leck, Ben and Jerry's, Berr Sheba Ice Cream and others belong to this group. These ice creams are marketed via the factory shop or several branches of the manufacturer.

The ice cream market is heading more and more towards quality, with quality being characterize by consumer taste preferences. Dr. Leck has led the field in raising quality in the market. Success has shown the producers that for improved quality the consumer is willing to stand in line and pay more.

The trend of health-consciousness brought a variety of diet, low cholesterol and yogurt ice creams. Most manufacturers have started to produce ice creams based on cream. The entrance into this field has been accompanied with huge advertising campaigns and indeed the cream-based ice cream has a strong market segment while the vegetable fat-based ice cream leads in sales, mainly because of its low price.

JIT concepts in ice cream production

One can see that the application of JIT concepts can have at least three advantages for the ice cream production: quality (taste), reduction of production costs and market advantages.

Food quality is measured by three factors:

* Quality of raw materials;

* Production process quality; and

* Freshness of the final product.

For ice cream produced in mass quantities, m milk powder and conserved flavors are usually being used. The use of these products is necessary because the raw materials have to be stored for a long period of time. Using natural ingredients will improve the quality. Fresh milk tastes better than preserved milk, milk powder or any milk into which preservatives have been added and, equally, fresh fruit tastes better than fruit essences.

Minimizing the storage period of the raw materials and using fresh materials is possible only by switching to a JIT system, e.g. preparing the equipment for the raw material for a short period of time ahead, buying fruits as near as possible to their use in production and buying every day the milk quantity needed for the production day (including a small safety margin). The quality of the finished product will certainly be enhanced.

Ice cream produced in large batches (flavors) is supposed to meet the demand of a relatively long period of time (not daily). That means the consumer gets a product that has been stored for a long period of time. A switch to smaller production batches, which will meet a monthly demand, and later maybe the demand of a week, will reduce the period the product is being stored and thus the consumer will be able to buy a fresher and better product.

Looking at reduction of production costs, a long storage period in special conditions (deep freeze) is very expensive. Production in small batches might save on storage space needed to storing on site. This would mean a significant savings in energy, physical space and damage to the stored product. A further importance element is flexibility. Producing ice cream in winter in order to meet summer demands means large quantities with no possibility of adjusting the product to a specific taste demand or special flavor. The manufacturer might "get stuck" with excess stock due to change in taste or a mistake in sales forecast.

The ice cream consumer is the one who turns the marketing wheel -- actually the wheel for the whole industry. The consumer asks for a quality product. This product has to be fresh -- made of fresh, natural raw materials and be marketed as close as possible to its manufacturing date. The choice of fresh homemade-tasting ice creams made of natural ingredients offered to the consumer leads the consumer to demand an improved quality also from the industrial ice cream makers. The JIT philosophy could answer to this demand so that a better, higher quality ice cream can be offered.

Production process

Basically, the process of ice cream manufacturing includes the following stages: putting the raw materials into a container, pasteurizing the mixture, homogenizing, cooling and storing. There are differences among the various manufacturers.

In the first processing stage of industrial ice cream, all raw materials -- milk, stabilizers, flavors, sugars, fats and milk powder -- are put into a kettle to be pasteurized (heating the mixture to 72 [degrees] C and leaving the mixture for half an hour at this temperature or heating to 84 [degrees] C for a period of 30 seconds). The plate cooler is made two metal plates through which the mixture passes. Ice water and tap water flow on both sides of the plates After pasteurization, the mixture goes through a plate cooler for cooling the mixture to 4 [degrees] C. The mixture must be completely smooth when passing the plate cooler (without fruit or any other additives), which is why additives are added only in the final production stage.

The next stage is homogenization. The process takes place in storage containers where the mixture is stored and mixed up to 16 hours. This stage is called aging when finally the mixture is unified and the different ingredients have the same taste. From the mixing containers the mixture is moved to freezing machines and quickly frozen to minus 8-10 [degrees] C. Leaving the freezer, the mixture passes a fruit feeder. This machine "throws" fruit chips, chocolate and/or other ingredients at a fixed dosage into the mixture.

If we could eat the ice cream at that stage, the result would be the best. But as a long storage period is necessary until the product reaches the consumer, the ice cream moves through nitrogen tunnels, where they quickly freeze to a temperature between minus 30 and 40 [degrees] C, the temperature in which the ice cream will be stored till marketed. This stage is critical for the ice cream quality. Theoretically, if this stage is being performed quickly and correctly, the ice cream will maintain its quality for a long time. Actually, a long storing period might harm the taste and quality of the ice cream.

