Solution Manual - Chapter 5

Study Questions
1. Many of todays CEOs came up the corporate ladder during the anomalous period when American
manufacturing did not have serious foreign rivals and hence Finance, Marketing, and to a lesser extent
Accounting, were king. The increase in global competitiveness is demanding that the manufacturing
function be a significant part of a firms strategic arsenal and is therefore likely to open the path to the
executive suite to those with manufacturing backgrounds.
2. American faith in the scientific method may have contributed to the failure to develop effective OM
tools because we placed so much emphasis on mathematical precision that we shied away from realistic
problems that did not lend themselves to clever quantitative solutions. Note that this was a more a matter
of trying to look scientific than of actually being scientific, however.
3. In all but the smallest systems, the MRP calculations are impractical without a computer. It is no
accident that MRP did not appear until the 1960s and 1970s when computers became available for
business purposes. Unfortunately, because these early computers were not powerful the calculations had to
be kept quite simple, which was done by means of the infinite capacity assumption of MRP.
4. W = well, P=poorly

a fabrication plant operating at less than 80 percent of capacity with relatively stable demand
--- W
a fabrication plant operating at less than 80 percent of capacity with extremely lumpy demand
--- P
a fabrication plant operating at above 95 percent of capacity with relatively stable
demand
--- P
a fabrication plant operating at above 95 percent of capacity with extremely lumpy
demand --- P (very!)
an assembly plant that uses all purchased parts and highly flexible labor --- W
an assembly plant that uses all purchased parts and fixed labor running at over 95 percent of
capacity --- P

5. Even the best scheduling tool cannot remove uncertainty from the demand and production processes.
By coordinating releases into the system with completions, JIT prevents the system from being
overwhelmed or starved with WIP. Hence, JIT is likely to continue being the foundation for an effective
execution system even in the most sophisticated ERP planning environment.
6. Romantic JIT refers to the glowing rhetoric used to describe JIT, while pragmatic JIT refers to the
various specific techniques (e.g., setup reduction, kanban) associated with JIT. In America, upper
management may have been wooed by the appeal of romantic JIT, while those charged with implementing
it may have been confused by the lack of systematization in pragmatic JIT.
7. Some JIT terms that may have served to cause confusion in America include zero inventories, lot
sizes of one, zero breakdowns, zero anything, stockless production, the WIP as water and plant as
stream analogy, and many other slogan-like phrases. These may have been less confusing to Japanese
managers than American managers because they may have been more culturally comfortable with using
unacheivable ideals as motivational goals. After all, the phrases and slogans were developed specifically to
resonate with a Japanese audience.
8. It took Toyota 25 years to reduce punch press setups from three hours to three minutes. This kind of
perserverance on a mundane engineering problem seems exceedingly rare in modern day American
manufacturing.

9. It is hard to imagine Toyota coming up with anything revolutionary by looking at the 1960s American
auto industry. It was precisely Ohnos willingness to look beyond his own industry for inspiration that
helped him achieve revolutionary, rather than evolutionary, progress. This lesson should serve as a
warning against overreliance on benchmarking. At best, one can be a fast follower by benchmarking
industry leaders. To become a leader requires thinking beyond the rest of the industry. A telling example
is that in the 1990s Dell chose to benchmark Walt Disney as a source of ideas on achieving superior
customer satisfaction.