Un-level Demand

What if we unexpectedly run out of customer orders?

If you are in a repetitive or continuous process flow environment - you probably aren't using a pure pull schedule anyway - and you will probably gamble to make stock inventories based on forecast.

If you are able to approach the efficiencies of a pure lean environment, you will have your people do anything but make stock inventories (that will inevitably NOT be what the next customers want).

Your people should be trained to know what to do to keep productive. Examples:

• Clean up their work area
• Perform preventative maintenance
• Conceive and document ideas for the next continuous improvement kaizen
• Train a new-hire
• Create process documentation (to train new-hires, or comply with ISO 9000, etc.)
• Perform another job for which the employee has been cross-trained
• Learn new skills to become cross-trained
• Take the rest of the day off - use some vacation or flex time
• It is better to read the newspaper than to produce stuff that hasn't been ordered

Maximize throughput - not output

Output = dollar value of items produced

Throughput = dollar value of items produced that have been sold

What if we have a spike of unanticipated customer orders?

In a lean environment, you should usually stick to your takt time - trusting that demand will balance out soon. If it doesn't - then you will revisit takt time soon. (Usually weekly, bi-weekly, or monthly)

What if actual orders don't match our planned product family ratios?

If there aren’t enough actual customer orders for one product family, then increase the other product families by equal ratios to stay as close to the plan as possible

Don’t try to “make up” for product family demand variances later - just return to the planned ratios as soon as possible

What if our customer demands are truly unpredictable?

All customer demands are unpredictable in the short term. Most prove quite stable when viewed within a longer time-frame - which is all that is needed for Pull to work.

One of the key enablers of Pull methods is "excess capacity" - which is how you are able to profitably handle pretty wide demand fluctuations without missing delivery promise.

If you experience seasonality, or other predictable phenomenon, your Systems2win consultant can help you devise appropriate demand-leveling strategies.

Very commonly, a root cause analysis will reveal that your demand fluctuations are caused by your own quirky practices, which can be smoothed out by employing level selling techniques.

If production volumes for a given product line (not just a specific product) are extremely low - then that product line should be produced using batch & queue - if the product line survives careful scrutiny to determine whether the product line should be discontinued.

It is a good idea to work with a qualified consultant to explore best practice approaches for handling your unique demand patterns.