The basic manufacturing process of the laboratorial ice cream is very similar to the industrial ice cream except for a few fundamental changes. The first stage, pasteurization, is performed in the same kettle for heating and cooling the mixture. After pasteurization, the mixture is moved to kettles for aging (where mixture remains while mixing). From these kettles the mixture goes to the batch-freezer where it is cooled to a temperature of minus 8 [degrees] C. Coming out of the batch-freezer, the ice cream is packed in storage containers and transferred to freezing rooms where it is stored at a temperature of minus 30 [degrees] C until brought to the shop. Production timing is set by manufacturing a "mother mixture" which is stored in an interim container. When needed, a quantity is taken out this container and various flavoring materials added and put through the ice cream machine. This makes immediate production possible of the flavor needed.

JIT elements that can be applied

The factory functions as a focused plant since only ice cream is being produced there and no other products compete with it for production time or capacity. The process is similar to produce all flavors, thus minimizing the conflict between departments and the goals of the company.

Reducing the set-up time is an area of potentially big savings to a manufacturer. Kettles must be washed out when one kind of the ice cream is transferred to another. Movable kettles instead of fixed kettles might convert operations from internal to external set-up while minimizing the time when kettles are not in use. Fast set-up devices of machinery parts can also reduce set-up times. Another possibility for reducing set-up times is manufacturing timing. If the production planning department divides the ice cream into groups that use the same base and starts the production in each group from the lightest to the darkest ice cream, the internal flavor change for the ice cream might require only partial set-up times, e.g. automatic quick washing of the kettles. Economic justification for purchasing automated equipment must take into account saving production time, flexibility , stock reductions and other advantages of reduced production time.

All these actions will enable the factory to produce in smaller batches, to reduce set-up times, to reduce the stock for the finished product and to increase the flexibility needed to meet changed demands.

The continuous process of ice cream

Ice cream production is a continuous process. The ice cream passes through the stages, meaning that a failure in one of the machines stops the whole line. It is therefore essential to apply the total preventive maintenance plan in all machines in order to keep the whole line form stopping. The application of this plan can reduce the marginal stock and increase the flexibility on the production floor.

Because of the specialization of the factory and the single process, group technology] is not applicable. The ice cream continually flows between the production devices, and there is no need to apply production cells.

All workers are trained in all production activities. This include set-up and operation of the machines, unloading of arriving raw materials, loading of finished products, performing simple maintenance jobs and transport of materials. Most of the production stages do not require a lot of specialized training. With internal training, every worker can perform every job on the production line. The result is optimum flexibility and use of labor.

A unified working load cannot be maintained in an ice cream factory. Because of the uncertain market demand, a sophisticated forecast can minimize the mistakes and the need for stocks (e.g. weather conditions for the next two weeks, as the demand for ice cream depends on the weather as well as holidays, when demand for ice cream increases). Small production batches, based on higher flexibility, can be very useful to solve this problem and reduse the stock.

Dairy products and fruits can be supplied daily, thus reducing the raw material stock. This is not only important from the point of view of the stocks but from the taste of the finished product. Other materials such as essences, sugar, etc., will be bought in larger quantities. The possible problem of having less than a truck load can be solved by delivering several items in one load or establishing another system with the supplier to have smaller batches delivered more frequently. Undoubtedly, this will affect the product's quality and possibly increase its sales potential.

The Kanban system can be the connection between the shops where the product is sold and its production. The shops may run out of a particular, popular flavor of ice cream. To prevent this situation, a plastic marker can be placed in each container as a Kanban card. Inside the container will be an indicator of the demand rate for a certain flavor. For example, a flavor which sells out a quarter of a container per day will have the marker placed at the quartermark of a container plus a small margin (in order to make sure that there will be sufficient supply of the requested flavor until a new batch is ready). When the maker is reached, it will be taken out and brought to the supplier who will then provide the customer with a new container of the flavor.

Mosha Dov is a professor in the Department of Industrial Engineering at Tel Aviv University, Tel Aviv, Israel.
COPYRIGHT 1992 Institute of Industrial Engineers, Inc. (IIE)
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Title Annotation:just-in-time inventory systems
Author:Dov, Mosha
Publication:Industrial Management
Date:Mar 1, 1992
Previous Article:Issues raised by the challenges of foreign market pricing.
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