In “It’s about Time”, Rajan Suri applies the principles of the lean philosophy to high variety, low volume environments – custom manufacturing, services, and other situations where very high product variety means there is no stable takt time.
Suri argues that lead time should be the primary performance measure in such situations and that the main cause of “waste” in high variability situations is wait time. One of the highlights of the book is the formulae that the author produces to show that the “wait” time at any particular resource is a function of the variability of arrival times; the variability in job times; and the amount of free capacity at the resource.
The keys to improving flow, therefore, in environments with high demand and product variability are work to increase resource capacity (including quick changeovers and quality improvement); and work to reduce (as far as possible) variability in the work and in demand.
Where there is high variability there is no stable drumbeat (takt) and kanban cannot work effectively. Rajan Suri has developed an alternative “pull” signal – POLCA. You’ll have to read the book for the full explanation, but where kanban is an inventory signal, POLCA is a capacity signal. To use an analogy, it is like the token system on a single track railway. A train can only enter a section of track if a token is available, thus controlling flow and capacity.
Rajan Suri’s book takes the lean philosophy into the realm of high variability. There are weaknesses with the book – more detail in some areas (particularly worked examples) would be good, and accountants will find Suri’s section on cost accounting disappointing. Overall though this is an important and valuable work. Recommended for all lean practitioners.